The Education Gadfly Weekly

Perhaps you’ve been on vacation or caught up in the historic events of recent weeks, but over the past ten days, we at the Thomas B. Fordham Institute hosted our second annual Wonkathon. Last year’s was about charter school quality; this year’s focused on how to implement the brand-new (and groundbreaking) Nevada education savings account program. (Congratulations to Seth Rau of Nevada Succeeds, the winner of the Wonkathon, who both seized his home field advantage and proved that when it comes to using similes, you’d better go big or go home.)

Yet lurking behind the apparent consensus is an unspoken question: What’s this reform trying to accomplish? The law itself says it wants to increase student achievement and parental satisfaction. But go back and read the fourteen posts and you’ll find that the ones most enthusiastic about ESAs don’t say much about the achievement half of this equation—typically reformers’ touchstone. (Even reform apostate Diane Ravitch noticed as much when she questioned Rick Hess’s ESA enthusiasm: “Surely he doesn’t believe that Nevada will emerge at the top of NAEP in five years, ten years, or ever because of all this subsidization of nonpublic schools.”)

Instead, there’s a lot of talk about “customization” (from Matt Ladner), “flexibility” (Jonathan Butcher), “experimentation” (Jason Bedrick), “personalization” (Adam Peshek), and “innovation” (Travis Pillow). To be sure, for many of our wants—and for no small number of families in Nevada and elsewhere— increased choice, outcomes notwithstanding, is an intrinsic good in itself.

But if your primary goal is to significantly raise student achievement as it is traditionally defined (test scores, graduation rates, college attainment, etc.), especially for disadvantaged children, education savings accounts are probably not the way to go. Instead, you’d want to learn from last year’s Wonkathon and create the conditions for high-performing, “no-excuses” charter schools (or voucher schools) to thrive. You would want to put in place a strong authorizer, ample funding, and a charter-friendly law and work to build a great charter sector like those in place in cities like Boston, New Orleans, and the District of Columbia. (Thus Michael Goldstein’s admonition for Nevada to find a “Neerav Kingsland,” and Neerav Kingsland’s admonition that Nevada cough up more money per child.)

But raising the achievement of disadvantaged children need not be the only project reformers undertake. Customization, flexibility, experimentation, personalization, and innovation are all important too. And as Chester Finn and Bruno Manno point out in the current issue of National Affairs, charter schools have, by and large, disappointed on these fronts. “There's a certain sameness across much of the charter world,” they write, “and (save perhaps for virtual schools) not enough real innovation.”

It’s not hard to understand why. Again, if the goal is to raise test scores and other outcomes for disadvantaged students, educators will quickly settle on a “no-excuses” model—because it works. That’s not to say that these models are all exactly the same, or that they don’t include certain innovative aspects. Yet by and large, KIPP and its cousins are obsessively improving on traditional education; they aren’t making leaps into the unknown.

The value of education savings accounts, then, is to provide a space within the K–12 system for true breakthroughs and allow for “multi-provider customization” (in the words of Matt Ladner) or “unbundling” (in the words of Rick Hess). These experiments may not yield immediate benefits in terms of increased test scores, but they might serve the needs of individual children and help us find promising breakthroughs that could someday enjoy mass appeal and application.

And what about the “S” in ESAs?

What also went largely unnoticed was the “savings” element in education savings accounts. One goal of this market-based reform is to encourage parents to shop around and choose educational providers that are both effective and efficient. This is no small thing, since K–12 education suffers from the “third-party-payer problem”: People generally ignore costs when they aren’t paying out of their own pockets. That’s the case in health care, where generous insurance plans with low copays and deductibles can encourage individuals to use more health care then they really need or choose doctors and hospitals that are needlessly pricy. Health savings accounts—the inspiration for education savings accounts—are meant to correct for this problem by giving patients skin in the game. They provide incentives for individuals to find low-cost options—or skip the doctor’s appointment when they come down with the flu.

Education savings accounts can do the same thing by encouraging families to take their children out of the public school system and purchase a variety of educational services directly, for less cost. Because the value of the ESA is less than what taxpayers are spending, per-pupil, on the public schools, it’s a win-win. (Though Rabbi Motzen is correct that it’s unfair to penalize private school parents—who are already saving taxpayers a lot of money—by making them ineligible for the ESAs.)

So who will be enticed by ESAs? I suspect it will be public school parents who (1) were on the fence about choosing private schools and for whom the $5,000 subsidy will push them over the edge; or (2) have been contemplating home schooling and see the ESA as a way to supplement home education with a variety of a la carte services.

Most of these families, I suspect, will be relatively affluent and well-educated—either capable of paying the difference between private school tuition and the value of the ESA or able to afford for one parent to stay home with the kids and play teacher. Their kids are unlikely to have extraordinary (and extraordinarily expensive) needs.

I’m perfectly fine with that. Returning to the health savings account analogy, these are people who are relatively healthy from the standpoint of education. HSAs don’t hold much appeal to people with chronic illnesses or life-threatening conditions; they would blow through their HSAs in a matter of days or weeks. Likewise, ESAs aren’t going to hold much appeal to families who face the chronic condition of poverty and for whom an extraordinary education is a matter of life and death for their children (unless they can find an excellent private school willing to charge not much more than $5,000 a year).

Yet it will be very hard for anyone in Nevada to say honestly that an a la carte education probably isn’t a great fit for families struggling with poverty. And regulators won’t be allowed to keep such families out of the program.

Therein lies the problem, and my biggest fear: What if a significant number of low-income Nevada families sign up for the initiative anyway? We’ve seen this movie before in the virtual charter school world. At the outset, companies like K12.com expected to serve mostly affluent home schoolers. (I know—I was there at the beginning.) But over time they decided to target low-income students too. The academic results have generally been catastrophic.

Regulators should pay special attention to providers that are obviously recruiting disadvantaged families—especially via “incentives” like free iPads, computers, and such. And local reform groups should be ready—and willing—to counsel Nevada’s needy families to consider other options. Thankfully, the state is embarking on a wide variety of promising reforms, from charter schools to turnarounds to tax credit scholarships. Who will have the courage to say that ESAs aren’t for everyone?

Nevada is a state of constant experimentation. From its founding in the days before the 1864 presidential race to ensure an additional three electoral votes for President Lincoln’s reelection to letting the state be turned into a nuclear site in the 1950s to the so-far dormant Yucca Mountain Nuclear Waste Repository, many forces have used Nevada for their experiments. Knowing its history as a testing ground, Nevada should regulate its new, nearly universal education savings accounts, or ESAs, (current private school students are excluded to avoid a large cost to the state) in a fashion similar to another uniquely legal phenomenon in the state: prostitution. You may chuckle, but there are real similarities here.

Prostitution in Nevada has a few non-negotiables. First, the employees (most are actually non-unionized independent contractors, but that’s another analogy) participating in the work must be tested and examined regularly to ensure the customers’ safety and satisfaction. On the user end, the client must use protection in order to protect the employee’s safety per the state’s regulations. Once these details are in place, however, everything else is open to negotiation. The employee and the client can take part in both imaginable and unthinkable acts within the regulatory framework. This type of regulation lays the groundwork for innovation.     

Nevada’s ESA program has two goals: It aims to increase student achievement and improve parents’ satisfaction with their children’s schooling. These are both admirable goals, and both are sorely lacking in Nevada’s current educational ecosystem. On the first goal, there needs to be a measure to confirm that a student is progressing each year with his or her education (full disclosure: My organization, Nevada Succeeds, advocated for this amendment to the law). Ideally, the student would still take the same assessments as students enrolled in public schools (currently Smarter Balanced in Nevada), but that is likely impossible due to test security issues. Therefore, as long as a student takes a nationally normed assessment approved by the Nevada Department of Education (this list is currently being created for the state’s new tax credit scholarship program), his progress can be adequately measured to determine student growth. 

Meanwhile, the state treasurer’s office (which will administer the program) must ensure that the process is easy for parents to use. There should be a straightforward online portal that makes receiving the ESA funds relatively simple. Parents will be given a restricted debit card for using the funds (Nevada should follow Arizona’s example on restricting the MCC codes), and the state should conduct annual audits (the law requires random ones) to check that the funds are being spent on kids’ education and not something that does not benefit student learning.

Many families will choose a traditional option with their savings accounts—their local private schools. Nevada does not currently offer many available private school seats, but I expect the supply to rise dramatically in the next five years, especially near overcrowded schools in suburban Las Vegas and Reno. (It’s also important to remember that 90 percent of Nevada’s kids are in these two metropolitan areas, each having only one school district and a small but growing number of charters.) However, some parents will surely get more creative. I am most excited to see what types of educational options emerge for all students. With the creation of the tax credit scholarship and the ESA, some students whose family incomes are below three times the poverty line can receive funds from both programs totaling over $13,000.

By combining both sources of funding, some poor students could have access to true school choice in Nevada. As of now, the Opportunity Scholarship is capped at $5 million, so the dual-funding options will only be available to hundreds of students instead of the thousands likely seeking out that choice. With the income-restricted Opportunity Scholarship, the state can invest the most in students who truly need the additional support, while also investing in every child through ESAs.

Ideally, the goal of the Nevada ESA experiment would be to succeed and be replicated all over the country. For that to happen, the regulations must first be successful. Second, the program must withstand an expected lawsuit. While Democratic leaders in the state (the bill passed with no Democratic votes) are certain that a suit will be filed, the usual suspects for filing the case will likely refrain. The teachers’ union had an excellent legislative session during which Republicans dramatically increased the state’s education budget; Clark County School District, the state’s largest (and nation’s fifth-largest), is preoccupied with a bill that may lead to its dissolution; and the ACLU has not expressed willingness so far. Due to the national interest, another party may file suit, and it will be a fascinating case to follow.  

My biggest question is whether $5,000 is enough to create educational value for students who aren’t languishing in poverty. Are parents willing to pair some of their own funds with the ESA to remove their kids from the public school system? I do not know the answer at scale, but it will be an important experiment for the future of American education.

The state treasurer’s office must set its non-negotiables in order to safeguard the ease of parental choice, the tracking of student outcomes, and the financial accountability of the program. If they can keep these non-negotiables tight, then innovations in education should prosper over time. I’ll be following this process closely to ensure that the forthcoming evolution brings Nevada pride—instead of the shame that the current system has wrought in the Silver State.

Seth Rau is the policy director at Nevada Succeeds.

Over the past two weeks, we received fourteen responses to Fordham’s second annual Wonkathon prompt:

As Nevada implements its groundbreaking education savings account program, what must it get right in order to provide positive outcomes for kids and taxpayers? Should state authorities stay out of the way? Or are there certain areas that demand oversight and regulation?

This year’s posts offered a wide-range of oversight models from some of the wonkiest wonks in education reform. But there can only be one Wisest Wonk.

Without further ado, the winner of Fordham’s 2015 Wonkathon is Seth Rau, whose “Nevada should regulate ESAs like brothels” came in with 39 percent of the vote.

Tracey Weinstein’s “Does Nevada’s new ESA law hold promise for kids?” came in second with 17 percent.

And Rabbi A.D. Motzen’s “Why almost universal is not good enough” came in third with 15 percent.

Thanks to all the participants for another great Wonkathon, and congratulations to this year’s Wisest Wonk, Seth Rau! You can re-read the individual responses below or get the short and sweet version from Jason Bedrick’s recap.

 “Nevada needs Neerav” by Michael Goldstein

“Nevada should regulate ESAs like brothels” by Seth Rau

“New tools for new challenges: Updating accountability for ESAs” by Matthew Ladner

“Take a lesson from the cane toads” by Jonathan Butcher

“Does Nevada's new ESA law hold promise for kids?” By Tracey Weinstein, Ph.D.

“Private choice and the public interest” by Andy Smarick

“The price is not right (yet)” by Neerav Kingsland

“Overregulation in the name of accountability serves no one well” by Lindsey M. Burke

“Let the market work” by Jason Bedrick

“A new approach for a new era of education” by Adam Peshek

“Wanted: A new breed of bureaucrat in Nevada” by Robin J. Lake

“ESAs let parents drive the quality discussion” by Travis Pillow

“State agencies can’t do it alone” by Robert Tagorda

“Why almost universal is not good enough” by Rabbi A.D. Motzen

• Defined benefit pension packages: Love ‘em if they’re sending you a check each month, hate ‘em if you have to think too hard about their consequences. That’s probably the reason we just don’t give them much consideration (well, part of the reason; they’re also slightly less gripping than you may have been led to believe). Good thing the National Council on Teacher Quality put together an informative, concise fact sheet on the realities of our teacher retirement processes. The short version isn’t pretty—backloaded plans with lengthy vesting periods typically penalize teachers who leave the profession early, enter it late, or move to a different state mid-profession. Their escalating costs are also threatening to overwhelm cash-strapped districts. Painful though it may be, we may have to start dedicating more thought to the subject.
• The Foundation for Excellence in Education has released a fantastic tool that accomplishes two purposes: explaining what we actually mean when we talk about student “proficiency” and clarifying which jurisdictions actually measure anything close to it. Users can see how students are performing in their states, and whether those states’ reporting practices give a picture that resembles reality—or just an illusion.
• It wasn't cool to be a "no-excuses," tough-love teacher for poor minority kids in the 1970s. Academic standards (to the extent that there were any) were dumbed down, and lots of folks just took for granted the idea that demographics equaled destiny. Marva Collins, who died last week, thought otherwise. She believed—and said—that "kids don’t fail. Teachers fail, school systems fail. The people who teach children that they are failures—they are the problem.” Then she put her own money and reputation on the line to prove that it didn't have to be that way. Along with a handful of other education renegades of the era, she demonstrated that poor minority kids from the inner city could succeed just fine if given the right kinds of expectations, encouragement, and instruction. Today, we have plenty of these "proof points" in programs like KIPP, Achievement First, Success Academy, and many more. But Marva Collins paved the way.

So-called “turnaround school districts,” inspired by Louisiana’s Recovery School District and its near-clone in Tennessee, have been gathering steam, with policymakers calling for them in Georgia, Pennsylvania, and other states scattered from coast to coast. But just how promising are these state-run districts as a strategy to bring about governance reform and school renewal? What lessons can we take away from those districts with the most experience? Can their most effective features be replicated in other states? Should they be? What are ideal conditions for success? And why has Michigan’s version of this reform struggled so?

A new report by researchers at the University of Arkansas examines non-public revenue in public charters and traditional public schools (TPS). This is the same group of researchers that the Thomas B. Fordham Institute commissioned to do our first charter-district finance study—and thankfully, they’re at it again, dispelling the myth that charters get all the philanthropic dollars they need to make up the existing funding deficit. Not so.

Analysts engage in an in-depth examination of non-public funds for Fiscal Year 2011 in public charter and TPS sectors in the fifteen states where they possess sufficient data (which means this isn’t a representative sample). Non-public funds include revenues from areas such as food service (that yummy cafeteria food), investment revenue, program revenue, rental revenue, philanthropic funds, and others.

Key findings: TPS received $6.4 billion and charters $379 million of non-public revenue in 2011. For TPS, this amounts to an average of $353 per pupil; for charters, an average of $579 per pupil. Yet these numbers vary by state. For instance, in Michigan charters receive 50 percent less in per-pupil revenue from non-public sources than do the TPS. The types of non-public revenue coming in also change by sector. In TPS, one-third of non-public revenue comes from food service and “miscellaneous,” but in the charter sector, philanthropy makes up almost half of non-public revenue. Charters receive $264 per pupil in philanthropy and TPS $18, but this difference is driven by large student enrollments in TPS, which receive almost double the amount of philanthropy in absolute dollars. Philanthropic funds also vary greatly among charter schools (one-third of them receive no philanthropic funds of any kind).

The report's last takeaway says it all: “Although charitable funds from philanthropies make up almost half of the non-public revenue in the charter sector, they account for only 2.5% of total charter revenues nationally and therefore cannot be expected to close the 21.7% total funding gap between charters and TPS in these 15 states.” Another charter school myth bites the dust.

SOURCE: Meagan Batdorf et al., "Buckets of Water into the Ocean: Non-Public Revenue in Public Charter and Traditional Public Schools," Department of Education Reform, University of Arkansas (June 2015). 

In the midst of debates about whether school is the best place to combat the effects of poverty, several educational institutions have taken it upon themselves to integrate non-academic poverty-relief supports into their academic programs. According to a new report from the Clayton Christensen Institute for Disruptive Innovation, these schools offer unique on-the-ground efforts to support high-need students above and beyond the traditional academic model. They include KIPP, SEED schools, the Harlem Children's Zone, and community-based schools like those found in Cincinnati Public Schools (CPS).

Each organization offers its own take on anti-poverty programming. KIPP focuses on extended school days and longer school years, character education, and initiatives like KIPP Through College, which includes step-by-step assistance in the college admission process as well as after-school tutoring and counseling. These are services that other high-poverty schools struggle to offer. KIPP is also extending its services in specific locations; KIPP Houston, for instance, features a school-based health clinic called KIPP Care. The SEED schools, meanwhile, take efforts even further with a one-of-a-kind public boarding school model: Those enrolled live on campus five days a week, then head home for the weekend. Students, many of whom come from disadvantaged communities, benefit from a character education program, mental health and counseling services, off-campus and summer enrichment opportunities, and college transition advising. Both SEED and KIPP boast impressive academic achievement numbers. (For a look at a potential SEED school in Ohio, see here).

The Harlem Children’s Zone (HCZ), meanwhile, is a nonprofit serving a ninety-seven block area of its namesake neighborhood of New York City. Its umbrella of assistance includes parenting workshops, preschool programs, charter schools, after-school programs, a college success office supporting HCZ college students, and free legal and financial services for families.

The report also looks at community schools, which centralize a range of services inside one building by partnering with local service providers. (To be clear, this term doesn’t refer specifically to charter schools, which Ohio law dubs “community schools.”) Cincinnati Public Schools is currently transitioning fifty-five schools into Community Learning Centers (CLCs), which join with a variety of outside organizations to offer recreational, educational, social, health-related, civic, and cultural opportunities to students, families, and the broader community. Its ethos mirrors that of Communities in Schools (CIS), the nation’s largest wrap-around services organization. Both organizations operate through the use of on-site coordinators, who assess student needs and recommend services.

The report’s authors are careful to note that there are concerns around non-academic poverty supports, mainly as they relate to cost and scalability. Outsourcing services the way CLCs do (an approach they call “modular”) may seem more efficient and less expensive, but it is actually impractical in the long run because outsourcing leads to a loss of control for schools. This loss of control means that educators on the ground—those who are most knowledgeable about what services are needed—can’t oversee the balance of services offered to each student. On the other hand, the interdependent, integrated models offered by SEED, KIPP, and HCZ allow educators to determine the exact mix of supports that students require, make them available, and then permit researchers to measure success. Only once this mix is identified can schools transition to the affordable, scalable model necessary to ensure that all students receive suitable assistance.

SOURCE: Michael B. Horn and Julia Freeland, “The Educator's Dilemma: When and how schools should embrace poverty relief,” Clayton Christensen Institute for Disruptive Innovation (June 2015).

In the last four years, thirty states have transformed their teacher evaluation systems to improve student outcomes—and fourteen more are expected to follow suit by 2017. Too often, however, states focus more on the design of the systems than on how schools will and should implement them. This report from Education First argues that this is a mistake. We ought to also provide teachers the feedback and support they need to succeed. The report identifies five districts (Aldine, Texas; Greene County, Tennessee; Salem-Keizer, Oregon; Fulton County, Georgia; and St. Bernard Parish, Louisiana) that seem to be doing this right—a collection that’s diverse enough in location, racial makeup, and student body size to be applicable to myriad locales across the country.

The authors pinpoint a handful of essential teacher evaluation practices that hold the promise to improve student outcomes. First, schools need to make feedback and support a top priority and treat it as an ongoing process, including regular conversations centered on teachers’ professional development goals. Educators must be an integral part of the process, which creates an environment in which feedback is an expected and positive aspect of the job rather than a punitive one. For example, teachers and evaluators (such as principals or other administrators) should work together to create a “personalized learning plan” based on specific strengths and weaknesses. This lets teachers know what they need to work on, guides their ongoing professional development, and can be used for future evaluations.

This all sounds great, but how will financially troubled districts find the necessary time and money to ensure effective implementation? To its credit, the report acknowledges this problem and gives a helpful—if not entirely complete—solution. It explains how all of the five districts reallocated Title I and Title II funds to cover the cost of hiring more teacher leaders, implementing improved training programs, and providing more and better professional development opportunities.

Overall, the report paints an optimistic picture of what school districts can do when it comes to teacher evaluations. The suggested practices should improve student outcomes if districts make them a priority.

SOURCE: “Giving Teachers the Feedback and Support They Deserve: Five Essential Practices,” Education First (May 2015).