Private contracting of noninstructional services has helped many districts meet their bottom line without drastic cuts to core programs. The share of districts that contract out for transportation, custodial or food service climbed significantly since 2001, a time when education revenues were steadily rising and state public school enrollment was near its peak. Back then, only 30% of districts contracted out for these noninstructional services, but that rate grew significantly since and has stabilized at around 70%.[58]
Thus, the number of districts that could stand to benefit from contracting services is comparatively smaller than it was 20 years ago. Extra state and federal dollars, including those allocated to address the effects of COVID-19, further reduce incentives for districts to pursue this cost-saving approach.
Under state law, charter schools have the additional authority to contract out for instructional services.[59] More than 90% of them already take significant advantage of this cost-effective option for staffing their classrooms.[*]
School officials in some cases can stretch their budgets through optimizing district size, contracting out, and similar practices. But alone they do not promise to bring a great deal more bang for the buck to Michigan’s K-12 system, just as current funding increases hold very little promise of improving the state’s overall educational performance. The system requires deep-seated design changes to fulfill the promise of providing quality public education for all Michigan students.
[*] Author’s calculations based on 2019-20 NPEFS data. Out of 294 public school academies, 272 of them, or 92.5%, reported spending more on instructional purchased services than instructional salaries, a strong indicator of contracting.