The Manchester Enterprise
A Heritage Newspaper
Weekly Publication
Granholm pushes for consolidation
But will efforts really help school districts save money?
By Brian Cox, Heritage Newspapers
PUBLISHED: March 22, 2007
As state legislators hunt and peck for the least politically painful path out of the school funding morass, school districts have come under increased pressure from Lansing to pursue cost-saving measures of cooperation and consolidation under the umbrella of intermediate school districts.
Advertisement
There are more than 560 Michigan public school districts, and most have their own payroll systems, transportation directors, food service managers, and other non-instructional personnel, representing what some consider an inefficient redundancy that if reduced would result in important savings.
State Superintendent Mike Flanagan, for one, wants intermediate school districts to perform non-instructional services for individual districts, saying he believes school districts should focus on student achievement rather than costs for food service, busing and custodial work.
The idea has appealed to Gov. Jennifer Granholm, who proposed offering school districts $10 million in one-time incentives if they consolidate business, administrative or instructional services as part of her budget plan for this year. She called the incentive a "carrot."
Granholm is also proposing a "stick": If school districts do not make efforts toward consolidating services, they would incur funding penalties in 2009.
But while school officials across Washtenaw County agree that exploring ways to consolidate services is a good idea, they argue that consolidation is more complex than it might first appear, could lead to diminished levels of customer service, and –– most importantly –– do not expect to stumble upon significant savings in the near future.
"I agree with the concept of looking at consolidating services," said Milan Area School Superintendent Dennis McComb, "but in reality, I'm not sure these are overnight solutions."
Administrators are also quick to point out that consolidating services such as payroll or transportation does nothing to resolve the structural problems in school funding. Some bluntly say the call for consolidation is only another example of legislators affixing a Band-Aid to a gaping wound.
"There is a structural problem with the way we are funding schools," said Chelsea Area Schools Superintendent Dave Killips. "(Consolidation of services) does nothing to address that. We need a legislative answer to the problem."
Consolidation and Cooperation Is Nothing New
Some umbrage underlies district leaders' response to the brighter spotlight now turned on consolidation and cooperation efforts because they say they have been working on them all along.
"It's not a new idea," said Washtenaw Intermediate School District Superintendent Bill Miller, "but it is accelerating the idea."
"Consolidation of services is not a bold move," said McComb. "It is a public relations move."
Administrators are also concerned that past efforts in consolidating services may be seen by the state as not fulfilling any "carrot" requirements.
"Most districts in (Washtenaw) County have been a head of the curve on this," said Killips. "I would hope districts get credit for what they have already done. Districts that have been proactive shouldn't be shortchanged by this legislation."
Chelsea already shares the cost of a special education director through the ISD and is exploring opportunities to share transportation oversight when its transportation director retires at the end of this year.
The ISD is close to putting into place a countywide system for scheduling and paying substitute teachers and has formed a finance study committee expected to issue a report in June on the prospects of consolidating other administrative services.
"With technology there are some things we can do that we couldn't five years ago," Miller said.
Many districts also rely on the ISD to coordinate staff development and participate in the Southwest Washtenaw Consortium to share the cost of career and technical courses for high school students.
Most of the districts also are members of different purchasing cooperatives to pool their buying power for materials, utilities and equipment.
District officials say they are considering other ideas of cooperation and consolidation, as well.
There is even talk of some districts sharing a superintendent.
"There are a whole variety of options available," said retiring Manchester Superintendent David Oegema.
Savings Expected To Be Slight
There are no hard numbers on what districts might save through consolidating services, but it's unlikely the savings will exceed 10 percent of their budgets over the next four to five years, says Michigan State University Professor Eric Scorsone, who spent 15 months researching the consolidation of school and government services.
"There are long-term benefits to consolidating services, but short-term costs," he said.
The higher scale of savings would come from some form of consolidating health insurance programs.
Tom White, executive director of Michigan School Business Officials, agrees.
"There's no question in my mind that (consolidation) is something we need to look at," White said, "but it's unlikely there are big savings here."
On average, central office services come to about 3 percent of a district's budget, said White, and while savings can be found, he is not convinced it will be of any significant impact.
Saline Superintendent Beverley Geltner said she did not expect to see much savings in consolidating services, but would continue to have her staff look into it.
"We're open to anything that produces savings," she said.
In part, the savings may not be much because merging services is actually one of the more conservative options available to districts.
"(Consolidation of services) is not one of the more radical solutions so therefore it is not going to produce huge cost savings," said Scorsone, who pointed to privatization and the merging of smaller districts into larger districts as more "radical" ideas.
Not As Easy As It Looks
At first glance, consolidating services among districts appears straightforward, but school administrators say it's deceptive.
"This is far more complicated than people first think," White said. "It's more complicated than it is in the private sector."
For example, districts may have different accounting systems and software that would need to be converted if payroll were consolidated at the ISD level.
Each district's union contracts with teachers and support staff is different and would have to be accommodated. There is also no common school calendar across the county, which could complicate matters.
And someone at each district would still have to collect the payroll data and send it to the ISD for processing.
"I'm not sure it would save us much money," McComb said.
Scorsone said it's difficult. "It takes a lot of coordination. It is no trivial challenge," he said.
Aside from concerns over how much savings can be found and the complexity of putting any consolidation plan into place, administrators fear transferring some services to the ISD would adversely impact a sense of local control and identity that districts have built up over the years in their communities.
If transportation was coordinated at the ISD, for example, a parent calling the school because his or her child did not get off the bus would be directed to contact the ISD for assistance. School administrators believe such a scenario would leave a parent frustrated and angry.
"People are worried about what they're giving up and they're wondering if the level of service they've become accustomed to will diminish," Miller said. "It's a matter of tradeoffs."
Killips said going to any countywide system would result in the loss of some independence for districts.
"All of a sudden, the school district is less a part of the community," he said.
No consolidation of major services is expected any time soon, however, district officials say. For now, they continue to meet and explore ideas.
"There's been a lot of talk, but not much more than that," Oegema said. "As far as going the next step, that's a long way off."
Brian Cox is a reporter for Heritage Newspapers. He can be reached at 428-8173 or bcox@heritage.com.
Not all stories are guaranteed to appear
online. The Web edition contains a reasonable
sampling of the print edition stories.
For the most complete news coverage, we invite you to
subscribe
to the print edition of the paper.
TOP JOBS
