State data shows local schools top heavy
St. Louis County, Ely school district administrative costs above state average
Both the St. Louis County and Ely school districts have administrative costs far above the norm for districts of similar size in Minnesota. That’s according to the Minnesota Department of Education (MDE), which annually posts comparisons of school district expenses by category.
School boards typically work to contain administrative costs—particularly when budgets are stressed by flat funding— in order maximize the funds available for teachers and other programs that impact the classroom. But some school districts have been more effective at it than others.
Iron Range school districts like Virginia and Hibbing have managed to remain well below statewide averages for administrative costs, while Grand Rapids, the district with the most schools and the largest total enrollment in the region, outside Duluth, has kept administrative costs close to the average for similarly-sized districts.
But both Ely and St. Louis County have struggled to keep administrative costs in check, even as both districts have been forced to make painful cuts in other areas, including cuts directly affecting students.
The St. Louis County School District, or ISD 2142, is planning significant teacher reductions for next year, as the district attempts to stem a rising tide of red ink. As many as 15 teachers may be on the chopping block next year according to recent discussions by school officials.
Ely is looking at some minor teacher adjustments for next year, most likely less than 1 full-time equivalent, according to School Board Chair Ray Marsnik.
But neither school district has announced plans to trim administrative overhead, at least as of this week.
Marsnik noted that Ely’s school district administration has undergone a significant number of changes over the past three years, including three different superintendents, and board members appear to favor maintaining at least one year of stability before considering how the district might pare administrative costs further.
Ely’s administrative costs did increase following the replacement of former Superintendent Don Langan, who worked on a part-time basis, with a full-time superintendent. Marsnik said that increase in administrative costs was partially funded by federal stimulus dollars in 2010, which helped buffer the financial impact of the shift to a full-time superintendent. But those extra dollars are no longer available, which is forcing the district to turn to other revenue sources to make up the difference.
Marsnik acknowledges that the district’s administrative costs are higher-than-average. “It’s an area that we will probably have to take a look at in the near future,” he said.
St. Louis County school board members have begun discussing administrative cutbacks as well, but those discussions have yet to result in actual reductions.
School districts assess administrative costs by a variety of means, including actual dollars expended, percentage of total budget, and, the cost per student, or “average daily membership,” or ADM in school district parlance.
Marsnik said he prefers the cost per ADM as the best way to compare schools, since it shows how much of the aid schools receive for their students winds up being spent on administration, or in any other budget category.
According to MDE data (see chart accompanying this story in our e-edition) from the most recently completed school year (2011-12), both Ely and the St. Louis County schools were both well above the norm, although St. Louis County is the more extreme case. The MDE breaks down administrative costs into “district” level costs and “school” level costs. The MDE also tracks averages in both categories for school districts of comparable size. In both categories, ISD 2142 is exceptionally high. According to the MDE, the district spends $663 per ADM for district level administration and an additional $699 for school level administration. That amounts to $1,360 in total administrative costs per ADM, which is among the highest in the state for districts of similar size.
According to the MDE, the average school district with student enrollment between 1,500 and 2,199 (ISD 2142 is currently about 1,890) spends $375 per ADM on district level administration and an additional $408 per ADM on school level administration— for a total of $783 per ADM. That puts ISD 2142 almost 74 percent above the statewide average for administrative costs for similarly-sized districts.
Ely, with a current enrollment of approximately 545 students, spends $796 per ADM on district level administration and an additional $541 on school level oversight— for a total of $1,335 per ADM.
While that’s nearly as high as ISD 2142, Ely fares better in the comparison with school districts of similar size. That’s because smaller districts tend to spend more on administrative overhead than larger ones on a per ADM basis.
On average, school districts with enrollments between 470 and 624 spend $616 per ADM on district level administration and $432 at the school level. That’s a total of $1,048 per ADM, which puts Ely 27 percent above the average for districts of similar size.
On a percentage basis, Ely spends slightly more of its overall budget, 10.26 percent on administration, than does ISD 2142, which spent exactly 10.0 percent, according to MDE data. In overall dollars, ISD 2142 spent far more, a total of $2.58 million compared to $724,486 for Ely. But that’s an example where differences in district size can make comparisons of little value.
Other Iron Range districts have a mixed record on administrative costs, although most of the larger districts perform better than average. Virginia performs best of all, spending $322 per ADM on district level administration and $191 on school level oversight. That’s just $513 total per ADM, putting Virginia well below the statewide average. With 1,643 students enrolled, Virginia falls within the same size range as ISD 2142.
Hibbing, with 2,350 students, spends a total of $649 per ADM for all administrative costs, which is also well below the $738 per ADM average for districts with enrollment between 2,200 and 4,449.
Grand Rapids, which operates eight schools, including the Bigfork School, spends a total of $794 per ADM on administration. With a total of 3,953 students, that’s slightly above the average for districts of similar size.
While such comparisons offer a useful guidepost for school districts and taxpayers, Hibbing Superintendent Bob Belluzo said they are not always as reliable as the numbers may indicate. School districts report expenditures to the MDE using numbered categories, known as UFARS codes, and Belluzo said differences in how school districts code their expenses can skew results.
Still, Belluzo agreed that school districts need to be watchful to ensure that administrative costs don’t get out of line. He noted that his school district has made a number of reductions in recent years, phasing out the assistant superintendent and curriculum director positions, as well as reducing the number of assistant principals in the 1,300-student Hibbing High School from two to one. Hibbing also splits the time of one principal between the district’s two elementary schools.
The Timberjay sought information about ISD 2142’s administrative costs, but emailed questions to the superintendent and business manager went unanswered.