You might have read about the results of school district audits conducted by the staff of New York State Comptroller Tom DiNapoli over the past year. In a state with the highest public school spending relative to its residents’ incomes, and therefore the highest state and local taxes as a share of income collected for schools, DiNapoli’s staff has found that the school districts waste nickels and dimes, and sometimes follow only 49 steps in 50 step financial procedures. According to the New York Times, “state auditors found that the Niagara Falls, N.Y., school district overpaid 272 employees by more than $500,000 in 2006, apparently incorrectly sending out an extra paycheck to each of them. Separately, they discovered that a laptop computer assigned to a school administrator in Vestal, west of Binghamton, had been used to visit Internet sites for pornography. And they determined that districts in Mount Vernon, Newburgh, North Syracuse, Schenectady and Williamsville could have saved a total of $212,000 on electricity if they had shut off computers at night and used power-save settings.” Superintendents and school board members “complained that the audits could be too focused on relatively minor infractions and accusatory in tone.”
I agree with the superintendents and school board members about the minor infractions, but believe the tone could be even more accusatory. Without any staff at all, using only widely available public statistics, I’ve been able to find far more telling explanations of why New York’s school spending is so high, as reported in prior posts. Based on that data, the real story is the questions DiNapoli didn’t ask.
For example, according to the 2007 Census of Governments conducted by the U.S. Census Bureau, which I tabulated for New York in a spreadsheet attached to this post, while the United States averaged 1,559 full time equivalent public school instructional employees per 100,000 residents and New York City had 1,457 that year, the downstate suburban counties (Nassau, Suffolk, Westchester, Rockland, Putnam) averaged 1,901; the mostly highly urbanized Upstate NY counties (Albany, Broome, Dutchess, Erie, Monroe, Niagara, Oneida, Onondaga, Orange, Rensselaer, Saratoga, and Schenectady) averaged 1,826; and the other more rural Upstate New York counties averaged 2,062.
Among the questions DiNapoli did not ask are why are so many more teachers required in the portion of New York State outside New York City? Are class sizes that much lower there, or do teachers spend more time out of the classroom or on sick leave? Or, in the case of rising enrollment in tiny school district A and falling enrollment in tiny school district B, does district A hire more teachers while District B retains the ones it has by assigning them to administrative positions, so they will not have to move to District A and lose their seniority? Are teachers who are unable or unwilling to teach shifted to less important positions in good school districts, meaning more of them are required, and retained in the classroom in bad school districts, rather than fired? Even if class sizes are much smaller than average, is it worth it? And can New York State residents afford it?
That same data shows that for non-instructional public school staff, the United States averages 689 per 100,000 residents and New York City (where the rest of the state has complained about administrative overstaffing for decades) has just 373, while the downstate suburban counties averaged 857, the upstate urban counties averaged 930, and the upstate rural counties averaged 977.
DiNapoli didn’t ask if the sky high level of non-teachers in the rest of the state is because of the duplication of many school districts relative to the number of students (even though it isn’t found in states with even more districts relative to students). Or if it is a more lucrative duplication of the welfare system, complete with better health insurance and a pension, for well connected suburban and upstate residents who are otherwise out of work. Perhaps, for some, one without a workfare requirement.
The data who that while private sector workers in downstate New York earned 32.3% more than the national average in 2007, if the then-overpaid finance industries are excluded, and New York City teachers earned 20.1% more than average in March of that year, teachers in the downstate suburban counties earned 46.2% more than average that year. Private sector workers in Upstate New York earned about 10% less than the national average, but teachers in urban and rural upstate counties earned 16.3% and 5.4% more than average.
DiNapoli didn’t ask if the higher taxes required for those higher levels of relative teacher pay are fair to community members who work in the private sector and are seeing their income fall relative to inflation, particularly now that those overpaid Wall Streeters may no longer be around to pick up the slack. Why do teachers outside New York City, public employee retirees, and Social Security recipients get an automatic inflation adjustment when private sector workers do not, and the minimum wage is left to trail the cost of living for years between increases? Doesn’t that mean those with the automatic adjustment keep getting richer relative to those who serve them when they go shopping, who keep getting poorer?
Using Current Employment Survey data from the New York State Department of Labor, as discussed in this post, DiNapoli could have found that the public schools in the portion of New York State outside New York City added another 4,900 jobs in the year to September 2008, bringing the total increase since September 1993 to 76,400. This in the face of a fiscal crisis, and the fact that public school staffing was already very high relative to the national average back in 1993.
Outside New York City, New York State’s population has been stagnant. And outside Manhattan and a few suburban counties in the downstate suburbs, its residents’ per capita income has been falling relative to the national average for decades. Without more people, why does New York need more teachers? Could it be that when enrollments fell after the baby boom left school in the 1970s and 1980s excess teachers were retained, gaining the “right” to a diminished workload and more out of classroom positions? And when enrollments subsequently rose as the large number of children of the baby boomers entered school in the 1990s, even more teachers were required to keep that deal? Is the pattern about to be repeated as the baby boom echo generation leaves school? Note that in New York City, according to this same data, public school employment has started falling with public school enrollment. Not in the rest of the state.
DiNapoli also could have asked some questions about the annual public school finance data released by the Census Bureau, which I discussed in this post.
The data show that New York City’s total expenditure per child was $17,591 in FY 2006, or 61% higher than the national average of $10,918. Even adjusted for the higher cost of living here per child spending was $13,389 in New York City, or 22.6% higher than the national average. New York City’s instructional spending per child, at $8,679 after adjustment for the cost of living, was 56.3% higher than the national average ($5,552), and about as high as the adjusted Downstate Suburbs ($8,676) or Upstate New York ($8,555). So how come NYC’s teacher pay wasn’t higher relative to those other areas? Because NYC’s spending for employee benefits, particularly retirement benefits, is spectacularly higher than the national average per child, and was rising rapidly in FY 2006.
Under the circumstances, was it really a “win for children” (as described by Randi Weingarten) when in early 2008 the state legislature voted to allow New York City teachers to retire at 55 instead of 62, with those then 55 or over not having to contribute an extra dime? What has that deal, described as costing nothing, actually cost in extra pension contributions and retiree health care benefits? Doesn’t that mean even more money diverted from higher teacher pay and lower class sizes? If Mr. DiNapoli wants the support of the teacher’s union for re-election in 2010 he’d better not ask that question. He just needs to parrot the line that quality of education will have to be cut, and taxes on the non-retired will have to rise, as part of a “shared sacrifice” that those who cashed in are exempt from.
School districts in the Downstate Suburbs averaged $19,337 in spending per student, or nearly twice the national average. Even adjusting for the cost of living, spending in that area averaged $14,757, or 33.5% higher than the national average. While non-instructional spending and staffing has always been low in New York City it has always been high in the Downstate Suburbs, at $4,596 per student even after adjustment compared with $3,601 nationally. Non-instructional spending per student rose 14.7% in the Downstate Suburbs after adjustment for inflation from FY 2002 to FY 2006, and it was high to begin with. Once one discounts average Downstate spending for the cost of living, one finds that Upstate spending, at $14,848 per student, is slightly higher than in the Downstate Suburbs — 36% higher than the national average.
In all parts of New York State, including New York City, much of the increase in spending (in excess of the inflation adjustment) from FY 2002 to FY 2006 has been in employee benefits, and much of the increase in employee benefits has been for retirees. Is this really fair given that most people in Upstate New York are seeing their wages fall behind inflation?
Finally, DiNapoli could have asked the question I asked in this post: if one were to start over with the then-current amount of money, what could the amount New York City residents pay for public schools have bought? Instructional spending per child, unadjusted, was $11,400 in FY 2006. Now imagine that instead of putting that money in the public school system, parents could use it to hire teachers who lived in their neighborhood and taught children in their homes, the way they hire music teachers and tutors. Those teachers could be given $136,800 to teach 12 children — for their wages, health insurance, IRA contribution, and teaching materials. If the parents were willing to pay for after-school and summer care, and the teachers were willing to provide it, they could earn additional money over and above the $136,800 just to sit in the park while the kids played or be around as the did their homework or played games. And they would have a class size of 12. Twelve! And that doesn’t even include all the additional money now going to non-instructional spending.
Given that, does the way we organize public education make any sense at all? Especially when, given the burden of all those retirement entitlements, our schools are heading for an institutional collapse?
“You really have to be sure that money is not being used in a wasteful way, because for many of the communities, school district spending is such a large part of the property tax burden, which is the most onerous tax for people to pay,” DiNapoli told the Times. “For the most part it was helpful, but in some areas we felt that they took gratuitous shots at the district in a way that was self-serving for the comptroller’s office,” a superintendent responded. “Robert N. Lowry Jr., deputy director of the New York State Council of School Superintendents, said the audits have too narrow a focus because they look only at compliance rather than larger fiscal issues.” Perhaps like the need for more state taxes and higher state aid for wealthier jurisdiction, perhaps funded by a cut in state aid for New York City as in prior recessions.
New Yorkers are being ripped off by school system employees who are too great in number and paid too much for working in the part of the state outside New York City, and paid too much for too long for not working in the part of the state inside New York City. That accounts for just about all of the higher taxes required for schools in all districts, and the bad quality in all of them. DiNapoli dances around these politically powerful interests while instructing school administrative staffs to turn off their computers at night. At the private sector company where I work I always turn off my computer at night. The IT staff told me not to bother, once a week over the weekend is fine, so little is the money saved.