In 2004, Arkansas Governor Mike Huckabee initiated a move to streamline government operations by advocating for the closure of small school districts with fewer than 350 students. Over the next decade, this led to the merger of 85 districts and the closure of 105 schools, mostly high schools, amidst considerable public dissent.
Observers noted that the consolidation resulted in longer commute times for students, many of whom struggled to engage in extracurricular activities. A 2022 study pointed to accelerated depopulation in rural areas and diminished property values while another found little to no improvement in academic performance following the mergers.
Originally, the rationale behind these mergers was clear: reduce administrative expenses by eliminating duplicate positions. However, recent findings from the University of Arkansas challenge this notion. Their analysis, presented on September 26 at a conference of the Society for Research on Educational Effectiveness, tracked 20 years of financial data from Arkansas school districts and concluded that overall cost savings from consolidation were nonexistent.
Josh McGee, the study's co-author and an economist at the University of Arkansas, expressed caution regarding the push for school consolidations, stating, “The potential benefits have not materialized as envisioned, and there are real potential harms.” Despite the study's significant findings, it has not yet been peer-reviewed.
Arkansas serves as a particularly instructive case study due to its statewide consolidation mandate. McGee asserts that the financial dynamics observed here could reflect trends seen in other states, especially as national student enrollment is forecasted to drop by 6% between 2020 and 2030.
So where did the anticipated savings vanish? Initial reductions in administrative costs were somewhat tangible, with an estimated decrease of $138 per student in administrative spending, along with a drop in certain instructional costs like textbooks, estimated at $92 per student. Yet, these cutbacks were overshadowed by spikes in other areas.
Transportation costs, for instance, climbed by $24 per student immediately post-merger, ultimately reaching an additional $63 annually. Simultaneously, expenditures on instructional staffing, including teachers and aides, saw an upwards trend of about $179 per student. And costs related to support staff like counselors also rose, with increases around $61 per student.
The fundamental issue lies in the fact that merging school districts does not reduce the total number of students needing education. Instead, larger entities often introduce new administrative layers, alongside additional support roles that do not equate to overall downsizing.
Montgomery, a district that was compelled to merge, once catered to just 81 students. However, the study did not ascertain whether such small populations can effectively fund a viable district.
Interestingly, the type of merger seems to impact outcomes significantly. The analysis noted more effective savings when larger districts absorbed smaller ones, as opposed to the merger of two small districts.
Another complicating factor is the state's funding formula, which ties funding to student numbers rather than reflecting the number of educational districts. Thus, even with fewer districts, the financial pressures to educate students remain unchanged, creating no incentives to streamline expenditures.
According to McGee, “You receive your state allotment based on the number of students, leading schools to find ways to utilize that funding effectively.” He hopes such spending contributes positively to educational outcomes.
This research does not categorically debunk the merits of all district mergers. A large district absorbing a smaller one might offer different economies than two small districts combining. However, the Arkansas case indicates that simply consolidating districts does not inherently lead to lower educational costs.
In fact, Arkansas appears to be retreating from strict consolidation policies. The state is increasingly granting waivers for districts that fall below the enrollment threshold, and there are instances of districts opting to separate into smaller units.
The promise of consolidation was to reduce disruptions while saving costs; however, after two decades of data from Arkansas, it seems that the expected financial efficiencies have yet to materialize.
Contact staff writer Jill Barshay at 212-678-3595, jillbarshay.35 on Signal, or [email protected].
This article on school district consolidation is from The Hechinger Report, a nonprofit news organization focused on education. Subscribe to Proof Points and other Hechinger newsletters.
