Promoting improved student outcomes means finance must join the conversation about academic strategy—and must have the tools to succeed.
As debate rages about how best to promote reform in America’s cash-strapped public education system, many consider the first step for school districts and charter management organizations (CMOs) is to funnel as many dollars into the classroom as possible.
To promote better educational outcomes, many argue, districts must allocate additional resources to the classroom, and must reduce district administrative costs accordingly.
At the same time, many indict districts for spending significant sums on services that fall outside of school budgets. Budgeting for centralized services has led to concerns about misaligned spending and over-spending, with often unanswered questions about undue waste and inefficiencies.
Doubtless there are districts that have spent disproportionately on administrative costs—including on vendor contracts, on maintaining aging school infrastructure, sometimes on administrative salaries, and in other cases on ill-advised initiatives that came to naught. However, as others note, consolidating certain services can sometimes be more cost-effective for schools and the district or CMO as a whole.
Our work with districts has revealed that many make earnest, rational efforts to make the best of limited funds while still providing services to all schools within them. The prevailing challenge is that national, state and local funding sources are increasingly strained to provide support to schools, even as enrollments continue to grow. Adjusting to tightened budgets makes resource allocation more difficult.
Beyond that, the question becomes more nuanced. Are centralized costs allocated appropriately? Are the services paid for centrally even needed by all schools that are paying for them? Not all schools need the same extent of centralized services; yet by virtue of being in a district, financial resources are pulled from their individual budgets to pay for those services. And are principals, academic officers and financial personnel working in concert to address budget challenges in a coordinated, integrated way?
At some of our nation’s largest school districts, including those with the most pressing budgetary constraints (i.e., deficits), the services needed at any one school can vary widely. Transparency into budgeting and spending is critical. With charter schools now part of the fabric of our nation’s public education system, ensuring equitable distribution of funds on a per-pupil basis while including the full cost of providing services to each school is of increasingly vital concern.
Better funding allocation strategies will help; new tools will help also. Most important, we believe, is to fix a disconnect that we often see between academic planning and financial planning, and get principals, academic leaders, and finance leaders working together to support improved student outcomes. Too often, chief financial officers and chief academic officers—including school principals—do not always understand the challenges each other faces and how academic planning and school design is interconnected to finance.
Often, a school district’s finance function seems to have developed along its own path: repeating each year a cycle of budgeting and reporting that is divorced from academic objectives and seen by administrators as a separate function. Compliance requirements often force district and CMO finance functions to spend an inordinate amount of time simply tracking grant monies and reporting on progress (or, to be candid, spending for the sake of compliance, as well).
It’s rare that we hear a district or CMO finance director say they feel like they’re part of a strategy for improving student outcomes. More frequently, we hear them say they feel like they’ve been put in a tough position by those trying to execute on a strategy to improve academic performance. (Those trying to execute academic strategy often say the same thing about finance.) Still other finance directors report they have neither the tools nor the training to successfully implement new strategies even when they acknowledge those are necessary and desirable.
In sum, finance wants to help, but often finds its hands are tied. The result is frustration and missed opportunities. With financial planning and budgeting performed at a distance from conversations about school design and instructional needs, financial and academic strategies cannot best complement each other. When this separation promotes different priorities, administrative leaders—chief academic officers, principals and CFOs—can end up at loggerheads.
This separation is something we try constantly to overcome: by designing and implementing financial and operational strategies that promote transparency in the finance function and throughout a district, by encouraging thoughtful interaction and dialogue between academic and finance officers, and by designing student funding allocation strategies that align with academic objectives and priorities as well as financial realities imposed by limited funding. Increased understanding of the challenges faced on both sides can promote not only more productive debate but more tightly focused programs and budgets that better serve a district’s students.
How might all of America’s public schools get there? We’re actively looking to share methods and best practices, and we’ll continue to solicit the input of our readers on this subject. Please let us know what you think!
Carrie Stewart and Scott Milam are co-founders of Afton Partners, which helps school districts and charter management organizations to align resources to achieve stability and sustainability, so they better achieve their objective of improved student outcomes. Carrie is based in Chicago, Scott in Washington DC.