Opponents of school consolidation who claim that such mergers won’t save any money on administration or other costs are simply ignoring empirical evidence and common sense.
The only way that a merger of two smaller organizations into one larger one won’t reduce personnel is if those put in charge of the consolidated entity are incompetent.
Everywhere in the business world, where mergers and acquisitions are commonplace events, the combination results in payroll savings. It’s why the mergers work financially and how one company is able to pay off the debt it accrues to purchase another.
So, when Greenwood Sen. David Jordan, who has vacillated a bit on the subject in recent years but is presently in the “anti” camp, says that he doesn’t see how consolidation will result in lower administrative costs, he’s only showing his lack of understanding of basic economic principles, such as economies of scale. Maybe that’s to be expected from someone who has not worked a day in the private sector as an adult.
Jordan’s premise — that administrative personnel is directly proportional to student enrollment — is simply untrue.
A report this week by the Joint Committee on Performance Evaluation and Expenditure Review underscores the fallacy of the Democratic senator’s premise.
PEER, the legislative watchdog group, was asked to estimate the potential savings in just administration for two of the proposed consolidations being considered by the Legislature this year. Based on 2013-2014 school year data, the report says, the merger of the Carroll County, Montgomery County and Winona districts could save $930,000 a year; the merger of Houston, Okolona and Chickasaw County districts $1 million.
What’s more enlightening about the analysis is the wide disparities it reveals in administrative costs per pupil. In the six districts examined, the administrative costs ranged from $464 per student in Carroll County to $1,628 per student in Montgomery County, a nearly fourfold difference. What the small sample generally shows is the larger the district, the more efficient it can be.
Of course, those who see schools primarily as job providers don’t really care about efficiency. The more they can load up school payrolls with family, friends and supporters, the better they like it.
But that approach cheats not only the taxpayers but also the students. Wasting money on patronage leaves less for instruction, extracurriculars and better schoolhouses — precisely those areas that should be the main focus of a school district.
