School and District Consolidation
March 14, 2011
As cuts to education budgets continue, many states and school districts are exploring the idea of school and district consolidation as a means of decreasing the cost of education. Consolidation, also referred to as regionalization or reorganization, is the process of joining two or more schools or districts into a single entity. For decades researchers and policymakers have debated the effect of consolidation. On one hand, streamlining administrative processes decreases the cost of providing education due to economies of scale. On the other hand, traditional economic theory does not necessarily apply to schools and districts because larger schools and districts do not translate into reduced administrative costs. Despite this disagreement, the consolidation of schools and districts has greatly changed the national landscape of education over the last 90 years. The National Center for Education Statistics (NCES) reports that in the 2008-09 school year there were 100,713 public schools in 13,976 school districts serving 49.3 million students. That compares to an estimated 271,000 schools in nearly 130,000 school districts in 1920 serving 23.6 million students (Berry, 2004; Fischel, 2009).
School district consolidation has been steadily increasing over the years. Some recent studies have helped illuminate the cost impacts of consolidation. A study from the Center for Policy Research at Syracuse University examined the cost savings of consolidation involving districts of varying size in New York state. It determined that consolidation is most effective at cutting costs when the districts involved are small (300 pupils). As larger districts consolidate, the study found that the cost savings are reduced. And when districts reach 1,500 pupils or more, the study found that consolidating such districts has little impact on cost effectiveness (Duncombe & Yinger, 2001). Attempts to find an optimal district size has resulted in mixed results. In general, the University of Syracuse study provides evidence for optimal district sizes that range from 1,000 – 3,500 pupils.
Labor costs can increase as the result of consolidation, including the ‘leveling up’ of faculty salaries. In other words, when multiple districts merge, collective bargaining agreements sometimes force the new consolidated district to pay all faculty members at the rate of the highest paying district involved in the merger. This results in an overall increase in salary expenditures. Furthermore, larger districts tend to have stronger teachers’ unions that can negotiate higher salaries and benefits (Tholkes, 1991).
Larger districts also tend to have higher administrative costs, according to the 1999 New Jersey Assembly Task Force on School District Regionalization. This report found that as administrators begin to take on region-wide responsibilities, it often becomes necessary to hire more staff to support the new regional positions. This creates new levels of administration. Additionally, the new regional responsibilities may result in a need for higher compensation for regional administrators to avoid a decrease in job performance.
Ellwood P. Cubberly, an early 20th century education reformer, identified three advantages to larger schools:
- larger schools reduce the ratio of administrators to teachers, thus providing for more efficient, centralized administration
- larger schools facilitate more specialized instruction—by age level, subject area, and level of ability
- consolidated schools can provide higher quality facilities at a lower cost
Other arguments in favor of larger schools include reduced transportation costs (Gritter, Silvernail, & Sloan, 2007), fewer facilities to lease and maintain, and the ability to purchase supplies and food at bulk-discounted prices.
Some concerns have been raised regarding consolidating schools that go beyond cost savings. According to a 2005 Syracuse University report, teachers at smaller schools have more positive attitudes; students at smaller schools have more opportunities to participate in extracurricular activities; and students at larger schools feel more isolated and less motivated.
In the last 10 years, there has been a movement toward breaking up large schools into smaller schools with no more than 400 students each. The results of this trend have been mixed. A 2006 report prepared for the Bill and Melinda Gates Foundation, a key supporter of small schools, on the results of the intiative concludes that student performance is not improved simply by breaking up large schools into smaller ones. But rather, small schools must commit to the opportunities that make small schools unique - allowing for a more personalized learning experience for students, improving relationships between students and teachers, and allowing for improved instruction. The report also explains that breaking up schools can be disruptive to the learning environment, and it can be many years for teachers, administrators, and students to adjust.
The Role of State Legislatures
States’ role in consolidation tends to focus on setting limitations on the number of school districts allowed in a state, setting a minimum number of students in each district, breaking up low performing districts, and regulating the process of consolidating schools and districts. Another strategy used by states like Maryland, New Jersey, and Virginia requires that counties have only one district that covers the entire county.
In states with stronger local control, school district elections may be required to approve the consolidation of districts making it difficult for states to regulate their size. Maine addressed this challenge in 2007 by passing legislation (CHAPTER 103-A) that reduced funding to small districts whose voter’s did not approve consolidation ballot questions. However, with nearly 80 school districts still out of compliance, the state has backed away from the penalties.
Berry, C. (2004). School Inflation: Did the 20th-Century Growth in School Size Improve Education? Education Next , 56-62.
Duncombe, W., & Yinger, J. (2001). DOES SCHOOL DISTRICT CONSOLIDATION CUT COSTS? New York: Center for Policy Research, Maxwell School of Citizenship and Public Affairs, Syracuse University.
Fischel, W. A. (2009). Making the Grade: The Economic Evolution of American School Districts. Chicago: University of Chicago Press.
Gritter, A., Silvernail, D., & Sloan, J. (2007). Analysis of the Impact of School Consolidation on Student Transportation Cost. Applied Research and Evaluation, University of Southern Maine.
Tholkes, R. (1991). Economies of Scale in Rural School District Reorganization. Journal of Education Finance , 497-514.