Atlanta Public School Board of Education approves donor funded transition services agreement for Carstarphen

April 30, 2014

The Atlanta Public School Board of Education approved a transition services agreement (vote 9-0) that would allow for the newly appointed superintendent to begin working on a transition prior to her official start date on July 7th. The cost of the transition will be funded by outside charitable donors and no APS operating funds will be used. The funding mechanism is designed to not impair funding of the organizations educational priorities.

Chairman Courtney English addressed the external funding and indicated that Carstarphen would report directly and only to the Board during this phase, that he would be responsible for reviewing and authorizing the payment of expenditures and that a “wall” was being erected between the donors and the superintendent.

The Resolution passed by the Board (see text below) stated that “there would be a significant benefit to the District if [she] could begin transition planning and execution immediately”. The Resolution also gave the Chair the authority “to request funding of these transition costs from outside charitable sources”.

The AJC reports (see here) that,

Board Chairman Courtney English said he plans to raise between $500,000 and $1 million from business and philanthropic organizations to compensate Carstarphen and her team for their interim work.

He said soliciting outside contributions will prevent draining money from Atlanta Public Schools’ $658 million general budget for next school year. Safeguards will be put in place to ensure Carstarphen isn’t beholden to private donors, he said.

“We definitely want to make sure folks know where the ultimate responsibility lies and that there are no strings attached,” he said.

She’ll work with Superintendent Erroll Davis during the transition period …Until then, Carstarphen will recruit her senior leadership team, work with Davis to hire school principals, learn about Atlanta Public Schools and collaborate with existing staff, board members said.

In addition, the AJC reports that the Transition Services Agreement contains the following provisions,

Carstarphen will be paid a daily rate in line with her previous $283,000 salary as superintendent in Austin, Texas… The rest of the contributions will compensate her transition team for their work and expenses.

Note – the Transition Services Agreement was referred to as Annex A in the Resolution passed, but has not been released publicly to my knowledge. Repeated requests – and promises to deliver a copy of what should be a public document have not been honored. This is no way to run a railroad – more comments on the APS communications process in a later post.

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Transition Resolution 042914 002

 


APS superintendent transition to start soon – Board of Education to meet to approve funds for transition team – external sources sought – Why?

April 29, 2014

The Atlanta Public Schools announced that a Special Legislative meeting will be held today at 5:15 p.m. to consider – and likely approve – a resolution to establish a transition team for the new superintendent Dr. Meria J. Carstarphen who will officially start on July 7th.

The meeting will be held at the High Museum of Art Hill Auditorium at 1280 Peachtree Street NE, Atlanta, GA 30309. The Special Legislative meeting will follow the Board training sessions that were held yesterday and today at the High Museum.

The AJC reports that (see here),

The Atlanta school board plans to approve a resolution Tuesday that would allow Carstarphen to recruit a transition team and begin readying the school system for her official arrival July 7

[Board Chair Courtney] English said Monday he intends to raise between $500,000 and $1 million from business and philanthropic organizations to compensate Carstarphen and her transition team.  

Carstarphen would be able to begin working immediately after the resolution is approved.

First, let me say that it is a good thing to establish a transition team now. It will allow Carstarphen to spend the next nine weeks getting up to speed on the status of APS and to identify and begin making changes to how APS operates.

However, I am a bit disconcerted by the funding mechanism. Why is it necessary to raise funds from business and other organizations to establish the transition effort?

Let’s look at a brief history of prior offers of funding. Last year private donors offered to fund the search effort for the new superintendent. The Board (while it had a different composition) declined. Then Mayor Reed announced that certain donors had offered to supplement the new superintendent’s salary with up to $300 thousand per year (see here). The Board seems to have declined that offer as well.

In both instances, I believe the Board did the right thing and refused to accept contributions from outside sources that might have ‘strings’ attached. It is also important to note that, as a routine matter, APS accepts donations for many different reasons – but they always are for specific educational purposes.

So what is different now?

In my view – nothing has changed. Establishing a transition team is perfectly sensible – and it is a school administrative expense that the Board should pay for out of operating funds. Additionally, if paid directly by APS, then the activities of the transition plan will remain transparent to the community. However, private funding could result in a process that is not so transparent.

If $1 million can be raised – wonderful – but put it towards improving educational outcomes.

The history of outside influence on APS is checkered enough and one small part of restoring faith in APS requires that they maintain their independence from external groups.

There is absolutely no reason to start off Carstarphen’s tenure with a ‘cloud’ of external influence on the horizon.

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We will get better answers by changing how we ask the question – and then get to better solutions

April 28, 2014

The term “downtown office cost” is often used as a euphemism for all the personnel in APS serving in administrative functions. However, not all administrative personnel are located at the downtown CLL office and where these personnel actually sit is not really relevant.

However, when the administration is asked about the cost and number of personnel, they respond by generally focusing only on the individuals who have desks at the downtown CLL office. And while their answers are technically correct (sometimes), their focus on personnel sitting in the CLL building in downtown Atlanta often results in confusion regarding how many administrators actually work for APS.

To illustrate this, let’s look at a couple of examples.

If the entire Finance Department were to move from the CLL to another building (maybe even to an underutilized school building), we would not say that the general administrative cost had decreased. However, the administration would be correct in saying the employee costs associated with the “downtown CLL building” had gone down. There is a big difference between the two.

Conversely, take the example of a specialist teacher that has responsibilities in multiple schools and spends most of their time in the field. Let’s say that this teacher was transferred to a desk at the CLL because it was more efficient to be there. While it would be correct to say that the employee cost of the CLL building had gone up, the fact of the matter is that the cost of general and administrative functions had not changed by a dime.

My suggestion is that when you are addressing this issue, use the term “centralized school and general administration costs” and avoid the “downtown office” euphemism. By changing how you ask the question, the issue of where the desk is located is taken out of the equation and places the focus on the number of administrative personnel across the district.

The charts below present the answers that are important to the discussion.

FY15 admin staffing and salaries 042815

The staffing increases have already been the subject of prior posts (see here and here). The chart at the bottom shows the salary for these departments after adjusting FY14 for the Vacancy Management savings that never occurred as there was no mechanism to track it. After making this adjustment you can see that average salaries have essentially stayed the same. However, salaries in total are up by 4.0% due to the staffing additions.

I think it is interesting to note that only one department continues to work to drive costs down and become more efficient. Finance has consistently worked to reduce staffing cost for the last several years and did so again this year. Over the last two years, Finance has reduced staffing by 4.2%.

If the other administrative departments had followed their lead, instead of increasing by 13 in FY15, the personnel would have been reduced by 15 positions from FY13 levels to 330. In other words, if the staffing had simply remained at FY13 levels, the total would have been 345 – with efficiency improvements, the staff should have been brought down to 330.

Given that these incremental administrative staff cost $3.2 million for salaries and benefits, my sense is that a better use could have been easily found for these resources.

As the discussion on average class sizes begins to heat up over the next several weeks, remember the $3.2 million number as the “unacceptably high cost” of reducing class sizes is discussed. The same goes for “there is not another dime in administration costs that can be cut”.

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Round-Up of APS Headlines from the Past Week

April 26, 2014

APS News

*** FY15 APS Budget

*** CCRPI Report

*** Special Needs Students Abuse Case

*** Coan/Kennedy School Merger

*** Other APS News

Board of Education, Committee Meetings and Public Forums

*** Board of Education meeting held on Tuesday, April 22

Non-APS News and Opinion of Interest

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AJC reviews the Atlanta Public School Board of Education’s first 100 days in office

April 25, 2014

The AJC’s Mark Niesse issued a report on the Atlanta Board of Education’s first hundred days in office. The general assessment is that they are off to a good start, but everyone agrees that there is much work to do. Per the report (see here behind pay wall), the following are some of the Board’s accomplishments and the work still yet to do:

  • …the revamped school board has unified around a common agenda promised during the campaign,
  • …its goal of spending more money in schools and less on administration remains largely unfulfilled so far.
  • Board members have hired a superintendent,
  • …given teachers a raise and eliminated furlough days.
  • They’ve held dozens of community meetings with parent groups…
  • …worked full-time hours at near minimum-wage pay.
  • When they’ve disagreed over class sizes and spending, their differences haven’t devolved into the kind of factionalism…
  • Passing the budget in April rather than at the end of June…
  • …current board members said they’ve confined themselves to their policy-setting role.
  • … formed [Committees] to decide the future of charter schools in the city, shore up a pension plan with a $550 million unfunded liability and coordinate superintendent evaluations.
  • By hiring their choice for superintendent…the board ensured they’ll work with a leader who shares their priorities…

All in all, this is a great start. My sense is that they can keep the positive record going by quickly revising the FY15 budget in concert with the new superintendent to reallocate expenditures from administrative functions to spending in the classroom, reducing class sizes and gathering the necessary data to evaluate the resource allocations across the system.

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APS administrators becoming less efficient while increasing teacher workloads

April 25, 2014

In the face of a declining traditional school student enrollment and a reduced teacher workforce, the number of administrators is increasing. And what is the result? Based on the data over the last two years and the approved budget for FY15, the workload trends for teachers is going up while the workload for administrators – as measured by the number of personnel they support – is coming down.

The chart below (click to enlarge) identifies the staffing numbers for all administrative functions in APS that are accounted for in the General Fund.

FY15 Admin staffing 042514

With this information, we can then begin to see the trends in how the workload is being distributed.

First, the average number of students per teacher is going up – not dramatically, but up 2.2% in the last two years. Obviously, this trend is counter to the desire by the Board to reduce average class sizes. But it also tells us that the workload carried by a teacher is increasing.

And while it is clear that the number of administrators is rising, it is troubling to see that the number of people they are supporting is coming down. This indicates that instead of getting more efficient, the administrative functions are getting less efficient in the conduct of their responsibilities.

As you can see, the number of teachers is down 79 as compared to last year and down 127 over two years. However, the number of central office school administrators is going up and, as a result, the number of teachers supported per central office school administrator is coming down. Over two years this has decreased by 2.9 or 7.7%. Again, this indicates that the workload for central school administrators is decreasing while the workload for teachers is increasing.

The case is also the same for General & Administrative staff. Their functions support all of the staff in the district and their workload – as measured by the number of non-G&A staff they support – is coming down as well. In FY13, each G&A staff supported 18.5 district personnel – in FY15 the number of personnel has come down to 16.9, or an 8.9% decrease. This is a strong indication that the efficiency of the G&A staff is declining.

Teacher workloads are up and administrative function workloads are down. This is not an indication of an improving and more efficient group of administrators.

It is time to radically change the trends and to focus the staffing where it counts the most – not into administrative functions – but into direct instruction where they have a chance to improve educational outcomes.

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APS administrative costs increasing for only “technical reasons”? I don’t think so.

April 24, 2014

In the recent Board of Education meeting in which the budget was passed, the following exchange occurred:

Board member Steven Lee: Almost every one of the central office departments has an increase yet we are decreasing services at the bottom line.  I have very serious concerns in regard to where it is.

Superintendent Davis:   The data say that the progress of moving more money to the school-house is being made.  

CFO Burbridge:   There are several technical reasons why expenses are higher in certain central offices than in the FY14 budget.

First, let’s take a look at administrative spending, how it is changing as a percent of total spending and see if these statements are supported by the numbers.

FY15 Summary of GF Expenditures 042414

In the chart above (click to enlarge), you can see that the combined Central Office School Administration and General Administration costs have gone up – both when comparing FY15 to FY14 and for the last two years. This component of spending is up $9.2 million as compared to FY14 and $18.0 million as compared to FY13.

It is also interesting to note that the Direct Instruction and Student Services expenditures are also up by $17.5 million over two years – but notice that this is less than the increase for administrative functions.

As CFO Burbridge notes, there are some technical reasons why spending in these two categories of administrative functions are up as compared to FY14, but the technical reasons do not explain a substantial part of the total difference.

And the technical reasons fly out the door when comparing FY15 to FY13. So maybe there is another way to justify the increasing cost of the administrative functions.

Below is a chart that presents each major category of spending as a percent of total adjusted spending. Please note that I am using the “Total expenditures before other items” as the denominator in the calculation as the other items below this line are not relevant to the assessment (see Note at end of post for further discussion of why this is the case).

FY15 Exped as Percent of Total 042414

Whoops!

This chart (click to enlarge) does nothing to support the administration’s contentions either. As a percentage of the total spending (as adjusted) the administrative functions have steadily increased over the three-year period, going from 11.3% in FY13 to 13.9% in FY15. That is a 2.6% increase in the share of expenditures gobbled up by the administrative function in just two years.

And where did the administrative function increases come from? You guessed it – primarily from both Direct Instruction which, as a percent of spending, is down 2.0%, and Professional Development which is down 0.3% over the last two years.

So let’s keep looking and see if we can find anything in addition to “technical reasons”. Is it possible that staffing changes might have had an effect on the increasing cost of administrative functions?

FY15 Staffing Summary 042414 

Well, well, well – the number of teaching positions in Direct instruction are down 197 over two years, but the number of administrators is up by 17 during the same period.

While I agree that there are certain technical reasons the cost of the administrative functions are going up, there are also certain key expenditure increases that also contribute to the increase that were not mentioned. Staffing increases is one – and the relationship between the increases in administrative staff as compared to decreases in Direct Instruction staff – is a very disturbing trend that has now persisted for some time. In addition, there are other substantive reasons why administrative expenditures are going up – and here are the changes:

  • Information Technology – $4.7 million of the increase is related to incremental Professional Services and Supplies & Materials.
  • Legal – a $704 thousand two-year increase in Professional Services (this in addition to the two staff attorneys added).
  • Human Resources – up $3.6 million over two years – a substantial portion of which was approved for Project Thrive. However, much of this increase was related to the transfer of staff (and related cost) from Central Office School Administration.
  • Central Office School Administration – remember those savings from transferring staff to HR that were just mentioned. The “savings” did not happen. The transfers to HR were made, but then the positions were replaced within the group. Total change in staffing for this group – up one over last year – up at least four in two years – and these numbers are net of any transfers.

While the administration focused on the technical changes, there were also additional – and substantial – reasons for the ever-increasing cost of administrative functions in APS.

Board member Jason Esteves may have summed it up best when he commented on the budget prior to its approval (Esteves voted no),

We should not expect the community to accept large class sizes and limited academic programs if this BOE and administration is not making the central office more efficient.  

The full Board is looking forward to working with the new superintendent to amend the budget. Hopefully some of the disturbing trends noted above will be reversed and the focus of an amended budget will be on educational priorities and not on funding the ever-growing ‘administrative beast’.

Note – in the expenditures as a percent of the total chart above, the denominator excludes certain costs that are not allocated to departments including Vacancy Management in FY15 and the Salary Increase. Both of these are likely to be allocated across multiple categories and the result would likely be immaterial to the assessment. I have also excluded the Pension Liability Payment as most of this is a past cost and requires limited, if any, administrative costs to manage this. Also, I have excluded the Charter School funding as the administrative cost of managing these is generally covered by the 2% fee assessment which, along with the administrative costs, is accounted for in Special Revenues.

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