Education Funding

In Consolidating Districts, States Run Tricky Course To Secure Local Support

By Katie Ash — October 23, 2007 7 min read

With their state education budgets under pressure and their rural enrollment numbers dropping, legislators in several states—including Maine, South Dakota, and Arizona—are moving ahead with school district consolidation plans to help shave costs and establish more efficient school districts.

But now that reorganization is under way, those states are dealing with complications over funding, resistance from residents, and criticism that the plans may not save as much money as promised.

In Maine, which is in the middle of a massive school consolidation effort, some school districts are concerned about receiving less money in subsidies from the state after they merge with neighboring districts. Other districts are worried that consolidation may result in increased property taxes.

In South Dakota, parents and school officials are waiting to see how their schools will fare under a new law passed last year requiring districts, with some exceptions, to have at least 100 students or to merge with a neighboring district after two years of low enrollment.

And in Arizona, despite reassurances that no schools would close, school boards are criticizing the recommendations of a redistricting commission that would unify many of the elementary and high school districts across the state. Such complaints do not surprise Marty Strange, the policy director for the Arlington, Va.-based Rural School and Community Trust.

“Wherever state budgets are tight, and they’re looking for ways to save money on school aid, [states] immediately turn to the idea of closing small schools or districts,” he said. States often expect to economize by cutting down on the number of administrators. But in Mr. Strange’s view, “school and district consolidations rarely make money; they redirect money.”

Maine Plunges Ahead

Maine’s consolidation plan, projected to save the state $250 million over three years, requires each district with fewer than 1,200 students to merge with a neighboring district, with the aim of bringing Maine’s 290 far-flung districts down to 80 large ones.

Districts have submitted merger proposals to Susan A. Gendron, the state education commissioner, and those plans have been approved or sent back with revisions. Districts will be expected to submit final plans by Dec. 1. (“Maine Districts Take Key Step to Consolidation,” Sept. 12, 2007.)

But new numbers calculated by Maine districts suggest that consolidation might not save money, and that districts may receive less state aid money after they merge.

“Because of the complexities and different units doing budgets differently, the analysis needs to be redone,” said David Connerty-Marin, the spokesman for the Maine Department of Education. “There are a handful of places where, in fact, there are some real barriers.”

One unforeseen snag is the amount of the subsidy each district receives from the state, said Mr. Connerty-Marin. Currently, each district receives a different amount, based on a complex school funding formula, which takes into account factors such as property values and the number of special education students.

In addition, every district receives at least a minimum subsidy amount—the greater amount of either 5 percent of its total education budget or 84 percent of its special education budget.

But once districts merge, the school funding formula will be readjusted, and some educators are worried that a newly combined district would receive less, overall, than the individual districts did before the merger.

Another concern involves the state’s existing requirement that districts raise a certain amount of money for education through property taxes. This year, for example, each district is supposed to raise $7.44 for every thousand dollars in property value for education.

In some districts with extremely high property values, however, that rate may be adjusted lower to prevent a surplus of education funding. In some areas where property values are high—and the education tax level lower than the state target—residents worry that their rates would go up if they were to merge with a district with lower property values. Some even say it may be more cost-effective for residents to pay the penalty stipulated by the law for not merging.

“We don’t know what the solution will be, but we’ll be working with the legislature to resolve it,” Mr. Connerty-Marin said.

Despite the recent tangles, Gov. John E. Baldacci, who was behind the consolidation plan, remains firmly committed.

“I will vigorously oppose any effort to repeal this law or to lessen the penalties for districts that don’t comply,” the Democratic governor said in a statement last month.

South Dakota Struggles

South Dakota, meanwhile, has determined that each school district must have at least 100 students to be considered effective and efficient, and has passed a law to enforce it. (“Funding Level Divides Legislators, Districts,” June 13, 2007.)

“There was growing concern on the part of the legislature that students [in small districts] weren’t getting as many educational opportunities as students in larger districts,” said Rick Melmer, South Dakota’s secretary of education.

Under the new law, passed in the 2007 legislative session, a district that has an enrollment of fewer than 100 students for two years in a row is expected to partner with a nearby district. If not, the state school board has the authority to do it for them. But the law affects only districts that are not considered “sparse”—that is, at least 15 miles away from the nearest district.

So far, no districts have merged. The two-year population count starts during the 2007-08 school year, and districts are expected to merge by July 1, 2009, if they do not meet the required enrollment.

Out of the state’s 168 districts, officials predict that only 14 will be affected, but that number could grow. Because of declining enrollments, districts on the cusp also are feeling pressure.

Although state lawmakers are not currently looking at increasing the required minimum enrollment, they may in the future, although Mr. Melmer does not expect them to do so.

Arizona Moves Slowly

In Arizona, a 13-member School District Redistricting Commission is exploring ways to put a 2005 law calling for the unification of districts in place.

Arizona’s 216 school districts now are divided into three categories: Some have only K-8 schools, some include only high schools, and some serve students from kindergarten through 12th grade. The new law seeks to pair up some of the K-8 and high school districts into unified districts.

“This is not consolidation, it’s unification,” said Art Harding, the deputy associate superintendent of state government affairs for the Arizona Department of Education and a member of the redistricting commission.

“My idea, and [state schools Superintendent] Tom Horne’s idea, is to create a continual curriculum from K-12, that you can build upon what you’re teaching in the early grades all the up through high school,” he said. “When they’re separated, you don’t have that connection.”

The commission recently gave its recommendations to the affected districts and is now going through the responses. Its final plan will be submitted by Dec. 31, and the proposals will appear on the ballot for voters in those communities in the November 2008 elections.

Although Mr. Harding stressed the curricular advantages of unifying elementary and high school districts, he also said there could be economic advantages.

“There’s an efficiency of scale to be looked at,” he said. “We’re potentially able to reduce two full administrations and put that money back into the classroom.”

New Moves in Nebraska?

Faced with a similar situation last year, Nebraska shut down its elementary-only, or Class I, districts. Those students have since been merged into larger K-12 districts, but supporters of small schools are lobbying for the reinstatement of those districts.

The law that called for the dissolution of the Class I districts passed in 2005, but was repealed by voters last fall. Since then however, no action has been taken to reinstate the districts. (“Neb. Judge Halts School Merger Law,” Nov. 30, 2005.)

Last spring, a bill that would have provided a framework for the re-creation of Class I districts passed the legislature, but was vetoed by Gov. Dave Heinemen, a Republican, on the grounds that it would not bring the districts back easily enough.

“The process was cumbersome, and there were lots of obstacles,” said Mike Nolles, the president of Class Ones United, an advocacy organization for the reinstatement of Class I districts. The bill required reinstatement to be approved by a K-12 district’s school board, Mr. Nolles said.

The issue will be up for debate again when the legislature reconvenes in January.

A version of this article appeared in the October 24, 2007 edition of Education Week as In Consolidating Districts, States Run Tricky Course To Secure Local Support

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