April 3, 2003
An Easy Way to Control Soaring School Costs:
Bring “Billable Hours” to the Teaching Profession
by Theodore Martland and Richard Olivastro
The
cost of education has increased dramatically over the decades. New school
construction and building additions - the bricks and mortar costs - have
increased significantly creating exceptional bonded indebtedness. At the same
time, dramatic cost increases in salary and benefits for teachers,
administrators, and support staff - the human resource costs of education -
have spiraled upward.
As
a result, education budgets in towns and cities across Connecticut are
consuming higher and higher percentages of property tax collections year after
year. And, in a growing number of towns and cities, more of the direct and
indirect costs of education are assigned to the general budget. Wherever we
find the practice of burying some education costs in the general fund, the real
aggregate costs of education are being shrouded from the eyes of most
taxpayers.
Fortunately,
a simple accounting method used by many professionals outside the field of
education offers a way out of the crisis.
Almost
everyone has heard of the phrase “billable hours.” But, not everyone outside of
the legal and accounting professions may know exactly what it means. In
simplest terms, “billable hours” are those hours a professional spends at work
in service of a specific assignment.
Teachers
do not normally track their time in the way that lawyers and accountants do,
but they certainly could.
Why
is it desirable for teachers to account for their time in such a manner?
Because using “billable hours” gives all education stakeholders the ability to
begin to make rational choices about the optimal allocation of a school’s most
precious education delivery resource - teacher time. By translating a teacher’s
labor into an objective measurement, parents, school boards, and principals can
begin to make cost-effective decisions about who should be hired, what should
be taught, and when.
How
would “billable hours” work in education? For every teacher, we make two simple
calculations:
The
first is the “teacher instruction cost.” You get this figure by multiplying a
teacher’s scheduled daily teaching hours times 180 school days and the dividing
the result into the teacher’s annual salary. For example, a teacher with a load
of 4.75 class hours per day and a salary of $64,400.00 would have a teacher
instruction cost of $75.32. Put more simply, an hour of his (or her) teaching
time costs the taxpayers $75.32.
The
second calculation is the “student instruction cost.” This is simply the
teacher instruction cost -- the hourly amount we’ve just calculated -- divided
by the number of students in a specific classroom. Carrying through on our
example, we would say that the student instruction cost for a teacher making
$75.32 an hour running a Social Studies class of 25 students is $3.01. With
this figure we can say exactly what is costs to educate each student in a
particular class.
With
these two simple calculations it is now possible to establish the actual cost
of delivering an education to any classroom. More importantly, it is possible
to make objective comparisons of education delivery costs within a single
school or across a district. Parents, school boards, taxpayers, principals and
other stakeholders can even compare Elementary, Middle or High Schools
classroom costs across districts with complete objectivity.
The
potential benefits of these calculations are enormous. Using the both the
“teacher instruction cost” and “student instruction cost” it is possible to
insure that instructional costs are not skewed by the size of a school system’s
census -- a factor that has historically confused comparisons between small and
large districts. These measures can also uncover and pinpoint the actual costs
of different modes of instruction, of school organization and of daily school
scheduling, all-the-while insulating cost-effective judgments from attempts to
obscure them with pedagogical rhetoric.
The
use of “billable hours” will enable those who wish to get the most from their
town’s tax dollars to review public school costs with a “laser-like” focus,
producing the kind of quality education parents and school boards statewide
would like to see. This concept, easily adapted from the accounting and legal
professions, can provide all education stakeholders with a powerful a tool to
effectively manage education delivery costs.
ABOUT
THE AUTHORS: Dr. Theodore Martland is a former Superintendent of Schools in
Connecticut. Mr. Richard Olivastro is president of People Dynamics, a
Connecticut based Leadership Development Company and a member of the Board of
Directors of the Yankee Institute. They can be reached at Education
Dynamics, 860-678-7526.