August 18, 2008

No Extra Charge for Success On Same Budget, Charter School Gets Better Results

By Nancy Mitchell

West Denver Preparatory Charter School was born over lukewarm coffee in the basement of a church called The Pearl in a graffiti- stained neighborhood at the south end of Federal Boulevard.

In meeting after meeting, a carefully selected and diverse group - The Pearl's minister, the city's chief operating officer, a troubled kid from L.A. turned veteran teacher - drew the bones of a school they hoped would change minds about what can be achieved in public education in Denver.

Today, West Denver Prep ranks No. 1 among the city's 44 middle schools in the academic growth of its students. It stages annual lotteries to select pupils from an overflow of applicants and, from those not chosen, tears are not unusual.

Less talked about, but just as important for that group at The Pearl, is the fact that the school runs on roughly the same budget as any other Denver Public School.

"We are trying to create a model that . . . can be grown without significant alternative sources of funding," said Chris Henderson, chief operating officer for the city of Denver.

"There are good examples in town of schools that are very successful that raise a lot of money," he said, "but in order to be viable as a true growing enterprise, as a public school, you have to be able to operate and be successful with that level of funding."

West Denver Prep opened in fall 2006 in a former nursing home on Federal. Though Henderson and others say they did not expect to be so successful so fast, they are planning to open a second middle school in fall 2009 and a high school three years later.

"It's compelling to keep growing . . . when you stand and watch the lottery and see the reactions of families and kids who don't make the list" to get into the school, Henderson said.

"You realize that the odds of them receiving a similar education in the short term are relatively low, and that's life-changing for them."

Mixing money, academics

Alexander Ooms, a partner in a Denver boutique investment bank and a founder of West Denver Prep, compared tax dollars spent on education at Denver middle schools with their proficiency levels on state academic exams.

The results were staggering. Kepner Middle School, for example, received $6.5 million in state funding to educate its sixth-graders in 2005-06, seventh-graders in 2006-07 and eighth-graders in 2007- 08. But fewer than 25 percent of those students achieved proficiency during those years on any reading, writing or math exam.

So the average amount spent on each proficient student by grade eight was $124,839, or about the costs of four years of tuition at Harvard.

Ooms admits the analysis is crude. It doesn't consider, after all, where the students were achieving when they entered Kepner and how much they grew.

But the point, as he sees it, is clear:

"We're doing a really lousy job getting a return on what we're spending on education," Ooms said. "So let's start measuring what kind of value we're getting and figure out how we can do a better job of it."

A growing number of educators and researchers agree with him. Last year, Teachers College at Columbia University launched the national Center for Benefit-Cost Studies of Education, where a pair of economists considers questions such as whether raising teacher salaries by 10 percent pays off in the long run.

"There's a little bit of reluctance among educators to say this is about money," said center co-director Clive Belfield. "They think about making a difference in the lives of students. But . . . there's a lot of money involved."

"We take a purely economic perspective," he added. "We don't say, 'It's not right kids are not graduating from high school.' We say, 'What are the consequences for us if they don't?' "

In Colorado, the state's public school finance chief, Voreta Herr- mann, said conversations are beginning about how to complete a "return on investment" analysis for Gov. Bill Ritter's Colorado Achievement Plan for Kids.

And in Denver, the Piton Foundation is slated next month to release a report on education spending vs. academic results among the city's 140 schools.

Education on a budget

DPS Superintendent Michael Bennet said he has never seen such an study for the district or its schools.

Bennet, whose former jobs include turning around bankrupt companies for Phil Anschutz, said he once tried to complete such an analysis on spending per DPS graduate but was stymied by the district's "indecipherable" budget.

Now the DPS budget is more transparent, he said, and the district can measure student growth in its schools - and tie funding decisions to academic progress.

"What this is about is moving away from an era . . . where the politics around schools and the decisions that have been made in school systems are all based on opinion and conjecture and not fact," Bennet said.

Chris Gibbons, head of school for West Denver Prep, said he now can run his program solely on what he receives from the district. That wasn't possible in the first year.

That's because his school began with only one grade of 100 students and the low student-adult ratio required extra dollars. He took advantage of two grants available to most charter schools, including $230,000 from the Walton Foundation.

For 2008-09, Gibbons has set a private fundraising goal of $180,000, including $80,000 for his school's bonus plan for teachers based entirely on increasing student achievement. Another $60,000 will fund a trip to Washington, D.C., for his 57 eighth-graders.

And the remaining $40,000 will go to pay off debt for additions to his school building, a cost that he points out he would not have incurred if charters were able to make use of DPS buildings.

While some are squeamish about putting a price tag on education, Gibbons is not.

"We have to tackle this question of responsible funding and responsible use of funding," he said. "Just giving more money is not the answer."


Rating money spent on education: Worth the $$?

A business term known as "ROI" or return on investment is increasingly cropping up in education as K-12 school spending consumes a greater share of state budgets. Some examples of the types of comparisons:

* EXAMPLE 1: Colorado state spending vs. state test scores

2002-03 school year: $2.3 billion in general fund allocation, 41.7 percent of the state general fund.

2007-08 school year: $3.0 billion in general fund allocation, 41.8 percent of the state general fund

Difference: $710,492,470

* In 2002-03, 66.1 percent of students were proficient or advanced on state reading exams, grades 3-10. In that same school year, 40.9 percent of students were proficient or advanced on state math exams, grades 5-10.

* In 2007-08, 67.7 percent of students were proficient or advanced in state reading exams, grades 3-10. In that same year, 47.8 percent of students were proficient or advanced in state math exams, grades 5-10.

Difference in reading exams: 1.6 percent, or 15,471 students

Difference in math exams: 6.9 percent, or 25,942 students

Is it worth it?

"A lot of people think we should just be improving education as an end in itself. But the trouble with that is, I'm a taxpayer, you're a taxpayer and, at some point, you say to yourself, 'How much money are we supposed to throw at this?'"

Clive Belfield, economics professor and co-director of the Center for Benefit-Cost Studies of Education at Teachers College, Columbia University

* EXAMPLE 2: West Denver Prep, Grades 6 through 8

Location: 1825 S. Federal Court, 1.27 miles from Kepner Middle School

Poverty rate: 89%

Students: 200

* Sixth grade, spring '07: 49% proficient or advanced in reading, 66% proficient or advanced in math.

* Seventh grade: spring '08: 62% proficient or advanced in reading, 72% proficient or advanced in math.

Operating budget, 2007-08

* DPS receives $7,123 in state funding per pupil, or $1.4 million

* DPS keeps 3 percent for administrative costs, as allowed by state law with charter schools, and provides services such as special education by contract

* Results in per-pupil revenue of $5,360 to school

* EXAMPLE 3: Kepner Middle School, Grades 6 through 8

Location: 911 S. Hazel Court, 1.27 miles from West Denver Prep

Poverty rate: 87%

Students: 900

* Sixth grade, spring '07: 31% proficient or advanced in reading, 33% proficient or advanced in math.

* Seventh grade, spring '08: 30% proficient or advanced in reading, 17% proficient or advanced in math.

Operating budget, 2007-08

* DPS receives $7,123 in state funding per pupil

* DPS takes a cut for districtwide programs and services such as human resources, special education and transportation

* Results in per-pupil revenue of $4,499 to school, or a total of $4.1 million

Originally published by Nancy Mitchell, Rocky Mountain News.

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