Gearin Decision Challenges Parties to Work Together Courageously

In the last legislative session, the legislature presented a full complement of appropriation bills to the governor for signature. The governor signed these bills and they became law. In some cases he exercised his line item veto, removing some expenditures from the bill, unless the item was added back in by a 2/3 vote of the legislature. This is how our Constitution requires the two branches, executive and legislative to work together. However, it turns out that the governor signed bills with appropriations greater than the amount he wanted to spend. The bills that he signed had total appropriations exceeding the total amount of revenues that the governor was willing to tax for. In short, he intentionally created a deficit by agreeing to spend more than the amount he was willing to tax for. Now in Minnesota, the Constitution prohibits the State from spending more than it collects in revenue.

The Governor, it turns out, evidently believed that by this device, he could acquire far reaching power to control the entire budget, without involving the legislature. He did this by vetoing revenue bills (taxes, fees, etc) that raised the revenue needed to fund the legislation he signed. He then took the position that he could "unallot" any appropriation of his choosing, even if he, the governor, had previously signed that appropriation into law. This is the context in which several plaintiffs sued the Governor, contending that the Minnesota Constitution prohibits the Governor from intentionally creating a deficit and then using that deficit to take sole power over Minnesota Government.

One nefarious side effect of what the Governor did is that it exacerbated the lack of cooperation that should exist between the legislative and executive branch. We have a government divided by party. Government works best when both parties attempt to arrive at a common solution which harmonizes and reaches to the middle. In addition, the Governor's course absolved the DFL of all responsibility for solving problems. Both parties could feed their base, instead of creating an efficient solution to the present budgetary crisis.

Yesterday, District Judge Gearin of Ramsey County granted a motion for temporary restraining order on behalf of plaintiffs challenging the Governor's use of the unallottment power to defund programs which had been authorized and for which funds had been appropriated by legislation passed by both houses of the legislature and signed by the Governor. If you want to read the Judge's decision, you may read it by clicking on this link. For some reason, this decision divides most of us along partisan lines, but it should not. The decision is not at all remarkable. It upholds one of the most basic principles of our form of government. As the Judge's decision points out: The Minnesota Constitution Article 3 Section 1: "The powers of government shall be divided into three distinct departments." These branches, which are co-equal are carefully allocated powers by the State Constitution. Under the Constitution, the Governor is allocated the power to prevent passage of legislation with a veto, which can then be overridden by a 2/3 majority of both houses, Senate and House.

As the Judge wrote:

The citizens of Minnesota, as well as the entire country, are the heirs of our founding fathers, the drafters of the United States Constitution. It was their brilliance that resulted in the creation of a government consisting of three co-equal branches. This results in a system of checks and balances that ensures that none of the three branches has absolute power. This system of checks and balances was embraced by the writers of the Minnesota Constitution in themid-19th Century and continues to the present day in Minnesota, as well as in our country.

The Governor gets one free shot to stop legislation, and that is before he signs a bill into law. In fact, the Governor has line-item veto power in Minnesota. He may exercise his line item veto removing specific line item appropriations that he doesn't like. This power, however, is subject to the legislature's ability to override or to pass different legislation that addresses what the Governor has done.

Now in the case in question, the legislature passed and the Governor approved, an appropriation for the General Assistance Medical Care program. In other words, the Court was dealing with an appropriation that the Governor himself approved. What happened, this is quite simple. The Governor himself intentionally approved appropriations for a variety of programs while intending not to sign legislation that would fund these programs. As the Court wrote:

In the beginning of June of 2009, Defendants took steps to unilaterally balance the budget by unallotting specific programs enacted into law during the session. By exercising his unallotment authority to apply to reductions in revenues that were determined by a forecast made before the budget had even been enacted and by not excluding reductions that were already known when the budget was enacted, the Governor crossed the line between legitimate exercise of his authority to unallot and interference with the Legislative power to make laws, including statutes allocating resources and raising revenues. The authority of the Governor to unallot is an authority intended to save the state in times of a previously unforeseen budget crisis, it is not meant to be used as a weapon by the executive branch to break a stalemate in budget negotiations with the legislature or to rewrite the appropriations bill.

In plain language, the Governor purposely approved too much spending so that he could arrogate to himself both the executive and the legislative power.

When a decision like this is issued, people on both sides typically vastly overstate the implications. Proponents of the decision and opponents of the decision alike are most certainly going to claim that the victory (defeat) has monumental implications. The decision is important, but it is much narrower than it first appears.

This decison merely says that if the Governor wants to limit funding, he has to do that by vetoing the funding. In this case, the governor signed the nutritional appropriation into law. He approved the funding. He could have used his line item veto, but instead, he made it the law of our State. What makes this case special is that the Governor intentionally signed into law appropriations that totaled more than he, the Governor, was willing to fund with revenues. The unallotment statute, the Court explains, was not designed to give the Governor the power to defund an appropriation all by himself, unless the funding shortfall was created by an unanticipated deficit.

If I have the time, I want to write some more on the implications of this decision for education. Judge Gearin's decision recognizes several important constitutional principles relating to separation of powers. But the parties before the Court were advocating about an issue of benefits for indigent Minnesotans, a funding responsibility that is important, but not guaranteed by the Constitution. The Constitution contains a paramount duty upon the State's Constitutional officers to provide an efficient system of public education. As our elected officers grapple over a solution to this crisis, all parties must recognize that when they are finished, they have not done the duty that they were sworn to, unless they have left us with an efficiently properly funded system of public education. Under the current budgetary crisis, they cannot achieve this objective unless they arrive at a compromise which gives school districts both the revenues they need and the powers they need to control costs. Accomplishing that objective will require courage and depth of thinking.

Happy New Year

Questions and Answers regarding the Bargaining Crisis in Public Education

This is the first in a series of attempts to answer some of the questions that I've been hearing about the bargaining deadlock facing our school district. This year school districts have been struggling with budgets probably more than ever before. Our struggle with budgets has led school boards to confront the question whether to fund compensation increases for teachers by cutting the size of the teaching force, and to use the savings for those increases. The crisis is not the fault of teachers nor is it the fault of school boards. The crisis arises from a long term persistent structural imbalance in the funding of school districts versus the compensation structures existing in public eduction. Some school boards are making cuts to fund increases, and some are not. The St. Cloud Board of Education has decided that it cannot justify cutting teacher positions to fund compensation increases. We're not critical of school boards who make a different decision. We've decided after careful thought that public education cannot remain economically and fiscally sustainable, if we keep implementing program cuts and staffing cuts to cut .

One of the things that we heard from the representatives of teachers is that many teachers wish they had more information about the financial condition of the school district and also that they had more meaningful involvement in the budget process -- the budget at their own schools and the budget at the District level. The Board invited teacher representatives to make a proposal for how we could do just that. We said that we would be interested in creating a process whereby the board could enhance the participation of teachers in the budgetary process, and that this would be something that we could envision doing as we develop our final budget document for next year. Public education is in jeopardy as a result of systemic structural problems in the way that it is addressing long term challenges in both revenues and costs. This problem has been brewing for more than a decade. In the last decade, all over the state, boards of education and teachers unions have grappled with these problems by wrangling over whether the financial problems are going to be resolved by slowing down the rate of compensation increase or by implementing program cuts, putting off long term expenditures, raising fees, and reducing staff, including teaching positions. The issue has been treated as if it were a two year problem that can somehow be solved at the local level by coming up with temporary expedients. When a board of education increases compensation faster than the legislature increases funding and makes program cuts to fund those increases, the board is not solving a problem for teachers, for kids, or for the public--it is kicking the can down the road for a few years and making the problem even worse.

I think it is critical that the public and educators get a better handle on reasons for the financial crisis that is facing public education. I've been trying to address some of those reasons on my blog post. In this post, and some upcoming posts, I'm going to try to answer some of the questions that I've been hearing in recent weeks.

Why did the School Board adopt Bargaining Principles: The state funding crisis has led the board to adopt bargaining principles which guide our approach to compensation issues and bargaining. You can look at those principles by clicking on this link: Bargaining Principles Link. Our bargaining principles call upon us to provide fair compensation within our means. They say that we are committed to providing the best possible compensation for our employees within the means provided by the State of Minnesota.. Our bargaining principles state that "increased compensation for employees depends upon increased revenues from the State. To that end, we regularly advocate for increased funding for public education."

Several facts have led us to adopt these principles. The first is that over the last decade, the rate of compensation cost increases in most school districts has regularly exceeded the rate of increase in the state funding formula. Here in St. Cloud, if you sum the total percentage increases for all settlements in the last decade, it comes to 48 percent, or 4.8 percent per year. That compares to a rate of increase in the funding formula of 25% in that same decade, or 2.5% per year. Now the formula increase is not a perfect indicator of the rate of growth of our funding, because special education funding plays a significant role in our financial situation. But obviously, these two trends cannot continue forever.

You could look at just about any school district and find the same trend. Compensation increases faster than state funding increases resulting in program cuts, staff layoffs, fee increases, reduction in textbook replacement, library replacement, and other cuts. At some point, compensation increases and state funding increases must be brought into balance. Our bargaining principles state that

Our commitment to maintaining quality programs and reasonable class sizes prohibits that we use budget cuts to fund increased compensation. We cannot and will not increase the total cost of compensation faster than the increases in state funding permits. Cutting programs, thereby hurting students and families, is not an acceptable or effective mechanism to accomplish the objective of funding settlements.

Does this mean that we think that teachers are overpaid? Absolutely not. People who use this funding crisis as an excuse to beat up on teachers, or argue that they don't work hard, or try to minimize the contribution of the teaching profession aren't doing us any favors. A community that honors its teachers and its professional educators and recognizes their tremendous value is likely to be a growing, well educated, vibrant community. A community that devalues its professional educators is on the road to ruin. People need to understand that employers can assign great value to their employees, but still find themselves unable to provide compensation increases.

The decision of the St. Cloud Board of Education to adopt sustainability principles is not anti-teacher. In fact, if we were to adopt the approach urged upon us by the teachers union, we would be cutting over ten percent of our existing teaching force. That's not going to seem very pro-teacher to the 70 to 100 teachers who lose their jobs. And, if we were to do that, the remaining teachers would have significant increases in class size, and that's not exactly a boon to those teacher either.

As we confront this choice here in our community--to keep all teachers employed or to implement position cuts to fund pay increases--a number of questions keep cropping up. Here are some of them:

What are the components of teacher compensation and how do they contribute to rising costs?

• Lanes When teachers earn a required number of post graduate credits, they move into a new "lane", and earn compensation for training. The estimated cost of lane improvement is about $190,000 per year. Teachers earn that lane improvement, and receive it, even when the new bargaining agreement has not yet been approved under the law of "continuing contract." Since the state has given us no new funding to cover this cost, we had to make cuts in this year's budget and next year's budget adjustments to fund them.
• Steps A teacher earns a step for an additional year of experience, but only It costs about $500,000 in any given year to fund steps. Its steps are the primary vehicle that allow teachers to move upward in pay during their career. Steps are, I think, a good thing, because they create some level of predictability and equity in teacher pay. The problem is that if the state freezes funding, there is no money to pay steps. This year, SCEA is asking us to pay steps retroactively for this year, and to pay them next year. That would increase our costs beyond this year's budget by $500,000 and next year's budget by $1,000,000 for a total unfunded increased cost of $1.5 million.
• TRA and FICA contributions. These are costs that don't seem all that real to the employee, because they are costs paid to the State of Minnesota to fund teacher retirement, or for unemployment compensation insurance, etc. We spend about 13 cents in increases in this category for every increase in pay.
• Health Insurance: This year, the District pays $586.00 per month for each teacher receiving individual health insurance coverage. Because this cost is "uncapped," it increases automatically when our premiums increase. And, Minnesota law prohibits us from changing the content of insurance coverage to adjust to increasing costs, unless we agree to that as part of our collective bargaining agreement. The insurance premium increases are difficult to predict and represent a major uncontrolled cost for our district. We budgeted about $300,000 this year to cover this increased cost, just for the single coverage increase, and we included the cost of a similar increase in our budget adjustments for next year. We received no money from the State of Minnesota to cover these increased costs. The district contributes $937.85 toward the insurance costs of teachers receiving family coverage, a figure that is capped--that is does not increase automatically. SCEA has sought an increase in our contribution in this category, and if we were to grant it, then we would have to make additional cuts to fund the increase.
• Other: SCEA has sought extra compensation for teachers who don't receive steps, because they are at a point in their career, when they wouldn't get steps. It has sought increased "longevity pay," which is a form of extra pay for teachers who are at the very top of the pay scale. Again, the State has not provided us with any funding to pay for these requests.
• Salary Schedule Improvement: Salary schedule improvement occurs when the entire pay scale goes up. Over the last ten years, according to Education Minnesota figures, the average salary schedule improvement across the state has been about 23 percent, and our salary schedule improvement has been just about the same. That's about 2.3 percent per year. The funding formula for public education has gone up 25% in this same time period, leaving nothing to cover the other items of compensation. Often, when compensation increases are reported in the news, you hear only the cost of salary schedule improvement, but school districts have to find funds to pay for all of these increases, whether they are reported or not.

Why is the Board offering Q Comp this year? Quality compensation is about the most cost effective way we have to provide additional pay to teachers. It is available on a two for one match by the State of Minnesota. In addition, it is the key to possible additional funding sources from the federal government. It provides the only possible method to provide additional funding for teachers pay without forcing teacher layoffs and other program cuts.

It is true that we lost quality compensation last year. I've heard people comment or claim that the District lost q comp because the District failed to comply with the State's requirements. If you believe that, then I have a bridge for sale out in Brooklyn for you. The District lost quality compensation, because the SCEA refused to consent to implement changes in Q Comp required by State law. We could not implement these changes, under the Q comp law, without consent of the SCEA, and we did not receive that consent. I sat in a room with the representatives of teachers myself, when they refused to make these changes. Any suggestion to the contrary is simply untrue. We have once again offered the opportunity to implement Q Comp so that teachers can receive an additional $2,000, per year, plus or minus, provided that SCEA will agree to comply with the minimum requirements of the Q Comp law. Nobody is trying to make them do it. Its a choice between two alternatives. We've just said, look, here is a way to improve your compensation. You don't have to take it, of course. But don't tell us that complying with q comp is more onerous than increasing class size, cutting programs, laying off teachers, and doing all of the other harmful things that are required by trying to manufacture pay increases out of nothing.

What can you tell us about the so-called language issues that are as yet unresolved? "Language issues" involve changes in the work rules for teachers. They deal with the length of the duty day; the amount of prep time that teachers receive, and so on. I'll talk about those issues in a future post. Stay tuned.

I want to close by repeating one more time. When an employer freezes pay during a fiscal crisis, so that the employer can keep all employees working, the employer is not saying that the employees are not valuable. In fact, in many cases, the employer who makes an effort to keep all employees on board values employees at least as much or more than the employer who sends its employees out in a high unemployment job market. People do a grave disservice to the issues confronting us to see this as a question of whether teachers earn the pay they receive, or whether they deserve a raise. We have an exceptional teaching staff in St.Cloud. They are dedicated to learning, and they earn their pay. We are lucky to have them here, and as a community we are enriched by their presence.

The issue here is entirely different. Compensation increases need to be funded by the State of Minnesota. We cannot sustain public education over the long haul by adopting a strategy that school boards are going to cut programs, raise fees, delay long term acquisitions of library and textbooks, and reduce teaching staff

You can't fix the public education finance mess with deceptive evasions

Before Christmas I wrote that it has become reasonably clear that St. Cloud school district and its teachers union will not arrive at a settlement before January first of this year. We find ourselves millions of dollars apart, many millions of dollars apart, I wrote. I received a number of comments, both negative and positive. If we are going to figure out a solution to education finance, we'll need to think clearly. When we are struggling with complex issues, at times the dialogue deteriorates into a series of deceptive evasions, designed to keep us from thinking about the real issues. Wouldn't it be easier if we could solve the problem by attacking personalities? Or putting the problem off until another day.

Much of the discussion that takes place here and elsewhere in the community represents a complete evasion of the central financial issue facing public education today. The central problem is how we will come to grips with the long term, nearly intractable imbalance between the rate of growth in teacher compensation and the rate of growth in state funding per student. Some people prefer to assert that this is a temporary problem and point to the fact that the growth in the funding formula in the last four years has been 2 percent, 1 percent, 0 percent and 0 percent respectively, or 3/4 percent per year. But the problem is not temporary; it is permanent and structural and requires a permanent structural solution. Anyone who says the solution is simply to keep proceeding along the same course is simply engaged in another form of evasion.

The solution will require significantly more revenue from the state, some form of cost controls and cost discipline, a major rethinking in the structure of the way in which we organize the discipline of teaching itself, or some combination of all of these. We cannot permanently and regularly solve the imbalance between revenues and teacher compensation cost by permantly raising pay faster than revenues, permanently reducing programs and raising class size. At some point there will be a day of reckoning, and really, the day of reckoning is close at hand.

One of the deceptive evasions that is commonly advanced, and the one that I would like to discuss today, is the attempt to confuse the issues by attacking alleged overspending on administration. The use of this deceptive evasion plays into people's prejudices. We are in the teaching business. Everyone wants to keep class sizes down. Wow: wouldn't it be wonderful if we could somehow solve this problem by cutting administration and putting that money into teachers salary! The fact is that if you completely eliminated all of our school and district administrators, every last one of them, that wouldn't give you enough money to pay for the increased compensation sought by the SCEA for teachers in this contract period alone.

Let's have a look at the real numbers. The school District's operating fund budget is the part of our budget that pays for teachers, paraprofessionals, administrators and other staff. It pays for operating our school buildings (heating, lighting, and so on). It pays for regular education (primarily classroom instruction) and it pays for special education (funding in addition to the regular education component of students with disabilities). In the school year 2000-2001, the general fund budget for expenditures of all kind was $79.9 million. By the 2008-2009 budget, the general fund operating budget had risen to $82.6 million, a 3.3% increase total, an increase of about 1/2 percent per year. Remember that during this time period grant funding changed, and our enrollment changed, so we can't say that the rate of increase of just over 1/2 percent per year is all that helpful. I'm providing these numbers to provide some perspective on school budgeting.

When we budget, we catagorize administrative expenditures as School Administration and District Administration. School administrators include principals and assistant principals. Earlier, I talked about the amount of revenues that you could raise by eliminating all administration, and of course that would be both ridiculous and illegal. School administration answers parents phone calls to deal with various issues. School administrations selects and supervises teachers. School administration is in charge of educational leadership in the school. Educational research is persistently reporting that school administration is a critical component in quality schools.

District Administration is also required by law, so talking about eliminating that is also ridiculous and illegal. These are the people who issue paychecks to employees, and who make sure that the correct number is on that check. They supervise transportation, school safety, implement state curriculum and testing requirements. They monitor request for acquisitions and make sure that the payments are authorized and within budget. They monitor school effectiveness and supervise principals. All the time, we wrangle with whether our expenditures are too high or too low, but the amount of money that we are talking about here is in a completely different order of magnitude as compared to the size of the teaching compensation budget.

In the 2000-2001 school year the combination of District and School Administration was just over $3.6 million, less than the two year increase in spending sought by the teachers union for increased compensation. $3.6 million represents the cost of all of the principals, assistant principals, most of the folks at the District Administration Office, in other words, the folks who administer at schools and the folks who administer at the main administration office. The total cost of District and School Administration budgeted for 2008-2009 was just a bit smaller, but in round numbers, it was just under $3.6 million. By way of comparison, Site Building and Equipment operations, another part of our general fund budget, run about $6 million.

The point I want to make is that as folks jump on the cost of administration in the district as if cutting it could somehow produce great revenues for the district, the facts show otherwise. Look at it this way. The total compensation costs for teachers was $51 million last year. This number should be way higher than other components of the budget, because we are in the teaching business. That $51 million number includes about $40 million for regular compensation (primarily base pay plus steps plus lanes) and about $6.3 million in health and dental insurance costs. For every salary dollar we pay teachers in compensation, you then have to add about 13 cents (13%) for TRA (Teachers Retirement) and FICA costs. That, and a variety of smaller costs, for summer school and the like, bring the total to last year's base of $51 million. In their last specific bargaining proposal to us, the teachers union, SCEA sought about $1.7 million in increased compensation costs (salary, benefits, etc) for the current budget year, and another $2.4 million in increased compensation costs for the next budget year (2010-2011). That's a compensation cost increase of $4.1 million. As I have said, you could get rid of the entire administration at the DAO, and all of the principals, assistant principals and all of the other district and school administration, and you still couldn't come up with that increase.

People who claim that the teacher compensation cost issue can be resolved by getting rid of an administrator or two are thus buying into a convenient evasive deception. Its a way of changing the subject. Suppose you got rid of all administrators and used the money for compensation increases for teachers. Putting aside the fact that there would be nobody to collect the money from the state and nobody to issue the checks, and nobody even to calculate the increased amount to put on the checks, what would we cut the next time we came to the bargaining table to fund the next round of increases?

We spend a lot of time monitoring the size of our administrative staff and the budgetary trends. We need to do this, because we are spending public money. We compare our costs from one year to the next, as I've said, and we scrutinize the comparative costs from district to district. Reasonable people can quibble with staffing decisions here or there. But there is no credible argument that our administrative budget is out of line for a district our size and responsibilities. When people say, oh, oh, I think you should cut your administrative costs and everything will be just fine, they are engaging in an act of financial evasion and double talk.

Always, we need to monitor costs and keep them under control. Always we need to monitor efficiency. But the issue of administrative efficiency is completely irrelevant to the question whether we can increase teacher compensation by $4.1 million in two years. When somebody brings up a complaint about administration as a reason why we should increase teacher compensation by millions of dollars, they are trying to hoodwink you. You can't by a new Lexis with the savings that you get by eating less ice cream.

Attacking administrative expenses is just one form of deceptive evasion. People want to ignore the facts and sort of change the subject with personal attacks and non sequiturs. Another form of deceptive evasion is to attack personalities. Its an evasion to attack board members, the superintendent or his cabinet. Its an evasion to attack or disparage teachers or their representatives. Notice how this kind of attack cleverly avoids confronting financial facts of life. If every school board member was an evil money grubbing insensitive teacher-hater, the budgetary facts would still be the budgetary facts. Board members, administrators, teachers and their representatives are mired in a dysfunctional system.

We've been asked to cut a huge block of teachers and increase class size to pay for this year's settlement. Our refusal to do that cannot be explained by asserting that we don't care about teachers. Raising class size increases the workload of teachers. Cutting 50, 60 or 100 teachers isn't a favor to those teachers, and its not a favor to the teachers who will be left to carry the larger load. And even if we do that, what are we going to do at the table in two years when we are asked again to increase compensation at a rate faster than the state increases revenues. And what are we going to do the time after that?

If we really care about education, if we care about teachers and students, we need to start addressing the financial crisis in a more thoughtful, visionary way. Pretending that you can increase a $50 million budget item by 8% by making cuts in a $3.6 million budget item isn't thoughtful and it isn't visionary, its a deceptive evasion.

No Teacher Settlement in Sight

It has become reasonably clear that St. Cloud school district and its teachers union will not arrive at a settlement before January first of this year. We find ourselves millions of dollars apart, many millions of dollars apart. People tell me that we should go into a room and negotiate day and night, until we come to a settlement. Believe me, if I thought that going into a room for days would make a difference, I would. I spend a good bit of my career, trying to settle controversies through settlement. But sitting in the same room for hours cannot bridge an unbridgeable gap. The issue is more fundamental.

By our calculation, to fund the increased compensation expectations of teachers representatives this year, would require us to cut nearly 10 percent to 15 percent of our teaching force, raising class size, and eviscerating our schools.

Over the last several weeks, it has become increasingly apparent that the teachers union's bottom line was going to be several millions of dollars beyond our reach, probably more than $4 million beyond our reach. Consequently, a number of board members have begun to seek advice and counsel of citizens, community leaders and of course their own conscience. Why would we do that? The answer is that public education is a public trust. Its future belongs to the public, and the decisions we make are publicly accountable.

Transparent Budgeting
During the last year, the Board of Education and the Superintendent spent months involving the public to discuss budget adjustments for the 2009-2010 school year, and then we conducted another round of public discussions to consider the budget adjustments for the 2010-2011 school year. We held meetings at schools. We asked principals to discuss proposals with their staff. We had several board meetings to discuss options and sought input on our website and in person. The public budgetary process focused on the need to find about $700,000 of budget adjustments, some of which involved new revenues. As we proposed these cuts, we heard compelling pleas from teachers and others to avoid unnecessary cuts. Even those relatively small cuts were unpopular and drew criticism. As we did this, parents universally urged us to avoid increasing class-size. Virtually everyone told us that it was really important as well that we maintain the commitments we made to the public when we campaigned for and passed the operating referendum.

Sustainability Principles

The Board of Education has come to believe that public education is not sustainable, if we continue to operate public schools on the theory that every year we will raise compensation faster--significantly faster--than the State increases revenues. Over the last decade, all over the state, boards of education have felt compelled to raise compensation by more money than they have, and make painful and damaging cuts. When the State provides relatively generous funding increases, the rate of compensation increases across the state are even higher. When the state provides no increase at all, or as in this year, actually cuts revenues, then school boards feel compelled to reduce the rate of compensation growth, but still the rate of growth is significant. Boards make up the difference by cutting critical programs, by raising class size, by increasing fees, by cutting back on textbooks and school libraries, by cutting necessary administrative staff, or delaying needed repairs. Or, they go back to the public and ask for an increase in operating referendum support. Whether this is wise is a matter of great public importance.

You don't need to be a mathematical whiz to calculate the result should this trend continue unabated. If compensation consistently rises at a rate faster than funding, the destruction of public education as we knew it is inevitable. At some point, school boards are going to have to draw the line and keep compensation growth and funding growth at the same level. A lot of people would like to put that painful truth off until next year, or maybe the year after. But at some point, the mathematics catches up with you, and our board of education has decided that the date has come. We're not going to kick the can down the road any more. Its time to face reality in public. As a community we must choose between sustainability principles, or recognize that we are dismantling public education. That's the sustainability choice that we face.

When we decided to propose the closure of Wilson school, we engaged in numerous public meetings and sought the input of staff, parents, and the general public. We're still not done with that process, because we will be scheduling a public hearing early next year. My point is that this cutting took place in a public environment and for good reason. The decisions that we make, and the reasons that we provide for what we do need to be transparent and publicly accountable.

Transparent Bargaining
Some people would have us now go into the back room in a closed board session and decide to cut another $4 to $5 million out of our budget, and to do that in private, to find more money to increase teacher pay. They think that bargaining is a private matter. And there are a lot of good people, school board members, superintendents, and teachers representatives, who really believe that bargaining and the issues that surround it should be a private mystery, like the election of the Pope, conducted in the conclave in absolute secrecy, until the white smoke appears, and the result announced. "By some mysterious process, in private session, we have decided to drastically modify our budget, the consequences of which we will make known to you in due time."

I feel that would make a mockery out of our commitment to transparent governance. But there is a more nefarious consequence of making huge consequential decisions impacting the future of public education in secrecy. And, it is the same consequence that follows when any element of the public's business is done outside of public view. It deprives the public and policy makers of the information they need to understand how local government is actually functioning. As a parent of three school children, I was constantly amazed when our school board would announce that mysteriously next year's budget would be several millions of dollars short. "Why can't you live within your means," I wanted to yell out, as I know some of you are wont to do. "This year we are cutting a little music here, some middle school athletics there, a gifted and talented program, and cutting back on text book acquisition." How did that happen? When consequential decisions are made in the back room, shrouded in secrecy, it becomes impossible to develop a consensus behind a comprehensive solution.

Respecting Educational Professionals
The worry about discussing these issues in public is that some folks will come out of the woodwork and use it as an excuse to attack educational professionals. And to them, I say, that would be a shameful thing to do. This pressing problem should not be an excuse to attack anyone, and above all, should not be an excuse to disparage teachers. We have great teachers. They work hard and deserve to be paid well. Two of the members of our board are retired teachers. Three of us have substantial high school teaching experience. One teaches classes in the school of education at SCSU. Another teaches nurses in college. We have a former teacher union leader on the board and a former union bargaining representative. There is probably no board of education in Minnesota that is more committed to the concept that teachers deserve to be well compensated. It is not productive to frame this issue as whether they deserve a raise. The issue we face is whether it is prudent when the state is suffering a budgetary crisis, to cannibalize our teaching force, to lay off younger teachers, to pay the ones who remain. Sometimes people say to me "why don't our teachers have a contract." I answer, if we agreed to cut teachers to fund a settlement for other teachers, then there would be a whole lot of teachers who have no contract at all.

Now listen, there are two sides to this issue. A number of school boards have decided to make slashing cuts in workforce in order to raise compensation. Maybe they didn't explain the consequences to the public, but let's be clear---when you raise compensation without increased revenues, where the heck do you think the money is coming from? These boards have reasoned that it is better to cut public education than to continue the strife and discomfort that visits a school district where the contract has not been settled. Our board of education, and many others around the state are taking a different course. And that is why we have begun to seek the counsel of citizens and community leaders.

Which of these courses do you want us to take? Neither course is an easy one. One course leads to an early settlement, followed by deep cuts, cuts four to five times as deep as the cuts we just made with a lot of pain and hand-wringing. Those cuts will be followed by more the following year, and more the year after that. Because when you adopt a policy of regularly cutting to increase compensation, the cutting never ends. Perhaps the course that some boards are taking will be better in the short run. But it is undeniable that going down the unsustainability road ultimately will fail. At least, by staying sustainable, we have plotted a course that has a chance to work.

So with respect, I look forward to hearing from citizens on which of these courses is the correct course. I will tell you that if you use this as an occasion to tell me that you are angry at teachers, or don't think they work hard, or any other bunk like that, it will have very little impact on me, because that's not the question of the hour. We have good, hard working teachers--some of the best. We wish that the legislature had provided the funding necessary to provide increases: we wish that the economy was not in the tank. We wish that unemployment wasn't over ten percent. The issue is whether it is sound public policy to fund compensation increases out of massive cuts, or whether compensation increases must come from the State of Minnesota, as the Constitution intends.

Compensation Reform Ain't Easy: Maybe its politically smarter to just keep our heads down

Today's Times (that's St. Cloud Times) contains a story on our settlement with the administrators to transform longstanding benefits systems. I want to start by acknowledging the cooperation of the administrators in assisting with this difficult transition. When you work under one system, changing to a new system requires a lot of hard work. From the outside, its easy to say, just change the system: get it over with. But the fact is that most school districts have not been able to accomplish that objective, because it is so hard. It may sound a bit whiny, and for that I apologize, but there are times when you feel like it would be politically smarter to just leave things alone.

We've been trying to wean ourselves from a system that accrues benefits now, but pays for them in the future, a system that is very common in public entities. The city of St. Cloud and many school districts in Central Minnesota have significant accumulated post-retirement benefits, including health and leave cash out benefits, that were agreed to many years ago. Some people would say, well just get rid of those benefits. Do it tomorrow. But people have worked under these systems for decades. They have planned their future around them, and have been attracted to school districts and cities as a result of these benefits. Moreover, Minnesota law protects public employees and requires public employers to bargain about these benefits. The representatives of employer groups have an obligation under labor law to represent their members effectively; they can't just lay down and die, and of course they don't. To make a long story short, the new system that we have adopted is a substantial advance over the old. Its a transition that the Board of Education has been trying to make for a number of years, and its a transition that many cities and school boards in the area still have not made.

But that's not really what I wanted to write about today. I wanted to write about the political question whether it is politically smart for school boards to take on tough questions like this, or whether we would be better off, politically, to just let them lie unaddressed.

There are people in the world of public education who argue that its a bad idea to try to fix things that need fixing, because it just brings attention to the fact that the fixing was necessary. Dummy up, they say. The only way you get into trouble is if you try to address a difficult problem. This idea is not unique to education. I started out practicing law for the airline industry. They had an unwritten rule that you didn't talk about safety improvements. That would just make people realize that the last time they flew, the airplane wasn't as safe as it could have been. So now you have people arguing about why planes are unsafe, instead of celebrating that they are safer. Dummy up. Don't talk about safety and nobody will worry about it.

A lot of people make the same arguments in public education. Look. They say. The school districts that don't confront their intractable problems don't get in the newspaper for not doing anything. It's only if you do something that you get bad publicity. If you have major problems in your curriculum, for goodness sake, don't talk about it too much. Even if you make necessary improvements, the publicity is going to be nothing but bad. People won't remember the success that you achieved; they only remember the fight that ensued when you tried to make the reform. If there are problems in your compensation structure, you're probably better off letting sleeping dogs lie, because the public discussion isn't going to do anybody good. If you fix it, people will say, why didn't you fix it sooner. If you don't fix it enough, then people aren't going to celebrate that you made progress, they're going to trumpet the fact that you didn't fix it enough.

Now listen. When we passed the OPEB bond issue we asked our administrators for a sunset agreement. If we hadn't done that, nobody would have ever thought to discuss the issue in public. When we took an inventory of the districts who don't have a sunset, even with their teachers, let alone their administrators, it was amazing the number of school districts that hadn't even taken a run at trying to address the problem. But those districts aren't in the news. And probably, they are a whole lot smarter, politically, than we are. This year, school districts all over the state had an opportunity to make improvements in their post-retirement benefits structure. But the districts that didn't do anything stayed out of the newspaper. Now who is politically smart, and who is politically dumb. Leave well enough alone, and people will leave you alone. Evidently that's the rule.

Last week, the Board of Education adopted a memorandum of understanding with its professional school administrators, that is our principals. There are two features to that agreement. One of them has gotten a significant amount of media coverage, and was the subject of an editorial in the Daily Times. That's the issue of post-retirement health contributions to our administrative employees. The second has gotten almost no attention in the media, but it was equally important. That's the subject of changing the structure of payment for accrued leave. In both cases, we dramatically improved the structure of compensation. The improvement had nothing to do with increasing or decreasing the cost of compensation. It was about changing the structure so that it fits with modern compensation principles.

The public has a right to scrutinize whether we made a good deal for the taxpayers or a bad one. So I have no call, really to whine when that happens. We've gone down a road here in St. Cloud, to try to present our issues publicly, and to try to explain them. The price that we pay when we do that is that some people will not agree with the way that we've solved our problems. At the end of the day, I think we are better off putting these issues on the table, even thought some folks use them as the occasion to beat us up, than if we just try to stick our heads in the sand and leave well enough alone.

Some people misunderstand these compensation issues deeply. They like to use it as an opportunity to beat up on professional educators. That's shameful, because there is no call to do that. Maybe they got disciplined by an administrator when they were a student. Maybe they listened to union propaganda, or taxpayer league propaganda, trying to convince that if we would just cut administrators, the district could balance the budget. But the fact is that overwhelmingly, the educational research is telling us that school transformation begins with school administrators. This issue isn't about who is overcompensated. The issue is about putting your compensation structure on a sound basis so that when you properly reward quality people, that you aren't doing it with funny money that will have to be raised in the future.

Several decades ago, when school districts were growing, someone hit on the idea that you could attract better administrators (and teachers) for less money out of current dollars if you would offer them benefits when they retire--some thirty or more years later. What a wonderful idea theses people hit on. Hire good people now by offering benefits that could be paid three decades in the future. The boards who did that believed that school districts would keep growing and growing. There was a baby boom on, they thought that in thirty years there would be way more younger employees than older employees. They built a compensation pyramid where, they believed, there would be way more new teachers and new administrators coming into the district, than retired teachers and retired administrators going out. And if they had predicted the demographics correctly, everything would have worked out great. They didn't predict the skyrocketing medical costs. They didn't predict the falling birth rates. They didn't predict the huge increase in life expectancy that would completely change the ratio between children, adults of working age, and the retired.

Now over the years, educators came to school districts planning their future around the existing structure. They aren't the only ones who have been surprised by the new realities. Private companies have been confronted by similar problems, as their pension plans proved inadequate to meet the retirement expectations of their employees. All over the country, private and public employers are confronting this new reality, and some are confronting the problem now, and some are not. If we beat up on the public employers and their employees who are working hard to confront these issues, and give a free pass to the ones who are not, what lesson do you suppose is going to be taught?

The memorandum that we signed with our administrators last week was not designed to decrease the current compensation of anyone employed by the district, it was designed to significantly change the structure of compensation so that it would be more fair to the district over the next decades, and we accomplished that objective. We have now sunset the post-retirement health benefits for all of our bargaining units. Keep in mind that a huge block of school districts, big and small, have not implemented any sunset agreements. Some of them are right here in central Minnesota. But they have kept their heads down and so let's not talk about them.

The other thing that we have done is to change a system that was implemented many years ago with respect to compensation for unused sick leave. Once again, our primary goal in these discussions was not to lower current compensation. but to change the structure to make it more transparent, more accountable, and subject to reasonable limits. Our primary goal was to stop passing the compensation buck to future generations and future school boards. With the cooperation of our administrators, we revised the system so that caps were installed that provides more long term protection for the taxpayers of the future. The school board ten years from now is going to mark this date as a substantial improvement in how we managed our compensation system. One of the defects in the leave accrual systems in public employment is that unearned leave is paid at the hourly rate earned by the employee when he or she retires. The reason that school boards used to adopt this system is that they could provide a benefit now that would only get paid out of future revenues. Its much smarter and more fiscally sound to fund the benefit immediately at the current hourly rate and allow the employee to invest the funds. When you are forced to pay for benefits as they accrue, instead of paying for them out of a future generation's revenues, you are much more likely to take the cost seriously.

No. We didn't eliminate administrator benefits. That wasn't our purpose. And why would we want to do that anyway? Attracting and retaining quality administrators is one of the keys to educational success and transformation. We weren't trying to take away benefits earned over the last two decades, benefits offered and accepted over those decades. Our goal was to implement a smarter, more controlled system that places the benefits we do pay on a pay as you go system. What we did, compensation experts will tell you was a great step forward for the long term solvency of our school district.

Listening to citizens on facing the crisis in public education finance

As public education faces a financial crisis, I've been trying to talk to citizens, and community leaders, to get a sense of how we on the Board of Education should be approaching our challenges. What I am hearing is that the community expects us to face the reality of the crisis that is impacting employers and employees.

According to an article in the Minneapolis Star Tribune, total wages in the United States are down by 4.5%. In Minnesota, total wages are down 5.5%. Projections for next year’s State budget are for a $1.16 billion revenue shortfall caused largely by a drop in income tax receipts. An estimated 224,000 Minnesotans have lost their jobs since the start of the recession. The Management and Budget office estimates that 90,000 more were forced to take part-time work because of hourly cutbacks at their plants or the inability to find full-time jobs after layoffs. The owners of businesses are living on the edge, many of them worried that they will not be able to keep their businesses afloat. Employees of many of our lunch-bucket companies, printing, machine tools, the construction trades and construction suppliers, have been laid off, and many are fearful that their unemployment compensation will soon expire.

People are telling me that commercial real estate is under stress. There is a glut of unsold residential real estate and we hear pessimists in the residential construction trades contend that its going to take a number of years before the stock of unsold homes has been absorbed by the market.

People are telling me that unions in the private sector are giving back wages and benefits, or turning paid vacation into unpaid vacation, or both. They say that one of the major impacts on middle income workers in the construction trades and manufacturing has been the loss of overtime work. Overtime work pays time and one-half and provides a significant portion of many of these workers' income. The value of many retirees or those who are soon to retire has fallen. Retirees who were invested in stocks suffered terrible losses, although if they held on to their stocks, their values are coming back. Retirees who were invested in "safe" interest bearing investments have suffered a significant loss in the rate of return on various forms of interest bearing savings. The vast majority of Minnesotans who have jobs are thrilled to be employed, and even more thrilled if they are lucky enough to be keeping the wages that they earned last year. Commissions are down for people who work on commission. Bonuses are way down, or completely non-existent, for people who get year-end bonuses. Contractors who several years ago had booming businesses are struggling to keep out of bankruptcy.

On TV, the economists are telling us that we are beginning to see a potential turnaround, but we know that when the turnaround begins, it takes a long long time before the turnaround trickles down to real people.

This places extreme stress on those of us on school boards whose job it is somehow to communicate across the boundaries of education and the rest of Minnesotans. In the rest of Minnesota, people are saying, well, they are lucky to have a J.O.B. People are telling me, "Don't you guys in education know that there is an economic crisis underway?!"

I've often felt that the public would benefit by taking a field trip to the classrooms of teachers so that they can get a better sense of the challenges teachers face. I really do believe that those folks who have never taught, have no idea how hard teachers work, how many extra hours they work, getting lessons ready, grading papers, assimilating new curriculum, and adopting new techniques. There is a gap between the world outside of education that fails to understand and appreciate what goes on in the classroom, and what educators actually do.

But there is a similar gap in understanding about the economic risks and challenges faced by non-public employees and entrepreneurs. In times of recession, I think it might be beneficial for public educators to take some field trips of their own, to talk to laid off employees, to meet with small business owners who are struggling to keep up their leases and loans, to sales people pacing the floor in empty salesrooms, or to visit the homes of middle income workers seeking to balance their budgets under duress. There is a communication gap in education right now, that is clear, and we need to figure out a way to close that gap with a herculean effort to understand each other.

Some school districts have large fund balances accumulated over the years to ride out storms like this. Our school district had a modest fund balance for its size -- $6 million -- in 1999. But in the next four years, the district spent the fund balance down completely, so that by the time that I arrived on the Board of Education in 2004, the fund balance was negative. Now, we hear rumors that the governor may have his sights on school district fund balances as a way of helping the state ride out the financial storm. When I talk to citizens they are telling me that we board members need to make decisions that reflect what is happening here in Minnesota, and if we do not, precious few are going to understand.

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.

Turnaround Schools

Periodically, I read something that captures important insights so well, that I feel the need to write about it to the point of near plagiarism. I write today about Allan Odden's recent article in Education Week. One of the leading centers for educational thought is found at the University of Wisconsin's Center for Educational Research. I like reading their work, because it seems to be consistently thoughtful, and consistently bereft of the sense of pandering to the educational industrial complex that one finds in think-tanks that derive their funding from organizations with a point of view. A recent article in Education Week by its Director Allan Odden, caught my attention as being particularly appropriate as we confront pressures from the Obama and Pawlenty administrations to exchange reform for funding. The article, entitled "We Know How to Turn Schools Around."

Now right away, I have to caution that when we talk about turning schools around, we are using language that seems to suggest that the schools and teachers are the problem, that they have done something that merits re-probation and failing marks. Sometimes this is true. There are schools, especially in major metropolitan areas where the staff is not qualified, where leadership is completely ineffective, where the curriculum is embarrassingly weak, and where the resources are so limited that the school itself is a huge part of the problem. These are schools where turning everything upside down and starting from scratch might make sense. But we don't have that problem in St. Cloud or anywhere in Central Minnesota.

We have a teaching force that is capable of taken young people to the highest levels. They are smart, highly qualified and dedicated. The challenge that we face in St. Cloud is a change in the readiness of many of the students who are coming to school. So we need to start with two central propositions. We have great teachers and great programs. The reform that we need to do is not a negative reflection on them; it is driven by the fact that we have an obligation to take the children who come to us and deliver them to excellence on graduation. We are meeting the needs of most of our students; the majority of our students are doing way better than students did when I was in school. They write better; they know more science and math, and they achieve far beyond anything that we dreamed of achieving.

Odden argues that we know how to make the changes we need to make. He characterizes this as a recipe for turning schools around. I would characterize the principles as helping us to change directions to respond to a changing student population. Odden identifies 5 components of reforms leading to excellence:

Sense of Urgency: "The first step is to create a sense of urgency. Such heightened awareness of problems and their impact emerges when teachers and administrators analyze state student-performance data together and become more informed about the academic effectiveness of their school and district."

Setting Ambitious Goals: The next step is setting ambitious—some might call them eye-popping—goals.

Reform Curriculum and Implement Best Practices: "to build, over time, a common understanding of effective instruction. Districts that move the student-achievement dial by large amounts have a systemic view of curriculum and focus intensely on instructional practices shown to work—and they require all of their teachers to use them."

I want to pause here to emphasize this point, because it is so important. It represents a paradigm shift for some of us. When all students come ready to learn, we can run our schools on a different model, a model in which teachers have a high degree of autonomy. But when a significant number of students are coming to school not ready to learn, albeit still a minority of those students, we cannot assure success for all students, unless all teachers adopt and adhere to best practices. Does this mean that teachers must become educational automatons, educational vending machines? Not at all. Best practices may look differently in different classrooms, because teachers have different strengths. You can't make professionals effective by making them all do exactly the same thing in exactly the same way. But we can expect that, using their individual strengths, they adhere to best practices and achieve best possible results.

Move beyond a concentration on state tests and use a battery of assessments, including formative and diagnostic assessments, common end-of-curriculum-unit assessments, and benchmark assessments. Formative and diagnostic assessments hone instructional strategies before each curriculum unit begins. End-of-unit assessments not only measure what students have learned, but also compare the effects teachers have had across classrooms. Benchmark assessments gauge overall student performance every nine weeks. All of these enable teachers to make midcourse corrections and to get students into interventions earlier.

Creating and implementing an intensive and ongoing professional-development program. The best districts and schools form collaborative teacher teams—professional learning communities—that meet often, make use of student data, and work with school-based coaches to improve curriculum and instruction. These schools and districts also include intensive summer institutes in their professional-development plans, to allow teachers opportunities to gain new knowledge.

So here we are again. At the center of reform is collaborative teacher teams. This is the DuFour approach that I've written before, but packaged in somewhat different language. Over and over again, we keep hearing the same story from leading researchers.

But teacher driven team based collaboration does not occur in isolation, and this is important. The teacher driven teams are part of a complete district wide team, led by principals and executive leadership whose focus is on educational excellence.

Leadership in successful turnaround systems is “dense.” Teachers lead grade- and subject-based professional learning communities. Most of the instructional coaches are the school’s best teachers, and they orchestrate the overall professional-development system. And principals provide real instructional leadership. Moreover, these districts also have instructional leaders in the central office who know how to support schools and teachers and can help create the systemic approach to curriculum and instructional practice needed.

In order for public schools to transform themselves to meet new challenges, we need a new vision of professionalism, based on teamwork, on leadership, and on collaboration and on accountability:

Turnaround schools and districts are professional in the best sense of the word. Their staff members read the most recent research, reach out to experts in the field, look for and use best practices, and take responsibility for assessing the impact on student learning of what they do, improving instructional practices when student results are not what’s desired.

Don't Pass on Race-to-the-Top

Yesterday's Minneapolis Tribune carries an Editorial on Race to the Top arguing that "Stakeholders should set aside differences in spirit of innovation." Race to the Top is a new multi-billion dollar fund provided by the Federal Government to challenge states and districts to reform. Unfortunately, Race to the Top has become mired in education politics. The reasons are both simple and complex. Like every other administration in the last several decades, the Obama administration has come in with fixed ideas on what must be done in public education in order to "reform" education. Some of the ideas are good, some are terrible, and some are untested and unproven. Many of the ideas are driven by the belief that we should treat all school districts as if they were failed dysfunctional schools like those found in the most troubled areas of major cities. Some are influenced by the emerging charter-industrial complex of lobbyists and who are seeking to turn education into a trillion dollar private industry. The Obama initiatives, in fact, are not all that different from the Bush initiatives, because they derive from the think-tank bureaucracy of the beltway.

Those are all faults, but there are many positives in the reforms and above all, the Race to the Top funding provides desperately needed funding for those parts of education that needs the most improvement and reform. The editorial warns us:

Last week's forecast that more billion-dollar budget deficits are on the horizon in Minnesota doesn't bode well for any institution that relies on state aid. And though state lawmakers protected the $12 billion-plus K-12 education budget from deep cuts this year, that probably won't happen in 2010.

As teachers organizations across the state campaign for large compensation increases, most citizens cannot understand why they would refuse to cooperate with funding opportunities like Race to the Top. Yes, the funding comes with problems and flaws, but nothing is perfect. We have become mired in Minnesota in a philosophy of "my way or the highway," instead of putting the future of our children first. Leading democratic legislators and statewide candidates have been strangely silent, almost AWOL, on these issues. Leading republicans see this as an opportunity to pander to the worst instincts of Minnesotans. The Governor seems poised to use the failure of public educators to seize this opportunity as an excuse to inflict further unilateral cuts to education.

In this time of financial crisis, we are witnessing bankrupt behavior. Problem solving by pandering, picketing, and punting. Its time for the adults in politics and education to put aside destructive behavior, reach out and make the best of the opportunities we have. As the editorial rightly states:

In some states, resistance to reforms from special interest groups has hampered the application process. Minnesotans should expect better from their educators, legislators and teachers. We urge stakeholders in education to set aside partisanship and turf battles and work together on a grant proposal that is best for kids.

Successful Schools Require Teamwork and professional learning communities

One of the great issues in public education today is whether education is going to be delivered by teams under the Professional Learning Community model championed by DuFour and others, or whether it is going to be delivered under the university model in which the teacher is an autonomous teaching professional. Overwhelmingly, the best minds in education are coming to realize that we can get the most out of schools when they function on a teamwork model. The more teamwork the better. A great public school system requires everyone to work together, to get the most out of everyone. When a student comes to school, the student arrives with the accumulated capabilities provided to him or her imparted by parents. The differences in readiness are significant. Some students come to school with a vocabulary of about 600 words. Some students, the same age, come to school with vocabularies of 3000 words. When children arrive in kindergarten, some are fully prepared to learn. They already have the emotional intelligence that allows them to work productively in class. Other children arrive in school completely unready, undisciplined, a handfull if you will.

In each grade, students come to teachers in vastly different states of readiness. In urban core school districts, the range is especially broad. In our school district, here in St. Cloud, the upper quartile of students are significantly ahead, many of them, of neighboring school districts. They are taking harder courses; they are bound for engineering schools, pre-medical programs, top universities and colleges. In the bottom decile, we find children further behind, often. Students who speak no English. Students whose parents never read to them.

When I taught school, I might have two sections, say, of European History, or of algebra, one after another. (I taught social studies and mathematics, in different years). Thirty kids in my first period class might be fabulously talented, as a group, and hungry to learn. The thirty kids in my second period class might be unprepared to read the material for social studies, or fundamentally unprepared to do the basic mathematical operations they needed to perform to succeed in my class. My success as a teacher, in terms of the test scores of my students was radically dependent upon the success of the teachers who came before, the parents, and above all upon the students who were assigned to me.

In the last decade, the most significant evolution in education has been the recognition that public schools can be much more successful when teachers work together in what DuFour has called professional learning communities. DuFour's professional learning communities are not mere study groups, but teams that make proper just in time use of data including testing, and a relentless pursuit of quality. The teams start with a zero tolerance approach to failure and insist that students do their work and do it well. In a great community school system, teachers, administrators, parents, and students form a learning community dedicated to learning and the success of of one is the product of the hard work of everyone.

When I use the phrase "professional learning community," it leaves a bad taste for some, because they think of it as used in other contexts. The DuFour idea is that the adminisistrator of each school is a leader of a team. Not the dictator, but a leader, using modern collaborative leadership techniques that begin with inspiration, collaboration, modeling, listening, and a sense that the school belongs to everyone.

This model is threatening to some who raised up under a different model of public education, in which teachers were isolated in their classroom, free of scrutiny, and basically on their own. In return for the isolation, teachers got autonomy. They want to "take back the classroom" and maintain the old isolating model in which teachers are autonomous. Under this old model, teachers were largely unobserved, largerly free of supervision, kings or queens of their classroom, but mostly alone. Newer teachers, and frankly quite a few of the best older teachers, are much more accustomed to the teamwork idea.

They are energized by the concept of being part of a broad team of education professionals working together. They enjoy having co-teachers in the classroom. They recognize the benefits of team planning, the support that comes from quality educational leadership, the use of just in time testing data and "response to instruction" strategies. If public education is going to succeed, the teamwork model must prevail. The true "Professional Learning Community," described in DuFour's early book Professional Learning Communities at Work is teacher empowering by making the teacher part of an integrated school wide professional learning community with a visionary collaborative educational leader at its head. The professional learning community uses teamwork to assure that students learn.

Study Commission Report Calls Upon us to Take Courageous Action

I've been writing on and off about the need for courageous action by leaders in Minnesota at all levels. These days courage is hard to find among political leaders. Perhaps one of the reasons is that our political system is increasingly structured around the perception of elected leaders that in order to survive politically, they must maintain the active financial support of their base, and especially their highly motivated campaign funding base. It is not courageous for Republicans to champion the cause of reduced taxation. It is not courageous for Democrats to champion the cause of more funding for governmental services and governmental workers. Courage involves reaching beyond one's base, and doing what needs to be done. Nixon, for all his many faults, had the courage to go to China, despite the anger of his political base. Truman had the courage to fire MacArthur to preserve the principle of civilian control of the military. Clinton, for all his many faults, had the courage to reach across the aisle and balance the budget with a package of spending controls and tax increases, an act that led to balanced budgets and years of sustained growth.

One act of courage from our political leadership would be to reach across the aisle and develop a solution to the structural financial problems facing Minnesota in the next decades. Report after report warns us that Minnesota faces a long-term fiscal crisis that can only be solved by a combination of actions on the revenue and expenditure sides. One of the more recent such reports is the 2009 Minnesota State Budget Trends Study Commission. The Commission, authorized by the legislature, was comprised of fifteen members including five members appointed by the governor; five by the senate and five by the house. The Commission Report explains that "Minnesota has a long-term structural budget problem, with long term expenditure growth likely to outpace revenue growth." The first finding of that report is that Minnesota is currently experiencing a major, long range demographic shift which has grave economic consequences for the state, unless we act courageously.

Today, as the first of Minnesota’s 1.4 million baby-boomers begin to reach retirement age, the state has reached an inflection point - a moment of profound change that produces an immediate shift from recent trend. This milestone requires a complete reassessment of the way the state’s economy is perceived. No longer can Minnesota sit by and watch as the crest of this giant aging wave grows larger. As Minnesota’s population begins to transform, new, long ranging factors will begin to weigh more and more heavily on the state’s tax base, spending needs, and overall economic progress. The wave is beginning to break and policymakers have not adequately prepared for the overwhelming implications this will have on state government finances.

The report continues:

A rising dependency ratio will have profound implications on virtually all aspects of state and local government. For instance, a larger dependent population will put upward pressure on government expenditures. Dependent populations rely more heavily on health care, education, economic assistance,and social service programs. .....Current trends signify that by 2020 the number of seniors in the state of Minnesota will exceed the number of school age children for the first time. However, this change is due to the unprecedented number of individuals reaching age 65, not to a drop in the school age population. Over the next twenty years, the number of school age children in Minnesota will actually be increasing.

In 1999, the State of Minnesota, flush with cash from the growth during the Clinton Presidency, adopted a series of fiscal measures that threw state government into permanent financial chaos. The government rebated a significant share of the accumulated surplus with one-time payments. At the same time, the State adopted permanent reductions in the tax rates, combined with permanent increases in spending. The result was not merely a reduction in our surplus, it was the creation of a permanent long term structural deficit. Hence the Commission's finding number 6, that:

Finding #6: Minnesota has a long-term structural budget problem, with long-term expenditure growth likely to outpace revenue growth.

What happened following these structural changes? The answer is that during this period, Minnesota experienced one of its most significant economic declines relative to the rest of the nation. We have experienced a decline in our infrastructure, a drop in the national rankings of our K-12 and post secondary education system, and a decline in our relative economic performance as compared to the rest of the nation.

What is causing this structural deficit. The answer is primarily ballooning health care costs, the largest component of which is health care for the elderly.

Growing at an average annual rate of 8.5 percent, state payments for direct health care services are the fastest growing segment of the state’s budget and consume a greater share of available resources each year. State health care programs face many of the same cost pressures that exist in the private health care market, including medical inflation and increased utilization of services spurred in large part by the development of new medical technologies, services, and pharmaceuticals to treat illnesses.

In the absence of structural reform, on both the revenue side and the cost control side, health care costs alone will drive the state into bankruptcy. This problem will not be solved as long as Democrats campaign only for the revenue part of the solution to this problem and Republicans campaign only for the cost control part of the problem. Each of our structural problems require each party to "go to China" as it were and to shape a grand compromise that solves our structural problems with courageous action.

To read the report click on this link: Commission Report

Atlantic Century Report warns of Competitiveness Decline

Yesterday, CNN's outstanding Sunday news magazine, GPS with Fareed Zakariah, referenced a new report on global competitiveness, the Atlantic Century Report. There are many such reports, and so you have to take each such report in context, considering whether the report has any bias and drilling down to determine its methodology. Above all, one must be ultra cautious in sezing on a study or report that seems to vindicate views that you always hold.

This new report sounds an alarm regarding a possible decline in United States competitiveness, especially in the areas of technology, innovation, and the role of advanced science and engineering degrees in maintaining our competitive edge. The port points out that some recent reports have argued that our competitive edge remains strong. But, the authors argue, that there are disturbing signs that in recent years, other nations are catching up with us. The report uses a scoring system to report competitiveness (see at the bottom of this post);

In the last few years a number of studies have assessed countries’ global competitiveness. Many of these have found that the United States is the world leader in international competitiveness. Such rankings have led many observers to claim that calls for concern or questions about the U.S. competitiveness position are unwarranted. For example, the World Economic Forum’s report, The Global Competitiveness Report 2008-20097, ranked the United States first in global competitiveness two years in a row.
Innovation and productivity are supported by a highly educated workforce, so higher education attainment has become an important component of economic success, particularly in higher wage nations that can compete less effectively in lower skilled, routinized work.......

For example, the United States leads Europe in terms of higher education attainment, with EU-15 (the broadened definition of the European Union) levels 77 percent of U.S. levels and EU-10 levels just 57 percent. But the report argues that in the last decade, the trends are in the opposite direction:

When it comes to trends, however, the picture is quite different. The United States ranks last, with almost no increase since 1999. In contrast the share of 25- to 34-year-olds in the EU-15 with a tertiary degree increased by 25 percent, in part because of very strong growth in nations like Ireland and the United Kingdom. In addition, some EU-10 nations increased even faster, including Poland (117 percent).

The report continues:

"Europe and the United States vs. the Rest of the World: Despite the fact that the United States led for many years in higher education attainment, it no longer does. In fact, Russia leads with an over 40 percent higher rate, while Canada, Japan, and South Korea lead the United States by over 30 percent. And all four have attainment rates over 70 percent higher than EU-15 rates. Most developing nations have much lower rates, with rates in Brazil and India below 30 percent of U.S. rates. Europe vs. the United States: Europe lags behind the United States in the number of researchers, with the U.S. researcher intensity over 55 percent higher than the EU-15 and twice as high as the EU-10. The strong science and technology base of the United States economy established after World War II and reenergized with strong IT and biotechnology leadership more recently means that the United States is among the world leaders."

When it comes to trends, most other nations are making faster progress than the United States. Perhaps not surprisingly given its concerted push to be a more technologically-based economy China grew the fastest, with its share of researchers more than doubling. But other lagging nations also experienced rapid growth, with Mexico almost doubling (98 percent); Brazil up two-thirds, and India up 50 percent. A few nations such as South Korea and Singapore that had relatively high levels of researchers in 1999 made rapid progress, increasing by approximately 70 percent. Finally, Japan and Canada both outpaced the EU-15 and the United States.

Here in Minnesota, one manifestation of the competitiveness crisis is the fact that Minnesota's labor force growth is shrinking radically at the same time that the number of older Americans is increasing. From 1970 to 1980, Minnesota's labor force grew by about 450,000 according to the State Demographer and State Economist. (Click on link for slide show with charts). In the following three decades, net labor force growth was between 325,000 and 400,000. But now comes crunch time. But the State demographer and economist estimate that net labor force growth will fall to about 150,000 in the decade 2010-2020, and to about 100,000 in the following decade. During the same period, the population and percentage of the population over age 65 will grow significantly.

From 2006-2011, for example, the number of Minnesota workers turning 62 will jump from about 38,000 to 60,000. The number of people who will be doing productive labor will be falling over the next several decades as compared to the number of senior citizens. (This growth in the elderly is offset somewhat by the lower number of children). But still, the rising number of elderly will be a significant challenge will have more people to support than prior generations. To make this work, it is absolutely critical then that we invest in education that allows you, and your children to be productive.

In a prior post, I argued that our failure to maintain a strong education infrastructure endagers our competitiveness as a nation.

One manifestation of the crisis in education may be illustrated by thinking back to what has happened to the cost of going to college. Back in 1957, tuition at the University of Minnesota for the whole year, 1957, was $111. By the time I graduated from high school in 1963, tuition for the full year had rise to $255. If you take that inflation adjusted $255 into today's dollars, the tuition would be only $1744. It's actually over $10,000. The cost of attending Minnesota's major public university, which was founded to provide a quality college education to average citizens, has grown by over 5 times, in terms of constant dollars. We are making it vastly more difficult for this generation of young people to attend college than for my generation. How did this happen.

By the time that I graduated from college, one year tuition was $294. When I enrolled in Georgetown Law school, tuition at U of M had risen to about $504. The tuition at my private university law school was about $2600. I could work my way through law school on summer jobs. Minnesota's spending per capita on higher education peaked in that year, 1972 and has been falling ever since. Minnesota's ranking among states in state funding for higher education dropped from 12th in FY 2001 to 35th in FY 2006, as a share of personal income. And although Minnesota is below-average in state funding for higher education, it is above average in the cost of attending public institutions.

The current full year tuition for undergrad at the University of Minnesota $10,320, Law School. It costs $21,000 to attend the law school for a year, and at my alma mater, Georgetown Law it now costs $39,000 per year. According to MNSCU statistics, the state appropriation per MNSCU sudent, adjusted for inflation, has decreased since 1999 while tuition has increased 57%

What was the University of Minnesota like when tuition was only $255 per year. In those years, Dr. Lilihei's team there completed the first open heart surgery using hypothermia. Their efforts led to cross circulation techniques, then to a heart-lung machine and ultimately to techniques that now make open heart surgery almost mundane. Lilihei's expertise led him to train more than 150 cardiac surgeons from 40 nations, including Christiaan Barnard (a fellow University of Minnesota Ph.D. recipient in the 1950s who went on to perform the world's first heart transplant in South Africa). At the University of Minnesota Lillihei and his coworkers also developed the first electronic pacemaker. At the University, when tuition was under $255, the school of medicine did the first pancreas transplant; pioneerered the development of the mechanical heart valves; conducted the first implementation of artificial blood; and implemented the first clinical use of cortisone, the great anti-inflammatory. Without these advances, our medical technology industry, which employed 20,400 workers in 2000, would not exist without the people and the basic research coming out of the university. In fact, from 1990 to 2000 the number of medical technology employees grew 67 percent in Minnesota, while increasing only 17 percent nationally.

During this time, the university spawned and supported growth of other areas of technology. That era witnessed the growth of Control Data, the establishment in the Twin Cities of Cray Supercomputers. U of M grads populated the laboratories of Minnesota Mining and Manufacturing .

Over the last two decades, and especially during the last 8 years, there has been a fundamental change in our ability to sustain the vital educational infrastructure that made Minnesota a center of growth in technology and in the next decades, unless this is reversed, we will pay a heavy price.