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The Boston Consulting Group Hallazgos y Recomendaciones
Noviembre 12, 2014
1
Presentando al equipo de BCG
Tyce Henry Allison Bailey Danny Acosta
Principal, Washington DC
Senior Partner and Head, North American Education Practice
Partner, New York
Tyce is a member of the leadership team for BCG's Education Practice, with broad experience advising school districts, state governments, universities and education services firms on issues of strategy, operations and organization. Tyce received his MBA from the Wharton School of Business at the University of Pennsylvania.
Allison has been with BCG since 1987 and leads BCG's Education Practice in the U.S. She is the Regional Practice Leader for BCG's People and Organization Practice and has deep experience advising clients across K-12, higher education, foundations, and global intermediaries (eg, World Economic Forum). Allison received her MBA from the Wharton School and her MA from Harvard's Kennedy School.
Danny is a core member of BCG's Public Sector practice with a focus on performance management, organizational and operational effectiveness, economic planning, growth strategy, and large-scale transformation. He worked closely with Puerto Rico's Government Development Bank to develop an economic development plan. Danny holds a dual JD/MBA from Georgetown University.
2
Agenda
Overall PRDE context
School consolidation and docente staffing
PRDE administrative restructuring
3
800
600
400
200
0
411
# de estudiantes (Miles)
Inicio del año escolar
-22%
Superior
2020
321
2018
2019
2017
2016
2015
Intermedio
Elemental
2014
2013
423 20
10
2000
1990
1980
713
-42%
Pronosticado
La matrícula se ha reducido un 42% desde el 1980 y se espera una caída adicional de 22% para el 2020
Sources: BCG analysis; US Census
Matrícula histórica y pronosticada, 1980-2020
4
1. "Expenditures" include instruction, instruction-related, support services, and other elementary/secondary current expenditures, but exclude expenditures on capital outlay, other programs, and interest on long-term debt. Data used for 1980-1981, 1990-1991, and 2001-2002 come from "The Economy of Puerto Rico: Restoring Growth," Helen Ladd and Francisco Rivera-Batiz, p.209), which lists the PRDE as its source and uses 2003 constant dollars. For 2010-2011, data comes from NCES and has been adjusted to 2013 dollars using the CPI inflation calculator. Sources: National Center for Education Statistics, "The Economy of Puerto Rico: Restoring Growth"; National Center for Education Statistics, "Revenues and Expenditures for Public Elementary and Secondary Education: School Year 2010-11, Table 2; BCG analysis
El gasto por estudiante se ha triplicado en los últimos 30 años
DE gasta menos en instrucción y más en administración que cualquier otro Estado (50% en instrucción vs. 65% promedio en EEUU)
0
4
3
2
1
2010-11
$3.6
2001-02
$2.8
1990-91
$1.8
1980-81
$1.8
+98%
$B (c
onst
ant 2
013
dolla
rs)
+230 %
2010-11
$8,540
1980-81
$2,584
Utah
Nevada
PRDE's inflation-adjusted budget doubled over the past 30 years ...
... while per-student spending more than tripled
5
30% de estudiantes en educación especial (dos veces el promedio de EEUU), lo que aumenta el nivel de gasto
0
20
30
25
15
Pine
llas
13%
Wak
e C
ount
y
13%
City
of C
hica
go
12%
Mon
tgom
ery
Cou
nty
12% M
emph
is
12%
Hills
boro
ugh
15%
Palm
bea
ch
15%
Fairf
ax C
ount
y
10%
13%
Ora
nge
14%
Brow
ard
14.5
Cob
b C
ount
y
11%
San
Die
go U
nifie
d
14%
11%
PG C
ount
y
8%
11%
Haw
aii D
E
Dal
las
11%
Gw
inne
tt C
ount
y
Duv
al
11%
8%
Dad
e
Puer
to R
ico
DE
30%
New
Yor
k C
ity
18%
Phila
deph
ia
16%
11%
Hou
ston
Cla
rk C
ount
y
12%
10%
Los
Ange
les
Uni
fied
12%
Cha
rlotte
-Mec
klen
burg
% Individualized Education Program Students [District] 2010-11
Note: New York City data from 2008-2009 school year; PR data from 2012-2013 Source, BCG analysis
Special education population, top 25 US school districts by size
6
En la última década, la reducción de estudiantes ha sido más acelerada que la disminución de maestros
Since 2004, enrollment has declined by 27% ...
... while the number of teachers declined by 18%
600
400
200
0
800
Enrollment ('000) -19%
-27%
2013-14
423
2004-05
576
1980-81
713
Note: 1986 Sources: National Center for Education Statistics, Puerto Rico Department of Education
40
20
0
60
2004-05
43
1980-81
32
Teachers ('000)
2013-14
35
-18% +33%
Los estudiantes por maestro en PR se ha reducido de 22.1 en el 80 a 12.0 hoy en día (por debajo del promedio de EEUU de 16.1)
7
Salones de clase con menos estudiantes por maestro no resulta en aprovechamiento académico más alto
Note: Total number of students and teachers excludes Pre-K. Teachers include all regular, vocational, and special education teachers; Guidance councilors, social workers, and program coordinators excluded. All teachers are under active status within the January 2014 Plantilla. Source: PRDE data, BCG analysis
Student:teacher ratio, top 20 U.S. states by density
PRDE has a very low ratio of students to classroom teachers relative to U.S. states ...
... low ratios do not translate to higher student performance in PRDE schools
0
20
40
60
80
100
0 5 10 15 20
% Math Proficiency
Number of students per teacher
PRDE school 25
20
15
0
16
VA
18
MI
18
IN
18
CA
24
Avg.
: 16.
1
PR
12
NJ
13
RI
13
NY
13
CT
13
PA
14
MA
14
No. of students per teacher*
14
MD DE
15
TN
15
GA
15
FL
15
NC
15
IL
16
HI
16
OH
* Note: excludes teachers working in administrative roles
8
Agenda
Overall PRDE context
School consolidation and docente staffing
PRDE administrative restructuring
9
La utilización de escuelas irá de 71% a 55% en el 2020 si no se realiza un esfuerzo de consolidación
1.Schools omitted when capacity or enrollment were not available Note: Other category includes schools with all grades and secondary schools (7-12). Sources: BCG analysis; US Census; 2014 M1 official enrollment data from PRDE as of October 2014. School capacity information from OMEP.
411 394 377 362 346 333 321423
0
200
400
600
800
0
20
40
60
80
100
# estudiantes (en '000's) Utilización (%)
2020
55%
2019 2018 2017 2016 2015 2014
71%
2013
Best practice: 90%
Basada en M1 certificada del 2014
10
U.S
. ave
rage
(14.
4)
Las escuelas pequeñas y sub-utilizadas contribuye al bajo número de estudiantes por maestro
0
10
20
30
40
% of small schools (<150 students)
# of students per teacher
18+
0%
16-18
0%
14-16
3%
12-14
12%
10-12
28%
8-10
37%
6-8
17%
4-6
1%
2-4
1% 0
10
20
30
40
50
% of larger schools (>250 students)
# of students per teacher
18+ 16-18
4%
14-16
16%
12-14
44%
10-12
30%
8-10
5%
6-8 4-6 2-4
Small K-6 schools tend to have ratios of 6-10 students per teacher ...
... while larger K-6 schools tend to see ratios of 10-16 students per teacher
Source: Teacher ratio calculated using 2013-14 student enrollment and teacher data as of January 2014. Total 2013 enrollment from official PRDE enrollment figures as of August 2013. Teacher information from PRDE HR include maestro docente, maestro vocacional and maestro de confiianza
Student:teacher ratio for small schools (<150 students)
Student:teacher ratio for larger schools (>250 students)
n = 261 schools
U.S
. ave
rage
(14.
4)
n = 292 schools
La consolidación de escuelas es esencial para mejorar el aprovechamiento y las practicas de staffing de docentes
11
El enfocarse en la cantidad adecuada de escuelas le dará al DE más opciones en el futuro
Declining revenues
Enrollment declines and shifts
Unsustainable stopgap measures
Last-minute cuts with adverse
impacts on students
• Declining population • Declining birth rates • Increasing shifts to private schools
Driven directly by declining enrollment: • Fewer students generating federal
per-pupil revenues Exacerbated by... • Decreased state funding due to
recession and government's fiscal crisis
• Drawing down "rainy day" reserves
• Deferring facilities maintenance
• Increasing class size without focus on more effective teachers
• Cutting academic programs
• Decreasing length of school day
12
La metodología utilizada para identificar escuelas para la consolidación busca primordialmente mejorar el desempeño
Three main criteria for receiving candidates
Building quality
Academic performance
High
Low
Low High
Prioritize program for: • Program
relocation (to existing bldg)
• Facility renovation • New construction
Close program and facility
• Emphasis on lower utilized schools
Maximize capacity
utilization
Retain facility; replace program • Replacement with high-
performing program
• Academic
performance should be equal or better based on PPAA scores in Spanish and math
• Building quality must be better based on regional director ratings, OMEP repair needs
• Distance from closing school should be within ~3 -4 miles of driving distance
Objetivo: Consolidar escuelas con bajo desempeño académico y baja calidad en las instalaciones
13
Las proyecciones de matrícula de estudiantes sugieren potencial para consolidar / reconfigurar varias escuelas Con la meta de llegar a 90% de utilización
233
415
80
34
85
0
200
400
600
33 300
580
2020-21
High schools
Middle schools
Elementary/K-9
School year
Number of consolidated schools
2015-16
PRDE could reconfigure up to 300 schools now and 580 by 2020
200
250
0
50
100
150
249
76
2015
129
2016
129
2017
167
2018
226
2019
School year
2020
Savings ($M)
By 2020, reconfiguration would free up to $249M per year in costs
Source: BCG analysis
14
La reconfiguración de escuelas es esencial para mejorar las prácticas de staffing de docentes Ejemplo demuestra mejor oferta curricular con 30% menos maestros
Consolidating school Grade Students Teachers
K 17 4 •3 K-3 •1 Arts
1 2 2 6 3 10 4 13 5
•2 4th-6th •1 English •1 Consum. •1 Health
5 11
6 12
7 15 5 •1 Math •1 English •1 Spanish •1 Phys. Ed. •1 Librarian
8 17
9 12
Special Ed. 8 2
Total
123 16
Receiving School (before) Grade Students Teachers
K 21 5 •4 K-3 •1 Arts
1 17 2 18 3 18
4 16 6 •3 4th-6th •2 English •1 Consum.
5 26 6 23
7 53
14 •2 Math •2 English •2 Spanish •5 Science •2 Phys. Ed. •1 Librarian
8 58 9 39
Special Ed. n/a 3
Total
289
28
Receiving School (after) Grade Students Teachers
K 38 7 •5 K-3 •2 Arts
1 19 2 24 3 28
4 29 6 •3 4th-6th •1 English •1 Consum. •1 Health
5 37 6 35
7 68
13 •2 Math •2 English •2 Spanish •4 Science •2 Phys. Ed. •1 Librarian
8 75 9 51
Special Ed. 8 4
Total
412 30
16 teachers 8:1 student:teacher ratio
28 teachers 10:1 student:teacher ratio
30 teachers 14:1 student:teacher ratio
44 teachers 30 teachers (32% reduction –14 teachers )
15
La consolidación tiene beneficios académicos y fiscales para todo el sistema
Invest in modern facilities and technology
Recruit fewer, better school directors and teachers
Focus turnaround efforts
Move children to higher-quality schools
Academic benefits Fiscal benefits
Increase academic and extracurricular offerings (eg, arts)
Shrink backlog of deferred facilities maintenance
Revenue from sale of facilities
Use instructional staff more efficiently
Reduce administrative and support staff
Lower operations costs
16
La consolidación de 70 escuelas y la implementación de nuevas prácticas de staffing permitieron reducir 2,450 puestos de docentes este año
Teachers Guidance Counselors & Social Workers
Total Docentes
Perm. Trans. Total Perm. Trans. Total Total January 2014 Staffing1 31,040 4,800 35,840 2,170 130 2,300 38,140
Attrition through July 31 (1330) 570 (760) (80) 50 (30) (790)
Retirements3 (1,770) - (1,770) (130) - (130) (1,900) Transitorio contracts terminated on May 31 - (5,370) (5,370) - (180) (180) (5,550)
Transitorio hires - 5,560 5,560 - 230 230 5,790
2014 – 2015 staffing (as of 9/2014) 27,940 5,560 33,500 1,960 230 2,190 35,690 Eliminated positions (3,100) 760 (2,340) (210) 100 (110) (2,450)
1. Includes all teachers that are active or on paid or unpaid leave. Excludes non-teachers and abandoned, terminated, or suspended posts. 2. Estimate to be verified with latest plantilla data and PRDE projections. 3. PRDE estimate as of August 6. Excludes 92 estimated administrative retirements (facilitators, directors, etc.). Note: Numbers are rounded to the nearest 10. Source: PRDE data, BCG analysis
17
Los ahorros de la consolidación y la reducción en posiciones docentes se estiman en $109M por año
1. Includes State's retirement contribution, special laws (Christmas and medical), Social Security contribution for non-docente and Medicare contribution for docente, FSE, and unemployment. 2. Reduction of non-teachers made up of school directors, janitors, food service workers, and guards. 3. Maintenance costs extrapolated on a smaller sample of 51 potential school closures due to data limitations. 4. Confirmed OGP budget. 5. Estimating new teacher hires to reduce class size to 15 students per class in K-3 in selected school interventions (or other interventions to be determined by head of Asuntos Académicos. Source: PRDE Office of Budget and Office of Human Resources
Category ($M) FY15 FY16 FY17 R
ecur
ring
savi
ngs Teacher, counselor, & social worker salary & benefits1 $96 $96 $96
Other personnel salary & benefits (~310 fewer)1,2 $8 $8 $8
Privatized services $2 $2 $2
Electric (AEE) & Water (AAA) $2 $2 $2
Maintenance3 $1 $1 $1
Recurring Savings Total $109 $109 $109
Cos
ts Licencia payouts ($39) $0 $0
Facility costs (shutdown, moving, repairs)4 ($8) $0 $0
Academic investments5 ($20) ($20) ($20)
TOTAL IN-YEAR SAVINGS $42 $89 $89
CUMULATIVE SAVINGS $42 $131 $220
18
Agenda
Overall PRDE context
School consolidation and docente staffing
PRDE administrative restructuring
19
0
100
200
300
400
500
0 200,000 400,000 600,000 800,000
Clark County
Number of students
Puerto Rico
Memphis
Philadelphia
Hawaii
Houston Miami-Dade
Chicago
Los Angeles
Los gastos en administración por estudiante del DE son mayores que la mayoría de los distritos grandes de EEUU
1. Defined as the sum of all expenditures for school district administration, including boards of education and their staff, and executive administration. Also included are expenditures for legal activities in interpretation of laws and statutes, and general liability situations. Data is from 2010 – 2011 unless otherwise noted. Source: NCES 2011 data, BCG analysis
General administrative costs per-pupil among large U.S. districts
Los costos administrativos de PR ($260 por estudiante) son más que el triple vs. Los Angeles ($69/estudiante) o Miami-Dade ($81/estudiante)
20
El DE pudiera reinvertir entre $75 y $100M en instrucción al reducir los costos administrativos
District # of pupils Admin cost per pupil ($)
Total admin cost1($M)
Projected PRDE admin cost at
benchmark ($M) PRDE savings at benchmark ($M)
Philadelphia 155,856 401 62 198 (70) Chicago 404,584 319 129 158 (30) Puerto Rico DE 493,393 258 127 127 - Broward County 256,472 107 27 53 75 Gwinnett County 160,744 93 15 46 82 Palm Beach 174,663 92 16 45 82 Dallas 157,143 86 13 42 85 Orange County 176,008 82 14 40 87 Miami-Dade 346,842 81 28 40 88 Clark County 313,866 78 24 38 89 Fairfax 174,428 77 13 38 90 Houston 204,245 72 15 35 92 Los Angeles 667,090 69 46 34 93 Hillsborough County 194,525 66 13 33 95 Hawaii 179,601 60 11 30 98
1. Defined as the sum of all expenditures for school district administration, including boards of education and their staff, and executive administration. Also included are expenditures for legal activities in interpretation of laws and statutes, and general liability situations. Data is from 2010 – 2011 unless otherwise noted. Source: NCES 2011 data, BCG analysis
21
0
20
40
60
80
100
120
0 200,000 400,000 600,000 800,000
Baltimore County
Administrator staff2 per 10k students
Number of students
Memphis
Duval County
San Diego
Charlotte-Mecklenburg
Montgomery County
Gwinnett County
Philadelphia
Orange County
Hawaii
Hillsborough County
Houston
Broward County (Ft Lauderdale)
Miami-Dade Los Angeles
Puerto Rico DE3
El DE tiene más personal administrativo que la mayoría de los distritos de EEUU
General administrative staff per 10,000 students, for 25 largest districts1
1. Data not available for NYC, Chicago, and Clark county. 2. As identified by NCES. Includes chief executive officers of education agencies, Districts, deputies, and assistant Districts; other persons with districtwide responsibilities, e.g., business managers, administrative assistants, and professional instructional support staff; and staff members providing direct support to LEA administrators, business office support, data processing, secretarial and other clerical staff. 3. Inclusive of 1,952 Central, Regional, and District office administrative positions. Source: NCES 2012 data, PRDE April 23 Plantilla, BCG analysis
22
Los comparativos sugieren que el DE pudiera reinvertir ~$30M en instrucción al reducir posiciones administrativas
District # of
students
District staff / 10k students
Total district staff1
Projected PRDE admin staff at
benchmark
Projected savings
(positions)
Projected salary + benefits
savings2 ($M)
PRDE (2014 Plantilla)3 427,113 46 1,952 N/A - -
Los Angeles (2012 NCES) 659,639 29 1,932 1,251 701 28
Miami-Dade (2012 NCES) 350,239 28 996 1,214 737 29
1. As identified by NCES. Includes chief executive officers of education agencies, Districts, deputies, and assistant Districts; other persons with districtwide responsibilities, e.g., business managers, administrative assistants, and professional instructional support staff; and staff members providing direct support to LEA administrators, business office support, data processing, secretarial and other clerical staff. 2. Represents savings on salary and benefits, based on average PRDE administrator salary and benefits of $39,480. 3. Inclusive of 1,952 Central, Regional, and District office administrative positions. Source: NCES 2012 data, PRDE April 23 Plantilla, BCG analysis
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