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SUMMARY
The Office of the Auditor
General has conducted an analysis of Arizona
school districts’ percentage of dollars spent in
the classroom during fiscal year 2004. In
addition, this report summarizes how districts
reported spending their Classroom Site Fund
monies resulting from Proposition 301, the
education sales tax approved by voters in
November 2000. This analysis was conducted
pursuant to Arizona Revised Statutes (A.R.S.)
§41-1279.03, which requires the Auditor General
to monitor the percentage of each dollar spent
in the classroom and conduct performance audits
of school districts. This is the fourth year the
Office of the Auditor General has conducted this
analysis.
The definition of classroom dollars used in this report is
the same definition developed by the U.S. Department of Education’s National
Center for Education Statistics (NCES) for “instruction.” This definition, as
described in Table 1 (see page 3), includes current expenditures for classroom
personnel, instructional supplies, instructional aids, certain tuition payments,
field trips, athletics, and cocurricular activities. This definition has been
applied by the NCES for a number of years and provides a basis for comparing
Arizona’s results with other states, the national average, and Arizona’s past
performance.
Dollars in the classroom
(see pages 7 through 21)
In fiscal year 2004, Arizona’s state-wide percentage of
dollars spent in the classroom remained at 58.6 percent, the same as fiscal year
2003. Arizona’s classroom spending continues to lag nearly 3 percentage points
behind the national average of 61.5 percent, as reported by the NCES.
The same disparity is also evident when Arizona’s
expenditures are compared with those states that are closest to Arizona in
per-pupil spending. Based on NCES-reported data, the ten most comparable states
spent an average of 61.3 percent of their current expenditures on instruction.
Thus, Arizona is behind both the national average and its “peer states” in
directing dollars into the classroom.
Although the addition of Proposition 301 monies has helped
raise the state-wide average to 58.6 percent, the average could have been higher
still. If districts had spent their fiscal year 2004 non-Proposition 301 monies
in the same proportions as they did prior to receiving Proposition 301 monies,
the additional monies would have raised the state-wide average to 59.2 percent.
However, many districts now spend proportionately less of their other monies in
the classroom than they did before Proposition 301.
In late February 2003, the Governor’s Office requested school
districts to submit plans on how they would move 5 cents more of every dollar
into the classroom to improve Arizona’s classroom dollar percentage. Therefore,
fiscal year 2004 was the first full year for districts to implement their plans.
The plans and how they were implemented differed significantly between districts
that increased their classroom dollar percentages and those that decreased. The
districts with the largest increases had developed plans with well-defined
actions and made progress toward the goal. The districts with the largest
decreases had developed less-specific plans that often included actions that
would not have improved their classroom dollar percentages even if implemented.
Excluding certain special-purpose districts, classroom dollar
percentages for individual districts ranged from 35 to 83 percent. This wide
range is somewhat misleading though, as nearly two-thirds of Arizona districts
were within 5 percentage points of the state average. Many of the districts with
very high or low percentages are the State’s very smallest districts with fewer
than 200 students. Because of their size, these districts tend to either not
provide some nonclassroom services such as administration, transportation, or
food services, or have very high costs relative to their size to do so.
The primary factor associated with higher classroom dollar
percentages continues to be larger student populations. Larger populations
provide districts with more money, allowing them to meet their necessary fixed
costs and leaving more money to devote to the classroom. Conversely, higher
plant operation and maintenance, administration, and transportation costs were
the most significant factors associated with lower classroom dollar percentages.
State-wide, Arizona school districts continue to allocate a
lower percentage of their dollars to administration costs than the national
average and allocate a higher percentage of their dollars to plant costs and
student support services.
Within Arizona, higher total per-pupil spending does not equate to higher
classroom dollar percentages. Although these districts have more resources
available to spend per pupil, on average, they put a smaller proportion of each
dollar in the classroom. As a result, districts with the highest per-pupil
spending, on average, have lower classroom dollar percentages.
Districts’ uses of Proposition 301 monies
(see pages 23 through 27)
Districts spent $236 million from their Classroom Site Funds
during fiscal year 2004 and continued to use the monies almost solely for
teacher compensation. This complies with the requirement that at least 60
percent of the monies be used for teacher compensation. According to salary data
collected by the Arizona Department of Education, the State’s average teacher
salary increased from $37,176 in fiscal year 2001 to $38,534 in fiscal year
2004. Based on district-reported data, teacher salary increases attributable to
Proposition 301 monies in fiscal year 2004 averaged 10 percent, but ranged from
1 to 20 percent. The amounts attributable to Proposition 301 monies ranged from
$500 to $6,700 per eligible employee, on average.
While most monies were directly used for teacher compensation
increases, districts also used some of their monies for the other purposes
authorized under Proposition 301. This was often accomplished by paying teachers
for activities related to these other purposes, such as teacher development and
AIMS intervention.
Appendix
(see pages a-1 through a-223)
The Appendix provides alphabetically organized one-page
information sheets on individual school districts. Each page summarizes the
district’s classroom and nonclassroom spending, its reported Proposition 301
program results, and other descriptive and comparative data.
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