Fiscal Crisis Planning: Actions & Opportunities

Spring 2009 Executive Action Planning Meeting; April 28-29, 2009; Westin Copley Place, Boston, MA

DMC's Executive Action Planning Meeting met in Boston on April 28-29, 2009 with the goal of helping districts build a framework to respond strategically to the changed economic landscape. The EAPM encouraged districts to use the opportunity of fiscal crisis not just to react through immediate cuts, but instead to think proactively about tactical approaches that can foster leadership capacity, communications, and strategic planning and cost efficiency. These tactics should serve both to spend stimulus dollars effectively in the short term and to prepare for the end of stimulus payments in FY 2011.

One effective use of stimulus dollars is to bring systemic reform to special education, which DMC Senior Adviser Nate Levenson addressed during the meeting. Districts can employ a 10-step process to improve special education student achievement and parent satisfaction while also controlling cost. With significant gains possible through one-time expenditure, reorganizing special education represents a strategic use of stimulus dollars.

DMC then expanded on the strategic framework by delineating the ways in which the ARRA advises districts to maximize a short-term investment. Asked to rank a hypothetical shopping list of items according to the difficulty of their implementation and their strategic value, the EAPM attendees affirmed that the districts hope to use stimulus dollars to make strategic investments, such as targeting professional development and embedding technology, that do not endanger a “funding cliff.”

Staying strategic even during budget crisis was the theme of a case study led by DMC and Barbara Hunter, Assistant Superintendent of Fairfax County, VA for Communications and Outreach. The case study explored Fairfax’s innovative integration of strategy, a program budget structure, and community input and collaboration in its response to budget cutbacks. Fairfax solicited public and employee feedback to assess all school programs against the district’s beliefs, vision, and goals. The feedback provided the foundation for the district leadership team to reconsider the status quo and debate whether to keep, redesign, reduce, or eliminate every program in the district.

Drawing on lessons from the case study, DMC described more tools to bring a rigorous analytic approach to budget cuts and strategic decisions. A structured scenario planning process can lead to more consistent long-range decisions about how a district hopes to evolve and where it should invest. Similarly, adopting elements of “zero-based budgeting,” as Fairfax did in its budget rationalization, and making administrators build a “business case” for key programs can clarify strategic direction. In the decision-making process, it is vital, as the Fairfax study illustrated, to use quantitative and qualitative research to maintain community input and to assemble more powerful, coordinated decision-making teams.

Thank you to all who joined us at the EAPM. We greatly appreciate your attendance and participation and we are especially grateful to Nate Levenson and Barbara Hunter for the insights during their presentations.