New Report Released: "Does School Reform = Spending Reform?"

January 17, 2017

A new study from the Education Research Alliance for New Orleans at Tulane University examines how New Orleans schools’ spending patterns changed after the city shifted to a charter-driven system.

The study analyzes the effects of post-Katrina school reforms on the operating expenditures of New Orleans’ publicly funded schools. Authors Christian Buerger and Douglas Harris were able to estimate these effects by comparing spending levels of New Orleans schools from 2000 to 2014 to those of a comparison group of Louisiana school districts that had spending patterns nearly identical to New Orleans before the reforms.

Researchers find that New Orleans publicly funded schools spent 13% more ($1,358) per pupil on operating expenditures than the comparison group by 2014. “Taking a closer look at the spending trends,” Buerger said, “we found that administrative expenditures increased by 66% ($699 per pupil) relative to the comparison group, while instructional expenditures decreased by 10% ($706 per pupil).”

The study also finds that salaries for administrators and teachers are moving in opposite directions, but the situation is more complicated than it looks. According to Buerger, “Teachers are earning less because they have less experience. Those with the same experience now earn more than teachers before the reforms.”

“The fact that instructional spending has decreased despite a large increase in operating expenditures is striking,” Harris noted. “The increase in administrative spending suggests either that it is costly for charter schools and CMOs to provide the services that school districts normally would or that charter leaders think more management-driven strategies will be more effective.” The authors also find a 33% ($300 per pupil) increase in transportation spending.

The study is the first of its kind to look at the effect that switching from traditional public schools to charter schools has on operating expenditures, which helps isolate the effect of the charter approach. “These results are somewhat surprising given the common concern that traditional school districts spend too much on large bureaucracies,” Buerger said, “but it is worth noting that these changes in spending levels and patterns came alongside a large improvement in education outcomes for students.”

While this study focuses on how New Orleans schools’ spending patterns have changed as a result of the post-Katrina school reforms, the Education Research Alliance for New Orleans has forthcoming studies examining the factors that explain educator compensation and school leader compensation.