Of Course It Didn't Save Money

It appears that Mike Huckabee's efforts to merge smaller school districts and shut down schools to save money actually cost more money.

I'm not sure if McKinsey was involved with this, but it's certainly a McKinsey result. 

When Mike Huckabee was the Arkansas governor in 2004, he wanted government to be more efficient. He signed a law to shut down tiny school districts with fewer than 350 students.

Over the next decade, 85 school districts merged with others, triggering the closure of 105 schools, most of them high schools.

Families and teachers protested. Some students had bus rides so long that they couldn’t participate in sports and other after-school activities. A 2022 study found that the mergers had accelerated depopulation in rural communities and depressed property values; that same year another study found almost no academic gains.

At least there was one potential payoff: saving taxpayers money.

What economic sense does it make to maintain a superintendent and a district office to serve just a couple hundred students? Consolidating tiny districts seemed like an obvious way to eliminate administrative overhead.

But a surprising new analysis by researchers at the University of Arkansas finds that the savings never materialized. Reductions in administrative overhead were offset by rising costs for transportation and instructional staff.

The study, presented Sept. 26 at the annual conference of the Society for Research on Educational Effectiveness in Baltimore, followed the finances of Arkansas school districts for two decades. It found no overall cost savings from consolidation — not immediately after districts merged and not more than a decade later.

………

So where did the savings go?

Administrative costs did fall. The researchers estimate that consolidation reduced administrative spending by as much as $138 per student, on average, according to their preliminary, unpublished calculations. Some instructional costs, including spending on education technology and textbooks, also declined, by as much as $92 per student.

But those savings were eaten up by higher costs elsewhere.

Transportation costs rose $24 per student initially and continued climbing over the years, growing to an additional $63 per student annually. Instructional staff costs — including teachers and aides, as well as math and reading coaches — rose by as much as $179 per student. Pupil-support costs, including guidance counselors and social workers, rose by as much as $61 per student.

The basic problem is that merging two districts doesn’t eliminate the need to educate the same number of children. And larger districts may create new layers of management or add more support staff, such as instructional coaches, counselors and aides.

Also money spent on consultants, I'm sure.