The nation’s fifth-largest school district could save $162 million over five years by implementing a variety of cost-cutting measures, a new report says.
Reducing costs through negotiation, repurposing materials, shifting investments, and changign management practices were major areas for potential savings in Nevada’s Clark County School District, said the September report from Gibson Consulting Group, an efficiency research company. The district’s annual budget is $2.5 billion. It projects a $131 million shortfall this year, mostly due to falling tax revenues.
The report also recommended trimming duplicative and obsolete human resources and student data systems, updating energy systems, and outsourcing custodial work.
“A lot of the recommendations had to do with repurposing the expenditures they’re making now,” said Greg Gibson, the consulting group’s president. “They were spending on an excessive number of programs, and our recommendation was to focus on a better set of curriculum offerings and academic program offerings so they can spend smarter.”
Gibson studied CCSD over three months, then compared it to three higher-performing U.S. school districts with similar demographics: Broward County Public Schools in Florida, Houston Independent School District, and Miami-Dade County Public Schools.
‘Excessive Number of Programs’
Overall, the study found the district was efficient in per-pupil spending but could improve student performance through certain operational adjustments.
Of the 367 schools in the district, 44 percent rated “in need of improvement” on student performance. The county spends about $8,000 per student, and $500 to $800 less per student on instruction than peer districts. Its pupil-to-teacher ratio is 31 percent higher than the national average. To use funding better, the district has to look outside the classroom.
“Organizational silos, driven primarily by different funding sources, [have] contributed to an excessive number of academic programs, interventions, assessments, and staff professional development programs in CCSD,” the report said. “These programs and interventions often overlap, and according to input from principals, they are at times in conflict with each other.”
More than 30 percent of CCSD students transfer within the district each year, and they currently meet a compound of assessments on the way. The district could combine those into one assessment, the report said.
Data ‘Key’ to Identifying Problems
The district should purchase $10 million in human resources software and a new student information system costing $23 million over five years, the report said.
“A lot of districts get behind in their investment in information systems and have to play catch-up,” Gibson said. “Data is really key to identifying problems. Every ten years or so, you have to expect to upgrade and purchase new information software.”
Though these systems may take years to establish, the district superintendent’s special assistant, Ken Turner, said some improvements are already in motion.
“We’ve organized all of our schools so they’re poised to operate in a different way,” Turner said. “We’re going to differentiate our oversight based on the [test] results that schools get. We’re going to focus our resources so we provide for those that need the most help.”
Negotiating Labor Costs
Described as a “last resort” by Gibson and Turner, negotiating cost reductions with the labor unions could result in significant savings.
The report states, “Primarily because of pay and benefit differences, CCSD’s custodial cost is $2.34 per square foot, significantly above the industry benchmark of $1.59.”
“It’s very encouraging for the report to talk about savings from outsourcing,” said Victor Joecks, communications director at Nevada Policy Research Institute. “Hopefully Superintendent [Dwight] Jones and the school board will have the political courage to address this. Dollars going to their employees that are above the market value are being taken away from the classroom.”
If the district negotiated more market-standard wages, it could save more than $10 million over five years in custodial work and $11 million each year by reducing busing supervisory staff and staggering bus schedules and school departure times so the district employs fewer drivers.
Saving on Energy
Installing solar panels and updating cooling and heating systems would improve energy efficiency, the report said. School districts across the nation could increase energy efficiency this way, Gibson said.
Preventive measures occupied just 6 percent of CCSD maintenance hours, whereas the best practice level is more than 50 percent. Additional steps to update heating and cooling systems could save the district $41 million over five years.
Big Hurdles Remain
The Gibson study is part of an overall financial efficiency project Jones began last year. The district must next agree on which recommendations to pursue. After that, the district will review and restate its financial reform priorities each year, Turner said.
Implementing the ideas also depends on funding.
“[The district’s] funding has consistently gone up, but the money schools have may go down depending on what county they’re in,” Joecks said.
CCSD is not likely to outsource custodial work right away or make other staffing changes. The recommendation garnered adverse reactions from the district’s 38,000 employees.
“We have not yet reached an agreement with four of the five bargaining groups,” Turner said. “That’s a challenge. The preference is to work with our staff through collective bargaining.”
The district’s 2011-2012 amended budget states, “Without concessions from the employee bargaining groups, further reductions of up to 800 positions may be necessary in order to balance the budget for fiscal year 2012.”
Image by Lucas Cobb.