Are Superintendents Greedy or Just Over Regulated?

November 2, 2011

For immediate release (581 words).

Public school superintendents are greedy, selfish, over-paid, a big waste of taxpayer dollars, etc. — or so popular thought goes. Such perceptions are fueled by news reports of superintendent compensation packages, retirement packages and contract buyouts.

The Philadelphia School District this fall bought out its superintendent’s contract for $905,000. And closer to home, an Indianapolis-area superintendent retired this year with a $1-million retirement package (but a few weeks after retirement decided to forego $200,000 of the retirement pay). Another Indianapolis-area superintendent a few years ago settled a contract buyout dispute by accepting a settlement of $470,000. A Fort Wayne-area superintendent received a retirement package of $495,000 a few years ago.

Politicians rail loudly against such retirement packages and buyouts, but there is another side to the story.

Public-school superintendents have a tough job if not an impossible one. They are supervised generally by elected school board members who have their own agendas and special interests. Often these board members disagree among themselves and do not provide a unified direction to the superintendent. Trying to please a divided board almost always results in a change of superintendency.

Superintendents live their life in the public fishbowl. Late-night calls from angry taxpayers or parents are common. There are demands from the media for interviews at all hours of the day and night. Some media will also knock on the superintendent’s door at home and peer into the windows. It is a near total loss of privacy and a life of competing conflicts between special-interest groups.

Employees and citizens assume the superintendent has the authority to run the school district’s daily operations. In reality, it is individual board members who tell the superintendent what to do on many daily operations. On top of this, there are thousands of laws and regulations passed by the state legislature, Congress and state agencies that constrict the decision-making authority of a superintendent. Thus, it is a job with great responsibility but little authority to accomplish that responsibility.

This year, Indiana legislators are talking about putting salary caps on superintendent salaries and even requiring public hearings of proposed superintendent contracts. Both ideas are unsound public policy.

Indeed, it is widely reported that the pool of qualified candidates for the public school superintendency is getting smaller and smaller each year. Policymakers need to understand that there may appear to be sufficient supply of public-school superintendents when in reality many of those applicants are unlicensed, untrained and lack the experience, talent and ability to serve as a chief executive officer of a large government entity. There is in fact an inadequate supply of well-qualified superintendent candidates in Indiana today.

Supply and demand make up an economic model of price determination in a market. The model concludes that in a competitive market, the unit price for a particular good or service will vary until it settles at a point where the quantity demanded by consumers (at current price) will equal the quantity supplied by producers (at current price), resulting in an economic equilibrium of price and quantity.

The four basic laws of the supply-and-demand model are:

  1. If demand increases and supply remains unchanged, then it leads to higher equilibrium price and quantity.
  2. If demand decreases and supply remains unchanged, then it leads to lower equilibrium price and quantity.
  3. If supply increases and demand remains unchanged, then it leads to lower equilibrium price and higher quantity.
  4. If supply decreases and demand remains unchanged, then it leads to higher price and lower quantity.

It is Rule No. 4 that is in play now. With salary caps and public hearings on proposed superintendent contracts, coupled with already unattractive working conditions, the supply of well-qualified superintendent candidates will grow even smaller. These two legislative proposals are artificial restraints free market. Legislators are ignoring that by artificially reducing price (superintendent salaries) they will decrease the number of people who are willing to take a most difficult job. Policymakers will find that educators will make other decisions, such as stay in the classroom, serve as a principal, or seek employment in the private sector.

Demand for superintendents, however, will remain the same as the number of superintendent jobs remains the same. Thus, according to Rule No. 4 the price goes higher. This is why superintendent salaries have escalated in the past decade. Fewer right-minded, thoughtful and qualified people want the job in today’s highly regulated and political environment. To set salary caps or to hold public hearings will do nothing to increase the supply of qualified candidates — it will have the opposite effect — it will result in even fewer such candidates seeking a superintendency. And school districts will suffer the consequences.

Jeff Abbott, Ph.D., J.D., an adjunct scholar of the Indiana Policy Review Foundation, teaches at Indiana University-Purdue University at Fort Wayne. He is a former superintendent of the East Allen County School system.



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