ARRA: The Good News and the Bad News

Why have some school districts been able to invest stimulus dollars in transformational change while most have simply used the additional dollars to backfill growing budgets gaps and postpone difficult cuts?  Bellweather Education Partners’ recent report, “Conflicting Missions and Unclear Results: Lessons from the Education Stimulus Funds,” gives both good news and bad news.  The good news—districts who understood their resource use in relation to their strategic plan were able to use some of these dollars to invest in transformational change. The bad news—most districts weren’t prepared to do this. Under pressure to move quickly with unclear guidance and falling state revenue, they chose to back-fill current expense. The result perpetuated an unsustainable cost structure, exacerbating the funding cliff they now face.

ERS saw firsthand how the more strategic districts took advantage of the extra dollars and some of these stories are featured in this report. In Charlotte-Mecklenburg, for example, the ARRA funds came at the same time that the district was involved in a five-year strategic planning process. The report documents that the district “was able, among other things, to base layoff decisions on performance rather than seniority and made strategic increases in class size in order to maintain funding for academic coaches who work with new or struggling teachers.” They didn’t use the money for more of the same. They had clear goals for where the district was moving, they knew where their dollars were not being well-spent, so they made choices accordingly.

The report also shows how the districts that made strategic use of the funds were equipped with information to support and “sell” their decisions. Knowing where resources were going and what strategies were most important for improving instruction, they quickly identified the best places to make transitional investments and had the tools and information to more effectively explain the benefits of these investments to their boards and to the public.

As for the bad news, most districts weren’t prepared. They didn’t have data on where their resources were going and they hadn’t started a process of making the tough trade-offs to strategically change their cost structure that shrinking budgets demand. In addition, many states decreased district funding with the knowledge that ARRA funding would fill the gaps. Districts were faced with the dilemma of a public illusion of new money and less leverage to anything but save existing jobs and keep the status quo.

A key lesson from the ARRA experience is that spending and speed can be strategic. Districts with clear instructional priorities, who understand where resources are diverted from these priorities and who have a plan for making the changes required, are positioned to make smart cuts, strategic investments and bold transformational change when the opportunity arises. 

Looking to learn more about your resource-use? Check out our Resource Check, a quick online self-assessment. For more details on ERS thinking on district transformation see our new series Practical Tools for District Transformation..

Access the Bellwether report here.