Navigating the Funding Cliff: Academic Return on Investment
While school districts enjoyed record budgets over the last few years thanks to CARES, ESSER, and ARP dollars, district leaders are now wrestling with the challenge of reduced funding. The reality is that students’ increased needs persist as budgets are decreasing while costs are continually increasing. And, for districts facing declining enrollment, the funding gap is even larger.
Given this, returning to pre-pandemic budgets is not an option. Taking a strategic budgeting approach can help districts navigate and survive the funding cliff while preserving much needed services for students. This following post is part of our series, “Navigating—and Surviving—the Funding Cliff: Strategies for Maintaining ESSER-Funded Services Despite Declining Resources and Increasing Costs,” which shares best practices and actionable strategies for continuing to meet post-pandemic student needs and maximizing the impact of every dollar despite declining resources.
NAVIGATING—AND SURVIVING—THE FUNDING CLIFF
Academic Return on Investment: Keep what works, trim the rest
School districts used the billions of stimulus dollars received through CARES, ESSER, and ARP in recent years to add staff, programs, and services to better support students. Of course, the thinking was that all these new investments would be very impactful, but, in most districts, some investments have made a bigger impact than others. Unfortunately, most districts don’t really know which new spending actually made the biggest difference and are unsure of what to keep and what to trim now that the funding cliff has arrived and budgets must tighten.
Fortunately, best practices do exist for conducting a robust analysis to determine which investments are having the biggest impact for students so that districts can make data-driven budget decisions, keeping what’s best and trimming the rest.
Academic Return on Investment (A-ROI) to the rescue
Academic Return on Investment (A-ROI) offers a structured approach by which districts can answer the question: What works, for whom, and at what cost? Simply put, it helps districts get the most bang for their buck, and it can be tremendously helpful as a decision-making tool when it comes to shrinking budgets.
WHAT WORKS: Which programs are achieving the intended outcomes according to specific objectives, metrics, and district-developed definitions of success?
FOR WHOM: Exactly which students are benefiting the most from a given program, and which students are deriving little-or-no benefit from the program?
AT WHAT COST: How cost-effective are each of the programs, taking into account the fully loaded per student cost of running the program?
By looking at the benefits and fully loaded costs of individual programs, strategies and positions, districts can assess and compare different spending priorities and make informed decisions about which programs to expand, maintain, refine, target, or sunset.
The idea of measuring return on investment in education can be uncomfortable, but it is important. A-ROI enables districts to improve budget decision making, build buy-in for change, and ensure that limited resources are doing the most good for the most students. It is a useful tool during any budget process, and an absolutely essential approach during tighter budget times.
An example of A-ROI in action
A-ROI is a powerful decision-making tool when put into action. Here’s an example: In a district that made a $1.2-million investment in instructional coaching with ESSER funds, many assumed that the coaches would all be cut when the funds ran out, because a million plus dollars a year was too much to shift to the operating budget. However, by conducting an A-ROI study, the district learned a lot about the program’s effectiveness and was able to keep all the benefit at a fraction of the cost, which can be sustained into the future.
The district’s AROI study revealed that:
Coaching had a very positive impact when working with teachers with 2-10 years’ experience, but was not having the same impact with new teachers (who were too overwhelmed) or veteran teachers (who were just not that interested)
Coaches that focused on a specific topic, and on reading in particular, were more impactful than general-purpose coaches
Some coaches had much smaller caseloads (of about 8 teachers), but they were no more effective than coaches who had larger caseloads (of about 16 teachers)
By looking at the data through an A-ROI lens, the district discovered that most of the benefit of the $1.2 million investment could be preserved by a continued investment just a quarter of the size. By concentrating the instructional coaching program on teachers with 2-10 years of experience, focusing on reading, and standardizing coach caseloads, the district was able to trim $900,000 in spending and still benefit greatly from the instructional coaching program.
A-ROI shows the way to strategically navigate—and survive—the funding cliff
As in the example above, an Academic-Return on Investment approach can help districts identify which programs are most effective and most cost effective so that they can maximize the impact of limited budget dollars. Facing the funding cliff and sharply tightening budgets, A-ROI is an important tool for districts to make data-driven decisions about which programs are best to keep, and which should be trimmed.
To learn more, check out this article:
Academic ROI: What Does the Most Good?
Educational Leadership, December 2011/January 2012 (Vol. 69, Number 4)
