Big share of Atlanta education money never reaches classroom

From Atlanta Public Schools’ downtown headquarters, an expensive bureaucracy sprawls across the city, with costs per student that dwarf those in neighboring school districts.

Hundreds of administrators work outside the classroom. From assistant superintendents to secretaries to technology specialists, they support an aging school district with 49,000 students — less than half as many as 50 years ago.

Central office spending persists even amid the enrollment decline and low graduation rates and test scores. The amount of money Atlanta’s school system dedicates to administration is among the highest in the nation when compared to other major cities, according to U.S. Census Bureau figures.

Atlanta school leaders say the spending is justified in a district with more school buildings, poverty and crime than nearby school systems.

An analysis of state records by The Atlanta Journal-Constitution shows that APS spent $831 per student in 2012 on administrator salaries (excluding principals and assistant principals), more than double the $307 per student average of nine other metro Atlanta school districts. About 11 percent of what’s spent on each Atlanta student goes toward general administration, according to Georgia Department of Education figures adjusted to remove charter school costs.

These numbers suggest that a significant amount of tax money designated for education supports employees instead of students, and that Atlanta’s school system has failed to make painful cuts.

“Our job is not to spend money on administration. It’s to be spending money on children and instruction,” said Doug Eza, who advises state school systems on budgeting issues.

If Atlanta Public Schools reduced its spending on administrative salaries to the region’s average, it would save enough money each year to hire about 300 more teachers with salaries and benefits totaling $80,000 per educator. The potential savings could also be returned to taxpayers, used to pay off a giant pension liability, or help replenish depleted reserve funds.

Superintendent Erroll Davis said large urban school systems cost more than suburban schools, and APS needs to invest in administration as it recovers from revelations that educators cheated on standardized tests to inflate scores. That spending includes training for principals, three-quarters of whom started their jobs within the last two years, and money for quality assurance systems.

“My view is that you need to get the basic infrastructure in place before you start worrying about costs,” Davis said. “If you want systemic excellence, you have to build systems, and that costs money.”

Still, the Atlanta education system dedicates greater amounts — more than twice as much in many cases — to administrative salaries per student than nearby school districts’ averages in every category, including top-level management, technology services, curriculum and instruction/human resources, clerks, finance and legal personnel.

For example, APS pays $171 per student for assistant superintendents and department heads compared to metro Atlanta averages of $71 per student, and clerks and secretaries cost $138 per student compared to an average of $62.

Atlanta’s management expenses look even higher under the DOE’s broad accounting, which shows that the school district spent $2,330 per student on general administration in 2012. APS Chief Financial Officer Chuck Burbridge said the state’s figure is inaccurate because it counts charter schools as administration, but after excluding charters, Atlanta Public Schools spent about $1,634 per student on administration — the highest amount in the state.

“If I were a taxpayer in that district, I’d be looking pretty closely at what they spend,” said Georgia Department of Education Chief Financial Officer Scott Austensen. “Without making a value judgment, it does look particularly high.”

Spending on administration hasn’t delivered academic results in Atlanta Public Schools. Graduation rates stalled at 51 percent in 2012, below the Georgia average of 70 percent, and standardized test scores in reading and math are consistently among the lowest in the region.

Accountant Jarod Apperson, a Midtown resident who shared his research on metro area administration salaries with the AJC, said Atlanta Public Schools never adjusted its management structure to fit its size after decades of decline in student enrollment. Atlanta runs nearly 100 schools, while other school districts with similar enrollments, such as Henry County, operate about 50 schools.

But Atlanta Board of Education Chairman Reuben McDaniel said the school district must deal with the expenses of managing so many properties, addressing the needs of students with disabilities and providing services to students who qualify for free and reduced-price meals.

“Those administration costs are going to be higher relative to another district,” McDaniel said. “I don’t think Atlanta is bloated per se, but I don’t think there’s any organization where you can’t become more efficient.”

In surrounding districts, school boards haven’t spared the budget knife when it comes to administration costs.

Fulton County Schools required each department to justify its spending, said Chief Financial Officer Robert Morales. The district saved $17.3 million through measures that included reducing health benefits, gas costs and substitute teacher estimates for the new budget year that began July 1. Employees weren’t targeted after about 1,000 positions were reduced two years ago.

Cobb County Schools cut 16 central office positions, a move that Superintendent Michael Hinojosa said forces other employees to take on more responsibility.

“So far, academic performance has held steady … but maintaining the same level of service for schools is becoming increasingly difficult,” he said.

Nationally, Atlanta Public Schools had the ninth-most per-student spending on general administration and staff support among school districts with at least 40,000 students, according to 2011 census data. District of Columbia Public Schools topped the list, followed by school systems in Boston and Newark, N.J.

Urban school systems often spend more on administration because they serve a wide variety of student needs, handle complex regulations and funding sources, face greater political pressures and have multiple levels of management, said Jane Hannaway, principal investigator for the American Institutes for Research.

“You don’t tend to see a reduction except when resources are constrained,” Hannaway said.

In Boston Public Schools, Interim Superintendent John McDonough said he tries to keep central office costs from exceeding 6 percent of the system’s budget.

“We do attempt to ensure that obviously the maximum amount of our budget goes to support direct services at schools,” McDonough said.

The Georgia General Assembly tried to force school districts to send more money to the classroom in 2006 when legislators passed a law requiring that 65 percent of spending go toward instruction.

But since the recession put a strain on school systems, the Georgia DOE has granted hardship waivers to every district seeking an exception to the law, allowing them to direct money to other needs such as transportation, media centers and school counselors, said spokeswoman Dorie Turner Nolt. The state granted Atlanta a waiver in 2012 because its direct classroom expenditures grew by more than 2 percentage points between 2011 and 2012 to 50 percent of total spending.

The 65 percent requirement sounded like a good idea, but rules forcing schools to spend more on classroom instruction haven’t translated to better educational results, said Sen. Fran Millar, R-Atlanta.

One way for APS to limit central office costs would be to set a target for reducing the number of administrative positions above the school level, said Joe Martin, who served on the Atlanta Board of Education from 1978 to 1997.

That’s what the board did in 1990, when it decided that administrative positions above the school level should be reduced by 10 percent. The superintendent exceeded that goal in the following year’s budget, largely by transferring administrators to school level jobs.

Amy Shea, who has two children in North Atlanta High School, faults APS for resorting to furlough days when budgets came up short and not doing more to decentralize administrative functions.

“Trimming down our central office would clear up money to go back to the classroom and help attract the best teachers,” Shea said.

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Staff writer Daarel Burnette contributed to this article.