school-level resource allocation in urban public schools || processes and power in school budgeting...

Processes and Power in School Budgeting Across Four Large Urban School DistrictsAuthor(s): Margaret E. Goertz and G. Alfred Hess, Jr.Source: Journal of Education Finance, Vol. 23, No. 4, School-Level Resource Allocation inUrban Public Schools (Spring 1998), pp. 490-506Published by: University of Illinois PressStable URL: http://www.jstor.org/stable/40704040 .

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JOURNAL OF EDUCATION FINANCE 23 (SPRING 1998), 490-506

Processes and Power in School Budgeting Across Four Large Urban

School Districts1 By Margaret E. Goertz and G. Alfred Hess, Jr.

shared decision-making and school-based management have emerged as central themes in the current

education reform movement. Support for greater autonomy at the building level comes out of the desire to involve parents more directly in the education of their children, the recognition of the principal as a key educational decision-maker, the emergence of school-based management and governance as more responsive to educational needs, and the reconsideration of the school as a site for the delivery of an array of social services.

In 1983, with the publication of A Nation at Risk: The Imperative for Educational Reform, the report of the National Commission on Excellence in Education, the focus of thinking about public schooling shifted from efforts to assure equity in educational opportunity to efforts to improve the outcomes and effi- ciency of America's schools. During the three decades prior to the report's release, the Supreme Court had outlawed segregated schools, several state supreme courts had overturned their state's school finance schemes, and Congress enacted legislation providing compensatory funding for economically disadvantaged students and mandated equal treatment for students with special needs and

1 . The findings reported in this article are based on research conducted in Chicago by the authors and Ross Rubenstein, in Fort Worth by Joel Sherman and Shana Pribesh, in New York City by Robert Berne, Patrice M. Iatarola and Leanna Stiefel, and in Rochester by Michele Moser. The research was supported by a grant from the Andrew W. Mellon Foundation. We thank Catherine Clark, the review- er for this volume, for helpful comments on a previous draft. The statements made, and views expressed, are solely those of the authors.

Margaret E. Goertz is a Professor of Education and Co-Director of the Consortium for Policy Research in Education in the Graduate School of Education at the University of Pennsylvania and G. Alfred Hess, Jr. is the Executive Director of the School of Education and Social Policy at Northwestern University.

[490]



Processes and Power in School Budgeting 49 1

whose first language was other than English. In the decade and a half since the report was issued, the focus has been on setting chal- lenging standards for students and teachers, and improving accountability measures for judging school effectiveness.

While some scholars have argued that the shift towards excellence represented a turning away from concerns with equity,2 others saw the shift as providing a way to address the continuing large gap between the achievement of poor and minority students and that of more advantaged students.3 The "first wave of reform" following the release of A Nation at Risk, was reform by accountability. States across the nation established new and higher graduation requirements, new requirements for teacher certification, and statewide testing programs to publicize and compare levels of student performance. By 1997, 37 states published test scores for every school in the state.4 School-level reporting of student achievement was considered essential, because it would be schools, one at a time, that would have to change if student achievement were to improve.5

But if schools are to be held accountable for the achievement of their students, then they must be given responsibility for making the decisions that would change their current methods of operation and must be given control over the resources necessary to support changed ways of doing things.6 This argument has been based on effective schools research and research on high-involvement orga- nizations. The effective schools research identified characteristics of schools that were successful in educating inner-city disadvantaged students, among them a conviction among faculty that all students can learn, strong leadership by the principal, and clearly defined goals tied to educational programs designed to meet the

2. Edward L. McDill, Gary J. Natriello, and Aaron M. Pallas, "A Population at Risk: The Impact of Raising Standards on Potential Dropouts," American Journal of Education 94(2), 1986; A. Bastien, N. Fruchter, M. Gittell, C. Greer, and K. Haskins, Choosing Equality: The Case for Democratic Schooling (New York: New World Foundation, 1985).

3. Catherine Marshall, "The New Politics of Race and Gender," in The New Politics of Race and Gender, ed. Catherine Marshall (Washington, DC: The Falmer Press, 1993),l-6.

4. Council of Chief State School Officers, State Education Accountability Reports and Indicator Reports: Status of Reports Across the States 1997 (Washington, DC: Author, 1997).

5. See, for example, Carl Marburger, One School at a Time (Columbia, MD: National Committee for Citizens in Education, 1985).

6. Carl Marburger, School Based Management (Columbia, MD: National Committee for Citizens in Education, 1983).



492 Journal of Education Finance

changing educational needs of the students.7 Studies conducted in the private sector have shown that decentralizing power and authority to work teams, involving employees in making key decisions about how to organize and conduct their work, and holding work teams accountable for results enhance organizational effectiveness and productivity.8 In the context of school-based management, schools and their staff also need the power to make allocation and expenditure decisions, access to fiscal and performance information for making informed decisions, and training in the budget process.9

It is within this context that school-based budgeting has emerged as a part of the larger school-based management/shared decision-making reform effort. This reform has appeared in large urban districts in recognition that common decisions made by central office staff cannot be equally effective across the range of schools incorporated in these districts with very diverse student enrollments. Advocates of such reforms, such as Donald Moore, the executive director of Chicago's Designs for Change, point to the need to break open the system so that the concerns of students and of their parents can get a hearing within the operations of urban public schools.10 Moving decision-making to the school level is a critical strategy for allowing a diversity of policies and practices to emerge in the various schools of a large district, in order that the unique needs of different groups of students may all be met. School-based budgeting is at the core of this local decision-making.

The research on school-based budgeting has looked primarily at the design of different approaches to school-based budgeting and at the organizational and procedural changes within schools and

7. Ronald Edmonds, "Effective Schools for the Urban Poor," Educational Leadership 37 (1979): 15-18; Wilbur B. Brookover and Lawrence W. Lezotte, Changes in School Characteristics Coincident with Changes in Student Achievement (East Lansing, MI: Michigan State University, 1979); and Steven C. Purkey and Marshall S. Smith, "Effective Schools: A Review," The Elementary School Journal 81, no.l (1983): 426-452.

8. See, for example, Edward E. Lawler, The Ultimate Advantage: Creating the High Involvement Organization (San Francisco: Jossey Bass, 1992); Susan A. Mohrman and Priscilla Wohlstetter, eds., School-Based Management: Organizing for High Performance (San Francisco: Jossey Bass, 1994).

9. Priscilla Wohlstetter and Amy Van Kirk, "Redefining School-Based Budgeting for High- Involvement," in Where Does the Money Go?: Resource Allocation in Elementary and Secondary Schools, eds. Lawrence O. Picus and James L. Wattenbarger (Thousand Oaks, CA: Corwin Press, 1996), 212-235.

10. Donald R. Moore, "The Case for Parent and Community Involvement," in Empowering Teachers and Parents: School Restructuring through the Eyes of Anthropologists, ed. G. Alfred Hess, Jr. (Westport, CT: Bergin & Garvey, 1992), 131-155.



Processes and Power in School Budgeting 493

school districts adopting these reforms.11 We know little about the impact of decentralized governance and finance structures on the allocation of resources to and within schools, the knowledge and participation of members of the school community in budget decisions, and the interaction of resource allocation and educational programming decisions at the school level.

This article, and the three articles that follow, are designed to contribute to the body of research on school-based budgeting. They look at who makes school budget decisions and how they are made in four large urban school districts that implemented some form of school-based budgeting in the 1990s: Chicago, Fort Worth, New York City, and Rochester. As described in the Introduction to this volume, the findings are based on responses to 2,000 self-adminis- tered administrator, non-instructional staff, teacher, and parent questionnaires in a non-random sample of 30 schools in each of the four districts, and over 200 in-person interviews with district administrators, and school administrators, teachers, and parents in one-third of the sample schools.

This article uses data from the four cities to address three questions:

1. How much and what kinds of budgetary and personnel discretion do schools have under school-based budgeting?

2. How are resource allocation decisions made across and within schools? Who is involved and how? What do schools spend their discretionary resources on?

3. What factors affect how dollars are used in the school? In the articles that follow, Moser (Rochester), Peternick and

Sherman (Fort Worth), and Iatarola and Stiefel (New York City) provide more detail on the operation of school-based budgeting policies, and respondents' participation in resource allocation decisions, knowledge about schools' budgeting processes and operations, and perceptions of influence over resource allocation in the cities they studied. In addition, Moser compares processes and

11. See, for example, William H. Clune and Paula A. White, School-Based Management: Institutional Variation, Implementation and Issues for Further Research (Rep. No. RR-008) (New Brunswick, NJ: Rutgers University, Consortium for Policy Research in Education, September 1988); General Accounting Office, School-based Management Results in Changes in Instruction and Budgeting (Washington, DC: Government Printing Office, August 1994); Priscilla Wohlstetter and Thomas M. Buffett, "Promoting School-Based Management: Are Dollars Decentralized Too?" in Rethinking School Finance: An Agenda for the 1990s, ed. Allan R. Odden (San Francisco: Jossey-Bass, 1992), 128-165; Wohlstetter and Van Kirk, "Redefining School-Based Budgeting for High-Involvement."




opinions in schools that did and did not participate in Rochester's pilot school-based budgeting project and Iatarola and Stiefel contrast practices and perceptions in high and low performing schools in New York City.

Budgetary and Personnel Discretion under School-based Budgeting

The four school districts differ in the nature and extent of discretion given schools to make budgeting and personnel decisions. We can make three generalizations across the four sites, however.

First, although all four districts have engaged in some form of school-based planning since at least 1990, only two - Chicago (all schools) and Rochester (on a pilot basis) - have procedurally linked school-based planning and school-based budgeting.12 Generally, school-based planning entails requiring or encouraging schools to set school priorities and develop some type of school improvement plan with input from administrators, teachers, other school staff and/or parents. School improvement plans (SIPs) are mandated by the Chicago School Reform Act; by contract, every school in Rochester must create a School Based Planning Team (SBPT) that is responsible for developing a SIP. Texas requires all schools to develop school improvement plans in consultation with a school-level committee. At the time of our study, participation in school-based management was voluntary in New York City and commitment to school planning varied by community district and between the elementary and high school levels.

The Chicago School Reform Act requires Local School Councils (LSCs) composed of parents, teachers, and community members to adopt budgets that implement their schools' SIPs. Rochester began a pilot project in 1990-91 to extend school-based management to include greater decentralization of school budgets. The school develops a school-level budget by identifying a staffing plan and a specific allocation for other areas of expense, supposed- ly through the SBPT, or a subcommittee of the Team. There is no requirement that teachers and parents be included in these decisions. In Fort Worth, most budget decisions are made at the central office. Under Texas law, principals are responsible for the limited number of school-level budgetary decisions; school-level commit-

12. As of September 1997, New York City has begun what it calls Performance Driven Budgeting, an initiative to bring school-based budgeting to all public schools within three years, after multiple phas- es of development and evaluation.




tees are limited to an advisory role.13 Second, the discretion that schools have over their budgets is

limited by district budgetary and/or personnel allocation guidelines. School budgeting takes place at the margins. For example, while participating schools in Rochester are given a total allocation of resources for operating and capital expenses, the number of teachers in a school is based on pupil enrollment. Most of their discretionary funds come from their allocation for substitute teachers and small per pupil allocations. Chicago schools are also allocated staff based on student enrollments; their discretionary funds come from state compensatory education dollars which represent between 4 percent and 17 percent (mode of about 12 percent) of the elementary school and between 7 percent and 14 percent (mode of about 9 percent) of the high school budgets in our sample of Chicago schools. In Fort Worth, budgetary discretion appears to be limited to funds for instructional materials and supplies, and, if the school chooses, for building maintenance. At the time of our study, elementary and middle schools in New York City also had limited control over budgetary matters - funds for instructional materials and, in qualifying schools, funds for Title I programs.

Third, while schools are gaining more say in the individuals they hire, district policies and teacher contracts limit their ability to remove staff who may no longer meet school needs and priorities. Schools are also constrained by state and district requirements for specific positions. Chicago, for example, requires each elementary school to have a librarian and a physical education teacher; Rochester requires schools to employ art, music, and physical education teachers. One Chicago elementary school we visited, for example, no longer felt the need for a librarian. As they implemented a whole language reading program, they wanted to set up their library to be a research center for teachers to use with their classes. The librarian's position would then be used to increase their language arts staff.

It must be noted, however, that school districts and unions are increasingly employing contract waivers to allow individual schools to diverge from district wide practices. This instrument was

13. See Michele Moser, "School-Based Budgeting: Increasing Influence and Information at the School Level in Rochester, New York;" and Lauri Peternick and Joel Sherman, "Site-Based Budgeting in Fort Worth, Texas" in this volume, for more detail on Rochester and Fort Worth, respec- tively.




first introduced in Hammond, Indiana,14 and later utilized in the school-based management scheme in Dade County (Miami) schools.15 In Chicago, waivers were included in the original 1988 school reform legislation introducing school-based management, and made progressively easier to enact as the required supermajor- ity declined to a simple majority of teachers voting on the propos- al. Thus, a mechanism exists in Chicago for a school to eliminate its librarian, if a majority of the teachers agree to suspend the rele- vant section of the union contract.

Who Makes School Budgeting Decisions, How and for What?

Study respondents were asked a series of survey and interview questions about their knowledge of the school budget; the school budgeting process; their perceptions of who and what influences budget decisions; their satisfaction with their knowledge of, and involvement in, the school budgeting process; and how discretionary dollars are used in the school. The following patterns emerged across the four districts.

First, respondents in Chicago and in pilot schools in Rochester, whether administrators, teachers, or parents, were more likely to know about the existence of a school budget, to have access to that budget if they so desired, and to be satisfied with the information they get about their school's budget than their peers in the other districts or non-pilot schools in Rochester (Table 1: Items 1-3). Respondents in these schools, where there is a formal process for developing the school budget, are also considerably more likely to report that the school develops the initial school budget (Table 1 : Item 4). However, they are not more likely to report that the school has a lot of control over the way money is spent in their school (Table 1: Item 5). This response may reflect the limited discretion that schools have over spending, including what is included in their school budgets. In the words of one Chicago principal:

If I think about my school's budget as a whole (in its entirety), then I feel I (we at the local level) have

14. P. O'Rourke, "Shared Decision Making at the School Site: Moving Toward a Professional Model, American Educator (1987, Spring): 10-17.

15. M. K. Hanson, D. R. Morris, and R. A. Collins, "Empowerment of Teachers in Dade County's School-Based Management Pilot," in Empowering Teachers and Parents: School Restructuring through the Eyes of Anthropologists, ed. G. Alfred Hess, Jr. (Westport, CT: Bergin & Garvey, 1992), 71-87.




very little to say about the budget. School maintenance and repair, facilities, capital improvement, teacher and administrative salaries, textbook funds, instructional supplies, etc. budget lines are all determined at the district level and make up the largest proportion of the budget.

However, if I think about the proportion of the budget that is controlled at the local school level (discretionary funds), then I feel I have a lot of control. The problem is this amount of the budget, which is about 12 percent, is a small portion of the entire budget.... My lack of a sense of control stems from the 12 percent discretion rather than a higher percentage of discretion.

Second, regardless of the process used to develop the school budget, respondents in all four districts feel that the principal has considerable power in deciding how money is spent in their school (Table 1: Item 6). Even in schools in Chicago and Rochester, where the teachers and parents (and sometimes community members) are formal participants in the school budgeting process, they and others rate their influence considerably below that of the principal, the school board, and the district superintendent. And the teachers, parents, and community representatives in these schools self-report a level of power only marginally higher than their counterparts in schools in New York, Fort Worth, and non-pilot schools in Rochester. Although school-based management teams, for the most part, are not seen as participants in budget decisions, teachers in New York and Fort Worth may report a high level of influence because they are directly involved in those activities where there is budget discretion - instructional materials and supporting equipment for the school.

Why do we see these patterns? One explanation is that even in schools with shared budget decision-making, the principal takes the lead in preparing the initial budget. In Chicago, for example, the principal gets input from teachers, reviews draft budgets with the school community and the Local School Council, and must receive budget approval from the LSC, but these members of the community are not directly involved in the construction of the budget. Teachers in the Chicago schools we visited generally stated that they could be as involved as they wished (or did not wish) in the school budget process.

Another explanation is that parents and community members




TABLE 1 Survey Responses From Four Urban Districts

New York Fort Chicago City Rochester Worth

1. Believes that someone in their school has a 94% (P) written budget 92% 81% 83% (NP) 75%

2. Can see the budget 78% (P) document if they wish 75% 5 1 % 57% (NP) 49%

3. Are satisfied with information they can get about their school 3.2 (P) budget* 3.24 2.89 2.6 (NP) 2.88

4. Believes that school develops the initial 60% (P) document for the school 60% 27% 24% (NP) 33%

5. Believes their school determines how large proportions of money 52% (P) are spent in the school 62% 48% 37% (NP) 59%

6. Perception of how following are in deciding how money is spent in the school:**

Principal 3.85 3.81 3.56/3.75 3.77 Local School Board 2.90 3.011 2.82/3.17 3.08 Superintendent 3.08 3.452 3.04/3.49 3.45 Teachers 2.57 2.31 2.85/2.28 2.69 Parents 2.13 2.07 2.24/1.85 1.80 Community Representatives 2.10 1.54 1.84/1.59 1.80

7. Are satisfied with their ability to participate in their school's 3.11 (P) budget decisions 3.04 2.66 2.34 (NP) 2.78

P = Pilot school-based budgeting schools in Rochester; NP = non-pilot schools * 1 = Not at all satisfied; 4 = Very satisfied ** 1= Not at all powerful; 4 = Very powerful 1 Community District Board 2 Community district/high school superintendent

are satisfied with their limited role. When respondents were asked if they were satisfied with their ability to participate in their school's budget decisions, participants overall in Chicago and Rochester pilot schools were more satisfied than their peers in New York, Fort Worth, and Rochester non-pilot schools (Table 1: Item 7). In Chicago, however, administrators (a rating of 3.34) and par-




ents (a rating of 3.28) were more satisfied with their participation than teachers (with a rating of 2.91).

As Ross Rubenstein has pointed out in his study of Chicago, these findings:

raise the possibility that school-based budgeting in Chicago has become "principal-based budgeting" in practice. Although this distribution of power may differ from the intent of the school reform legislation, it could represent an acceptable and effective distribution of authority.16

In fact, over half (56 percent) of the survey respondents in Chicago reported that they would feel comfortable letting the principal of their school make most decisions about the budget, including 65 percent of the parent/community respondents. LSC chairs and members reported in interviews that while their groups some- time have questions about the budget, they "respect what the school staff does." The LSC members also feel that the principal will not do something the LSC will oppose. In a sense, the LSCs operate like local school boards. Rather than fighting over the budget details, they will fire the CEO (in this case, the principal) if they disagree with him or her.

In contrast, only 35 percent of the respondents in Rochester pilot schools wanted the principal to have the major say in the school budget. This may reflect the fact that unlike Chicago, the district does not designate who has to be involved in school-budgeting decisions. Some pilot schools use a subcommittee of the SBPT to develop their budget; in other schools, the principal makes most of the decisions.

Third, the external structure of schools limited flexibility over school spending.17 Respondents in the four districts were asked whether they thought union contracts, state mandates, and/or federal programs determined the way large proportions of total school funds were spent. In New York, Fort Worth, and Rochester, a large percentage (over 30 percent) of teachers and parents answered "Don't know." With this in mind, more than half of the respondents felt that state and federal mandates had a major impact on the allo-

16. Ross Rubenstein, "School-Level Budgeting and Resource Allocation in the Chicago Public Schools: Processes and Results" (Ph.D. diss., Robert F. Wagner Graduate School of Public Service, New York University, 1997).

17. See, for example, John E. Chubb and Terry M. Moe, Politics, Markets and America's Schools (Washington, DC: Brookings Institution, 1990); and Joseph Murphy, Restructuring Schools: Capturing and Assessing the Phenomena (NY: Teachers College Press, 1991).




cation of resources in their schools. About 40 percent of respondents in Chicago and Rochester pilot schools (including 37 to 38 percent of the teachers responding) reported that union contracts were a major factor in school spending decisions.

Interviews shed more light on these constraints. Union contracts limit flexibility in class size, teacher salaries, and teacher assignments to classes.18 They also constrain schools' ability to remove teachers who may no longer be needed to meet schools' priorities. State mandates affect schools in many ways, ranging from regulations attached to categorical program funds, to instructional and curricular responses to state standards and assessments, to state regulations on how to develop SIPs and school budgets in Chicago. State bidding requirements were viewed as limiting school flexibility in purchasing instructional materials in Rochester. The most fre- quently mentioned federal and state restrictions are Title I and special education programs. Schools that qualify as Title I school-wide projects are pleased at their increased flexibility in the use of these funds.

Schools also face constraints from district regulations, such as requirements they include certain kinds of staff (librarians, physical education teachers, fine arts teachers) in their schools. Both Rochester and Chicago had administrative procedures that restrict- ed the movement of funds among line items in the schools' budgets.

Fourth, in only Chicago and pilot schools in Rochester did schools appear to have enough budget discretion to make substan- tive resource allocation decisions. Schools in both districts used their marginal dollars for traditional purposes: hiring additional teachers to lower class sizes, particularly in the primary grades; to expand full-day kindergarten programs; to expand programs only partially funded or cut-back by the districts (e.g., art and music; counseling; school nurse); and to add extra courses/programs desired by the school community, such as a reading teacher or lit- eracy improvement program. Extra dollars are also available for professional development, equipment, and instructional materials and technology.

These decisions probably reflect a number of factors, including the constraints under which they operate (which limit the flexibility in their use of staff), what school personnel think and know about "successful" programs and interventions, and the perceived needs of their students. For example, many elementary school principals

18. See also, Wohlstetter and Buffet, ""Promoting School-Based Management: Are Dollars Decentralized Too?"; and Wohlstetter and Van Kirk, "Redefining School-Based Budgeting for High Involvement."




firmly believe that smaller classes, especially in the primary grades, are essential to improving student performance. In the words of one principal:

Research shows that if you can lower class size below 20, you can have some impact. Professional development dollars have led us to do things differently. Reducing class size linked to professional development will make a difference.

Factors That Affect Resource Allocation Decisions in the Schools: the Case of Chicago

We were particularly interested in learning whether and to what extent schools linked budgetary decisions to school goals and to data on student performance. The respondents in all four districts reported overwhelmingly (over 89 percent) that their schools have well-defined goals related to the students' education. Nearly all also reported that their schools develop these goals. This is not surpris- ing given the existence of some form of school-based planning and management in the four districts.

The potential link between school improvement planning and resource allocation is strongest in Chicago, however, where a formal process exists for making these connections. Chicago requires its schools to link their budgets to the priorities identified in the school's School Improvement Plan. This Plan, in turn, follows a required format which includes a needs assessment. And schools often reported using test scores to identify student needs, to review and restructure curriculum, purchase instructional materials and perhaps instructional services, and to identify needed professional development. However, external events, including district budget cuts, school violence, and most recently enhanced accountability by the district office have limited the autonomy of schools in deciding how to allocate their resources.

At the same time that the data for this study were being col- lected, the Chicago Panel on School Policy, one of the cooperating agencies in the study, was compiling its final report on five years of monitoring the implementation of school reform in 14 representa- tive schools across the city.19 One aspect of that report examined how discretionary funds were allocated in these schools and how

19. G. Alfred Hess, Jr., ed., Implementing Reform: Stories of Stability and Change in 14 Schools (Chicago: Chicago Panel on School Policy, 1996).




those allocations were related to changes in student achievement. While it is correct to note that discretionary funds decision-making is at the margin of a school's resources, as we have done above, it is also important to note that in Chicago these margins included sig- nificant funding that grew from negligible amounts in 1989-90 to fairly large amounts in 1994-95. In that year, these 14 schools allocated $8.2 million in discretionary resources among themselves; two of the four high schools each controlled close to $1 million that year.

In the first five years of implementation of the school-based management reforms in Chicago, schools were relatively unfettered in their use of discretionary funds. There were major differences in the way elementary schools and high schools spent their funds, however. In general, elementary schools focused their use of discretionary funds on directly affecting the teaching and learning process, while high schools utilized these extra resources more for social welfare efforts, particularly to enhance safety, and for administrative support. But high schools also had their discretionary powers infringed upon more than did elementary schools. For example, in 1991-92, in order to balance the school system's budget, high schools were forced to absorb into their discretionary funds the costs of 600 teacher aides that had previously been part of their nor- mal personnel allocation. And in 1993-94, some 800 teaching positions were cut from the high schools as the length of the class peri- od was expanded from 40 minutes to 50 and the number of courses offered each day was cut from seven to six. If high schools wanted to offset these changes to their basic budget, they had to divert discretionary funds from other uses to do so.

School violence also affected high schools in different ways than it did elementary schools. Following several incidents of shootings within schools, the mayor made reducing school violence a major news media concern and offered to install screening devices in every city high school. Every high school LSC had to make a decision about whether or not to accept this offer; thus, security became a major issue to be faced, and suppressing violence was the strategy to be debated. By contrast, most elementary schools are smaller, with younger students who are not usually a danger to other students, so that the focus was on resolving con- flicts and creating a community in which every student was well known, eliminating the opportunity for anonymous behavior. Such preventive strategies cost very little, compared to the screening and policing costs of violence suppression strategies generally adopted




in the high schools. More recently, school budget autonomy has been affected by

changes in district accountability policies. In Spring 1995, the Illinois legislature adopted a series of amendments to the 1988 school reform legislation that consolidated the central office func- tions of the Chicago school system under the direction of a Chief Executive Officer directly appointed by the city's mayor. The new legislation greatly strengthens the powers of the central office to intervene in schools failing to show gains in student achievement. These new powers allow the central office to exert greater influence over the use of discretionary funds in schools that are failing to improve. In one sense, the 1995 amendments reintroduced the early 1980s phase of accountability as a complement to school-based management. At the same time, the new accountability emphasis has brought new resources to failing schools and created greater flexibility in the use of basic school resources.

Enhanced accountability in the Chicago Public Schools has appeared in three guises. First, in the fall of 1996, 109 schools were placed on probation for failing to have at least 15 percent of their students reading at the national norms. Being placed on probation was a warning of more radical interventions if student scores did not improve. But probation also brought additional resources to the schools, at least initially. Additional external support was provided to schools on probation through the appointment of Probation Managers, generally well-respected former principals, to supervise and oversee the work of the principal and leadership team. Probation Managers were designed to provide mentoring to the leaders in probation schools, but also to be an important on-site locus of accountability that the school's resources be focused on improving student achievement. (The Chicago Panel's study also had indicated that local budgetary decision-making had not always resulted in well-focused spending.)

In addition to Probation Managers, the central office made available for selection by the individual schools a range of External Partners, generally teams of university-based personnel, to provide technical assistance and advice to faculties trying to improve student achievement. In the first year on probation, the central office paid for the External Partners; in the second year, schools had to find half the cost out of their discretionary funds; in the third year, the full costs would come from a school's discretionary funds. The costs of an External Partner were about $100,000 per year. Elementary schools on probation were also provided funds for




additional after-school tutoring and social programs, including an evening meal. Thus, probation resulted in schools receiving some additional external support, but also entailed an encumbering of future discretionary resources.

A more radical form of intervention, reconstitution, was the second form enhanced accountability assumed. In May of 1997, seven high schools were scheduled for staff reconstitution following the end of the school year. All staff positions were vacated in these schools, with staff allowed to reapply for their previous positions. Staff members not rehired would be retained in the school system through the following school year, but if they failed to secure a permanent position in another school, they would be fired at the end of that following year. About 30 percent of the teachers were not retained in these seven schools during the summer of 1997. While reconstitution did not allow schools to eliminate contract-mandated positions, it did significantly weaken tenure and the protection it provided to teachers unwilling to change in line with a school's improvement plan.

The third major accountability intervention affected students more directly. In the school year 1996-97, students in third, sixth, eighth, and ninth grades were required to achieve above established "cut scores" on the standardized achievement tests in order to be promoted to the next grade. Students at risk of not meeting these standards had been encouraged to utilize the additional after-school programs in the probation schools. Students in these grades who did not achieve the appropriate reading score at the end of the year were mandated to attend summer school. If they did not achieve the mandated level in retesting done at the end of summer school, they were not promoted to the next grade. Eighth grade students too old to remain in elementary school (15 years of age or older) were enrolled in specially created Transition Centers until they could reach the established reading level of high school entrance. Third and sixth grade and younger eighth grade students were placed into special classes, supplemented by after-school programs and summer school the following year, with the intent of catching these students back up to their original cohort of students in the following year. The costs of the summer school, called the "summer bridge," were borne by allocations from the central budget.

Thus, the accountability provisions included within the 1995 amendments to the Chicago School Reform Act of 1988 both provided greater program resources focused directly on improving student achievement and required diversion of some of a school's dis-




cretionary resources towards those same, centrally directed, ends. Low levels of student achievement performance resulted in signif- icant losses in local autonomy for schools, both in their freedom to set program directions and in their allocation of resources, both human and budgetary.

Conclusion

This was an exploratory study of school-based budgeting in urban school systems in the United States. We were surprised by the limited amount of discretion that schools have over their budgets in these four districts, although not by the constraints they face in spending those limited funds. This study has raised more questions than we have answered. Yet, our data and analyses have led us to the following observations and questions.

First, having a formal school-based budgeting process appears to increase the involvement and satisfaction of different stakehold- er groups in school resource allocation decisions. But equal participation does not translate into equal influence or power. It appears that rather than restructuring the resource allocation process, these four districts have just brought new groups into an established structure. The authority for school-level resource allocation decisions remains primarily in the hands of the building principal. Is this a bad thing? Not necessarily. It depends on the school, the principal, and how the system holds the principal accountable for his or her actions.

Second, if a school's budgetary discretion is limited to marginal dollars, schools may be unable (or perhaps unwilling) to make radical changes in the way they allocate resources. Schools are also constrained by state, district, and union regulations (or so respondents say). These are the kinds of constraints that are waived for charter schools. Will charter schools - with lump sum budgets and few constraints - use their resources differently? What factors and kinds of information will they use to make resource allocation decisions?

Third, schools can and do use test score data to identify student and programmatic needs, especially in districts with structured school improvement plans. These data, however, do not and cannot tell teachers and principals how to address these needs. Assessment data can also tell school personnel if a specific intervention has made a difference, but not why it has not. The traditional use of resources we saw in our schools reflect the current beliefs of school-level educators about what educational interventions will




make a difference. Few, if any, of the schools conduct formal program evaluations and only some use assessment data to evaluate their programs. Rather, principals monitor their teachers' use of instructional material purchases and observe teachers' classes as part of required teacher evaluations. One respondent noted that it is hard to use traditional measures to evaluate, for example, the impact of smaller class size on student behaviors.

Finally, school-based budgeting is designed to give schools flexibility to innovate and meet the needs of their students. But what happens if schools fail to meet desired student performance standards? How much control over staffing, programs, and resource allocation decisions should revert back to the district in these situ- ations?



school-level resource allocation in urban public schools || processes and power in school budgeting...

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