Michigan administrative expenses top $1.4 billion

School administration costs rise over two-times faster than instructional expenses

New evidence suggests that a growing percentage of public school funds are being spent on district administration rather than on teaching. According to Standard & Poor's, the private company hired by the state to analyze school data from Michigan public schools and public school academies, central administration costs have risen more than twice as fast as instructional expenses, including teacher salaries, over the past three years.

This increase in district administration spending is most evident in the state's largest school district, Detroit Public Schools (DPS). According to The Detroit News, last year eight Detroit employees were promoted to executive level positions and received pay increases between 11 and 48 percent. At the same time, Detroit teaching and support staff positions were cut. According to The News, DPS will now have 34 executive directors, each of whom earn between $98,000 and $132,600 and oversee school principals or administrative departments, such as adult education.

Some parents have publicly questioned why the district is hiring more high-level administrators while cutting teaching positions. Mary Rose Forsyth, whose son attends a Detroit middle school, told The News, "Before they cut anything at the school level, they ought to do away with most administration," she said. "If we are in such a deep crisis, the cuts need to be made at the top. We could get along without them for a couple of years."

Whether or not the shift in district spending priorities is intentional or not, it is clearly a statewide trend based on Standard & Poor's data. They show that from 1997 to 1999, while the total amount of education spending in Michigan increased nearly 7 percent, central administration spending increased approximately 18 percent. Administration at the building level, such as principals and school directors, grew at about 5 percent, more than the 3 percent that teacher salaries increased in the same period. Combined, these administrative expenditures make up 10 percent of total annual education spending, or $1.4 billion. This translates to more than $846 per pupil in administrative spending.

Detroit schools chief Kenneth Burnley defends the hiring of additional administrators, telling The News, "We added (executive directors) to try to get at functions the district had not been doing either well or at all, like raising money for the school district. We are putting people in who have specific expertise we didn't have before."

Some blame increased administrative costs on an increasing number of special needs students and the inflexibility of the state's rules for special education. According to Standard & Poor's, special education costs have increased more than 9 percent from 1997 to 1999. Total spending for special education in Michigan hovered around $1 billion in 1999. Standard & Poor's cites this increase as a policy concern that needs to be examined by lawmakers.

Standard & Poor's also encourages a serious evaluation of the increase in administrative costs, and suggests that districts consider ways to save money on non-instructional services in order to redirect more funds to the classroom.

For more information on how some districts are working to save money on non-instructional services, visit www.mackinac.org/pubs/mpr and www.mackinac.org/3463.