Karen Baroody, Managing Director at ERS, along with Texas Representative Scott Hochberg, and Chester Finn, president of Thomas B. Fordham Foundation, participated in the 2011 Fall Forum held by the National Council of State Legislators (NCSL) in Tampa, Florida.  During the session, the three panelists discussed how the current budget crisis provides an opportunity for state legislatures to achieve better student performance by reshaping education policy and focusing on new strategies for reallocating and maximizing resources.
In her presentation, Tough Times as Opportunity, Karen Baroody talked about the gloomy fiscal forecast facing states over the next decade, and how these tough times provide a real opportunity for transformational change in resource allocation.  She then discussed four of the highest priorities for K-12 restructuring state legislators should consider:

• Restructure one-size fits all job structure and compensation
• Optimize existing time to meet student and teacher needs and extend where necessary
• Rethink standardized class size model to target individual attention
• Shift special education spending toward early intervention and targeted individual attention

The panel continued with a discussion about the actionable steps legislators can take to steer education finance systems to be more output-driven as well as to encourage districts to be more innovative and creative. They also discussed the role that digital learning and technology can play in reform efforts and the impact of the federal stimulus. Highlights from this discussion include:

• With federal stimulus funds going away, states are facing a funding cliff, emphasizing the need for fundamental change now.
• Legislators should work to break down barriers and remove restrictions (e.g., categorical funding restrictions, class size mandates) so districts can optimize resource allocations.
• A lively debate around standardized testing – Mr. Hochberg suggested that states should examine the costs associated with standardized testing and consider whether or not every student should be tested every year.  Others disagreed with this approach citing the inability of districts to implement compensation systems that would seek to tie teacher pay to performance.
• Technology can and will play a larger role in education service delivery.  Most districts have a hard time freeing up operating expenses to invest in technology so it will be important for states to provide support.  However, districts must be willing to take some of the costs out of the system (e.g., more digital learning may mean fewer teachers) to realize the additional efficiencies that come with improved technology.