Saturday, December 12, 2009

Structural imbalance in public education calls for courageous action

Decades ago, public school systems implemented a series of compensation reforms designed to make compensation for teachers more fair. The new system would pay all teachers within the system, at every grade level, in every subject matter, whether male or female, the same pay and benefits. Employees would advance in compensation based upon their "training and experience," and experience meant the number of years working in the school district. Training was, and is, typically measured by the number of credits beyond the B.A or M.A. degree. In most districts, a "salary schedule" laid out in columns and rows determines the compensation of each employee. The columns are called "lanes" and each lane represents a training grade-from B.A. to MA and credits beyond. Different districts have different numbers of credits that must be earned to achieve a "lane change," and some districts have more lanes than others. The lanes, represent the experience measure, then.

The rows on the salary grid represent "steps," the number of years of service in the district earned and constitute the experience component of compensation.

This system had, and still has, a number of benefits for employees and for the public. It eliminated the disparity between men and women teachers that had existed throughout education. It prevented disparity of pay based on friendship with an administrator, or a board member, or weighty community member. It equalized compensation between elementary and secondary schools. It afforded a degree of certainty in future compensation in an occupation that had historic low rates of pay. The theory was that if you are going to have no opportunity to make significant bonus money in your profession, why then you should have some level of certainty in return. Finally, it avoids the possibility that if a teacher is delivering subject matter that is unpopular with a segment of the community that it could attack the compensation paid to that individual teacher.

Now for some folks in private enterprise, this system seems irrational or contrary to sound business sense, but frankly it provides a significant number of public benefits. If you are a private employer, it may not bother you that you can pay employees differently based on friendship, family circumstances, or perceived personal need. You own the business, so you get to do whatever you want to do. But in a large public organization there is significant danger that a compensation system without rules will lead ultimately to a form of patronage, in which you get paid based upon who you know rather than what you do. The people who dismiss the steps and lanes system as pointless or archaic are not recognizing the potential for abuse in a system politically accountable where everyone's pay is up for grabs based on judgment. There are good arguments for changing our system, but those who reject the arguments for the current system are not thinking clearly.

The steps and lanes system presents a number of financial structural challenges for school districts that policy makers at the State level need to confront. Unfortunately, the level of political dialog these days in both of our parties, and the way in which campaigns are funded, seems to prevent that dialog.

One problem is that the steps and lanes systems of some school districts are so expensive as compared to the average rate of increase in state funding, that frankly, it is virtually impossible for those school districts to maintain fiscal sustainability even in the good financial years. A second problem is that during the good years, especially, teachers look at the steps and lanes as part of their base pay, and expect the entire pay schedule to increase at the rate of inflation. This expectation creates pressure on school boards to pay step increases plus lane increases plus the rate of inflation. Simple mathematics will show that if you do that, eventually, your school district will go bankrupt unless the state provides revenue support that rises substantially above the rate of inflation.

But worse, in many years, the state of Minnesota provides revenue increases that is substantially below the cost of steps and lanes in most school districts. When this happens, the school district must freeze or limit the step and lane movement, or it must take revenues out of its fund balance temporarily to pay for the increases, or it must cut staff and programs to make up the shortfall. Then, in subsequent years, when the state is more generous, the district may want to make up the shortfall, but employees are expecting even more costly raises, because "this is a good year." If the district freezes steps and lanes, employees feel as though they have lost not just this year's pay, but have been permanently damaged for the rest of their career. But if the district "makes up" the lost pay in subsequent years, then the district is permanently behind the rate of revenue increase provided by the state.

In my view, the problem with this system is not that teachers are paid on a schedule. I think that the benefits of the schedule system outweigh the arguments against it. I believe that a system that left pay primarily to judgment would ultimately result in a patronage system that we would regret. Minor incentive systems can have some merit, provided that they actually have their intended effect--to incentivize the efforts of the people who work under the system.

But the problem in the steps and lanes system that really needs to be addressed is that it is leading to fiscal disaster, because it creates a structural expectation that school districts must persistently increase compensation faster than the state increases revenues. Every legislator that I talk to wants to claim that this is a local problem. This shifting of responsibility is an evasion, an alibi, and an act of political cowardice. The compensation system that exists is a statewide system. It is structural. It permeates and drives the financial crisis that school districts face every two years. The folks who represent us at the State level need to take responsibility for this system, because they have created the system, they foster it, and financial stability cannot be restored until they come to grips with it. The solution is not simple. Identifying the problem, even, requires an act of political courage.

If public education is to survive in Minnesota, the steps and lane compensation system must be brought into balance with the financing system at the state level. Legislators and governors who refuse to address this problem are part of the problem. When history is written, it will say that they presided over the destruction of public education, because it was politically inconvenient to confront the fundamental facts underlying their constitutional responsibility to maintain a efficient public education system. If public education is to survive, the steps and lanes system in Minnesota must be brought into balance with the revenue system, and revenue and cost control must be part of the solution. So-called taxpayers advocates will argue that the solution is to squash teachers financially, and put lids on the compensation system of some kind. Public employee union advocates will argue that the solution is massively to increase the amount of funding provided to public education. But neither of these solutions will work, and neither is possible, because the two wings lack sufficient power to impose their wills, and because neither solution solves the underlying structural problem. What has to happen is a great compromise that restores fiscal stability. It is going to require more revenues and it is going to require some cost control and restructuring.

I'm tired of hearing politicians tell stories and jokes, and give speeches about how much the care about our veterans. Of course we honor our veterans. That is a given. But it takes no courage to honor our veterans or to tell a great joke. But its time for politicians to get up in front of their audiences and deliver a message that shows that they have solutions to the tough problems. Don't tell me that you care about the poor. Don't tell me you care about the taxpayers. Don't tell me things that are safe and avoid offending anyone. Minnesota needs to come to grips with the real problems and we need to do it this year.

I'll have more ranting to do about the structure of school finance in a future blog.

No comments:

Post a Comment

comments welcome