Dr. John Augenblick Augenblick, Palaich and Associates

What APA Was Asked to Do Examine how revenues and expenditures have changed over time in DCSD Evaluate the efficiency of DCSD in terms of spending and personnel usage Prepare a document that would help the public understand DCSD’s fiscal situation 2

What Data Did APA Use in its Work? Data collected by state (CDE) and national (NCES) agencies that gather and organize information for their own purposes ( , , and ) Data from DCSD comprehensive financial reports, which was verified by DCSD staff after APA organized it ( , , and , which became available on November 17) It is important to note that: Data from state/national sources do not always match local data The primary use of state/national data is inter-district comparison and trends over time, where precision is of less concern. 3

“Drivers” of School District Spending/Revenue Over Time Number of students served Economies of scale (large districts cost less per student than small districts) Change in enrollment (marginal cost vs. average cost) Changes in student needs Special education, “at-risk”, and ELL Inflation Inflation rose by 9.3% between and and by 13.6% between and (Denver- Boulder CPI, the official index used by the state) 4

Counting Students Basic approaches Enrollment -- the number expected to be served Full-time-equivalent (FTE) attendance – the number that are served State count (funded pupils) – an artificial number based on the multi-year trend of attendance in a limited time period during the year Weighted students Counts students based on relative cost (2.1 for special education, 1.4 for low income, and 1.9 for ELL, 1.0 for others) Ratio of weighted to unweighted -- indicates “need” 5

Adjusting Spending for Need and Inter-District Cost-of-Living Example of student weights A district has 1,000 students with 100 in special education, 200 from low income families, and 30 ELL Weighted students = 1,217 Ratio of weighted to unweighted = If spending were $1,217,000, that would be $1,217 per unweighted student or $1,000 per weighted student Inter-district cost adjustment The Colorado School Finance Act uses an inter-district cost-of-living factor to adjust state aid APA created factors to adjust other districts to DCSD’s cost of living 6

Comparing DSCD to Other Districts We used a 12 district group based on size and proximity We used a 6 district group based on competition (Academy, Adams Five Star, Aurora, Boulder Valley, Cherry Creek, and Littleton) Used simple average for comparison but also counts of districts above/below DCSD and number of standard deviations DCSD is from the average For personnel, we used the number of personnel per 1,000 students to standardize across districts of different size and over time See Table 1 Enrollment Ratio of weighted to unweighted students Cost of living 7

Summary of Findings - Demographics DCSD has had much higher growth than the two comparison groups or the state average. See Table 1 DSCD’s needs are 15.3% higher than if it had no students with special needs, which is less than the two comparison groups and the state average. See Table 6 and Table 1 DCSD has not increased the number of its employees at the same rate as enrollment has grown. See Table 6 and Table 7 8

Summary of Findings - Personnel DCSD has comparatively fewer of some kinds of personnel and more of others Fewer Librarians and media specialists (Table 3B) Guidance counselors (Table 3B) School and district administrative support (Tables 3C and 3D) Instructional coordinators (Table 3C) More Teachers (Table 3A) Instructional aides (Table 3A) Library and media support staff (Table 3B) 9

Summary of Findings – Salaries and Benefits Salaries – slightly below the 6 district group average See Table 4A Benefits – in most cases, slightly higher than the 6 district average See Table 4B 10

Summary of Findings – Spending by Function Per student spending for school administration, district administration, and facilities maintenance and operation are lower than the two comparison groups and the statewide average. (Table 2) Per student spending for transportation has been comparatively high. (Table 2) Spending for instruction is slightly lower in per student terms and slightly higher in per weighted student terms. (Table 2) 11

Summary of Findings – State Revenue DCSD revenue from the state is comparable to that of other districts (Table 5A) School Finance Act of 1994 “Foundation” program Base per student (Amendment 23 assures rise of inflation plus 1 percentage point from through , then inflation only) Adjustments to base for small size, enrollment decline, inter- district cost-of-living, and at risk students(free lunch + ELL) Other aid for special education, transportation, ELL 12

Summary of Findings – Local Support DCSD generates more local revenue than other districts (Table 5B) Most local revenue is controlled by the School Finance Act SFA determines an expected contribution to pay for the foundation program SFA allows districts to generate up to 25% of adjusted base in millage overrides Districts can generate revenues from fees, investments, etc. 13

Summary of Findings – Federal and Total Revenue DCSD raises less federal revenue (Table 5C) DCSD raises comparable total revenue in per student terms and more in per weighted student terms (Table 5C) Figures do not add up perfectly due to combining funds and use of fund balance. 14

Cost Pressures Student need (Table 6) Special education, at-risk, and ELL Note performance improvement Salaries and Benefits (Table 7) Number of personnel is down relative to numbers of students In , DCSD was spending $10.3 million more for salaries and $10.5 million more for benefits than would have been expected based on student growth and inflation (note situation in , when the figures were $32.1 million for salaries and $11.0 million for benefits) 15

Revenues vs. Expenditures State revenue grew far more than local revenue, particularly relative to enrollment growth and inflation (Table 8) Note vs Expenditure growth outstripped revenue growth between and but the situation changed in (compare Tables 7 and 8) This appears to be explained by numbers of personnel and use of fund balance. 16

The Future Student needs and the new accreditation system based on the “growth” model Revenue Amendment 23 (as we have discussed) State aid Property assessment will put pressure on state aid Rescissions in (4%, 6%, or higher – December 18 revenue forecast) and beyond Spending Numbers of employees Transportation Benefits 17