District/School Administration Administration
The Massachusetts Board of Elementary and Secondary Education

Update on Study of Districts in Financial Distress

The Department of Elementary and Secondary Education and the Board of Education have recently heard increased concerns from school districts across the Commonwealth about challenges with financial conditions and their impact on districts' ability to maintain educational services for all students. At the Board's request, the Department has begun an analysis of the data it collects on district finances, staffing, and enrollment to look for trends that might shed light on what is happening and why.

We are examining several major potential symptoms and causes of financial distress to determine the degree to which each is contributing to individual districts' financial problems. Some of the symptoms of distress include: declining total spending; increasing local contributions per pupil; declining instructional spending; increasing athletic and transportation fees; increasing student-teacher ratios; and declining average teacher salaries. Some of the potential causes include: declining Chapter 70 aid; rising health insurance and other fixed costs; rising special education costs; enrollment changes (both declines and increases); and declining ability to raise local revenues. We also plan to include some specific examples of districts facing different types of financial problems to give a sense of how these problems play out at the ground level.

We will continue to refine our analysis over the next several weeks and will share our draft findings with selected superintendents to validate our results in their districts. We expect to bring preliminary findings to the Board in early 2008.