In fiscal year 2008, Arizona’s state-wide percentage of dollars spent in the classroom was 57.3 percent, which is the lowest it has been in the 8 years the Auditor General’s Office has been monitoring classroom dollars and almost 4 percentage points lower than the national average of 61 percent. The classroom dollar percentage has declined despite schools’ receiving about $300 million a year in Classroom Site Fund (CSF) monies. These monies are intended to increase classroom spending, primarily by increasing teacher salaries. However, spending patterns indicate that districts are using CSF monies to supplant—or replace, rather than add to—other district monies primarily to pay for increased student and instructional support services costs. If districts had maintained their previous level of classroom spending and added to it the CSF monies, the classroom dollar percentage would be 2.4 percentage points higher and the average teacher salary in Arizona would be about $7,500 higher.
A district’s size continues to be the primary factor associated with higher classroom spending. Larger districts can spread fixed, noninstructional costs over more students, leaving more dollars to spend in the classroom. However, many smaller districts are still able to spend a higher percentage of their dollars in the classroom than the state average. According to district officials at some of these small-sized districts with high classroom dollar percentages, they were able to lower their noninstructional costs by having employees perform several jobs and hiring part-time staff.
Finally, districts are required to direct 40 percent of their CSF monies to teacher performance pay. State law provides guidance on the types of goals that performance pay plans should include, but allows districts to modify these measures. As a result, districts varied widely in the goals they established for awarding performance pay to eligible employees.