Teachers Like Denver for Merit Pay Program

Published September 1, 2007

The incentives in Denver’s new performance pay plan appear to have piqued the interest of teachers, according to new data released by the school district in June.

The ratios of applicants to open job positions, both in challenging schools and in difficult-to-fill specialties, have grown since the introduction of bonuses in the 2005-06 school year. Denver’s Professional Compensation System (ProComp) awards 3 percent of the negotiated salary index ($34,200 in 2006-07) for teachers who serve in the most impoverished schools or who specialize in high-demand fields.

Teachers at 34 Denver schools qualified to receive an additional $1,026 each in 2006-07. Specialists in seven different job descriptions–including school nurses, speech pathologists, and special education instructors–received the same bonus amount.

Noticeable Impact

Total applications for difficult-to-serve schools have more than doubled, from nine per posted position in 2005-06 to nearly 20 per posted position in 2007-08. Similarly, the ratio of applications for difficult-to-staff assignments has increased from less than three per posted position in 2005-06 to more than eight per posted position in 2007-08.

“The bonus has an impact that’s noticeable,” said Henry Roman, a teacher on special assignment and ProComp’s liaison to the human resources department. He said two more years of data will be needed to confirm the trend.

An expert observer of teacher performance-pay programs also sees the increases as a positive development.

“It is encouraging that ProComp’s market incentives evidently are helping lead teachers to where they are most badly needed,” said Robert Holland, a senior fellow for education policy at The Heartland Institute. “Perhaps this trend will eventually lead to big increases in student achievement.”

Increased Interest

While successful applicants are required to be “highly qualified” under the terms of the federal No Child Left Behind Act, data were not available at press time on the number of applicants who fit the criteria.

However, Roman said the increased interest adds to the likelihood of principals finding enough candidates with the right credentials for their schools.

“Certainly it’s nice to be able to post a position and have extra dollars attached to it,” Roman said. “It increases their pools of applicants.”

‘Results-Based’ Pay

The Market Incentives–one of ProComp’s four components of teacher pay rewards, specifically reserved as bonuses for difficult-to-serve schools and difficult-to-staff positions–represent one means by which participating instructors can build their earnings. Others include Student Growth, Knowledge and Skills, and Professional Evaluations.

School and union leaders classify ProComp as “results-based” pay. In November 2005 Denver voters approved a $25 million-a-year tax increase to provide sustainable funds for the program.

Holland believes ProComp’s reform could have been more ambitious.

“A stronger merit-pay system would weight objectively measured gains in achievement more heavily in determining performance bonuses, but Denver has taken a step in the right direction,” Holland said.

Growing Participation

In all, the earnings of 42 percent of the district’s teachers will be paid under terms of ProComp in 2007-08. All teachers hired starting in 2006, representing about 13.5 percent of the professional workforce, receive results-based compensation. During the first three annual opt-in windows, 1,238 full-time equivalent veteran instructors have joined the new pay program.

“Teachers are starting to feel more comfortable with the process,” Roman said. “As this starts becoming more mainstream, we’ll keep getting that constant group of teachers opting into ProComp.”

Denver is upgrading its technological capabilities to make it easier for participating teachers to set student growth objectives, to complete professional development projects, and to succeed at evaluations. All three elements can generate permanent salary increases under ProComp.

“I think all of that is going to benefit the overall system,” said Roman.

Ben DeGrow ([email protected]) is a policy analyst for the Independence Institute, a free-market think tank in Golden, Colorado.