ED-RED Exec Board
School District Reorganization
Information from ISBE Meeting
September 22, 2010
This reduction in the number of school districts was as a result of legislation encouraging districts to merge through financial incentives provided by the state. From 1986 to 2010, the state has made incentive payments totaling $155.6 million.
Reorganization Incentives
In FY 2011, 16 school districts are to receive reorganization incentives of $3.2 million. There are four different types of reorganization incentives that are paid from one to four years:
• Deficit Fund Balance Compares the reorganizing districts’ fund balances for the four operational funds. If there are deficit fund balances, this incentive will pay the difference between the lowest deficit and the other deficits.
• General State Aid Differential Compares the General State Aid payment received by newly formed district to the total amount of General State Aid the districts had received filing separately.
• Salary Differential Compares teachers’ salaries paid pre and post reorganization. This incentive is calculated based on each teacher’s salary paid in the previous district, weighted against a comparable category on the highest salary schedule of all districts forming the new district and the difference is summed for all such teachers.
• $4,000 Per Certified Staff Provides $4,000 for each full-time certified staff member of the newly formed district.
Types of Reorganization | Fiscal Year 2011 Appropriation | Total Incentives Paid (from Fiscal Year 1986 through 2011) |
Deficit Fund Balance | $0 | $29,433,867 |
General State Aid Differential | $451,274 | $10,564,827 |
Salary Differential | $693,361 | $26,283,467 |
$4,000 per Certified Staff | $2,084,000 | $89,386,000 |
Total | $3,228,635 | $155,668,161 |
Types of Reorganization
There are six overall types of reorganizations:
1. Annexations, (69 since 1984) With this type of reorganization, one district dissolves and annexes into another district. The dissolving district assumes the tax rates, board members, etc. of the district they are annexing into. No new district is formed. § An example of this type of reorganization is dissolution of Divernon Community Unit School District 13 which annexed into Auburn Community Unit School District 10. Effective for the 2008 school year, Divernon School District dissolved but Auburn School District continued its operation with the same tax rates and board but now with the territory and students of Divernon.
2. Consolidations (56) When a consolidation occurs, two or more districts dissolve and form a new district. A new board is elected, new tax rates are established, etc. § For school year 2011, both Girard Community Unit School District 3 and Virden Community Unit School District 4 dissolved and formed a new school district, North Mac Community Unit School District 34. New tax rates were established and a new board was elected.
3. Hybrids (1) For hybrid reorganizations, dual high school districts and their feeder elementary school districts vote to determine if their communities would approve them becoming a unit district. For the elementary territories that approve the vote, a unit district is formed. If an elementary territory does not approve the referendum that district remains an elementary dual district that now feeds into the newly formed unit school district. These formations may also involve unit districts such as the example below. § The only hybrid formation Illinois has experienced was with the formation of the Flanagan-Cornell Unit 74 school district. This district was established in July 2008 from the previous Flanagan Community Unit School District 4 and Cornell High School District 70. The Cornell elementary district remains in operation. When their students reach high school, they now “feed” into the newly formed unit district instead of the now dissolved high school district.
4. Deactivations (13) Deactivation can be for either elementary attendance centers or high school centers. The community of the deactivating center approves the measure by referendum. If approved, the elementary center or high school center attends school in another district and pays tuition to the receiving district. § The latest deactivation was for school year 2010. Crescent-Iroquois Community Unit School District 249 deactivated their high school and they now pay tuition for their 9-12 students to attend Cissna Park Community Unit School District 6, Iroquois County Community Unit School District 9, and Iroquois West Community Unit School District 10.
5. Cooperative High Schools (1) With cooperative high schools, two or more districts enter into an intergovernmental agreement to form a cooperative. The high school students of the member districts attend the cooperative. The member districts pay tuition to the cooperative for the education of their students. § Illinois has only one cooperative high school. Legislation has been passed that allows for a pilot of another one. In July 2009, Paris Community Unit School District 4 and Paris-Union School District 95 entered into an intergovernmental agreement to form the Paris Cooperative High School. Both School Districts 4 and 95 pay tuition to the cooperative high school for its operations.
6. Conversions (1) For conversions, two or more unit districts convert into elementary dual districts and one high school district. For example, if two unit districts converted, the end result would be two elementary dual districts and one dual high school district. Illinois’ first and only conversion went into effect in July 2007 for the 2008 school year. For this conversion, Carthage Community Unit School District 338, Dallas Community Unit School District 336 and LaHarpe Community Unit School District 335 all dissolved. The new districts formed were Carthage Elementary School District 317, Dallas Elementary School District 327, LaHarpe Community School District 347 (PK – 8), and Illini West High School District 307.
Reorganization Issues
Through the years there have been many unsuccessful reorganization referendums. Many of these referendums were not successful because they did not address the following community concerns:
1. Loss of identity or voice. Community members are fearful they will lose a voice in the education of their children by being “absorbed” by a larger school district. They are also fearful they may not have input because they will not have an opportunity to have a member of their community elected to the school board.
2. Sentiment over the loss of mascot and school colors/rivalries/sports Community members may remember and cherish their school traditions and wish to maintain the sports rivalries between their school district and the school with which they are reorganizing. They may not want to lose their mascot or school colors.
3. Tax rates Tax payers are concerned with what the new tax rates will be. If they are deemed to be higher than what they are currently paying, the referendum is usually unsuccessful in that community.
4. Transportation of younger students While school buildings are not always required to be closed, many community members are concerned their school will be closed and younger students will spend a significant amount of time on the school bus. With a larger geographical area, districts may incur an additional transportation cost. Reorganization incentives are not provided for pupil transportation.
5. Closing of community schools Community members are fearful that their neighborhood school will close. The school may be one of the major employers in the community.
6. Test Scores Many community members and educators are concerned that if they reorganize their test scores may decline. They are especially concerned with this if they are reorganizing with a district that has lower test scores than their district.
7. Delayed incentive payments Twice in recent years, ISBE was required to obtain a supplemental appropriation to be able to pay all the incentives. With the state’s current fiscal condition, there is concern that appropriations will not be sufficient to pay the incentives.
For the state government and local school districts, there are also potential concerns:
1. Cost of Incentives If reorganizations increase substantially, will the State be able to appropriate enough funds to pay incentives to districts?
2. District staff retention If districts reorganize, will the projected savings materialize? Will districts align their staff to meet the needs of the newly formed district?
3. Closing of facilities Because of community concerns, will district officials elect to keep schools open that could be closed?
District Size
In October 2002, the Education Funding Advisory Board (EFAB) recommended that a district should have an enrollment of 250 or more students for the 9th through 12th grades. Adequate enrollment size for a district varies from study to study. For the purposes of this analysis, the EFAB recommendation was utilized. It is further assumed that the high school size should be at least 250 students; the equivalent elementary size would be at least 625 students.
Unit School Districts
Currently Illinois has 391 unit districts. Of these unit districts, 190 have elementary enrollment under 625 and /or a high school enrollment of under 250 students.
Elementary Districts
Illinois has 378 elementary districts. Of these, 160 districts have a Pre-K through 8th grade enrollment that is less than 625 students. The smallest of these districts is 21 students.
High School Districts
Illinois has 100 high school districts. Of these, 9 districts have a high school enrollment that is less than 250 students. The smallest of these districts is 46 students.
Dual Districts:
Education and curriculum alignment
The argument has been made that to enhance curriculum alignment, dual districts need to merge together to form a unit school district. Data analysis demonstrates that the majority of schools that have a three-year Average Percent Proficiency (APP) from ISAT, PSAE and/or Special Education Assessment of 50% or less are high schools. Only three elementary dual districts of 378 have at least one school that is receiving a three-year APP of 50% or less. Whereas 32% of the 100 high school districts have a three-year APP of 50% or less.
Operating Efficiencies
Efficiencies could be obtained if dual districts were to reorganize into unit districts. While all territory of dual districts may not be coterminous, the territory is compact and contiguous, thus alleviating some overall general concerns of creating unwieldy districts through reorganization. Merging of elementary districts and high school districts into unit districts could:
· Reduce the number of administrative staff required of the two dual districts
· Enhance efficiencies for pupil transportation, food service preparation, custodial services, and office services
· Reduce the number of staff required
· Reduce the number of building facilities needed
Staffing Changes
Care would need to be taken as to the student population size of the newly reorganized districts. Creating too large a district may not lead to reduction in staff. Instead realignment of duties may be required such as:
· Former superintendents may become assistant superintendents for curriculum, thus enhancing the curriculum alignment between elementary education and high school education.
· Former superintendents may become assistant superintendents for business, focusing on the financial operations of the district.
· Staff may become grant coordinators for better grant writing and oversight. This could result in more revenue in the newly formed district.
Available Revenues
Tax levy must be sufficient enough to sustain the newly formed unit district. Dual districts can levy a higher total tax rate than a unit district. For example, a high school 9th through 12th grade district can have an educational tax rate of $3.50 and an elementary Pre-K through 8th grade district can also levy an educational tax rate of $3.50 in the same territory for a total tax rate of $7.00. A unit district (Pre-K through 12th grade) can only levy a maximum educational tax rate of $4.00.
Configuration of Facilities
The new territory must have enough elementary buildings to be utilized for the Pre-K through 8th grade students. For example, if an elementary district that merged with two high school districts to form two new unit districts had only one elementary building, one of the newly formed unit districts would not have an elementary facility.
Local Wealth
The manner in which the student population is distributed could be an issue. How would student distribution be among the newly formed districts? Would the student distribution be equivalent to the equalized assessed valuation (EAV) in each respective geographic area? The EAV may or may not have students associated with it. If it is an industry EAV, no students would be associated with the new territory. If it is a subdivision, many students may be associated with the new territory with a significantly less EAV amount. Would the new unit district’s enrollment and EAV be adequate - not too small or not to large? Would building capacity be an issue?
EAV must be adequate to support the new unit district. Depending upon the way the new unit district lines would be drawn, a significant number of low income families with less EAV per student could be in one of the new unit districts. A substantially higher EAV could be in the other new unit district. This could leave one district at a disadvantage.
Student Performance
Of the 869 districts: For the 100 high school districts, 32 districts (32%) have at least one school that received a three-year Average of Percent Proficiency (APP) based on the definition of proficiency in ISAT, PSAE and/or Special Education Assessment of 50% or less. For the 378 elementary districts, only 3 districts (0.8%) have at least one school that received a three-year APP of 50% or less. For the 391 unit districts, 122 districts (31%) have at least one school that received a three-year APP of 50% or less. Of the 391 unit districts: - One unit district (.03%) had only their elementary school(s) receiving a three-year APP of 50% or less - 112 unit districts (29%) had only their high school(s) receiving a three-year APP of 50% or less - Nine unit districts (2%) had a combination of elementary and high school(s) receiving a three-year APP of 50% or less
Of the 869 districts: 13 districts (1.5%) had one or more of their elementary schools at this benchmark (3 elementary districts and 10 unit districts) - 153 districts (17.6%) had one or more of their high schools at this benchmark (32 high school districts and 121 unit districts)
Recent Legislation in Other States
Indiana
Senate Bill 521 from the 116th Session required Indiana districts with less than 500 students to merge. It further required districts with 499-1000 to merge unless they could demonstrate they met certain standards. Charter schools were exempted. Districts failing to merge by 2013 were subject to a comprehensive reorganization plan to be developed by the state board of education. On January 15, 2009, the bill was read the first time and referred to the Committee on Education and Career Development. The bill was withdrawn.
Kansas
House Bill 2728 required Kansas school districts to have a minimum of 10,000 students in order to reduce administrative and non-instructional expenses. The bill died in the Education Budget Committee on May 28, 2010. From the 1960’s until 2000, the number of districts was reduced from about 2,600 to 304 through legislative action. Later, the 1999 legislature passed KSA 72-7533 which required the state board of education to undertake a comprehensive boundary study of Kansas school districts. The study concluded that the total number of districts could be further reduced to 255-284. That same session, KSA 72-6445 was passed to provide financial incentives for districts to voluntarily consolidate. Voluntary consolidations reduced the number of districts from 304 in 2000 to 295 in 2009.
Maine
On April 18, 2008, a mandatory consolidation law was enacted requiring Maine’s 285 school districts to consolidate to 80 new districts by January 2009. Every district is required to convene its own reorganization planning committee. Reorganization plans (but not alternative plans) are subject to voter approval. Governance is by regional school unit boards and districts must attempt to form regional school units of at least 2,500 students. The law allows some exceptions. Non-compliance or voter rejection at referendum means monetary penalties through withholding of state education funds. By October 2009, 32 alternative plans and six reorganization plans had been approved (out of the 80 necessary). On November 4, 2009, a state-wide ballot measure to repeal the law was defeated; thus, the statute is still in effect.
North Carolina
Senate Bill 265 funds only one local school administrative unit in each county, in North Carolina forcing some mergers. The amount allotted per county is based on total average daily membership of all units located in the county. On February 24, 2009, the bill was referred to the Senate Education/Higher Education Committee and has not resurfaced.
The same Senate sponsor had proposed an identical bill (SB 120) during the 2007 session but was told by the education committee that the legislature would need more time to consider.
