Doesn’t Declining Enrollment in Local Public Schools Mean That the Amount of Money per Pupil Should Go Up?

According to news reports, the part of the Oregon state budget devoted to education has not declined in recent years. So why is declining enrollment in local public schools a financial problem? Doesn’t this mean that the amount of money per pupil should go up? —Educurious

Declining enrollment presents financial problems for pretty much any school system. However, the sting is particularly keen in Oregon now due to what some liberal policy wonks (is there another kind?) might characterize as our state’s original budgetary sin.

But before we get to that, let’s talk about the effects of declining enrollment in general. The core problem is that if you lose 10% of your students, you can’t make it up by shrinking all your facilities by 10%—your utility bills, maintenance costs, etc., will still be pretty close to what they always were.

In theory, personnel expenses are scalable, and you could respond to the downturn by laying off 10% of your teachers and staff. In real life, there are contracts and tenure and figuring out how you’re going to get those teachers back in two years when you need them again.

I get your math, Educurious: On paper it seems like our kids should be swimming in solid gold whiteboards and Gucci pencil sharpeners. But “more money to spend on each pupil” turns out to be just another way of saying “each pupil now costs more money.” If somebody quits your carpool, the rest of you have to pay more money, but the ride doesn’t get any nicer (unless the person who quit was Todd; fuck that guy).

Such economies of scale (or lack thereof) apply everywhere. It’s worse in Oregon, though, and that’s because of a middle-class tax revolt that began in 1978 with California’s Proposition 13 and rode the wave of Ronald Reagan’s hair throughout the 1980s, finally coming to rest in Oregon with a 1990 ballot initiative called Measure 5.

Measure 5 capped what some feared were becoming out-of-control property taxes, upending the long-standing system of local funding for K-12 education. This effectively shifted the burden of school funding to the state’s general fund. Today, for example, the state provides 70% of Portland Public Schools’ budget, up from 30% before Measure 5.

Crucially, that funding is allocated to each district largely on a per-pupil basis. The fewer pupils, the less state funding. Where’s Jerri Blank when you need her?

Questions? Send them to dr.know@wweek.com.