Dakota Beacon

This 59-page research publication (Working Paper No. 33) by William Duncombe and John Yinger was published in January 2001 by the Center for Policy Research, Maxwell School of Citizenship and Public Affairs, Syracuse University. It is available in pdf format at http://www-cpr.maxwell.syr.edu/cprwps/pdf/wp33.pdf.

Twelve Rural School District Consolidations Studied

Consolidation of rural school districts has occurred over the last 50 years as a way to improve school district efficiency. This paper evaluated the cost impacts of twelve consolidations (all twelve combined two districts into one) in rural school districts in New York between 1985 and 1997. The actual consolidation data (number of pupils from each school, the consolidated total, and the average original enrollment are as shown below:

Year         District A        District B   Consolidated Total     Average Original Enrollment

1987                290                  420                  710                                          355

1987                1990                920                  2910                                        1455

1988                490                  250                  740                                          370

1988                480                  250                  730                                          365

1988                970                  620                  1590                                        795

1989                250                  1360                1610                                        805

1991                270                  260                  530                                          265

1992                1010                310                  1320                                        660

1993                420                  710                  1130                                        565

1994                250                  1640                1890                                        945

1994                1860                390                  2250                                        1125

1995                690                  380                  1070                                        535

Holding student performance constant, the study found that school district consolidation substantially lowered operating costs when small districts were combined. Cost savings ranged as follows:

Cost Savings by Expenditure and Size of School District Consolidation

Expenditure               Average Enrollment Size, Two Districts Consolidated Into One                                      2-300 pupil districts        2-900 pupil districts     2-1500 pupil districts

Operating                                -22.4%                         -12.9%                         -8%

Capital                                     -23.4%                         +27.9%                        +62.4%

Instructional, all                      -18%                            -8.5%                           -3.7%

Teaching only                          -22.5%                         -11.3%                         -5.6%

Administration                        -35.6%                         -35.6%                         -35.6%

Transportation                         -32.4%                         -22.9%                         -18.1%

Overall                                                -20%                         -7% to -9%                         0%

Economies of Scale

Five economies of scale are:

Indivisibilities – Economies of size may exist because the services provided to each student by education professionals do not diminish in quality as the number of students increases, as least over some range. For example, central administration, as represented by the superintendent and school board, has to exist whether the district has 100 or 5,000 students.

Increased Dimension – Larger plants (school buildings) may be able to produce output at a lower average cost.

Specialization – The gains from specialization provide an especially compelling justification for consolidation in an era of rising standards.

Price Benefits of Scale – Large districts can benefit from negotiating bulk purchases.

Learning and Innovation – Teachers may be more productive by virtue of the fact that they have more colleagues from which to glean the benefit of “higher group experience”.

Diseconomies of Scale

Five diseconomies of scale are:

Higher Transportation Costs – Includes associated longer commuting times for at least one of the two consolidated entities.

Labor Relations Effects – Larger districts are easier to organize and unions may prevent reductions in staffing that are otherwise inherent in the consolidation.

Lower staff motivation and effort – Larger schools tend to add levels of middle management in administration, even in the face of declining enrollments.

Lower student motivation and effort – Students “at risk” tend to get lost in the numbers.

Lower parental involvement – Parents may feel more “like a number”.

Commuting Times

While this document did not provide any study on commute time, other studies have suggested that student commutes over one hour are highly undesirable. My own experience commuting 49 miles to work for 15 years provides me with a keen appreciation for the one hour limit. In fact, most problems with driver fatigue occurred beyond the 45-minute time frame on the way home. I personally would desire that my child sit in a bus for no longer than 45 minutes for safety reasons alone.

Natural Gas Powered School Busses

Another area not covered by this paper was alternative fuels for school busses. Natural gas was a viable cost saving alternative that first became available for autos and pickups in the mid eighties. At the time of this January 2001 paper, ten years after the first natural gas school bus was commissioned in California in 1991, 14.3% of school busses were equipped with natural gas engines that are 1/3 less expensive to operate than diesel powered engines on an equivalent energy basis. And by November of 2001, approximately 2,675 natural gas powered school busses were operated by nearly 130 school districts in the country.

Natural gas powered school buses emit 40 to 86 percent less particulate matter and 38 to 58 percent less nitrogen oxides than diesel buses. Moreover, natural gas is virtually toxic-free, while diesel exhaust contains more than 40 toxic constituents, about half of which are known or suspected carcinogens.

Conclusions:

Administration and transportation costs were dramatically reduced for all three levels of consolidation studied. Consolidation of “administration” and/or “transportation” sectors ONLY may be worth investigating when outright consolidation is not practical due to travel times.

School bus travel times over 45 minutes should be avoided if at all possible and a maximum of one hour travel time seems to me to be a legitimate upper limit. And Natural Gas powered school busses along with natural gas fueling facilities should be investigated as a way to prevent cancer in our children while saving money that can find better use in the classroom.