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Sweeping statewide consolidation across Pennsylvania's 500 public schools wouldn't bring the cost-savings that some lawmakers – and the public alike – envision, at least not without the state providing financial incentives, a recent analysis shows.

While there is evidence that in some cases moves to combine very small districts could yield savings or improve educational opportunities, consolidating schools with 1,000 students or more might increase costs – and, in many cases, raise the tax millage in many communities those districts serve, a Joint State Government Commission report notes.

That doesn't mean consolidation wouldn't benefit Pennsylvania's struggling communities. But the state has no incentives in place to help schools interested in combining to overcome financial sticking points that might be holding them back, a New Jersey-based reform-minded nonprofit's study added.

In 2016, a bipartisan group of Pennsylvania lawmakers spearheaded an effort to have Pennsylvania's Joint State Government Commission study the pros and cons of school district consolidation – in a moved aimed at looking to trim costs, particularly administrative expenses.

Aided by research by the state's Independent Fiscal Office, the results feature a 250-page caution against large-scale, widespread consolidation – with its authors pointing to pitfalls other areas have found in mandating the move.

"While school district consolidation is often associated with anticipated cost savings and tax reductions, it is a very complex process, involving multiple contributing factors, like changes in state funding, additional expenses necessitated by salary equalization, and capital costs," the report said. "Consolidation can lead to higher costs for districts, both on the short term ... and longer term."

While there might be an administrative-level savings in some cases by merging two or more districts, that savings could be eclipsed by the costs to add other supervisory-level building staff and to "level-up" educators' pay from building-to-building. 

Potential pitfalls

Under Pennsylvania law, teachers' salaries vary from school district to school district based on local contracts. Combining two would require salaries in every building to be matched, district-wide, meaning teachers who might have been making less in their former district would now earn the same salaries as their new colleagues from a higher-paid district next door.

Even if the number of teachers declines as a result of the merger, the salary adjustment costs could quickly outpace the savings from any cuts, researchers said.

“No two districts have the same contracts,” said Kimberly Zippie, superintendent, Commodore Perry School District, a rural Mercer County school district with 465 students enrolled for 2017-18.

“Nobody’s going to level down," Zippie said. "Everyone is going to level up.”

Crawford Central Superintendent Tom Washington agreed.

“Those local districts all have their own individual CBAs,” he said, suggesting that differing collective bargaining agreements between districts and employees might make mergers very challenging.

“It’s a huge issue to undertake to even look at that,” Washington said.

At Jamestown School District, Superintendent Tracy Reiser said that district has been able to avoid taking on large amounts of debt, while some surrounding districts have borrowed to launch building projects. That makes district officials less likely to consider merging.

“Why would taxpayers in Jamestown want to take on the burden of another district’s renovation?” Reiser said.

A Pennsylvania School Board Association report also noted that there would be other significant startup costs, such as providing identical textbooks to students in the newly merged district, connecting computer systems, and legal fees.

"It's not as simple as taking two districts that are financially struggling and suddenly creating one that isn't," said Yelena Khanzhina, a Joint State Government Commission public policy analyst who served as the project manager for its consolidation cost study.

Moves involving high-tax districts might soften the tax burden on those communities while increasing taxes ones in the neighboring towns they join, she said.

Differing district debt can also be a deal-breaker, Khanzhina noted. 

Lack of incentives

Pennsylvania is one of 39 states in the nation that do not offer significant incentives to schools to consolidate or merge – nor does state government have the power to force such a move.

Without the state stepping forward, there's a long list of excuses to stick with the status quo, according to Zahava Stadler, director of policy for EdBuild.

This summer, the New Jersey-based nonprofit outlined the consequences inaction is causing in Pennsylvania in the report "Stranded: How states maroon districts in financial distress."

The result is a system where the gaps in support, academic offerings and achievement have grown wide between the state's wealthiest and poorest schools, thanks partly to a long history of unfair state funding practices, Stadler said.

She described Pennsylvania's public school funding system as "sort of a wild west" where districts of similar sizes have received vastly different amounts of support from the state.

The result: Many districts charged with educating some of Pennsylvania's poorest young people have been forced to lean harder than they should on the struggling local tax bases they serve, while affluent schools continue to bring in their fair share of state dollars despite solid local tax bases.

"For the struggling schools, it gets to the point that they cut and cut ... and what other choice do they have but try to consolidate?" she added.

But with no pressure or incentive to do so, wealthier schools have no reason to do it.

Standler said there have been at least 18 attempts by one or more schools to consolidate with one or more partners in Pennsylvania since 2000.

In every case but one - the Center Area and Monaca consolidation – the effort failed, she said. 

Room for 'tiny' victories

From a cost standpoint, there have been plenty of studies estimating the projected benefits that consolidations at a district level might bring. But because consolidation has been such a rarity in the state, there really isn't much data in Pennsylvania to show what successes – particularly actual cost savings – such moves provide, Khanzhina said.

The Joint State Government Commission looked at follow-ups in several other states that did, however.

The results showed that while consolidation might make real sense out of necessity, it isn't a recommend move to save tax dollars or improve educational outcomes overall, according to several sources the commission cited.

Consolidation efforts involving several of the state's smallest school districts – those well under 1,000 students total – stand out as potential exceptions, however, according to research by two New York professors, William Duncombe and John Yinger, who are nationally recognized as school finance experts.

Combining two 300-student districts could cut overall costs by 20 percent, they wrote. In comparison, they wrote, there would be little resulting economic impact when combining two 1,500-student districts.

"The net benefits of consolidation are positive only for the smallest districts," they wrote.

Because those districts are so small, the savings they'd create wouldn't mean much at the state level, Duncombe and Yinger added.

Other researchers suggested splitting apart some of Pennsylvania's largest, mid-level administration heavy districts might provide more statewide savings.

At Reynolds School District in Mercer County, Superintendent John Sibeto said that if consolidation becomes necessary, he believes a move shouldn’t entail just two school districts.

That is putting a Band-Aid on the financial issues, he said. Instead, Sibeto said, merge half or the whole county in one or two districts.

“I’m not pushing and I’m not considering consolidation at this point," he said. "But when it’s time and we need to to do it think the answer is to go big. If I’m ever involved in something like that, I would certainly go for bigger than smaller.” 

Smaller can be better 

Tiny schools are starting to become a bigger trend in Pennsylvania.

Fourteen school districts across the state had fewer than 500 students in all grade levels combined in 2017 – twice as many as just decade earlier.

At 187 students, the smallest enrollment in the state in 2017 belonged to Potter County's Austin Area School District – which borders another that ranks among Pennsylvania's smallest, the 354-student Galeton School District

Salisbury-Elk Lick, with just 276 students, was one of four Somerset County schools with enrollments under 500 pupils, with one of its neighboring districts, Turkeyfoot Valley close behind with just 347 students.

But while consolidation could bring benefits – including increased educational resources, researchers caution that such a move should be carefully studied to weigh the pros and cons, not just on students – but the community itself.

For one, Pennsylvania is far from alone when it comes to having a large number of small schools.

A national look at public schools across the nation shows that while the average school district population varies significantly state by state, but very small schools are common in most states.

In fact, 46 percent of the nation's public school districts have fewer than 1,000 students, 2017 data showed.

One public school in Pickens, West Virginia, for example, was home to just 37 students in 2017.

Studies cited by the Joint State Government Commission noted that while per-student education expenses are, in some case, far higher in smaller schools than in larger schools, many also compare favorably with larger peers.

And, on average, the state's smallest schools have higher graduation rates.

And in communities with a large percentage of students living at or below poverty, small schools are beneficial, the report says.

"There are plenty of studies out there that show weaker and economically disadvantaged students do better in smaller schools and smaller districts because they get more attention," Khanzhina said. "That's why I always caution that when you start talking about consolidation, it can't just be about saving money."

"You don't want to sacrifice the quality of education." 

A 'success story' 

Today, one consolidation – the creation of Central Valley from Monaca and Center Area schools – stands out as Pennsylvania's lone success story in the past nearly 50 years.

Monaca and Center Area had nearly 700 students and 1,800 students, respectively, but both were located in struggling steel towns with declining populations.

They also had a willingness to make it work, Khanzhina said.

It took years of discussion and debate between the two Beaver County school boards before consolidation happened, with state support, in 2009.

"Look at Blairsville-Saltsburg. It was forced on them (in the 1960s) and all these years later, the community has never come to terms with their consolidation – they're still fighting to separate," Khanzhina said.

Richland School District Superintendent Arnold Nadonley spent two years as administrator at Blairsville-Saltsburg, when efforts were underway to merge the district's high school population into one building.

"No matter what's being projected, if people don't support something, it's going to be hard to make it work," he said.

Even looking back to statewide public school consolidations in the 1950s and '60s, it took well over a decade for the communities in many of those new schools to really embrace the changes, Nadonley added.

That didn't occur until families who had children in the old schools – from kindergarten up – cycled through the system and were replaced by a new generation of parents and pupils, he said.

"You can't just make a decision to consolidate," Khanzhina added. "You've got to study whether it's feasible."

'Maine' event; lessons learned

Other states have learned that the hard way in recent years.

In 2007, lawmakers in Maine approved a cost-cutting move that ended up whittling the northeastern state's number of school districts from 290 down to 160.

Communities fought the plan statewide.

And even though state officials maintained that a large number of the new, larger districts saved money by consolidating, some districts paid penalties to remain independent.

Others tried taking the matter to court.

"There were schools willing to pay fines rather than consolidate – and some of them are still arguing over it," Khanzhina said.

While new districts were formed, school boards for many communities remained intact. By 2012, state lawmakers amended laws to make it easier for communities to withdraw from their new districts. And once that occurred, 33 towns pulled away from their districts, citing concerns about lost local control or school building closures, in the five years that followed.

In the end, consolidation might be the right move for many struggling schools across the country – but their individuals strengths and weaknesses need to be studied closely before such moves are made, Khanzhina said.

"When it comes to consolidation, there's no magic bullet ... when it comes to the right number of schools or spending," she said. "What works for some doesn't work for everyone else. And there has to be careful planning."

David Hurst is a reporter for The Tribune-Democrat. He can be reached at (814) 532-5053. Follow him on Twitter @TDDavidHurst and Instagram @TDDavidHurst.