Education News Colorado | June 24, 2008

June 24, 2008

Written by Alan Gottlieb

Thursday, July 03 2008

From the editor

Denver’s ProComp teacher compensation system has been the focus of much national scrutiny (and adulation) since its inception in 2005. More recently, it has become the flashpoint between Denver Public Schools and the Denver Classroom Teachers Association during stalled contract negotiations.

Education News Colorado has featured several stories about ProComp in recent weeks. They focus on the underlying causes of the current dispute, the effectiveness thus far of ProComp and, last week, some tough questions asked by a citizens panel about the system.

But what you can read farther below in this issue of the newsletter is something different. It is a cold-eyed dissection of ProComp by Alexander Ooms, a member of the A-Plus citizens committee and a disinterested individual who has been studying teacher compensation for a while now.

Because ProComp has many proud and doting parents, what Ooms has written and we are distributing will undoubtedly raise some hackles, including those of some people I like and respect. But when something as complicated and nuanced as ProComp is sold to the public through a slick PR blitz, it’s important to make sure that the merchandise is labeled clearly and accurately.

ProComp was designed and implemented by honest people of good will, most of whom genuinely wanted to break new ground in teacher compensation. But along the way, ProComp has faltered, and fallen far short of expectations.

I may be going out on a limb if I try to assert what “most people (voters)” thought they were getting with ProComp. But I’ll do it anyway. I’m pretty sure they thought they were getting something that tied a significant chunk of a teacher’s compensation to his or her performance, and in a meaningful way.

The campaign literature from back in 2005 was deftly phrased so as not to deceive people into believing that ProComp was a merit pay or “pay for performance system.” Here are a couple of samples from a brochure thousands of voters received:

“ProComp will reward teachers for increasing student achievement, earning successful professional evaluations, working in the most academically challenging schools and advancing their knowledge and skills.”

“Denver’s new teacher compensation system should not be confused with “merit pay” and “performance pay” …these earlier attempts were unpopular due to the perceived subjectivity of the process and the often narrow focus used to evaluate an employee.

“The ProComp system actually is results-based pay, using multiple criteria to assess teachers’ performance.”

What is nowhere stated in the campaign materials, but Ooms and others have recently brought to light, is that the overwhelming majority (read: 90-plus percent) of the money ProComp pumps into the teacher pay system goes into “salary building” and is only distantly related to what I would consider “results-based pay.” See Ooms’ piece for the details.

Even after reading the Ooms commentary, I still believe that there’s a lot to like about ProComp. If nothing else, it’s an incremental step forward in how we think about teacher pay. But as the district and the union argue over how to dole out the money piling up in the ProComp coffers, it’s important that the public understand what the fight is really about. Until now, no one has made an effort to bring the basic facts to light.

Do you have an different take on ProComp? I would be more than pleased to run a rebuttal in next week’s newsletter. Please email me at This e-mail address is being protected from spam bots, you need JavaScript enabled to view it

ProComp Revisited

By Alexander Ooms

The current debate between Denver Public Schools and the Denver Classroom Teachers Association over ProComp offers fresh data from each side’s proposal and a chance to revisit the original plan. Still in its infancy, it is too early to judge ProComp a success or failure; but it is worth another look. One should not need to build a whole house to judge if the foundation is any good.

Changing teacher compensation is critical to education reform, and Pay for Performance plans can be a significant catalyst to improve student achievement. Their value is threefold: 1) to mandate focus on a limited number of objectives; 2) to measure teacher effectiveness to see what works; and 3) to reward specific behaviors.

Administrators often struggle with the first, as it requires choosing among seemingly endless objectives (and their constituencies). Unions dislike the second, as the implicit teacher ranking undercuts the single-salary structure at the core of collective bargaining contracts. Rewards get most of the attention, but in my view are often least important; it is the reinforcing cycle between focus and measurement that provides much of the value.

Ideally, Pay for Performance entails a specific bonus (the "Pay") received upon achieving defined educational outcomes (the "Performance"). These educational outcomes should address a central and acknowledged problem: in Denver, as in most urban centers, the primary need is to both raise overall student performance and close the achievement gap. How do the current proposals and original plan measure up?

First, let’s look at ProComp’s pay. Receiving pay as a bonus is important to both directly correlate to objectives and for financial solvency. It is unwise for a goal achieved in 2008 – particularly if it is not sustained – to become a salary increase for 15 years and a pension boost for another 25.

Under the DPS proposal, 90% of compensation goes into base salary, while the union's plan puts 98% in base. Whoever prevails, there will be no more than 10% - and as little of 2% of ProComp dollars paid as a specific bonus. So the direct link that is one of the central tenants of Pay and Performance is largely absent.

Now to ProComp’s performance objectives: ProComp is divided into 10 elements under four groups: 1) Knowledge and Skills; 2) Professional Evaluation; 3) Market Incentives; and 4) Student Growth.

In the first three of these groups there is no required educational outcome for students. “Knowledge and Skills” consists of tuition reimbursement and the completion of degrees, licensing, or professional development units. No study has ever shown a correlation between increased credentials and improved student achievement. “Professional Evaluation” is composed entirely of salary increases granted upon a rating of “satisfactory.” I don’t know the percentage of teachers currently ranked “satisfactory” or better, but I’d wager it is both pretty high and far greater than the percentage of proficient students. “Market Incentives” are bonuses for teaching specific subjects or in certain schools. There is no variation for the quality of teaching: the bonus is for showing up. Based on DPS data (http://denverprocomp.org/paychart) this means roughly 80% of ProComp dollars are available without either meeting an educational outcome or with any improvement in student performance. This is true under both proposals.

Of the 20% remaining for Student Growth, about 7% is a bonus for "serving in a distinguished school" – regardless if one’s performance helps the school achieve distinction or not (and assuming as few as 25 teachers per school; this nets out with the impact an individual teacher merits at about 0.3%). The remaining 13% is linked to educational outcomes: 10% is a “sustainable increase” (assume salary) for exceeding expectations on the CSAP, and another up to 3% is based on meeting one or two “Annual Student Growth Objectives.” This is better, but again, the link from Pay to Performance is not direct: of the 13%, only 1.5% is a bonus.

This gets complicated, and I’ve rounded some numbers, but the part of ProComp that is a specific bonus for achieving a defined educational outcome comprises roughly 2% of available dollars. Fully 87% is paid primarily for activities regardless of quality. The remaining 11% includes educational outcomes but the direct link to pay is tenuous as it is paid as salary and continues into future years and pensions, regardless if the performance is sustained. In fact, currently over 90% of ProComp builds pension costs, which given the existing pension burden could well be considered financially imprudent.

It also turns out that the annual cost of administering ProComp is $2 million. Initially this is not funded by taxpayers, but clearly this $2M cost was not well publicized in a district that just went through a gut-wrenching, 18-month process of closing schools that resulted in savings of just $2.5M per year.

Like so much else about education reform, the praise afforded ProComp seems deeply and prematurely self-congratulatory: lauded as "groundbreaking" and "unprecedented" well before anyone knows if the ground broken or precedents set actually work. Education too often applauds process and inputs, and never bothers with outcomes. Perhaps it is not surprising if ProComp suffers the same imbalance.

In the current debate, I think DPS recognizes the structural constraints, and their proposal makes some marginal improvements, but even if uniformly adopted, very little changes. DCTA’s proposal lacks even minor improvements: it would almost entirely preserve the “cake” of single-salary structure, and views ProComp as the complementary “icing” (their words).

While the current ProComp debate is important financially there is little innovation at stake. It seems increasingly that ProComp will be an argument between adults that does very little for kids. As an avid supporter of both changing teacher compensation and Pay for Performance plans, I want to avoid discarding the bathwater because of the baby. But it is abundantly clear to me that the chance of ProComp’s success in addressing the educational needs of our city is badly limited by its design.

ProComp is often defended as the best plan that could be achieved given the circumstances. This is, in all likelihood true, although the flaws are larger than acknowledged. Overall, the DPS and DCTA debate is a sharp indictment of the limited possibilities under a system dominated by centralized bureaucracies and unions. The final lesson of ProComp is likely to be that that real work of innovation and public education reform is still to come.

Alexander Ooms is a member of the A+ Denver citizens committee.

Ednews highlights

Trip shows inner-city kids new ways, worlds

By Erika Gonzales

Carrie Olson can size them up pretty quickly. The teachers who will last just a few weeks. Those who will struggle for years, frustrated by why their well-crafted lesson plans aren’t making a difference.

Olson, a teacher at Denver’s Kepner Middle School, was once one of them.

She remembers walking into her first urban classroom more than two decades ago, astonished that none of her impoverished students had a library card. Why not take advantage of a free service located just three blocks away, she thought.

Today, she says, many of her colleagues seem just as puzzled about how students come to school sporting trendy tennis shoes, yet don’t have enough money for pencils.

Expert: dropout prevention programs hit wrong target

By Rebecca Jones

Schools that target their dropout-prevention programs at the demographic groups most likely to drop out – minority students, students who live in poverty, or those with a parent or a sibling who dropped out, for example – wind up providing services to lots of youngsters who won’t, in fact, ever drop out of school.

And they fail to provide those services to a lot who do.

The lesson, says one national dropout prevention expert: Find better predictors than mere demographics, and then develop comprehensive, sustained and systematic approaches to keeping kids in school.

Blog highlights

Gambling on school bond elections is risky this year

Tuesday, June 24, 2008
Written by: Uncle Charley

It’s a huge political year in Denver, with the Democratic National Convention arriving into town. So when I read in yesterday’s Rocky Mountain News that Denver Public Schools is planning to put a nine-figure bond issue on the November ballot, I gave pause. Is this really a good idea, especially when enrollment is flat and the district is closing so many school sites? Still, DPS officials are faced with the tough choice of how much they’re willing to beg for:

Details such as, should the city school district ask for $300 million or go for broke at $600 million?

“We’re not assuming a $600 million bond issue, but that’s the sum total” of the identified need, Bill Mosher told DPS board members. He is co-chairman of the citizens committee exploring the bond question.

The board approved a resolution Thursday to notify the Denver Elections Commission that the district plans to participate in the fall election, a decision required to secure a spot on the ballot.

I’m not a gambling man myself, so I don’t have advice for the school district from the perspective of putting the city’s successful tax increase streak on the line. But a glance at the article’s comment section suggests that there might be some traction to an “enough is enough” No campaign. Several longtime Denverites I know have moved outside the city limits in the past year, and the common complaint is the unending growth to the homeowner’s tax burden.

Depending on how critical the school district’s identified needs are ($50+ million to renovate one high school?), DPS probably shouldn’t risk the whole kit and caboodle on the $600 million granddaddy proposal. It will be harder to overcome the opposition of justifiably disgruntled taxpayers with Mayor Hickenlooper otherwise preoccupied with the DNC. Yet even if he does find time to film an ad, what can he do to top his previous performances? Drive a motorcycle off a ramp through flaming hoops onto the roof of a school, Evil Knievel-style?

(And it’s not just Denver: Based on this Rocky article, it’s possible the state’s six largest districts, representing more than 40 percent of Colorado’s public school population, could all be pleading for more money this November. Who can blame them for trying? In recent years, citizens of this state have time and again generously given approval to requested tax hikes.)

However, the bureaucrats and officials who think it’s just another year and another time to burden taxpayers more may wish to think again. A perfect storm of rising energy prices on families, a growing backlash against Gov. Bill Ritter’s unauthorized property tax increase “for the children,” and the potentially costly and disruptive DNC hoopla may add up to a less hospitable climate for 2008 school district bond and mill levy requests.

Severance tax foes distorting the facts

Wednesday, June 18, 2008
Written by: Alan Gottlieb

No surprise here: energy interests on the Western Slope are using distortions and scare tactics to turn people against a proposed ballot measure that would change the state tax on mineral extraction.

Initiative 113 would boost revenues and fund a college scholarship program, wildlife protection, clean-energy projects and assistance to communities affected by energy development. Money would be generated by removing a tax exemption that resulted in Colorado’s so-called severance taxes being among the lowest in the mountain west.

The current law allows energy companies to offset state severance taxes with the amounts they pay in local property taxes. The initiative would strip away that offset.

According to the Colorado Municipal League, the initiative would increase severance tax revenue from $186 million to $446.9 million for fiscal year 2009-2010

Club 20, an influential Western Slope group of business leaders, recently commissioned a study of the proposed ballot initiative. The study, conducted by Jim Evans, the retired executive director of the Associated Governments of Northwest Colorado, found that the ballot measure would deprive Western Slope residents of their first-born children, blot out the sun and cause a plague of locusts to descend upon the land.

Well, not really. But the Evans study did find that it would “take money from the areas most affected by the energy boom,” according to the Grand Junction Sentinel.

Evans applied the terms of the proposed ballot measure, the Scholarship Initiative, to the past six years of severance-tax receipts. In only one of those years would the local-government share of severance tax revenue have increased, Evans said.

In analyzing the highest-revenue year of those six years, 2006, local governments would have seen a $23 million revenue loss and a loss of $45 million overall.

“It’s a raw deal any way you slice it,” said state Sen. Josh Penry, R-Grand Junction.

The problem is, Evans’ analysis, uncritically reported by the Sentinel (whose reporter didn’t even bother to gather substantive reaction from supporters of the initiative) is both inaccurate and incomplete in almost all its particulars, according to Matt Samelson, director of special projects for the Donnell-Kay Foundation. (Full disclosure: DK is a funder of Education News Colorado, as well as a key supporter of the ballot initiative).

Samelson fired off an e-mail to Club 20 Executive Director Reeves Brown, pointing out inaccuracies in the Evans study. “It’s no surprise that Club 20 would oppose the ballot initiative,” he wrote. “But stating that “Because of this adverse impact to locally impacted communities, the Club 20 Executive Committee has voted unanimously to oppose Initiative #113" is a disservice to your membership…

“Because when I plug in the proposed severance tax structure using FY2007 severance tax inputs and outputs, I get a set a numbers that indicate local communities in impacted areas would have received more money. In fact locally impacted communities would have received $79.36 million in FY2007, which is $18.21 million more than was dedicated to (the Department of Local Affairs) for the same time frame.”

Samelson also wrote (and key terms will be defined in paragraphs below, so don’t despair): “As a result of the ad valorem credit and stripper well exemption, 75% of all the oil and gas wells in Colorado don’t pay the severance tax. So if the framework of (the ballot initiative) had been in place during FY 2006-7 (no ad valorem credit and the altered stripper well exemption), Colorado would have received $256 million in severance revenue instead of the $122 million it did receive from the current tax structure.”

I asked Samelson to explain this in laymen’s terms, and here’s what he wrote me:

“Ad Valorem credit: Oil and gas producers in Colorado are allowed to apply 87.5% of the property tax against their state severance tax. In communities where the property tax is high, such as Weld County, the property tax credit can negate the producer’s entire severance tax liability. For example, producers in Weld County from 2002-2006 pulled $7 billion dollars of oil/and gas out of the ground, but because of the ad valorem credit, they didn’t pay severance tax for three of those five years. (Source: Randy Udall “Torched and Burned”) The severance proposal #113 removes this tax credit.

Stripper wells: Colorado has another exemption for small wells. If an oil well produces 15 barrel or less of oil per day, then it doesn’t have to pay the severance tax. If a natural gas well produces 90,000 cubic feet of gas or less per day, it also doesn’t have to pay the severance tax. The severance proposal #113 lowers the threshold for these exemptions to 7.5 barrels per day of oil and 45,000 cubic feet of natural gas per day.”

Initiative 113 has been criticized by some in the higher education community because it pours resources into scholarships instead of patching the gaping hole in higher ed funding. That is a criticism worthy of debate. But the predictable Chicken Little attacks from the energy business are the latest manifestations of the politics of distortion and half-truth.

One Response to “Severance tax foes distorting the facts”

1. Matt Says:
2. June 19th, 2008 at 4:54 pm e

Thanks for taking the time to write about this Alan. As a quick note, Donnell-Kay Foundation supports the concept of the initiative, but as an organization we are unable to take an official stance on ballot initiatives.
Thanks, Matt Samelson

And now for something completely…singular

Tuesday, June 17, 2008
Written by: David Ethan Greenberg

Now that school's out, let us temporarily forget union disputes and test scores, and look at the bigger picture.

Let us, for a moment, contemplate the singularity. In DC right now, ed bureaucrats are feverishly working out face-saving strategies that will allow one of the key, and in all likelihood, unreachable goals of NCLB, that of all students becoming proficient in math and reading, to be delayed (or diluted) from the statutory goal of 2014. The way things are going, we could be 10 or more years away from reaching this goal.

Meanwhile, in a galaxy far, far away, some very bright guys are contemplating the moment when artificial intelligence (AI) can be integrated with human thinking. The most optimistic of fellows is Ray Kurzweil, who would be considered seriously crazy were it not for the fact he holds key patents in speech and pattern recognition, and designed keyboards for Stevie Wonder. Here’s Kurzweil: "The basic paradigm of Moore’s Law—exponentially increasing improvement—will not only hold true indefinitely for logic circuits but will also apply to countless other technologies. It will lead to a singularity that will enable us to upload our consciousness into machines and, in effect, live indefinitely. This singularity will occur in about 15 years."

Most of Kurzweil’s peers thinks that’s a tad overoptimistic, others think it is complete sci-fi crap, but for many its a question of when, not if.

So, we have the educators hoping against hope we can teach 12 year olds algebra within their lifetime, and some very smart money betting that we’ll be implanting 12 year old minds with quantum computing chips a generation from now. Does this strike anyone else as strange? The Two Cultures gone amuck? Makes you wonder about the wisdom of constructing 100 year school facilities.

Want to know more about the singularity? Go to http://spectrum.ieee.org/singularity