Interdistrict Cooperatives Improve Cost-Effectiveness and Make Common Cents

By Howley, Caitlin; Hambrick, Kimberly | District Administration, July-August 2011 | Go to article overview

Interdistrict Cooperatives Improve Cost-Effectiveness and Make Common Cents


Howley, Caitlin, Hambrick, Kimberly, District Administration


ACROSS THE NATION, STATE expenditures on public education are expected to decline in the aftermath of the Great Recession of 2007-2009 (National Governors Association and National Association of State Budget Officers, 2010). For the fourth consecutive year, despite a temporary boost from federal stimulus funds, governors are proposing deep cuts to education in 2012, and the majority of states plan to spend less in 2012 on education than they did in 2008, adjusting for inflation, despite larger enrollments of students in public schools (Leachman, Williams, & Johnson, 2011). As states and local school districts grapple with the implications of budget cutbacks on the services they can provide to students, strategies for leveraging existing resources are increasingly important.

One strategy districts can use to reduce costs without sacrificing quality is to form interdistrict cooperatives to share services, staff and/or purchasing. These arrangements have also been called "clusters," "collaboratives," "consortia," "partnerships," or "shared resources/services/ purchasing agreements" (Eggers, Wavra, Snell, & Moore, 2005; Galton & Hargreaves, 1995; Nachtigal & Parker, 1990; Peed & Wyant, 2007).

Cooperatives are voluntary, semiformal, interdistrict agreements between two or more school districts for the purpose of sharing resources and services. They differ from intermediate education agencies, which are funded and/or administered by state departments of education to provide professional development and other services to educators in their service regions. The structure of cooperatives can vary widely--from independent, formal entities with their own administration, facilities and resources, paid by fees from participants, membership dues or tax levies, to less formal arrangements, with governing bodies consisting of representatives from participating districts, to single-purpose interdistrict sharing agreements (Eggers et al., 2005; Sommer, 1990).

Cooperatives enable member districts to take advantage of economies of scale. For example, districts in a cooperative may receive better pricing on resources through bulk purchasing. They might also share teachers in hard-to-staff subjects. A talented physics teacher hired by one district could teach students in other member districts through videoconferencing or other online platforms. Likewise, a member district might share a calculus, Mandarin, or Spanish teacher with other districts. Leadership and professional development can be shared and maximized for districts participating in a cooperative. Early childhood teachers from member districts could take advantage of a professional development opportunity by coming together to form a larger group, which might develop into a teacher cohort to ensure ongoing and sustainable professional learning. Some districts even share a superintendent.

Cost-Effectiveness

Ironically, although a key purpose of cooperatives is to improve cost-effectiveness, little research has been conducted to confirm whether they produce savings for members. In fact, districts themselves may not track savings; a survey of superintendents in Vermont revealed that only 42 percent of respondents evaluated savings from shared services (Vermont State Auditor, 2009).

What evidence there is suggests that savings range from modest to substantial. Minnesota's Southwest and West Central Educational Cooperative Service Units conducted two comprehensive cost-effectiveness studies (as cited in Stanley, 2005), in 1989 and 1995. The first found that member districts spent $11,409,798 for collaborative services. Estimates of the costs they would have incurred without the cooperative totaled $16,926,415. The difference of $5,516,617 represents overall estimated savings of 33 percent. Savings improved by the time of the 1995 study, with members spending 36 percent less than they might have otherwise.

The Greater Lawrence Educational Collaborative (GLEC), a consortium of 10 school districts in northeastern Massachusetts, compares its rates and fee schedules for special education services to private sector rates for equivalent services. …

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