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An Issue Paper Prepared by
I. David Wheat, Jr.
for the
Thomas Jefferson Institute for Public Policy
Executive Summary
The “Big Bucks” theme has dominated this session of the Virginia General Assembly. Due to a strong economy fueling state revenues, the 1998-00 budget appears headed for a $4 billion increase over the last biennial appropriation, but proponents of new spending programs have squared off against those who see a tax cut opportunity. As usual, the big ticket items have captured most of the media attention. Often unspotted—and, therefore, largely unknown to the general public—are some programs that are missing from the big bucks radar screen, yet have high-return potential for the tax dollars invested.
A case in point is the Education Department’s two-year-old Truancy Program, established by the General Assembly in 1996. It’s too soon to say whether the $2 million annual outlay for “reducing truancy and making schools safer” is working. What is clear, however, is that the goal makes sense. It has been estimated that reducing excessive absenteeism in the Commonwealth’s public schools by 25 percent would enable 22,000 more young Virginians to score above the national average on standardized tests. That’s more than twice the benefits expected from adding 2000 teachers to elementary classrooms.
The goal of this paper is to substantiate the connection between attendance and achievement and to examine some low-cost strategies for raising student attendance. Special attention is given to performance bonus programs for both school divisions and instructional personnel.
The Big Bucks SessionThe 1998 session of the General Assembly began with state tax revenues projected to produce a $4 billion budget increase, compared to the 1996-98 biennium. Governor Jim Gilmore wants much of that surplus tagged for his campaign pledge to reimburse local governments for their lost revenues if the legislature agrees to eliminate most of the personal property tax levied locally on cars and trucks. His opponents on this issue have countered with a plan to cut the sales tax on food.While tax cut proposals and refund options have dominated the legislative debate, the surplus funds have not gone unnoticed by those wanting to expand current programs or initiate new ones. In the education area, for example, the Governor also wants to fund the state’s share of 2000 new elementary teachers. His adversaries see this as an opportune time to use lottery fund profits for direct state aid for public school construction and renovation.
The tax cut debate and the big ticket spending items have gained most of the media attention. Up for renewal, however, are dozens of relatively small programs that get very little coverage. And some of the programs missing from the legislative radar screen may yield higher returns on the tax dollars spent than more costly programs.The Truancy ProgramA good example of a low-budget, high-potential program that gets little public notice is the public school Truancy Program.In 1996, the General Assembly passed a two-year $4 million appropriation to fund Education Department grants for reducing truancy and supporting safety in elementary and middle schools. The Governor’s budget proposal for 1998-00 includes a similar amount.
Grant eligibility and amounts are based on the number of elementary and middle schools in a school division that have the poorest attendance records, based on the percentage of students who are absent more than 10 days in a school year. Nearly 200 schools in about half of the state’s school divisions were eligible for Truancy Program grants in 1996-98, and the school divisions’ grants ranged in amount from $20,000 to just over $500,000, depending on the number of participating schools.1It is too soon to say whether the $2 million annual outlay for reducing truancy and making schools safer is working. What is clear, however, is that improving attendance should be a high priority goal. In 1996, about one-third of the school divisions had between 32 and 53 percent of the students miss more than 10 days of school.2 (See the map on the front cover.)The EvidenceThe connection between attendance and achievement is grounded in common sense. Unless a student is productively engaged in off-campus independent research, he will find it difficult to learn what is taught at school in his absence.This common sense understanding is supported by research in Virginia. It has been estimated that reducing excessive absenteeism in the Commonwealth’s public schools by 25 percent would enable 22,000 more young Virginians to score above the national average on standardized tests.3It should be emphasized that the correlation between attendance and achievement is not a by-product of social or economic factors at work. In the Virginia study, a statistical analysis revealed that even after the social and economic factors were held constant, schools with higher attendance rates achieved higher test scores .4In layman’s terms: If two school divisions have students with similar social, ethnic, and economic characteristics, the school division with the higher attendance
rate will have the higher test scores.Thus, the logic implicit in the Truancy Program—that raising student attendance will improve student achievement—is supported by hard data from Virginia’s public schools.Other Low-Cost Strategies For Improving AttendanceSchool Division Performance BonusesUnder the Truancy Program, school divisions with the highest absentee rates receive extra state funds to try to improve attendance. A performance bonus strategy, on the other hand, would reward a school division only after it achieves higher attendance levels on its own initiative.To experiment with a performance bonus program, the General Assembly should consider amending the Standards of Quality state aid formula to reflect changes—up or down—in excessive absenteeism for each school division.For example, the basic aid formula might be amended so that the Average Daily Membership (ADM) would be adjusted up or down 1/10 of one percent for each percentage point change in the number of students absent no more than 10 days a year, compared to that same measure in some prior “base” year.In that case, a school division with 5000 students that improved 6 percentage points on the excessive absenteeism measure would get to use 5030 as its calculated ADM for purposes of computing the basic aid. The state would then fund 100 percent of the cost of the “additional 30 students”—an amount equal to about $96,000 currently.5That state subsidy would increase in subsequent years if school division performance continued to improve. However, the subsidy would decrease if excessive absenteeism rose, and it would disappear entirely if future absentee rates reached or exceeded the base period rate.Extending this example statewide, consider that the total ADM is about one million students. If all school divisions showed an improvement of 6 percentage points (a 25 percent improvement), that would increase the calculated ADM by 6/10 of one percent, or about 6000 students. State
funding for 100 percent of the basic aid (about $3200 per pupil) for the “additional 6000 students” would cost about $19 million.Additional examples could illustrate variations on the theme. Different incentive amounts could be used, and a cap on the total incentive payments could be set. The essential principle of this strategic approach, however, is clear:Reward school divisions that reduce excessive absenteeism after they have done it, and continue that reward as long as they continue to do better than their base period performance.School divisions may develop some creative—and probably effective—ways to spend the Truancy Program funds. However, the creativity and effectiveness that would be fostered by a performance bonus program would likely be greater for two reasons.First, administrators in all school divisions—not just half—would be actively engaged. Without much doubt, that would introduce additional effective ways to combat excessive absenteeism.Second, there is reason to expect greater effort to produce results—at lower cost—when there is the prospect of gaining additional funding that could be used for instructional purposes, attendance programs, or both.Individual School Performance BonusesThe General Assembly should also consider funding a performance bonus program for those on the front lines—all instructional personnel—in schools that reduce excessive absenteeism. Principals and teachers should get a tangible reward for improving attendance in their particular schools, regardless of what happens elsewhere in their division.The primary purpose of the school-level incentive should be to jump start the divisionwide effort to reduce excessive absenteeism. Thus, it would more appropriately be a onetime start-up initiative rather than an on-going incentive program.
Consider, for example, an individual school goal of raising the attendance measure by 6 percentage points. A one-time $100 state-funded bonus could be awarded to each teacher and principal in schools that achieve the attendance goal. Since the number of teachers and principals in Virginia is near 80,000, such a program would cost a maximum of $8 million if every school in the state achieved the attendance goal.After that one-time state bonus for teachers had been paid, local school divisions could consider sharing a portion of any future school division attendance bonus with school personnel who maintain target attendance levels at their schools.It is highly unlikely that all schools would achieve the attendance goal in the same year. So the total maximum bonus payout would be spread over several years, and the budget impact would obviously be less if some schools failed to reach the goal.Education Department WorkshopsCutting absentee rates is not easy, nor can it be done without committing at least some resources. However, in the past six years, 75 percent of the school divisions have lowered their absentee rates .6The Department of Education should provide opportunities for all school administrators to learn from the success of others. And, as administrators perform the required evaluation of their schools’ Truancy Program, it certainly makes sense to share those findings widely.Therefore, the Department should sponsor mandatory workshops for all school principals and at least one school division administrator to identify effective tactics for reducing absenteeism.ConclusionThe Truancy Program is aimed at the right goal. In addition, it’s not expensive. However, the money will be spent whether any significant attendance improvements occur at all. Only after the money is spent will an evaluation of the program’s effectiveness be possible.An alternative approach is the performance bonus strategy. The funds would be awarded to schools and school divisions only after excessive absenteeism was reduced. Moreover, every dollar spent would be for progress actually achieved.
If both performance bonus plans were adopted, and the result was a statewide attendance improvement of 6 percentage points for every school, the total annual cost would be about $19 million for the school divisions, and a one-time $8 million bonus for principals and teachers. If attendance did not improve, the cost would be zero.What would be the benefits? It has been estimated that reducing excessive absenteeism by 6 percentage points (about a 25 percent improvement) would result in 22,000 more students scoring above the national average on standardized tests.7That’s more than twice what could be expected from adding 2000 new teachers, and at one-fourth the cost?
Next WeekAn old definition of politics is “who gets what, when, where, and how.” That adage gains credibility when lawmakers persist in highlighting the regional impact of isolated bills without acknowledging the cumulative effect of all legislation passed.Next week, the final issue paper in this series examines one way to balance the interests of the entire state and localities. And the three topics in the previous papers— distribution of 2000 teachers, car tax cut reimbursements, and improving student attendance—illustrate the balancing act.
1 Truancy/Safe School Grants: Status Report (Virginia Department of Education, September 1997).
2 Outcome Accountability Project (Department of Education, 1996).
3 Understanding Virginia’s Report Card: Why Test Scores Vary from One Community to Another (Thomas Jefferson Institute for Public Policy, November 1997). In the Virginia study, as in the Truancy Program, the indicator of excessive absenteeism was the percentage of students absent no more than ten days in the school year. In the map on the cover, the data are displayed in reverse format: the percentage missing more than ten days.
4Ibid.
5 Assumes an average basic aid amount per pupil of about $3200 (about 5% higher than the 1997-98 amount).
6 Outcome Accountability Project, 1991-96.
^ Understanding Virginia’s Report Card.
82000 Teachers: Where Are They Needed Most? (Thomas Jefferson Institute for Public Policy, February 1998).
About the Author
I. David Wheat, Jr. is a strategic planning consultant retained by the Thomas Jefferson Institute for Public Policy to examine complex education policy issues, and this is the fourth publication in a series. Others include Understanding Virginia’s Report Card: Why Standardized Test Scores Vary from One Community to Another (November 1997), 2000 New Teachers: Where Are They Needed Most? (February 1998), and Car Tax Cuts: How Should Localities be Reimbursed? (February 1998).1
He is president of Wheat Resources, Inc., a consulting firm established in 1981 that specializes in helping clients organize and analyze data they use in making strategic decisions. He received his Master’s Degree in Public Policy from Harvard University’s Kennedy School of Government in 1972, and then served three years as a White House staff assistant specializing in economic and energy issues. Later, at the University of Houston, he served as Director of Federal Relations and designed and taught a graduate course on public policy implementation.
His education policy consulting work is enhanced by several years of nationally recognized classroom instruction experience in Virginia public schools, as well as by service on the Governor’s Commission on Champion Schools, where he participated in the upgrading of the history and social science Standards of Learning for Virginia’s students. He also teaches political science at Virginia Western Community College.