The Texas Education Agency (TEA) issued its final version of the 65% Rule today. A readers of this blog know, I am not a fan of this one size fits all approach (see prior posts on the 65% Rule here). However, the TEA has done several things to make the rule implementation palatable.
On August 22, 2005, Governor Perry issued an Executive Order that required the TEA to mandate that school districts spend 65% of their budget "in the classroom." While maximizing the funds spent on students' education is critical, the definition of "in the classroom" has been problematic. The definition excludes items that districts are required by State and Federal law to provide to students. (See this prior post for examples of these excluded mandates).
Gov. Perry’s Executive Order refers to the definition used by the National Center for Educational Statistics (NCES). Under this definition, the following are not included in the calculation of "in the classroom" expenditures: Administration, Plant Operations & Maintenance, Food Services, Transportation, Instructional Support, including Librarians, Teacher Training and Curriculum, Student Support, including nurses and counselors.
The TEA's new rule (.pdf) requires that as part of the school district's financial accountability rating, each school districts must answer the following indicator beginning in 2006-2007:
- Was the percent of operating expenditures expended for instruction more than or equal to 65%?(Functions 11, 36, 93, and 95)(see below for details on each Function code).
This indicator utilizes the restrictive definition propounded by NCES and is subject to a 3 year phase in - 55% for 2006-2007, 60% for 2007-2008, and 65% thereafter).
Each school district must also answer the following indicator beginning in 2006-2007:
- Was the percent of operating expenditures expended for instruction more than or equal to 65%? (Functions 11, 12, 31, 33, 36, 93, and 95)
This indicator allows districts to include counselors, nurses, and librarians in the determination of the percentage of funds expended on "instruction." This indicator is not subject to a 3 year phase in.
Here's where the TEA made the implementation of this rule palatable. Each of these indicators carries a weight of 3 points, i.e., a total of 6 points out of the 100 points that comprise the district's FIRST rating. A copy of the new TEA FIRST Rating Worksheet effective August 2006 for the 2006-2007 school year is available here (.pdf).
In addition, a district can avoid any negative consequences due to a failure to meet these indicators by simply publishing its check register on the district's website. I am a proponent of this option regardless of the implications of the 65% rule as I believe doing so will promote increased transparency and accountability.
I also believe that the new rules further enhance transparency and accountability by requiring districts to report the following in the annual financial management report:
- a copy of the superintendent's current employment contract. The school district may publish the superintendent's employment contract on the school district's Internet site in lieu of publication in the annual financial management report;
- a summary schedule for the fiscal year (12-month period) of total reimbursements received by the superintendent and each board member, including transactions resulting from use of the school district's credit card(s) to cover expenses incurred by the superintendent and each board member. The summary schedule shall separately report reimbursements for meals, lodging, transportation, motor fuel, and other items (the summary schedule of total reimbursements is not to include reimbursements for supplies and materials that were purchased for the operation of the school district);
- a summary schedule for the fiscal year of the dollar amount of compensation and/or fees received by the superintendent from another school district or any other outside entity in exchange for professional consulting and/or other personal services. The schedule shall separately report the amount received from each entity;
- a summary schedule for the fiscal year of the total dollar amount by the executive officers and board members of gifts that had an economic value of $250 or more in the aggregate in the fiscal year. This reporting requirement only applies to gifts received by the school district's executive officers and board members (and their immediate family as described by Government Code, Chapter 573, Subchapter B, as a person related to another person within the first degree by consanguinity or affinity) from an outside entity that received payments from the school district in the prior fiscal year, and gifts from competing vendors that were not awarded contracts in the prior fiscal year. This reporting requirement does not apply to reimbursement of travel-related expenses by an outside entity when the purpose of the travel is to investigate or explore matters directly related to the duties of an executive officer or board member, or matters related to attendance at education-related conferences and seminars whose primary purpose is to provide continuing education (this exclusion does not apply to trips for entertainmentrelated purposes or pleasure trips). This reporting requirement excludes an individual gift or a series of gifts from a single outside entity that had an aggregate economic value of less than $250 per executive officer or board member; and
- a summary schedule for the fiscal year of the dollar amount by board member for the aggregate amount of business transactions with the school district. This reporting requirement is not to duplicate the items disclosed in the summary schedule of reimbursements received by board members; and
- any other information the board of trustees of the district determines to be useful.
Given what initially appeared to be a near complete erosion of local control, in my opinion, the TEA's final implementation of the 65% rule and the additional accountability factors is far less onerous than it otherwise might have been. Indeed, I believe that publication of the district's check register as well as the additional publication requirements will enhance the public trust in its public education system.
[The Function Codes appear below]