We are being told that a school merger will help stave off potential future financial shortfalls.  The actual experience of school mergers, and also research on the topic, reveals that school consolidation fails to deliver on the projected financial benefits.

A previous post on this site, Is Declining Enrollment a Valid Reason to Merge Schools? (Two), warned against the exaggerated claims  about enrollment and finances that are coming from our school districts.  This is the beginning of a series of posts that will reveal the real merger truth about school finances, financial projections, and the true financial effects of merging schools.

The first evidence comes from an article originally published in School Business Affairs, a publication of the Association of School Business Officials.  That article raises an issue not mentioned up to this point: “in smaller school districts in rural areas, communities are often built around schools. People know one another and friendships are formed within the boundaries of the school district. In short, the school district is the glue that holds the community together. That outlook certainly has potential implications for school finance. Given the importance of passing levies to finance school districts, should the consolidated district be unable to garner support from the constituents, the levies might not pass. Failure to generate funds through tax levies could negatively affect every facet of the school district.” (1)

Of course, that is only one small caution. The Connecticut School Finance Project raises many other issues concerning the financial implications of merging schools. Here is a sampling: “the increase in state revenue was not offset by a corresponding decrease in local revenues, and therefore, district revenues increased rather than decreased in the 5-year period post-consolidation, when compared to the five-year period pre-consolidation. This research provides caution to policymakers who may rely on economic models that predict school district consolidation will result in economies of scale, when in both Nebraska and Iowa the economic benefit predicted may not have been fully realized.” And further: “The Pew Charitable Trusts (2011) studied the outcomes of public school consolidations in Chicago, Detroit, Kansas City, Milwaukee, Pittsburgh, and Washington, DC, and found the money saved through school consolidation was ‘relatively small’” and with “the largest savings being realized when school consolidations were paired with large-scale teacher layoffs.” (2)

Finally, research done on actual New York State school mergers between 1986 and 2006 produced results that clearly demonstrate that in actual experience, school mergers do not reduce costs but actually increase school expenditures and taxes.  We will explore the details of this research in future posts; but here is a summary of the findings: “There is no significant difference in Central Administration or Board of Education expense” after merging.  There is “a significant increase in undistributed expenses”, “costs per pupil”, most instructional expenses, “health coverage expenses”, and “transportation expenses.” (3)

The evidence is clear.  The idea that a school merger will solve possible future financial problems is entirely refuted by research and by actual experience.  The financial claims being made by our school districts have no basis in actual fact.