Afton supports transition efforts of a major portfolio school district
Afton was engaged by the Orleans Parish School Board (“OPSB”) in 2015 to advise the district as it was preparing to assume oversight of 60 public schools that had previously been under the oversight of the State of Louisiana’s Recovery School District (“RSD”).
At the time, the Orleans Parish School Board operated 6 schools and 2 education programs, and it authorized another 14 charter schools. The State’s Recovery School District operated approximately 60 schools, primarily charter schools, in Orleans Parish. Combined, public schools in Orleans educate over 40,000 students.
While school operations are highly decentralized in Orleans Parish, like many portfolio districts across the nation, OPSB plays the primary role in resource allocation decisions for all public schools in the Parish. Numerous federal, state and local funds flow to OPSB, and OPSB controls how certain of those revenues are allocated to services and schools. OPSB is the taxing and bond authority and the building owner of all public schools in Orleans. With the RSD, OPSB is responsible for school building planning, construction, and other services outlined in the Cooperative Endeavour Agreement (CEA).
In April 2013, the Bureau of Governmental Research (BGR) published a report, “The Accidental Steward: The Orleans Parish School Board as a Resource Manager in the Reform Era”. This report highlighted OPSB’s critical role in the finances of all public schools in the Parish and made recommendations for significant changes to be made in the way that OPSB budgets for and records revenues and expenditures. The work ahead for OPSB to act on those recommendations presented a significant opportunity to develop a school funding system that is equitable and a school reporting system that is transparent, while continuing to promote the fiscal autonomy that the current structure of school governance intended. Moreover, this work presents an opportunity to develop a road map for how portfolio districts across the nation might think about restructuring centrally managed resources toward more intentional and equitable resource allocation that supports the decentralized structure in their districts.
In order to begin planning for a more equitable and transparent budget, Afton conducted work for OPSB at the end of fiscal year 2015 which generated three deliverables:
- Documentation of the current annual budget development process;
- Identification of mandatory and non-mandatory services provided by OPSB; and
- Recommendation of near-term preparation work required for a transformed FY17 budget.
Our Insights
School districts have significant roles that stretch far beyond being a school operator, and this notion is often misunderstood. In this work of ensuring the District was financially prepared to take on the oversight of 60+ schools previously run by the State, it became necessary from a stakeholder communication and fiduciary responsibility perspective to provide all stakeholders with clarity around the roles and responsibilities of the district, particularly related to finances. In addition to being an operator of schools, OPSB is also a Local Education Agency, a charter authorizer, a tax collector, and a fiscal pass-through agent.
Because OPSB directly ran very few schools of its own, it was confusing to most why OPSB employed 90+ positions in its central office. While not all those positions were necessary for the organization’s long-term strategy, nevertheless, the District’s role was much more than school operator and therefore necessitated central staff to support the corresponding responsibilities.
Because OPSB’s role and responsibilities were largely misunderstood, funding withheld from schools (charters and district-run) to support central and shared services was also largely misunderstood. Transparency of services / responsibilities that OPSB provided was needed by stakeholders. Afton’s work included laying out the various activities that OPSB executed on and identifying them as mandatory or non-mandatory in the context of OPSB’s role as a LEA, authorizer, tax collector and fiscal pass-through agent.
Districts can transparently account for all district funding to the school level once it understands the nature of its central and shared services. Once a district’s services are identified as mandatory / non-mandatory, schools can be transparently “charged” for services – with the cost of mandatory services withheld from school funding and the cost of optional services being bought back at the discretion of schools.