Education Funding

Dollars & Sense

By Michelle R. Davis — October 16, 2008 7 min read
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District technology director Jared P. Mader is looking to pinch pennies and save dollars wherever he can. He’s not clipping coupons or planning to turn the thermostat down as winter approaches, but he’s getting creative about how to cut costs—large and small—from his IT budget.

Last year, he outsourced the building of two computer servers to a group of students in his 5,700-student Red Lion Area School District in Pennsylvania. The high school seniors taking a Cisco technology-certification class built two servers from the ground up, set up a network, and maintained it. It gave the students real-life experience in the field, and Mader estimates he saved several thousand dollars by employing the students rather than hiring a company to do the work.

Jared P. Mader used tech-savvy seniors, such as Jonah Caldwell, at left, to build two computer servers last school year.

Like many other district information-technology directors across the country, Mader is facing pressure to cut his technology budget without shortchanging services as a faltering economy, rising fuel and food prices, and other factors are putting the squeeze on school budgets.

“I think we’re all in this same boat,” Mader says of his fellow tech directors. “In a school district budget, there are so many things that are fixed items and not negotiable. It puts technology in the spotlight as one primary area to be able to save funding.”

So what’s a school IT director to do?

One of the best ways for districts to save money this school year will be to take advantage of the range of free, open-source technology options available. (“Understanding the Ins and Outs of ‘Open Content’ Licensing,” this issue.) For example, in the 32,000-student Forsyth County schools in Cumming, Ga., Bailey F. Mitchell, the district’s chief of technology and information, is saving $300,000 by replacing Microsoft Office with Open Office, free software available online that does much the same thing. “The Microsoft people are about to have a duck,” he says. “It’s a huge chunk of change [we’re saving], it’s compatible [with Microsoft products], and we’re not paying for it.”

Mitchell also reviewed all his district’s software subscriptions to see whether some were duplicative or not being used. A middle school math-simulation program contained many of the same tools as a K-12 math program the district already had, so it was let go, saving $55,000.

“You really cringe when it’s a piece of instructional software you can’t renew, because typically you try to support that at all costs,” Mitchell says.

‘Cost Us Nothing’

In Maryland’s 132,000-student Prince George’s County school system outside Washington, the IT department is still grappling with a $4 million, or 10 percent, cut in funding for the department for the 2007-08 school year. As a consequence, the department is not filling open jobs during this school year and not replacing some broken equipment, says Lisa Spencer, the district’s director of technology, training, and support.

To cut costs, the district is also swapping its Microsoft Exchange e-mail for free Gmail from Google, saving more than a million dollars, she says. “When we go to Gmail, we’ll have bigger mail capacity, and we don’t need to concern ourselves with the cost of Microsoft products,” she says.


1. Consider open-source technology options for everything from word processing to e-mail.

2. Review software subscriptions to make sure they are not duplicative.

3. Consider new technology practices such as virtualization to save hardware and energy costs.

4. Use environmentally friendly technological approaches to save money on everything from lighting to heating.

5. Examine the funds you receive from the federal E-rate program to make sure your district is receiving all the money it is entitled to.

6. Use existing district resources in new ways, such as having students build a computer server as part of a school project or tapping existing district foundation money for technology expenditures.

In a small district such as Pennsylvania’s Red Lion schools, even a few thousand dollars can make a difference. Mader used an open-source product to build a portal for teachers and other staff members to be able to see their files at home. “We were looking at $4,000 for that, but I don’t have $4,000 to spend on that,” he says. “We looked around more and found open-source options. Now we have a fully functional service that cost us nothing.”

Lenny J. Schad, the chief information officer for the 55,000-student Katy Independent School District in Texas, says the 2007-08 school year was the first time in his five-year tenure that he was asked to make significant cuts to his budget—roughly 10 percent from his general operating fund.

He’s put off training and travel he had planned for his employees and is looking at local, free professional-development options. He’s also exploring the use of virtual technology for a tactic called “virtualization,” which allows him to divide the power of one host server to run 30 others. The annual savings his department will see from using that approach will be close to $400,000.

“It’s a huge cost savings and a savings on power,” he says.

In many districts, new technology projects are financed by bond issues approved by local voters.

Ed Zaiontz, the executive director of information services for the 40,000-student Round Rock Independent School District near Austin, Texas, says his district relies on bond money to pay for major technology initiatives, such as building a network connecting all schools and purchasing ceiling-mounted data projectors for every high school classroom. In 2006, voters approved a bond issue that included $23 million for technology initiatives, but Zaiontz says he worries that future support may waver if economic troubles persist.

Re-examining regular IT routines can also make a difference. For example, slight alterations to maintenance and “refresh” schedules could add up to significant savings.

Bob Moore, the executive director of information technology services for the 20,000-student Blue Valley public schools in Overland Park, Kan., says even though his district typically has supported technology funding, he’s started thinking of ways to cut costs because of the prospect of tighter budgets down the road. Currently, the district replaces computers after four years and can spend $3 million a year just buying new machines. Now, Moore may replace them as needed or every five years.

“You can see very quickly a significant savings,” he says. “It’s really about questioning everything we do.”

The trend toward methods of “green computing”—which encompasses everything from using computer technology to aid energy efficiency to buying recycled computer parts—can also save money, says Ann Flynn, the director of educational technology for the Alexandria, Va.-based National School Boards Association. (“GoinGreen,” this issue.) Schools are using new technologies to centralize HVAC systems, for example, or shutting down all district computers nightly from a central location to save on energy costs.

“There are some places to look for resources where technology can be the underlying support,” Flynn says.

In tandem with cutting costs, ed-tech leaders are also searching for new money and other resources to bolster whittled-down budgets. Some are exploring grants from big technology companies or foundations, but Flynn of the NSBA cautions that a reliance on grant money can backfire.

“The grant opportunity is always attractive to folks, but a lot of grants are for unique projects, and they’re not generally designed for long-term sustainability for your IT programs,” she says.

Some districts are setting up their own foundations specifically for technology or for general education spending, to which local residents and businesses can make contributions. Mader’s Red Lion district has its own local education foundation that provides $20,000 in technology grants through the district each year, mostly for classroom-based projects.

“It’s nice to have that option, and then typically we’re not competing with everyone else in the country,” Mader says.

Other districts are forming partnerships with local employers—sometimes technology companies—to help supplement IT projects. In Pennsylvania’s 2,500-student Northern Lebanon district, a local bank last year donated $15,000 for textbooks for a technology program, and the superintendent has started a districtwide foundation for funding other programs, including technology.

But school district IT managers can also take a closer look at money they already have, says Scott Weston, the director of communications for Funds For Learning, a for-profit company that consults with schools on the federal E-rate program. The $2.25 billion-a-year program offers school districts discounts on some telephone, video, and technology costs, including long-distance telephone service and the Internet. Assistance is based on the number of students who qualify for the federal free and reduced-price lunch program.

What districts often don’t realize is that sometimes it may take only a handful of extra students qualifying for free or reduced-price lunches to bump a district from an 80 percent E-rate discount to a 90 percent level, Weston says.

“Sometimes a district can pinpoint that they only need 10 more eligible students at a school to get to 90 percent,” he says. And many students who qualify for subsidized meals don’t sign up, so there are often plenty of additional candidates.

In addition, districts often pay their technology costs upfront and get reimbursed through the E-rate program later. The program does not stipulate the reimbursement must go back to the district’s general fund, Weston says. “We know some tech directors who have been able to claim that reimbursed money and use it to fund IT projects,” he says.

Money from other federal programs can also be applied to technology projects. The National Science Foundation, the Individuals with Disabilities Education Act, and other grant sources have money available for technology projects.

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A version of this article appeared in the October 20, 2008 edition of Digital Directions as Dollars & Sense


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