Schools CFO says rezoning a net loss for Metro

Thursday, November 19, 2009 at 2:54pm

Metro Nashville's new student assignment plan, sold to the public as a money-saver by the school board, actually has resulted in a net loss to the district's budget, according to testimony Thursday in federal court.

"There would be more money spent" because of the rezoning plan, said Chris Henson, the district's chief financial officer.

Henson testified on the 11th day of a hearing for the NAACP-backed lawsuit accusing the school board of discriminating against black children by ending cross-town busing from north Nashville to Hillwood. During the hearing, board members have denied any racial motivation in adopting the rezoning plan, claiming instead that they wanted to make more efficient use of school buildings.

During his testimony, Henson was not asked how much money the plan costs the district. But he has stated previously that the net loss is roughly $4 million annually.

The district saved $1.2 million by closing four schools, he said, but spent an additional $5.3 million to improve north Nashville's schools as part of the plan.

Henson told U.S. District Judge John Nixon all the improvements were included in this year's budget, including more teachers and guidance counselors. School board members promised the improvements when they adopted the rezoning plan in July 2008, countering critics who said they were consigning black children to substandard schools in north Nashville.

Also Thursday, an expert witness testified for the school board that, by his calculations, the plan didn't resegregate schools. Milan Mueller, a consultant who said he has helped more than 100 districts produce rezoning plans, testified there are 10 Nashville schools with at least 90 percent black enrollment, the same number as before this city's plan took effect this year.

He conceded there was "some minimal segregative effect" in Pearl-Cohn's schools in north Nashville, but said, "Overall, diversity was increased."

Under cross-examination, civil rights attorney Michael Lottman pointed out there are 630 more black students attending Pearl-Cohn schools this year. "Isn't that the number that you termed insignificant?" he asked Mueller.

Mueller also termed Nashville's plan "progressive" because it gives north Nashville's parents the choice of putting their children on buses to Hillwood or sending them to school closer to home.

"By offering choice in perpetuity, it goes beyond what other districts have offered," he said.

The hearing is expected to end Friday with testimony from school superintendent Jesse Register.

7 Comments on this post:

By: Magnum on 11/19/09 at 2:25

This analysis is confusing at best. Is the $1.2M saved by closing the four schools an ongoing savings year over year? Is the $4.0M net loss the difference between the $5.3M investment minus the $1.2M savings? If so, how much of that $5.3M used for improving the north Nashville's schools is a one time expense and how much will be ongoing?

Point is, from what I could gather there is not enough information to determine whether or not this is financially viable over the long run. Of course, if the $5.3M is going to occur every year, then obviously, this won't provide favorable returns on its own. Then again, if they added $5.3M in ongoing annaul expenses, I would want to see what I had bought seeing that closing four entire schools only saved $1.2M. Something doesn't smell right there!

At the end of the day, I didn't think this decision was to be based on finances anyway. I thought it was based on what was best for our children. The real question is, where does our money go the furthest with regard to increasing the quality of the education received by these kids? Would the additional $4.0M spent on these improvements be better spent on books, buses & fuel, etc.?

By: dogmrb on 11/19/09 at 3:11

Is your question about whether extra resources over the long term would be better spent on "those" kids in North Nashville or on all kids regardless of where they live? The issue broken in this school system is trust and constantly moving families from zone to zone perpetuates the broken trust. Private schools are about predictability and expectations, not necessarily about better books, etc. That being said, it's nice to see that Chris Henson is who I thought he was. When asked a question, he will answer it whether it's PC or not.

By: Magnum on 11/19/09 at 10:28

No. My point was that I don't understand the numbers as they are not provided with enough detail to understand whether financially the plan will be favorable over the long-term. Sure there was a net loss this year,...most any change/investment will occur in a loss in year one.

Here's a question for the CFO/Board/whoever. What did the long-term economic analysis tell you when you researched it prior to the changes. It says the Board sold this plan to the public on savings. Well, lets see what they said, compare the results and hold people accountable.

By: dogmrb on 11/20/09 at 7:03

I like the way you think and ask questions but that isn't the way the MBOE does business: it's not about efficiency and effectiveness but what the people who vote for them want. Sorry.

By: dogmrb on 11/20/09 at 7:03

And fund their campaigns!

By: kennyj on 11/20/09 at 3:25

Loss? "Loss" of what? Were they making revenues on the old plan? Is "loss" an increase in expenditures, or a reduction in expenditures? "Henson told U.S. District Judge John Nixon all the improvements were included in this year's budget, including more teachers and guidance counselors" sounds like an increase in expenditures to me. If so, then the $4 million sounds like a recurring expenditure increase.
So, in using what I can from the CFO's gobble-de-gook it appears:
Total cost of plan Who knows, probably not the CFO
Cost to improve schools $5.3 million
Cost savings from closing 4 schools $1.2 million (assumption is this continues)
$5.3 Spent, $1.2 saved means it will take 4.16 years to recover the $5.3. Then the $1.2 is an ongoing annual savings.
What seems to be the continued annual cost $4mil
Can't claim the $1.2 as savings until after the 4.16 years (no cost adjustments), during which time a total expenditure increase of $16.64 mil would be incurred. After that the $4 mil annual expenditure offset by $1.2 million savings, nets an increase of expenditures of $16.64 million first 4.16 years; after that $4mil expenditure offset by $1.2 mil savings nets an annual increase of $2.8 mil.
What really offends me is that most every article I read involving the Metro Schools points to the BOC not listening to the school administration, or the administration was not fully disclosing facts. Until the BOC and Administration can get their act together, this will continue to be a podunk system.
This is just a plain silly lawsuit, as are the majority of the recent NAACP lawsuits. The expenitures to improve the schools says to me that the welfare of the students was taken into consideration and 67% of the affected students have elected to attend school closer to home. Come on folks, get real. Taxpayer money can be put to better use.

By: localboy on 11/23/09 at 9:55

The $5.3 m spent to improve the North Nashville schools to help "sell" this sounds like those schools needed to be upgraded and had been ignored, giving more ammunition to that community.