When it comes to school districts, small is beautiful

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By David Schwartzman

When it comes to school districts, bigger is not necessarily better. The number of public school districts in the United States has fallen sharply since the early 20th century: declining from 117,108 for the 1939-40 school year to 13,672 in 2014-15. While school district consolidation has slowed in recent years, the general trend continues. This has happened even as student enrollment in public schools has increased due to population growth. Consolidation has occurred largely because state governments have encouraged it. In California, the government has incentivized consolidation in the past by increasing per-pupil funding for unified school districts and paying for higher transportation costs.

Consolidation has some positive effects, as it allows school districts to take advantage of certain economies of scale in providing education. Notably, consolidation may allow for the elimination of local administrative positions and decrease administrative costs. There are indeed some reductions in cost from the elimination of the smallest districts.

However, these economies of scale level off relatively quickly. According to a study by Duncombe and Yinger, the optimal school size for school districts in terms of lowering costs is between 2000 and 4000 students. A Mackinac Center study estimated the cost-minimizing district size to be 2900. California’s average school district size lies on the upper end of this spectrum at 3,659 students per school district as of 2013-14.

Meanwhile, there are significant negative impacts from large school districts. According to UNLV’s Lincy Institute, student achievement is higher in smaller districts than in larger districts. Other drawbacks to large school districts exist as well. According to Robertson’s 2007 study, there are diseconomies of scale attributed to large school districts because they result in stronger teacher’s unions. Larger districts have higher compensation costs and less district accountability.

Besides higher wages and accountability losses, there are also high transportation costs associated with large school districts. As expected, transportation costs go up for students, but  transportation costs also increase for supplies. There are non-financial costs as well. In Huron, a city of 7,000 where many are pushing for separation from the under-performing Coalinga-Huron Unified School District, the nearest high school is 20 miles away. For many, that results in over an hour of travel – all for a school where math proficiency is 35% and English proficiency is 44%. Ben Silva, chairman of the Huron Reorganization Committee, believes the solution is deconsolidation. In an interview with Valley Public Radio, he said, “Our future is not gonna be left to somebody else. It’s gonna be left to us”.

The Huron effort is one of three active school district separation initiatives in California. In a previous article, we discussed parallel efforts in Malibu and Walnut Creek’s Northgate neighborhood.

The push for school district separation in diverse communities suggest that consolidation has failed – larger school districts report worse results. And the US, which has larger school systems than most other developed countries, has poorer educational performancerelative to peers, even as it spends more per-student than any country in the world. Things are particularly bad in California, which consistently ranks near the bottomin performance. Not coincidentally, many California school districts that are larger than they should be. In fact, 32 school districts in California have an enrollment exceeding 30,000, led by Los Angeles Unified with over 600,000 students.

While the evidence indicates that consolidation is ineffective and that smaller school districts are preferable to larger ones, there is less to say about deconsolidation. This is because deconsolidation has rarely been tried. Returning to smaller school district sizes has the potential to increase performance and curb union abuses.

More school districts is an easy way to introduce competition to public schools. Deconsolidation makes it less costly for students to switch schools, which offers families an escape from failing schools and forces school districts to be accountable to parents. Deconsolidation also offers parents a better chance of influencing school policy.

People with privileged backgrounds have options when it came to schools. The poorest in California do not have that luxury. Research shows that the poorest areas suffer the most from larger school districts. Large, union-dominated school districts drive families into unyielding cycles of poverty. We should never stop trying to make California better for those families. Deconsolidation will not solve every problem facing California’s schools, but it may be an important step along the way.

 

The mission of the California Policy Center is to secure a more prosperous future for all Californians.

David Schwartzman is a Policy Research Fellow at the California Policy Center. He is a rising senior studying economics, mathematics, and finance at Hillsdale College.


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