Wednesday, December 9, 2015

Pickups and Schools

This year has brought some big changes for me. Among them, I am not commuting 120 miles a day anymore. I also traded my 10-year-old Nissan pickup on a new Ford F150. These changes made me think about an interesting argument made by a Kansas policy group about median spending in schools. The argument is the Legislature should take the median spending level for schools and limit spending to that median for each spending category. The assumption, I guess, is that any spending above the median for each category is wasteful.

So let’s take a look at two hypothetical situations, call them medians for 2014JH and 2016JH. (Since I only had two data sets, I used average instead of median for a measure of central tendency.)

Spending Category               2014JH Monthly       2016JH Monthly       Average
Vehicle Maintenance                       $200                        $20                     $110
Gas                                                   $360                        $20                     $190
Principal and Interest                        $0                           $400                   $200

Based upon this comparison and the policy group’s reasoning, 2014JH is overspending on monthly maintenance by $90 and gas by $170, whereas 2016JH is grossly overspending on principal and interest by $200! These two JH’s are obviously on vehicular spending sprees. The differences in travel and age of vehicle explain the differences.

So let’s look at two large districts in a metropolitan area. One district, call them Metro City, is at the city core. Their buildings were primarily built in the 1950s and ‘60s. The bond debt has been paid off for years, but these buildings require as much or more maintenance as a 2006 Nissan pickup. Their maintenance and energy costs will be relatively high, certainly higher than the median.

Red River, the second district is in the same metropolitan area and has been growing rapidly. All of their buildings have been built since the 1980s. Because of the rapid growth, they add a new school building every year or so. This district’s bond and interest costs will be far above the Metro City’s and above the median in their category. But because they built with modern designs and materials, their energy costs are far less than the median. Maintenance costs on their newer facilities will be less than Metro City and the median.

If one is looking for a way to take cheap shots at different district’s spending levels in different categories, they would say Metro City is wasteful and inefficient because of high energy and maintenance costs out of one side of their mouth and Red River is wasteful and inefficient because of high bond and interest costs out of the other, while ignoring the obvious big picture differences.

Kansas School districts are as different as the children they serve. Garden City and Maize have similar enrollments, but are unique in more ways than my short blog can list. Should we really expect them to be at the same median spending levels in total in categories? If you believe that, you haven’t driven a Ford lately.