Week 5, Part 3

This course has broadened my understanding of school finance, but it has also shown me how much I do not know. School finance encompasses such a wide arena of knowledge that it will take continued practice for me to truly feel like I understand.

Reflecting on the eight superintendent competencies was a valuable exercise that forced me to evaluate my learning and abilities throughout the course. I gained insight into my own knowledge, and I really had to reflect on my learning. There are still concepts for which I will need further study, but overall, I have grown in my understanding of and confidence with school finance. I will continue to study these concepts and work with my campus and district leadership to expand my learning.

The lecture, interviews and readings were extremely helpful for me. In this course, I read many documents and samples of district documents that I never knew existed. This prompted me to search out the documents for my own district. These are very informative snapshots of information that give a great picture of district demographics, budgets and spending. I also had never spent a great deal of time examining my district budget, rather, I had only focused on the budget pertinent to my department. Reading the district budget was very informative, and it showed me how frugal our district has been, and this has been an asset to us in the current financial crisis. The lectures were also great sources of information, especially as they related to explaining economies of scale and differentiated staffing. I will use these concepts, especially that of differentiated staffing as we begin to look at our campus staffing for next year. I will work with other campus administrators to determine if we can more effectively utilize our personnel.

I also learned a great deal from my interview with our Assistant Superintendent/ Business Manager. He very patiently spent over two hours with me, going over revenue forecasting and the steps to developing, approving, and implementing the district budget. Being required to carefully examine documents and apply what I learned also helped to cement my understanding of the concepts. I will continue to examine these documents to learn and understand more about budgeting.

I enjoyed working on the lessons with other colleagues. Although I was confused at first about how we were supposed to collaborate on the lessons, I began to enjoy getting to work with other colleagues and gain insights into what was happening in other districts besides my own. For this reason, I also enjoyed the discussion boards. I am always interested to read the insights of other students, and to learn the ways other districts develop and implement budgets and manage staffing. I can also use the concepts of virtual learning communities on wikispaces to have dialogues and collaborate with other administrators.

Overall, I learned a great deal in this course. In light of the current state budget crisis, the lessons and readings were appropriate and timely. Much of what I learned in this course will help me understand current legislative proceedings and their impact on local districts.

Week 5, Part 2

This course has broadened my understanding of school finance, but it has also shown me how much I do not know. School finance encompasses such a wide arena of knowledge, that it will take continued practice for me to truly feel like I understand all of it.

The competencies that I feel are strengths for me are the competencies with which I already have some experience. These include effective budget management, ethical accounting principles, and use of technology to enhance operations. I currently manage a sizable budget as part of my responsibility includes serving as the Director of Career and Technical Education. I am comfortable with managing this budget and applying ethical procedures for accounting and purchasing equipment with federal and state funds. This level of comfort took some time, however, as I asked lots of questions, attended professional development activities, and learned by continually working to become more familiar with these items.

I do feel that I have gained some competencies through this course. I understand much more about lining up the budget with district visions and applying legal policies. After looking at district improvement plans and budgets, I began to see how the two line up. I am much more aware of how my district budget lines up with board goals. I have also learned a great deal about legal policies and feel much more comfortable applying these. I also know how to find these policies if I ever have a question. I have also gained more knowledge and confidence in the area of personnel management through this course, readings, and experiences.

While I feel that I have gained understanding in many areas, I still need to work on developing a district budget, account auditing procedures, and revenue forecasting. I spent a great deal of time talking with our Assistant Superintendent/ Business Manager about these areas. Although I understand a great deal more about these topics, I will need to read, ask questions, and practice a great deal more before I am completely comfortable working on my own.

Week 5, Part 1

Standard 1.2: A superintendent had maintenance employees working at his house on school time. The employees used school equipment and school funds to pay for the work being done on the superintendent’s house.

Short-range consequences include loss of time that maintenance employees should have been working at school and loss of funds that should have been spent on the school. Long-range consequences include issues with the district audit and a general distrust of the superintendent.

Preventative measures include requiring accurate records for time spent on the clock. Also, accounting procedures for use of district equipment and funds should be in place with checks and balances to ensure that no one person is able to make the decision to use these resources for personal use. In compliance with SBEC competency 1, the superintendent “model and promote the highest standard of conduct, ethical principles, and integrity in decision making, actions, and behaviors.”

Standard 1.6: A principal falsified attendance records and tried to coerce the attendance clerk to falsify records also. When the clerk brought the principal’s actions to the superintendent, the principal was fired.

Short-range consequences include the attendance clerk losing trust in the principal, and the principal losing his job. Long-range consequences include the school possibly having to pay back funds if too much ADA revenue was paid to the district as a result of the principal’s deception.

Preventative measures include internal auditing of attendance recording and a superintendent that will “apply laws, policies, and procedures in a fair and reasonable manner” in compliance with SBEC competency 1.

Standard 1:9: An administrator threatened violence on an employee who stated his plans to take his request to the administrator’s supervisor after the administrator originally refused. The threat resulted in an argument that turned into a physical fight. Several teachers witnessed the fight.

Short-range consequences include a distrust of the administrator and loss of professional respect. The long-range consequences include the loss of the principal’s job.

Standard 2.2: An administrator who does not like the decisions of the district regarding his campus begins to spread rumors in the community about why those decisions were made.

Short-term consequences include the administrator losing credibility, stakeholders losing confidence in district administrators, and a general feeling of distrust among campus personnel. Long-range consequences could include the administrator losing his job and the community questioning future decisions.

Standard 2.3: A principal fired an employee who made allegations against the principal. The employee was not given proper documentation to warrant dismissal, and prior performance appraisals were satisfactory.

Short-range consequences include the employee’s job loss. Long-term consequences include a lawsuit filed against the district for unlawful termination.

Preventative measures include requiring proper documentation before allowing a principal to move to non-renew or terminate an employee. The superintendent should make sure all administrators are aware and understand the The Code of Ethics and Standard Practices for Texas Educators. Policies and procedures should be in place to ensure compliance with these practices.

Reflection: Reading or hearing about unethical practices of administrators can be disheartening. I want to believe that everyone involved in education truly wants to uphold high moral and ethical standards in order to best educate children and serve our stakeholders. Sadly, this is not always the case. These examples demonstrate the importance of superintendents and other administrator adhering to the code of ethics and keeping others accountable to do the same.

Week 4 Part 5

I interviewed our Assistant Superintendent/ Business Manager, Greg Perry, and asked him about the audit process. Mr. Perry told me that auditors are selected by a process of securing bids. First, the district asks for RFQs (Requests for Qualifications). Once the search is completed for qualified auditors, the district then seeks RFPs (Requests for Proposals). After all of the proposals are considered, a recommendation is made to the board to hire a particular firm for a period of three years. Usually, the lowest bid is accepted. To conduct the audit, a team of auditors selects a pre-determined random sample of district accounts to evaluate. The auditors look at every part of the financial record they are auditing. For example, if the auditor were evaluating a payroll record, he would look at certifications, time sheets, etc. For a transaction, he would look at invoices, payments, etc. The auditors also evaluate activity and federal funds. The auditors come to the business office twice a year, usually during the summer and in September and stay for about a week each time. The audit team then prepares a report addressing every part of the district’s audit. The hard copy of the report is prepared with three or four letters dealing with different aspects of the audit. A good report is referred to as “unqualified”. Our district’s audits have traditionally been unqualified and the findings stated that the district complied with all requirements. The auditors present the results contained in the report to the Board and send both a hard copy and electronic copy to TEA and various other agencies. Also, a portion of the report must be posted in the newspaper for reporting to the public. Reflection: I enjoyed talking with Mr. Perry about the audit process. Our financial team is committed to following procedures, and practices internal audits throughout the year, so it is expected that all of the findings will be good. Mr. Perry emphasized the importance of finding a good auditing firm that you can work with since they are essentially “moving in” twice a year, sharing office space and going through paperwork. Knowing what to expect in an audit and how to select a qualified auditor is a valuable skill for any aspiring superintendent.

Week 4 Part 4

Personnel costs make up the majority of budgets in Texas public schools. Since districts employ so many people, it is logical that payroll would account for most of the budget. In the Little Cypress-Mauriceville CISD, payroll amounts to $24,798, 569 and accounts for 77% of the total budget. Although this is not quite as high as it is in many districts, it is still a significant portion of the budget. For this reason, when a district that has already cut expenses in every area looks to further reduce the budget in these tough economic times, personnel is the place that is cut. As with many districts, our district is not currently laying off employees, but staff has been reduced by attrition, and every open spot is scrutinized before it is filled. A five percent salary increase would have both positive and negative effects. The positive effects would be higher morale, retention of highly qualified staff, and competitive salaries to attract more highly qualified staff. The negative impact would be that the budget would be adversely affected in already tough economic times. Raising salaries 5% would increase the budget in that area by $1,239, 928. Because of the current budget deficit, that would mean that other areas would have to be cut. Since cuts have already been made in every area, it would be difficult to squeeze another $1.2 million out of them. Although a salary increase would be popular with staff, it is not in the best interest of the district.

Week 4 Part 3

Group 5 Paper The term differentiated staffing refers to the specialized use of campus personnel. This type of approach to staffing may produce greater efficiency on a campus by assigning different instructional and campus responsibilities to teachers and staff. The educational responsibilities would change for teachers and staff by having each group take over specific responsibilities. Many of the procedural tasks teachers do such as checking roll, issuing books, developing seating charts, making copies, and duty stations could be removed from the teachers and assigned to aides. This, in theory, should provide increased instructional time for teachers and students over the entire school year, and teachers would have more time to prepare lessons, participate in professional development activities, and study to improve their knowledge of their subject and best practices. This would result in a more qualified instructional staff, and, in turn, should result in more quality instruction. More specifically, differentiated staffing could reduce operational costs by hiring aides on a part time basis to reduce the number of full-time teachers, thus saving on salary and health care costs and increase in the flexibility of the times the aides would be on campus. For campus principals, the loss of personnel on the campus always creates additional stresses on the operation of the school. Increased staff flexibility would help to ease some of the constraints placed on the overall operation of the campus. With the imposing budget crisis the state and all school districts are facing and having salaries making the majority of a school district's budget, the loss of staff is becoming inevitable. With differentiated staffing, shifting procedural tasks to aides would help alleviate some of the stress felt by teachers who are having to teach additional preps and more students to make up for the reduced teaching staff.  Port Neches-Groves ISD is trying to be proactive in dealing with the potential financial problems they may be facing in the future. They are examining the district's overall personnel and will utilize the people they have currently to fill voids as people retire, move, and leave the school district. The need to have and use differentiated staffing is something they are examining to help streamline operational costs. The downside of differentiated staffing is that it could be met with opposition by teaching staff. Many teachers are against organizational changes that they fear might further reduce the number of teaching positions. Also, many teachers are very particular about the way procedural tasks are done in their classrooms and may hesitate to turn those tasks over to someone else. In these tough economic times, teacher morale is often waning in the face of increased workloads, lower salaries, and fear of layoffs. Supporting teachers and increasing morale is an integral part in providing a quality educational program. Differentiated staffing, if approached wisely, could benefit districts by improving efficiency and reducing operating costs. An effective superintendent would work with hesitant staff to produce a solution that would benefit students, teachers, staff and the district. When handled appropriately, differentiated staffing could lead to a higher morale as workloads are decreased and teacher quality increases. Reflection: Differentiated staffing is a term I had not heard before, although I have seen examples of this. I think differentiated staffing could be an asset to districts as long as leaders are aware of potential barriers and plan for them accordingly.

Week 4 Part 2

Group 5 Paper:

The concept that indicates that increasing size of an organization can result in a lower per unit production cost is known as economy of scale. Smaller districts have a disadvantage of economy of scale compared to a larger district. The overall infrastructure cost per student in a larger district is less than that of a smaller district. The average cost per expenditure per student is less in the larger district because it is spread over larger number of students per campus. The result of economy of scale is that the larger district has more instructional revenue per student. This allows a district to provide more funds for teacher salaries and to use more funds to enrich existing instructional programs. From the analysis of the data from a small and a large district we found the following:

District 1
Number of Schools = 3
Number of Students = 830
Total Revenue per Pupil = $10,529
Total Operating Expenditure per Pupil = $8,611
Average Teacher Salary = $39,771


District 2
Number of Schools = 45
Number of Students = 32,326
Total Revenue per Pupil = $10,316
Total Operating Expenditure per Pupil = $8,908
Average Teacher Salary = $50,307


From the initial examination of the data it looks like the two districts are comparable with total revenue and expenditure per pupil. For District 2 they generate over $329 million in revenue versus only $8.8 million in revenue for District 1. The extra revenue in District 2 allows for greater teacher salaries and a more enriched instructional program as evident by a higher percentage of teachers with advanced degrees and higher average SAT and ACT scores. The larger district has a larger fund balance which may also impact the overall instructional program of their district.

District 1 will have the same basic cost and personnel as District 2. For instance, District 1 may have a curriculum director for the three schools. A curriculum director may be able to handle more than three schools in a larger district, thus saving money per pupil to be put somewhere else. The same thing can be said for maintenance and other areas. One superintendent for the District 2 handling 45 schools with his cost split among the 45 campuses versus 3 campuses handling the cost of one superintendent. The principle also encompasses other areas, such as heating or cooling gyms, cafeterias, and office spaces. Regardless of how many students a campus educates, these areas are common to schools of both sizes. District 1 also had a higher teacher turnover rate at 16.4% compared to 15.7% in District 2. This could be indicative of teachers staying longer in the school with the higher salary. Again, this is an indicator that larger schools, which are able to provide higher salaries, retain higher quality teachers for a greater length of time, thus providing a better instructional program for students. These embedded costs are the same regardless of the school size and economy of scale can help the larger district to allow more and better programs because many costs are spread among more campuses.

Reflection: Economies of scale were something that I studied years ago in preparing for the economics portion of my social studies certification test. I had never thought of this concept in relation to a school district, but it makes sense. This was a very interesting topic for me.

Week 4 Part 1

Group 5 Paper:

According to this weeks lecture from Dr. Jenkins and Dr. Stephens, FIRST is for the accountability of a school district's business and financial operations. It is to encourage school districts to manage their financial resources better in order to provide the maximum money possible for instructional purposes. FIRST stands for the Financial Integrity Rating System of Texas. There is an extensive amount of information about the financial accountability rating system on the TEA website and we encourage you to review the website (www.tea.state.tx.us/index4.aspx?id=3864).
The purpose of the financial accountability rating system is to ensure that school districts will be held accountable for the quality of their financial management practices and achieve improved performance in the management of their financial resources. The system is designed to encourage Texas public schools to manage their financial resources better in order to provide the maximum allocation possible for direct instructional purposes. The system will also disclose the quality of local management and decision-making processes that impact the allocation of financial resources in Texas public schools. An evaluation of the long-term effectiveness of the system should disclose a measurable improvement in the quality of Texas public schools' financial decision-making processes. In accordance with Texas Education Code (TEC), Chapter 39, Subchapter D, each school district must be assigned a financial accountability rating by the Texas Education Agency. Beginning with fiscal year 2010-2011, the financial accountability rating of a school district is based on its overall performance on certain financial measurements, ratios, and other indicators established by the commissioner of education. There are five types of ratings school districts may receive. They are Superior Achievement, Above Standard Achievement, Standard Achievement, Substandard Achievement, and Suspended-Data Quality. The commissioner of education may apply sanctions to a district that is assigned a Substandard Achievement rating and may require other corrective actions. If serious data quality issues are disclosed by the commissioner of education, a Suspended-Data Quality rating shall be assigned to the school district. The Suspended--Data Quality rating will be assigned until the school district successfully resolves the data quality issues. The commissioner of education may apply sanctions to a school district that is assigned a Suspended--Data Quality rating and may require other corrective actions. After receiving their rating the district must
report the information and financial accountability ratings to parents and taxpayers by preparing and distributing an annual financial management report and providing stakeholders an opportunity to comment on the report at a public hearing or board meeting.
Each group member interviewed their business managers of their own district and came up with a list of their three most important components of FIRST. After reviewing each of our groups individual three components we collaboratively decided on three overall most important components of FIRST. Our first component was Sound Financial Management. FIRST encourages schools to practice integrity in their finances and manage their finances effectively. The second component was Public Accountability. Stakeholders are made aware of the district's financial rating just as they are the AEIS rating. Stakeholders can hold schools accountable to manage finances effectively just as they hold schools accountable for educating students effectively. A public meeting is held to discuss the district's rating. The third component was the Analysis of the District's Audit Report. The district's finances are carefully audited, and a report must be submitted as part of the rating system. The review of all the information acquired through our interviews, listening to the lecture and reading over the information on the TEA website about FIRST helped us reach our decision on what we collectively thought are the three most important components of the Financial Integrity Rating System of Texas. We now have a greater understanding of our states rating system for school finance.

Reflection: A system of financial accountability is important in any institution. Since public schools are supported by taxpayer funds, those taxpayers should have a report of the efficiency and integrity with which those funds are handled. Just as districts are held accountable for their AEIS rating, FIRST ratings should be an accountability measure as well.

Week 3 Part 3

The Affect of WADA on School Funding for Texas Schools

In the Coalition to Invest in Texas Schools, according to the Texas Association of School Boards, the definition of Weighted Average Daily Attendance (WADA): "In Texas, students with additional education needs are weighted for funding purposes to help recognize the additional costs of educating those students. Weighted programs include special education, vocational, bilingual, gifted and talented, and compensatory education. A weighted student count is used to distribute guaranteed yield funding." After examining and analyzing the school finance data from District 1 and District 2 for two Texas school districts we found the following information:

The data indicates for District 1:
$5044.00 Revenue per WADA @ Compressed Rate
5555.815 X $5044.00 = $28,023,530.86 Total Target Revenue for M & O
281 Teachers, Librarians, Nurses, & Counselors
The data indicates for District 2:
$7206.00 Revenue per WADA @ Compressed Rate
4794.076 X $7206.00 = 34,546,111.66 Total Target Revenue for M & O
307 Teachers, Librarians, Nurses, & Counselors

In a comparison between District 1 and District 2, they are of comparable size. District 1 has a student population of 3903, primary staff of 281, WADA of 5555.815, revenue per WADA @ compressed rate of $5044, and M&O revenue of $28,023,530.86. District 2 has a student population of 3890, primary staff of 307, WADA of 4794.076, revenue per WADA @ compressed rate of $7206, and M&O revenue of $34,546,111.66. District 1 has 13 more students, 26 less staff, and about $6.5 million less in revenue for M&O than District 2. District 1 has a much higher percentage of students in special populations than District 2. For example, District 1 has 93.3% Economically Disadvantaged, 48% Limited English Proficient, 41% Bilingual/ESL, and 24% Career and Technical Education. In contrast, District 2 has only 20.7% Economically Disadvantaged, 2% LEP, 2% Bilingual/ESL, and 14% CTE. These figures account for the higher WADA of $5555.815 in District 1 compared to $4794.076 for District 2.

After comparing the data, our group's position is that WADA, although it intends to provide an equitable education for all students, falls short of that goal. This weighted funding is designed to allow District 1 to be more closely matched to District 2 in their funding and in the personnel and educational services they can provide. This is not the case, however, in these two districts. Because District 2 has such higher property values and total target revenue for maintenance and operations, District 2 is able to provide more staff and has more money to spend per student than District 1. Though WADA is supposed to take care of the inequities, it can never balance out the difference between very poor districts and rich districts. District 2 gets only 30% of their funds from the state, which indicates a very healthy tax base. District 1 must rely on the state and federal government for 94% of their funds. The higher WADA value for district 1 indicates they have more students in special populations yet still receive less funding for their district. Having greater special populations should result in more funding and be a more positive impact for funding equity, but that does not seem to be the case.


REFERENCES
Coalition to Invest in Texas Schools (2010). School funding 101 - glossary. Retrieved January 30, 2011, from http://www.investintexasschools.org/schoolfunding/glossary.php.

Week 3 Part 6

District 1:
$3,835,006 Compensatory Education Allotment

District 2:
$633,369 Compensatory Education Allotment

District 1 receives a larger Compensatory Education Allotment due to their larger number of economically disadvantaged and at-risk students. Although these funds are meant to assist districts with a means to provide the necessary educational services to compensate for any educational deficiencies these students have, the allotment is not enough to compensate for all of the $6.5 million more in revenue District 2 receives. District 1 has more at-risk students, but the inequity still exists. Totaling the numbers, District 1 is still receiving $3.3 million less in revenue than District 2.

Week 3 Part 5

District 1

$145,968,635 Local District Property Value (DPV)

$94,871 Interest & Sinking Fund Tax Collection (I & S)

$572,716 Chapter 46 Existing Debt Allocation (EDA)

District 2:

$2,916,187,709 Local District Property Value (DPV)

$8,836,256 Interest & Sinking Fund Tax Collection (I & S)

$0 Chapter 46 Existing Debt Allocation (EDA)

In examining the differences between the two districts, it is evident that District 2 is a wealthier district than District 1. District 2 has a much higher Local District Property Value and Interest and Sinking Fund Tax Collection and receives no Chapter 46 Existing Debt Allocation. Conversely, District 1 does not bring in nearly as much local revenue, and being a less wealthy district, does qualify for EDA. Based on these observations, we believe District 2 has newer, modern facilities and is better able to provide for the learning needs of its students

Week 3 Part 4

Little Cypress-Mauriceville CISD receives funding from federal, state, and local revenues. Proposed budget revenues for 2010-2011 are thirty-nine percent local ($1,668,988), fifty percent state funds ($14, 857, 511), and eleven percent federal funds ($3,424,558). Exactly half of our revenue comes from state funding, and lower district property values account for less local revenue. The 2010 Maintenance and Operations Tax Rate is 1.04 and total M & O collections are $8,514,220. The total revenue for Little Cypress-Mauriceville CISD was $29,951,057.

The greatest expenditure in our district budget is payroll. Seventy-seven percent of district expenditures are allocated to payroll expenses. The remaining expenditures are seven percent for supplies/materials, two percent for operating expenses, one percent for contracted services, eight percent for capital outlay, and five percent for debt services. The total expenditures for Little Cypress-Mauriceville CISD are $32,190,666.

With total revenue of $29,951,057 and total expenditures of $32,190,666, Little Cypress-Mauriceville CISD is left with a budget shortfall of $2,239,609. A district fund balance of will help offset this deficit, but administrators are carefully examining the budget and ways to best conserve our funds so as not to deplete our fund balance in the coming years.

Reflection: In these tough financial times, I am even more aware of the necessity of a knowledgeable business manager. Our Assistant Superintendent has led our district to be very efficient with our funds for many years, resulting in a fund balance that can help us through this season of economic downturn. This assignment has led me to look deeper into our district’s budget than I ever have. I have had knowledge of expenditures, but this is the first time I have really looked at revenue.

Week 3 Part 2

District 1: $5044.00 Revenue per WADA at Compressed Rate 5555.815 X $5044.00 = $28,023,530.86 Total Target Revenue for M & O 281 Teachers, Librarians, Nurses, & Counselors District 2: $7206.00 Revenue per WADA at Compressed Rate 4794.076 X $7206.00 = 34,546,111.66 Total Target Revenue for M & O 307 Teachers, Librarians, Nurses, & Counselors District 2 has higher Total Target Revenue for M & O and a larger staff even though District 1 is a higher needs district. However, if District 1 did not have the adjustments allowed by WADA, the discrepancy would be much greater. This is an interesting look at they way WADA attempts to provide equity in funding to higher needs districts. Studying these calculations caused me to stop and think about how target revenue is actually calculated. It was interesting to see that although District 1 received a higher WADA, their funding was not at the same level as District 2. District 1 had much higher populations of students in special programs but was able to hire fewer teachers, librarians, and nurses to educate and care for their students. I believe the thought behind WADA was well intentioned, but it falls short of its intended goal.

Week 3 Part 1

District 1:
93.3% Economically Disadvantaged
$3893.754 Total Refined ADA Adjusted for Decline
$5555.815 Weighted Average Daily Attendance
District 2:
20.7% Economically Disadvantaged
$4032.937 Total Refined ADA Adjusted for Decline
$4794.076 Weighted Average Daily Attendance

District 1 receives a higher WADA due to a larger number of students in special populations. An economically disadvantaged percentage of 93.3% for District 1 compared to 20.7% for District 2 would account for a higher WADA. In addition, District 1's 48% LEP compared to District 2's 2% and District 1's 41% bilingual and 24% CTE compared to 2% and 14% in District 2 would certainly account for the differences in WADA.

This was an eye-opening assignment for me. I had heard about WADA, and I knew that it affected funding, but I had never had any real experience looking at it in a particular district. Even though the purpose of WADA is to account for the increased cost in educating student in special populations, it does not actually make the districts equal. While District 1 received a higher WADA, they had so many more disadvantages to overcome that their funding was not equitable when compared to District 2.