University of Arkansas Office for Education Policy

Effects of School District Consolidation in Arkansas

In The View from the OEP on March 3, 2021 at 12:34 pm

School district consolidation has been one of the most prevalent education reforms over the last century. As a result of consolidation efforts, the number of public school districts in the U.S. declined from 117,108 to 13,551 between 1940 and 2018. Despite the scale of this reform effort, relatively little rigorous research ‎explores the effect of district and school consolidation on student achievement. In this blog post, we summarize a new Arkansas Education Report that investigates the impact of a recent district consolidation law in Arkansans.

The latest round of school consolidation in Arkansas arose in response to school finance litigation that occurred throughout the late 1990s and early 2000s. The decade-long litigation culminated in 2003 with the Arkansas Supreme Court ruling that the state’s school funding system was unconstitutional in Lake View School District vs. Huckabee.

Governor Mike Huckabee responded to the court’s decision in part by proposing large-scale school district consolidation to reduce district administrative costs and provide greater educational opportunity for students. In early 2004, the legislature passed Act 60, which required the consolidation of any district with average daily attendance of fewer than 350 students for two consecutive school years.

The new law resulted in a substantial number of district consolidations in the years that followed. Table 1 presents the number of district consolidations occurring each year beginning with the 2004-05 school year. In the first year the law was in effect, 59 school districts were required to consolidate. Although Act 60 continues to have an impact as enrollments decline in rural districts, only a few districts have been required to consolidate since the initial wave in 2005.

Figure 1 shows the geographic location and district borders of the 99 districts that were either a consolidated or a receiving district in the 2004-05 school year. The map depicts district borders in the year prior to consolidation and districts are color-coded to indicate which districts combined due to Act 60. The initial round of consolidations was relatively widespread across the state, affecting districts in every region. Districts subject to Act 60 enjoy some autonomy in determining which other district to merge with; however, the overwhelming majority have merged with adjoining district.

Studying consolidation is challenging because, in most cases, districts voluntarily choose to consolidate for any number of reasons such as perceived cost benefits or to take advantage of state financial incentives. Districts that choose to consolidate are likely different from those that don’t in many observable and unobservable ways. These differences can lead results from simple comparisons of consolidated districts to unaffected districts to be biased.

Fortunately, Act 60 provides an opportunity to overcome this common challenge. In our analysis, we compare districts whose enrollment was just above or below the enrollment cut-off designated by Act 60. Students in districts with enrollment of less than 350 in the two years immediately prior to the passage of Act 60 are assigned to the treatment group and students in the remaining districts represent the control group. Given that the cutoff was not known in advance, comparing districts right around the consolidation threshold approximates random assignment, yielding two groups of students which should be quite similar except for the treatment group gets consolidated.

We estimate the effect of district consolidation on student performance on the state’s standardized test in math and English Language Arts (ELA). Our results are based on individual student-level data that allow us to follow students across years and school districts. We find small positive effects in both subjects. In math, the average effect is 4 percent of a standard deviation and is only marginally statistically significant. The average effect in ELA is slightly larger, 6 percent of a standard deviation, and is statistically significant. We also investigated how these effects varied over time, finding inconsistent results for mathematics but consistent positive and significant results in ELA. Overall, it appears that consolidation had a positive, albeit small impact on student performance in Arkansas.

While student achievement is important, the primary motivation that policymakers articulated for consolidating smaller school districts in Arkansas was to achieve cost savings through economies of scale. Even if consolidation only had small positive effects on achievement, Act 60 would still be considered a success if consolidation reduced administrative and other spending outside of the classroom, freeing up resources for additional classroom spending or to be redirected toward other important public purposes.

To investigate whether districts affected by consolidation experienced positive economies of scale we compare district-level spending trends before and after consolidation occurred. Table 2 presents a summary of financial information for districts affected by consolidation and Arkansas averages for even numbered school years between 2004 and 2008.

In 2004, prior to consolidation, districts that would be forced to consolidate by Act 60 spent $1,098 more per student, on average, than the state as a whole.  In addition, these districts spent  a lesser share on classroom teachers, and a greater share on other certified staff like administrators than did other school districts in Arkansas (see Columns 1-3 of Table 2). On the surface, these discrepancies support the argument that consolidation had the potential to deliver improvements through greater economies of scale. 

However, when we compare expenditure trends for districts affected by consolidation to unaffected districts, we find little evidence that affected districts meaningfully deviated from broader state trends after consolidation. Columns 4-7 of Table 2 shows that Act 60 affected districts exhibit consistent resource allocation over time to both classroom staff and other certified staff (see last two rows of Table 2). 

While affected districts experienced increased spending per pupil, that trend did not deviate significantly from the overall state trend. State average spending per pupil increased by $1,781 between 2004 and 2008, while spending in consolidation affected districts increased by $1,694.

School district consolidation has been an important and sometime contentious reform in Arkansas. Overall, it appears that the first wave of consolidations under Act 60 may have had small positive effects on achievement but did little to improve the efficiency of the state’s smaller school districts. These findings are relevant today because Act 60 continues to impact Arkansas’s school districts and district leaders and policymakers continue to discuss the value of consolidation/annexation. 

In 2015 the legislature passed Act 377 which allows the State Board of Education (SBE) to grant waivers to the consolidation requirement under Act 60 (see page 11 here). As recently as the fall of 2020, the SBE granted waivers to four districts that were subject to Act 60. In addition, the SBE has used consolidation/annexation as a tool to address consistently poor student performance and/or financial distress. In December, the SBE approved the annexation of the Dollarway School District, which was previously taken over by the state, into the Pine Bluff School District. 

Our research indicates that district consolidation is not likely to result in dramatic improvements in student performance or district efficiency, but small improvements are possible. However, these improvements must be weighed against the legitimate concerns of the communities whose schools are facing consolidation/annexation. If Arkansas is going to continue to use consolidation/annexation as a tool to improve district performance, it is important that we continue to conduct research to determine if these policies are making a positive difference for students and if they make sound fiscal sense.

New Research on Arkansas Challenge Scholarships

In The View from the OEP on February 17, 2021 at 12:30 pm

The Arkansas Academic Challenge Scholarship (ACS) has awarded over 600,000 college scholarships to Arkansas students. ACS is a state-financed merit-aid program with relatively low eligibility requirements, and there is no expectation of repayment. Governor Asa Hutchinson has expressed interest in enhancing ACS funding for students demonstrating a financial need, and results from new research out today highlights the fact that the timing of receiving money may heavily influence student behavior and postsecondary outcomes. Researchers find that receiving ACS funds initially while already in college resulted in small, negative impacts on short-run outcomes such as GPA and credit accumulation, but large statistically significant declines in the likelihood of graduating within four, five, or six years of entering college.

While a version of the ACS dates back to the 1990s, legislation passed in 2008 dramatically expanded the program by tying funding to the Arkansas Scholarship Lottery. Expansion of the Academic Challenge Scholarship allowed some students who were already enrolled in college to become eligible for the scholarship. In the current study, researchers examined how receipt of the scholarship impacted students’ college GPA, credit accumulation and likelihood of graduation. For more details about the research, you can read the full paper, or the shorter policy brief, but we wanted to share the highlights:

  • Overall, students who received the scholarship funds while already enrolled in college earned lower GPAs, accumulated fewer credits, and were over 40 percentage points less likely to graduate in four, five, or six years relative to their peers who did not receive the scholarship.
  • Compared to their peers, students who began receiving funding during their sophomore year of college enrollment:
    • earn lower GPAs and accumulate a staggering 18 fewer credits within the first year of receiving their scholarship
    • earn GPAs, on average, 0.75 points lower, and accumulate 24 fewer credits two years after receiving funding,
    • were 53-62 percentage points less likely to graduate in four, five, or six years.
  • Compared to their peers, students who began receiving funding during their junior year of college enrollment:
    • appear to have few significant changes in their GPA, or credit accumulation after one or two years,
    • experienced no statistically significant change in their likelihood of graduating within four, five, or six years.
  • Compared to their peers, students who began receiving funding during their senior year of college enrollment:
    • experienced small declines in their credit accumulation and GPA,
    • were 54 percentage points more likely to graduate within six years than students who did not receive funding.

It may seem counter-intuitive that receiving scholarship money would have a negative effect, but the research on college merit aid have found mixed effects of such programs on student outcomes. In the only study of randomly assigned aid offers, Angrist and colleagues (2016), find that being assigned to receive merit-aid increases both the probability of enrolling and persisting in college and demonstrates that students with relatively low academic achievement and those who enrolled in less-selective four-year institutions generated the largest gains in both outcomes. However, this same study also indicates that students appear to delay graduation to a fifth year in order to maximize scholarship funding if the program is renewable beyond four years.

We need to continue to research how the ACS funds effect outcomes for Arkansas students, including longer-term workforce outcomes. If the timing of the money matters, awarding the scholarship funds in the most effective way will lead to better outcomes for our students and our state.

ABC Pre-K Shows Benefits for ELLs

In The View from the OEP on January 27, 2021 at 11:50 am

Last week, OEP reported on the positive student outcomes associated with Arkansas Better Chance (ABC) pre-K attendance. Today, we add further insight to that report’s findings by offering evidence that the ABC program may be especially beneficial for students who enter school with limited English proficiency. These students, often called English Language Learners (ELL), face a unique set of challenges as they navigate K-12 education with the added task of mastering a second language. As we serve an increasing number of ELLs in Arkansas public schools, we must work to determine how to help these students achieve English proficiency as early as possible to mitigate the challenges associated with the language barrier. 

Arkansas’s state-funded ABC program provides tuition-free pre-K opportunities for qualifying families, and it is considered a high-quality program, as ABC teachers must have bachelor’s degrees and AR teacher licenses. Research that examines public pre-K programs in other states demonstrates that ELL students experience especially pronounced benefits from such programs (Gormley, 2008; Lipsey, 2018). We examine whether that pattern holds true for ELL students in Arkansas. In this analysis, we follow three cohorts of Arkansas students (those who began Kindergarten in the fall of 2011, 2012, and 2013) through 5th grade to see the long-term outcomes of ABC participants who enter school with an ELL designation. Our outcomes of interest are math and reading achievement, as demonstrated by statewide assessments, as well as the likelihood of students exiting the ELL program by 5th grade. Our research design does not allow us to make causal claims of the program’s impact, but we hope that these findings will inform us of the potential for ABC programs to serve the ELL student population. You can read the policy brief or the full paper for more details, but here are the takeaways:

•          Approximately 10% of ABC pre-K enrollment is comprised of ELL students, making this student group over-enrolled relative to its 8% of K-12 enrollment. This is a positive and unsurprising pattern, given that ABC targets its enrollment toward high-risk student populations. 

•          We find positive, statistically significant relationships between ABC attendance and math and reading achievement across 3rd to 5th grades in all three cohorts of analysis. Gains are large and meaningful, although they are too limited in most cases to close achievement gaps between ELL and non-ELL students. 

•          Evidence from our subgroup analysis shows that ELL students who attend ABC pre-K experience a differentially positive benefit in two of three cohorts analyzed. This means that ABC attendance is associated with greater achievement benefits for ELL students over and above the program benefit for English-proficient students. 

•          ELL students who attend ABC pre-K are less likely to remain identified as ELL in 3rd to 5th grades. The process for exiting the ELL program is complex and involves demonstrating English proficiency on a variety of measures. ELL students who attended ABC were 9 percentage points less likely to be designated ELL by 5th grade, compared to those who did not attend ABC prior to starting Kindergarten, in the second cohort of analysis. 

While ELL students are currently over-enrolled in ABC programs relative to their K-12 enrollment, it is clear that they experience especially positive benefits from ABC, over and above the benefits for English-proficient students. Based on the findings from this analysis, policymakers and community leaders should consider efforts to further expand ELL enrollment in ABC pre-K programs across the state. The current strategy for program advertisement is through communication with families in schools, churches, and other community spaces. Additional efforts could include outreach in organizations that include many linguistic-minority community members. Also, program organizers in school districts across the state should ensure that applications and program materials are available in all non-English languages represented in their communities, including Spanish and Marshallese. Education leaders should also brainstorm ways to provide sustained support to this student subgroup, as ABC pre-K participation alone does not seem to be sufficient for closing the gap between ELL/non-ELL achievement. While we would love to employ a causal research design in the future, the patterns presented here are encouraging and suggest that ABC pre-K is a promising early intervention for this vulnerable student group.