Is Maryland Counting Its Low-Income Students Correctly?

A recent report by consultant APA Consulting for the Maryland State Department of Education reviewed Maryland’s method of counting low income school students and made some suggestions. APA Consulting is providing this report as part of the Study of Adequacy of Funding for Education in the State of Maryland.

The number of low-income students in schools has a bearing on federal and state school funding because formulas and grants reflect the strong correlation between students in poverty and learning challenges. The main additional state funding provided to Maryland schools for low-income students is called compensatory education funding. Under Maryland’s current system, compensatory education funding is based in part on the number of students who are eligible for free- and reduced-priced meals.

Students become eligible for free- and reduced-price meals through applications made by their parents, or because they fit into a certain category based on their status (such as children in foster care or head start). The latter method is called direct certification. In 2010, Congress passed the Healthy, Hunger-Free Kids Act (HHFKA) which allowed schools where 40% of students qualified for free- and reduced- price meals through direct certification to provide all students with free- and reduced- price meals.

Maryland’s General Assembly passed legislation allowing school districts to use a combination of the number of students eligible for free- and reduced- price meals and the number of students eligible through the federal government’s community eligibility provision as the count of low-income students used in the formula for compensatory education aid, for fiscal years 2017 and 2018. (The Hunger-Free Schools Act of 2015). However, in the long term, the community eligibility program only requires schools to collect direct certification data every four years, leading to difficulties in using this as the proxy for annual compensatory education funding.

Alternative Ways to Count Low-Income Students

The use of Free and Reduced Price Meals eligibility as the proxy for identifying economic disadvantage is one of the elements of the current system that APA is evaluating as part of the State’s review of education funding adequacy required by the Bridge to Excellence in Public Schools Act of 2002.

APA points out several issues with the current system, including potential over-reporting and under-reporting eligibility, and reviewed several other options. Ultimately, APA recommended either maintaining the current practice with some minor improvements, or adopting a “direct certification” system. A direct certification system would use eligibility statistics from other programs, such as to determine eligibility for free and reduced price meals, and compensatory education funding.

Of the four options that provide an individual indicator of economic need, the study team considers the continued use of free and reduced-price meals and the use of Direct Certification as being the best proxies for identifying economically disadvantaged students. . . While shifting to direct certification, over time, would disrupt the status quo, it would also direct greater aid to school districts that serve more economically needy students.

Funding Effects of Changing the Counting Method

A shift to direct certification statewide in Maryland would change the relative amounts of compensatory education aid provided to various Maryland counties, with Baltimore City receiving the largest increase in aid, and Prince George’s County receiving the largest decrease.

From the report, Evaluation of the Use of Free- and Reduced-Price Meal Eligibility as a Proxy for Identifying Economically Disadvantaged Students: Alternative Measures and Recommendations, page 18.

As described in the report,

Table 6, [above], presents a comparison for using free and reduced-price meals counts versus direct certification counts to identify low-income students in all schools. Because the direct certification uses a lower income threshold to identify low-income students, the direct certification count is substantially lower than the FRPM count, from 42.9% to 24.2%, or 18.7 percentage points lower. However, using this model, seventeen school districts see an increase in shares of the state’s low-income count. Baltimore City has the largest increase (6.2 percentage points), followed by Wicomico County (0.6 percentage points), and four school districts have increases of 0.4 percentage points (Allegany, Cecil, St. Mary’s and Washington counties). Prince George’s County has the largest decrease (-5.9 percentage points), followed by Montgomery County (-3.2 percentage points) and Baltimore County (-0.4 percentage points). Using direct certification as the indicator for low-income increases, the share of the state count for school districts that have a higher ratio of direct certified students to students who qualify for free and reduced-price meals – that is, school districts with a higher proportion of more severely economically disadvantaged students.

Next Steps

In discussion of the report by the Stakeholder Advisory Committee of the Study of Adequacy of Funding for Education in the State of Maryland, education stakeholders discussed the recommendations to continue using the free- and reduced-price meals proxy and for direct certification method. Some stakeholders explored other options, too, without coming to any general consensus on one recommendation at this time. Ultimately, a change in the school funding formulas would be accomplished through legislation in Maryland’s General Assembly.

This September, the Maryland State Department of Education, and the Department of Budget and Management are required to report to the Senate Budget and Taxation Committee, the House Appropriations Committee, and the House Committee on Ways and Means before December 1, 2015, on:

(a) the research and analysis in the Adequacy of Funding for Education Study relating to using free and reduced–price meal eligibility as a proxy for representing economically disadvantaged students in the State compensatory education aid formula including: (1) the proxies used in education formulas in other states, particularly states that participate in the Community Eligibility Provision of the federal Healthy, Hunger–Free Kids Act of 2010; and (2) the identification and analysis of alternative indicators;

(b) the impact of the Community Eligibility Provision on the State compensatory aid program that uses free and reduced–price meal student count as a proxy for representing economically disadvantaged students in the State;

(c) trends in free and reduced–price meal student counts to compare the free and reduced–price meal student count used for school systems participating in the Community Eligibility Provision to the number of students who would be expected to qualify for free and reduced–price meals in the next 5 years based on past trends;

(d) preliminary recommendations on a new proxy or a revised free and reduced–price meal student count that could be used to represent economically disadvantaged students in the State compensatory education aid formula; and

(e) any proposed changes to the calculation under § 5–207(a)(3) of the Education Article, as enacted by Section 1 of this Act [The Hunger-Free Schools Act of 2015].

For more information, read the whole report, Evaluation of the Use of Free- and Reduced-Price Meal Eligibility as a Proxy for Identifying Economically Disadvantaged Students: Alternative Measures and Recommendations.

State Officials Report Cost Savings Associated With New Student Assessment

The costs of technology and the amount of classroom time required to administer the new student assessment that accompanies the Common Core, (called PARCC) has been topics of concern for Maryland education stakeholders. See our previous posts, Boards of Education Comment on Draft College & Career Readiness Standards Implementation Recommendations and Commission Will Study Whether Maryland Students Are Over-tested

But following the first year of the test’s implementation, the state is finding cost savings, as reported by the Baltimore Sun,

State education officials say new standardized tests last year saved the state more than $2.5 million, compared to previous state assessments.

The state Board of Education received an overview Tuesday of the Partnership for Assessment of Readiness for College and Careers testing, which was first used in Maryland during the 2014-2015 school year.

Statewide, 1.3 million tests were completed during the school year. More than 80 percent of students took the assessments online.

For more information, see the full story from the Baltimore Sun.

26 States Apply a Performance-Based Model to Their College and University Funding

In search of greater accountability, 26 states are applying some type of performance-based funding models to their public colleges and universities, according to Stateline, a publication of the Pew Charitable Trusts. These models use metrics like graduation rates, student performance on national exams, and connecting students with jobs instead of enrollment as the basis for receiving some public funding.

As described,

While performance-based funding made up 8.8 percent of Florida’s spending on state universities this year, Tennessee allocates almost 100 percent of its higher education funding—for both community colleges and universities—through an outcomes-based formula.

“For every degree you award, it counts. For every student that accumulates 12 hours, they count. And we just simply count those up, and those are your outcomes for that funding year,” said Crystal Collins, a director at the Tennessee Higher Education Commission. “You don’t have to perform at a higher rate than you did last year; you just have to perform.”

The formula involves multiple calculations (you can check them out on the commission’s website). But basically, the state decides how much it wants to spend on higher education and parcels the money based on certain factors. A big one is whether students are progressing and graduating.

Tennessee’s model also takes into account basic operating costs and adjusts its formula based on each institution’s mission. Research universities are rewarded for spending money on research, for example, while community colleges are rewarded for connecting students with jobs.

For more information, read the whole story from Stateline.

For more information on other performance-based models, see our previous post, Congressman Delaney Calls for Smarter Government on TEDx.

Career and Technology Programs Could Complement Transition to New Compulsory Attendance Law

As reported in the Frederick News-Post, local school systems will soon enter the first year where Maryland students must stay in school until age 17 years.

One way that school systems are planning to ease the transition to the new higher compulsory attendance age is through expanding options for dual-enrollment at career and technology programs in local community colleges, as described by the News-Post,

Staff has worked to prepare for the coming year, Hartsock [Frederick County Public School (FCPS) Director of Student Services] said, and FCPS has, over time, diversified its options for classes. For example, the school system implemented dual enrollment, a program that allows students to register and earn credit in college-level courses. Such classes are taught either at their high school or on a college campus, the most popular being Frederick Community College.

Students who wish to drop out at age 16 typically cite a lack of interest in school as the reason, Hartsock said. Dual enrollment, or classes within the Career and Technology Center, Hartsock said, can typically capture the interest of students entertaining the idea of dropping out.

For more information, see the whole story from the News-Post.

MACo’s Summer Conference will feature a panel discussion on apprenticeships, including career and technology programs offered by local community colleges. Skills to Compete: How Our Schools Are Strengthening Maryland’s Future Workforce will be held on Saturday, August 15, 2015, from 9:30-11 am at the Ocean City Convention Center.

Learn more about MACo’s Summer Conference:

For a schedule of educational sessions at MACo’s Summer Conference, please view the Registration Brochure.

Questions? Contact Meetings & Events Director Virginia White.

Study Recommends School Formula Changes For Enrollment Gains, Drops

Enrollment changes by school district have been uneven across the state, and the effects are substantial – particularly as state funding does not truly reflect any differential between fixed costs and variable costs. These are among the findings of a key report released this month and discussed by school funding stakeholders this week in Annapolis.

The ongoing Study of Adequacy of Funding for Education in the State Of Maryland, and a stakeholder group comprising representatives from numerous interested parties, recently yielded several reports. The “Final Report of the Study of Increasing and Declining Enrollment in Maryland Public Schools” reviewed recent trends in school populations, and discussed the effects of cost-drivers in school systems both large and small.

From page 54, the consultant report offers this recommendation:

Given this study’s findings regarding the future outlook for declining enrollment, and the possibility that the number of districts facing the fiscal challenges presented by declining enrollment will increase over the next decade, Maryland should consider adopting a more permanent, and automatic, mechanism for giving districts temporary relief from revenue reductions driven by falling enrollment.

The approach suggested here is to change the student count used in the foundation formula calculations to a multi-year rolling average of the full-time equivalent enrollment count currently used. This rolling average, which would average a district’s full-time equivalent enrollment count over several years (the most common periods used in other states’ funding formulas range from two to four years), would work to temporarily reduce the funding impact of declining enrollment to give districts the time needed to make necessary changes to their operating costs (e.g. reducing staff, closing school buildings, or adopting other cost saving or efficiency strategies).

The report’s most pointed recommendations target school transportation funding:

Serious consideration should be given to modernizing the State’s transportation funding formula. The current formula does not appear to account for many of the major factors that drive transportation costs in districts. It also only adjusts funding amounts when district enrollment is increasing, but provides no adjustment when enrollment declines.

Implementing a more sophisticated funding formula will require timely submission of extensive data on transportation cost factors. In addition, the model may result in a significant redistribution of funding. For both of these reasons, a transition period will be required.

Another engaging section of the report (pages 48-49) is the assessment of school operating costs as fixed versus variable. That analysis is included below in its entirety, for clearest context. (cite as Hartman, W. & Schoch, R. (2015). Final Report of the Study of Increasing and Declining Enrollment in Maryland Public Schools. Denver, CO: APA Consulting.)

Numerous factors affect a district’s ability to adjust to either increasing or decreasing enrollment. School expenditures include both fixed and variable costs. Little adjustment is possible if costs are fixed. Some costs vary directly with enrollment changes. Other costs are subject to increments reflecting capacities such as school enrollment capacity, class size capacity, bus seat capacity, caseload limits, and other factors.

The following sections define fixed and variable costs and how each is impacted differently by enrollment changes and describe the options and limitations districts face when experiencing enrollment changes.

Fixed and Variable Costs

Fixed costs in schools are independent of enrollment or the level of educational services provided. Fixed costs include buildings, equipment, most utilities, grounds keeping, and many service contracts. Variable costs are costs that vary with the number of students served or programs provided. The operating costs of districts include a mix of both fixed and variable costs.

Examples of fixed costs in education include:
-one-of-a-kind positions (principal, school building secretary, school custodian, school nurse, librarian, etc.);
-school building construction debt service;
-school building utilities (heating/cooling fuels, electricity, water/sewer, etc.);
-contracted maintenance services (HVAC maintenance, fire and security alarm maintenance, etc.);
-grounds keeping costs (mowing, landscaping maintenance, snow removal, etc.);
-bus transportation costs when ride times would be excessive if all seats were filled to capacity;
-textbook series purchased for maximum enrollment;
-library books; and
-computer lab equipment.

Examples of typical variable costs in education, that is, those that can be adjusted with enrollment changes include:
-teaching staff for both regular and special education students;
-instructional aides/assistants/paraprofessionals; and
-consumable instructional supplies.

However, even some variable costs are difficult to adjust over short periods of time. These costs include changes that occur in one-unit increments, such as personnel changes based on caseload regulations or class size limits. Bus capacities are another example of a hard-to-adjust-for variable cost.

These may include:
-guidance counselors;
-specialist teachers (these are teachers, such as art, music, and physical education teachers, who provide classroom coverage according to the instructional schedule for regular teachers during planning and lunch periods); and
-central administrative positions (payroll, human resources, curriculum, administration).

The separation of fixed and variable costs is intriguing in part because it challenges underlying notions of state funding requirements. County “maintenance of effort” funding requirements arise from an implication that each cost of education is a purely variable costs, and must be maintained on a rigid per-student basis.

An overview document of the several reports and presentations made at the July 22 meeting is available online.

First “Hybrid” School Board in Harford County

cont From the Department of Legislative Services publication, Education in Maryland

Three appointed and six elected school board members were sworn-in as the first Harford County Board of Education of a so-called hybrid board this week. The transition from an appointed board to a board of both elected and appointed members is the result of state legislation passed six years ago, as reported in the Baltimore Sun.

Senate Bill 629 specified the methods of selection of the Harford County school board as:
The law, codified as Chapter 745, also stated that:

As described in the Department of Legislative Services’ handbook, Education in Maryland (2014), four counties have hybrid school boards,

The composition of the local boards of education varies, with 5 to 14 members serving three- to five-year terms. Seventeen counties have elected school boards, three counties have school boards that are appointed or jointly appointed by the Governor, and four counties have combined elected and appointed boards, including several unique arrangements. Twenty-two boards have student members, but only seven boards allow student members to vote on matters excluding collective bargaining and other personnel and budgetary decisions.

For more information, read the full story from the Sun, the bill information page for Senate Bill 629, and more information from Education in Maryland.

Allegany County Directs Casino Revenue to College Scholarships, Reaching Hundreds of Students

Hundreds of college students can pursue their college studies thanks to county scholarships funded by casino revenue, as reported by the Cumberland Times-News.

As reported,

Of the first $800,000 of slots revenue paid to the county by the Rocky Gap Casino Resort, 45 percent goes to the ACM [Allegany College of Maryland] Foundation and 25 percent to the Frostburg State University Foundation to fund the scholarships. The scholarships are available to Allegany County residents.

Allegany County Commission President Bill Valentine, who also serves as Vice Chair of MACo’s Education Subcommittee, was quoted in the article,

Helping students obtain a college degree is “key to our economic success in the next few years,” said Allegany County Commission President Bill Valentine on Thursday. Valentine made his comments during a presentation by college officials about the scholarships at the commission’s business meeting.

For more information, see the full story from the Cumberland Times-News.

This year’s MACo Conference will feature a session on apprenticeship programs, including apprenticeships and other workforce training available to Maryland community college students.

Learn more about MACo’s Summer Conference:

For a schedule of educational sessions at MACo’s Summer Conference, please view the Registration Brochure.

Questions? Contact Meetings & Events Director Virginia White.

Maryland Publishes School Size Report with Enrollment Recommendations

The final school size report has been published and posted on The Maryland State Department of Education (MSDE) website.

The School Size report’s Executive Summary sets forth two recommendations:

The research team has suggested enrollment limits based on the points at which schools in Maryland start becoming both less cost efficient and less productive. These enrollment limits are set at 700 students for elementary schools, 900 students for middle schools, and 1,700 students for high schools. The study team does not recommend that schools in Maryland should be this large, but no newly constructed schools should be allowed to exceed these limits.

The second recommendation suggests that the State should develop a small schools incentive grant program. Such a program would provide financial incentives and support for replacing the State’s largest, low-performing schools or for renovating existing large school buildings. Based on the research team’s set of assumptions, up to 74 schools would be eligible for this type of grant. The estimated costs vary, but will ultimately be controlled by the fiscal decisions of state policy makers.

For more information, read the whole report:

Final School Size Study Report: Impact of Smaller Schools

Prince George’s Will Earmark Half of Casino Revenue to Schools

The Prince George’s County Council unanimously approved a measure this week to earmark half of all county casino revenue generated from the MGM casino to public schools, libraries, and community colleges. As reported by the Washington Post,

Lawmakers introduced the measure in response to a proposal by County Executive Rushern L. Baker III (D) to raise property taxes by double-digits to generate new funding for schools. The council rejected the plan after a public outcry, raising taxes by a third of his original request.

The bill passed Tuesday would redirect 50 percent of the $42 million in revenue the casino is expected to generate once it opens in 2016 from the county’s general fund to its schools, library and community college budgets.

“This money should not supplant money that is already funding the schools, but supplement,” said council Chairman Mel Franklin (D-Upper Marlboro).

The legislation caps the amount of supplemental funding at $25 million.

The county executive’s office did not take an official position on the measure.

Baltimore Pursues College Scholarships for High School Students

As reported in the Baltimore Sun, Baltimore has been asked to submit a proposal for a program that could provide every high school graduate a college scholarship.

As described,

The national Say Yes to Education organization has chosen Baltimore to submit a proposal showing how local leaders would work together to help students socially, academically and financially to graduate from high school and enroll in college.

If chosen, Baltimore would join Syracuse and Buffalo, N.Y., in covering tuition for all students, regardless of income, to attend the state’s public universities. Students from low-income households would also be eligible to receive full scholarships to dozens of private colleges.

For more information, read the whole story from the Baltimore Sun.