School district spend considerable time thinking about budgets – mostly about how to balance budgets. They should also be thinking about school district economics. Why? because these are two completely different thought processes.  Budget balancing focuses on how to balance revenues and spending and making cuts to services and programs.

School economic thinking focuses the conversation on value and results.   When we think economics we naturally ask different question.  What does it cost us to provide a service? What does it cost other districts? What should it cost us to provide that service?  How can we provide that service at a lower cost?  Why is our purchasing approval process so complicated and time consuming?  What does that process really cost us?  Why do we pay $22/hour plus benefits when other districts pay $15/hour plus benefits for driver positions?  Are our labor rates competitive? Why do we pay $110,ooo in compensation for a teacher and a similar district in our county pays $75,000/year?  Can we justify that?  What is the cost and fact based benefit of an instructional program?  How many students can a counselor serve in a specific student body.  What mix of school spending (class size, support and supplamental services) provide the best results for students and our community?

School district leaders will find that they will discover the solutions to the current financial issues when they start thinking differently about money.

Steve Pereus