The Crisis in Jefferson County (Colorado) Schools: A Case Study of the Failure of Multiple District Governance Processes
A growing number of US school districts face a worsening wicked problem. Before the pandemic arrived, its interacting elements included declining academic results, falling enrollment and revenue, increasing overcapacity, and rising costs. COVID accelerated all these negative trends.
If districts don’t find a way to solve the wicked problem they face, it won’t just be their students who will suffer the consequences. So will employers, the economy, and national security. Our society and politics will also pay the price, via worsening income inequality and intensifying conflicts between different groups.
To solve a problem, understanding its root causes is critical. I’ve written this case study to explore one of them in depth: The failure of multiple governance processes in the nation’s 39th largest school district.
Jefferson County is an affluent, educated suburb located to the west of Denver, Colorado, with annual total revenues of $1.4 billion.
Faced with General Fund deficits forecast to total more than $130 million over three years, on November 10, 2022, the Jefferson County (Colorado) Board of Education voted to close sixteen underutilized elementary schools.
None of the media reports about the closures mentioned a critical point: The situation facing Jeffco represents a colossal, decade-long governance failure.
Background
Jeffco’s financial crisis has resulted from the confluence of a number of negative trends that have been building for at least a decade.
Jeffco is an affluent, educated suburb. Yet its academic results have been declining.
In 2019 (before COVID arrived), 54% of Jeffco 3rd graders didn’t meet state ELA standards on CMAS — an improvement of only 2% from 2015. In 6th grade math, performance got worse. While 58% failed to meet state standards in 2015, 65% didn’t in 2019.
The 2022 state assessment results showed that COVID learning losses have made Jeffco’s situation even worse. For example, even though over three thousand students who had low scores in 2019 didn’t take the 2022 CMAS, this year a shocking 70% of 6th graders failed to meet the state math standard!
In Colorado, all 11th grade students take the SAT. This is the last measure we have of the effectiveness of our school districts in meeting their primary goal of educating our children. In 2022, Jeffco’s 11th grade SAT scores continued their five-year slide.
A July 2022 EdChoice/Morning Consult poll found that parents’ top three school choice criteria are that it is close, safe, and has strong academic results. With 48% of Jeffco students choicing away from their neighborhood school, many parents are willing to sacrifice proximity for the other two benefits.
Given this, it is reasonable to assume that Jeffco’s worsening academic results has caused an increasing number of parents to “choice away” from their local neighborhood school.
As you can see in the table below, over the last decade Jeffco’s district-run neighborhood schools lost 11,058 students (2,050 went to district run Option Schools, 1,952 to district Charter Schools, and 7,056 left the district across all grades, including moves to other states, districts, and private, religious, and home schools).
As a result of these losses, before the announced closure of 16 elementary schools, sixty-eight Jeffco schools were operating at less than 80% of capacity, the industry threshold for low utilization. While forty-eight operated at below 65% of capacity; Jeffco is closing only sixteen of them. And since 2018, almost all these underutilized schools have received millions in new facility investments under the district’s capital improvement program.
The district’s costs have been rising, even as student enrollment in district-run neighborhood schools declines.
In 2012, Jeffco spent $446 million on salary and benefits to serve 77,143 students in its district-run schools). Ten years later, it spent $702 million (57% more) to serve 69,526 students (10% fewer). On a per student basis, Jeffco spent $5,782 on total compensation in 2012, and, in constant 2012 dollars, $10,097 per student in 2022. That’s a real increase of 41% in compensation cost per student — even as academic results were steadily declining.
In September, by a 4–1 vote, Jeffco’s Board of Education (whose majority is backed by the teachers union) made matters much worse by approving a $73 million increase in total compensation for district staff. Due to the steps and levels structure of its union contract, this amount will significantly increase in the years ahead.
In sum, Jeffco’s current crisis has resulted from the interaction of an academic performance crisis, a capital program and facilities management crisis, and a budget crisis.
A root cause of all of these has been the utter failure of multiple Jeffco governance processes.
Governance Processes in the District
In addition to the Board of Education, there are three other governance bodies in Jeffco.
Financial Oversight Committee (FOC)
Jeffco’s Financial Oversight Committee was established by the Board of Education in December 1999 to assist the board in fulfilling its fiduciary oversight responsibilities by reviewing:
- “Financial reports and other financial information used internally and provided by the district to any governmental body or the public;
- “The district’s system of internal controls regarding finance, accounting, legal compliance and ethics that management and the Board have established (note that this is in line with Government Accounting Standards, which state that maintenance of sound internal controls is a governance responsibility);
- “The business risk of the district; and
- “The district’s accounting and financial reporting processes generally.
The committee has a citizen chair. Members serve without term limits.
District Accountability Committee (DAC)
In Colorado, District and School Accountability Committees (DACs and SACs) are independent bodies created by the state legislature in 2009 to improve the performance of public schools.
Their legal existence exists separate and apart from school districts and boards of education. However, DAC members are appointed by the local school board, subject to distribution requirements for their membership (e.g., a certain number of business community members, parents of Special Education and Gifted Students, etc.). Parents of current students must represent a plurality of DAC members.
The DAC has citizen co-chairs, and members are term limited.
DACs are charged with reviewing student achievement results versus goals, the root causes of any underperformance, and the plans and budgets that are proposed to drive improvement, and advising the Board of Education on these issues.
Each year, every school and district in Colorado prepares a Unified Improvement Plan. These “UIPs” are intended to drive a continuous student achievement improvement process. Each UIP has three main sections: (1) a discussion of the previous year’s results and identification of key achievement problems; (2) discussion of the root causes of these problems; and (3) a detailed description of the major improvement initiatives that will be undertaken over the next 12 months to address the identified root causes, as well as clear metrics and goals that will be used to evaluate these initiatives.
Colorado’s Unified Improvement Planning process is just a variant of the process that is frequently attributed to W. Edwards Deming and Toyota Motor Company. Its four steps are summarized as “Plan”, “Do”, “Study”, and “Act”. Since the 1950s, organizations around the world systematically applied it to continuously and substantially improve their performance.
District UIPs must be approved by the local Board of Education before being submitted to the Colorado Department of Education (CDE).
CDE does not systematically track or publicly report on whether the Major Improvement Initiatives in district’s UIPs are actually implemented, or whether they achieve their achievement improvement objectives.
Capital Asset Advisory Committee (CAAC)
In 2010, the Jeffco Board of Education authorized the establishment of the Capital Asset Advisory Committee advise the board on the planning of capital needs and the implementation of capital programs, and “ensure that sound, long-term decisions are consistent with the needs of the district and in support of the district’s strategic plan.”
Per Jeffco’s website, “members have a working familiarity with facility design and/or construction practices; business management expertise with organization(s) of comparable size to the district, and are independent and free from any relationship that would interfere with independent judgment.”
As is the case with the Financial Oversight Committee, members serve without term limits. Unlike the FOC, the CAAC has no citizen chair, and instead is led by the District’s Chief Operating Officer and its Director of Facilities.
The Systematic Failure of Governance in Jeffco
The District Accountability Committee
While DACs were intended by the legislature to provide independent advice on improving student achievement results, such independence was quickly undermined by the provision that allowed Boards of Education to determine DAC membership.
More specifically, the Jeffco DAC has consistently undermined the effectiveness of the Uniform Improvement Process — which, as noted above, has driven performance improvement in private sector and other government organzations (e.g., the United States Marine Corps) for seventy years.
What are the root causes of this surprising failure? At the highest level, three come to mind:
- The root causes that were identified were not the most important root causes;
- The major improvement strategies identified to address the root causes were incorrect (e.g., not based on strong research evidence);
- The major improvement strategies were poorly implemented.
Consider this list of all the root causes that were contained in the Unified Improvement Plans that Jeffco Public Schools has submitted to the Colorado Department of Education since the 2010/2011 school year:
2010/11 UIP
- District Superintendent: Dr. Cindy Stevenson
- Board of Education: Dave Thomas, Jane Barnes, Laura Boggs, Paula Noonan and Robin Johnson
“Schools lack district-wide formative and benchmark progress monitoring tools in writing to calibrate the fidelity of implementation of the district writing curriculum.”
“Students needing to catch-up do not receive quality and/or adequate time for universal/core instruction in addition to effective, aligned targeted/intensive interventions.”
“Many secondary schools do not have a systematic, tiered system of support to respond to the needs of catch-up students.”
“The district has not strategically resource mapped and allocated resources differently among schools to better meet the needs of catch-up students.”
2011/12 UIP
· District Superintendent: Dr. Cindy Stevenson
· Board of Education: Dave Thomas, Jane Barnes, Laura Boggs, Paula Noonan and Robin Johnson
“Schools lack district-wide formative and benchmark progress monitoring tools in writing to calibrate the fidelity of implementation of the district writing curriculum.”
“Teaching and learning have not consistently demanded high expectations in every classroom due to superficial coverage of a large number of standards, lack of understanding of grade level mastery, lack of relevance for students, and lack of systemic progress monitoring.”
“Educators lack consistently rigorous, growth-producing feedback through the evaluation process.”
“The district is not meeting the state expectation of 100% highly qualified teachers…because an effective monitoring system is not in place for existing staff especially for secondary schools.”
2012/13 UIP
· District Superintendent: Dr. Cindy Stevenson
· Board of Education: Lesley Dahlkemper, Paula Noonan, Laura Boggs, Robin Johnson, Jill Feldman
“The district lacks systemic practices in writing instruction and effective feedback in every classroom.”
“The district lacks structures to ensure consistent quality of professional development is provided to all instructional staff.”
“District and school leadership lack systemic understanding around multiple pathways for students to stay on track to graduate.”
2013/14 UIP
· District Superintendent: Dr. Cindy Stevenson
· Board of Education: Lesley Dahlkemper, Paula Noonan, Laura Boggs, Robin Johnson, Jill Feldman
“Systemic implementation of intentional lesson design to engage students’ conceptual understanding of their learning and increase student cognitive load is not evident in all classrooms.”
“Educators have received inconsistent training on effective literacy instruction and the use of research-based resources”
“Math instruction tends not to be differentiated, lacking a variety of structures to meet students’ needs”
2014/15 UIP
· District Superintendent: Dan McMinimee
· Board of Education: Ken Witt, Julie Williams, John Newkirk, Lesley Dahlkemper, Jill Feldman
— Note: the following is not a typo. The 2014/15 UIP repeats the same root causes as 13/14 because this was the year the state assessment transitioned from TCAP to CMAS.
“Systemic implementation of intentional lesson design to engage students’ conceptual understanding of their learning and increase student cognitive load is not evident in all classrooms.”
“Educators have received inconsistent training on effective literacy instruction and the use of research-based resources”
“Math instruction tends not to be differentiated, lacking a variety of structures to meet students’ needs”
2015/16 UIP
· District Superintendent: Dan McMinimee
· Board of Education: Ken Witt, Julie Williams, John Newkirk, Lesley Dahlkemper, Jill Feldman
“There is a need for implementation across the district of systemic evidence-based instructional practices that promote learning of rigorous literacy skills and competencies to ensure every student can “read to learn” by the end of third grade.”
“There is a need for implementation across the district of vertical alignment (PK through 12th) and interdependence of math concept development that leads to successful learning in algebraic thinking…There is a need across the district for systemic classroom-based instruction, assessment and grading practices throughout the elementary and middle years that focus on higher level math concepts and procedures.”
“Core instruction in academics, and social and emotional skill development must meet the needs of all students in achieving the performance expectations that will prepare them each step in their chosen learning pathway to successful completion of a Jeffco education.”
2016/17 UIP
· District Superintendent: Dan McMinimee
· Board of Education: Ron Mitchell, Ali Lasell, Susan Harmon, Amanda Stevens, Brad Rupert
“In many schools, there is a lack of systemic evidence-based instructional practices that promote learning of rigorous literacy skills and competencies to ensure every student can “read to learn” by the end of third grade…For many students, the various literacy interventions are not specifically matched to student learning needs and may create additional barriers to learning rather than supporting literacy growth…Evidence indicates that current professional development in standards/competency-based core instructional strategies and learning supports has had limited impact on the effectiveness of high level literacy practices and matching interventions to student needs…Evidence indicates that current professional development and resource allocation for literacy instruction has had limited impact on desired increases in student performance.”
“In many schools, there is a lack of systemic classroom-based instruction, assessment, and grading practices throughout the elementary and middle years that focus on higher level math concepts and procedures leading to algebraic thinking…In many schools, there is a lack of systemic classroom-based practices that require application and transfer of higher order algebraic thinking to meaningful/relevant real world problems and contexts…There is a lack of understanding across the system of vertical alignment (PK through 12th) and interdependence of math concept development that leads to successful learning and algebraic thinking…There is a lack of commitment across the system to ensure consistent differentiated teaching and learning practices matched to student needs.”
“There is a need across the district for a system-wide commitment to ensure classroom practices and programming choices that provide every student with the opportunity to successfully complete a Jeffco educational pathway…There is a need across the district for a clear understanding among students and staff of the most critical performance expectations to achieve in order to be prepared for each student’s learning pathway…The allocation (or reallocation) of resources and supports to meet students’ social, emotional, engagement, and advancement needs are not addressing barriers to learning for all students (including students with educational plans).”
2017/18 UIP
· District Superintendent: Dr. Jason Glass
· Board of Education: Ron Mitchell, Ali Lasell, Susan Harmon, Amanda Stevens, Brad Rupert
“The district and schools have not provided equitable resources and support for math students to have a well-established foundation in: mathematical reasoning to explain, justify, and evaluate their thinking used to solve problems and applications of reasoning across content areas.”
“Due to inequitable resources and support, schools have limited capacity to differentiate instruction and engage students in relevant, authentic tasks, specifically in the core areas of mathematical reasoning and conceptual understanding in addition to memorization of facts.”
“All schools currently do not have the full capacity to meet all students’ early literacy learning needs due to inequitable resources and support, for a variety of reasons, including inconsistent structures and routines across schools for foundational classroom (core) reading instruction, variable evidenced-based instructional practices to differentiate teaching for all learners’ needs, and lack of literacy transfer and application to other content areas.”
2018/19 UIP
· District Superintendent: Dr. Jason Glass
· Board of Education: Ron Mitchell, Ali Lasell, Susan Harmon, Amanda Stevens, Brad Rupert
“Early Literacy: All schools currently do not have the full capacity to meet all students’ early literacy needs due to inequitable resources and support, for a variety of reasons including: (1) Inconsistent structures and routines across schools for foundational classroom (core) reading instruction; (2) Variable evidence-based instructional practices to differentiate teaching for all learners’ needs; and (3) Lack of literacy transfer and application to other content areas.”
“Middle School Math: The district and schools have not provided equitable resources and support (for example, differentiated professional learning, and interventions) for math students to have a well-established foundation in: (1) Mathematical reasoning to explain, justify, and evaluate their thinking used to solve problems; and (2) Application of reasoning across content areas.”
“Post-Secondary and Workforce Readiness (PWR): Due to inequitable resources and support, schools have limited capacity to differentiate instruction and engage students in relevant, authentic tasks, specifically in the core areas of: (1) Mathematical reasoning and conceptual understanding in addition to memorization of facts; and (2) Literacy transfer and application to other content areas.”
2019/20 UIP
· District Superintendent: Dr. Jason Glass
· Board of Education: Ron Mitchell, Ali Lasell, Susan Harmon, Amanda Stevens, Brad Rupert
“Inequitable early academic access, resources, and support that transform the student experience”
“There is a lack of engaging student learning experiences for middle level students. Many Jeffco students have not fully engaged in their learning due to a lack of student agency (voice and choice in their learning) and relevance (real world application) with high expectations for all learners.”
“There is a lack of student learning experiences for both career and college connections during the high school years that will ensure students are ready and able to connect to career, college, and life as productive citizens.”
2020/21 UIP
· District Superintendent: Kristopher Schuh
· Board of Education: Susan Harmon, Brad Rupert, Ron Mitchell, Stephanie Schooley, Susan Miller
“In Jeffco, we continue to focus on providing deeper learning, namely rich and authentic learning experiences for all students built on the foundation of “student task” — or what teachers create for students to do in the classroom. We want our students to have the opportunity to develop skills and abilities such as collaboration, adaptation to changing conditions, communications, creative problem solving, and civic and global engagement (a.k.a. Jeffco Generations Skills). Over the past century, historical approaches to teaching have not focused on this real-world application and it takes time for systems to adapt instructional approaches and change traditional practices.”
“A major root cause for many of the district’s priority challenges this year concerns the impact of the COVID-19 pandemic. Disruptions to learning, increased social-emotional needs, and exacerbated opportunity gaps for students experiencing poverty, homelessness and other risk factors have all contributed to this year’s challenges for the district and schools.”
2021/2022 UIP
· District Superintendent: Tracy Dorland
· Board of Education: Susan Harmon, Brad Rupert, Ron Mitchell, Stephanie Schooley, Susan Miller
“Inconsistent district/school/classroom leadership, data-based decision making, family partnerships, tiered supports and evidence-based practices to meet all students’ needs.”
“Depending on the school and/or classroom, all students may not receive or benefit from effective continuous improvement processes to meet their varied academic, behavioral, and social-emotional needs.”
“District supports have not been integrated across all departments to develop and support systemic leadership, data-based decision making, family partnerships, tiered supports and evidence-based practices to meet all students’ needs.”
2022/2023 UIP
· District Superintendent: Tracy Dorland
· Board of Education: Stephanie Schooley, Mary Parker, Paula Reed, Danielle Varda, Susan Miller
“Prior improvement efforts through strategic planning and district unified improvement plans have not yielded anticipated results due to inconsistent: District Focus, Clarity of expectations, Adequate training/support for staff, and, Effective tools to check progress and adjust implementation strategies.”
This list of root causes from more than a decade of UIPs raises two critical questions:
First, why did the root causes change? If the ones listed were successfully addressed but achievement results didn’t improve, it implies that the real root causes either weren’t identified or for some reason were identified but not listed in the UIP.
Second, if the listed root causes were not successfully addressed, why were they then changed in the subsequent UIP?
My observations over the past decade (including the time I spent as a member of the DAC), have led me to conclude that there were very clearly root causes which, for political reasons, could never be acknowledged. Here are two examples.
Unlike most other districts, Jeffco’s organizational structure diffuses responsibility and accountability. For example, in other districts principals of elementary, middle, and high schools in a given geographic area all report to the same “Area” or “Community” Superintendent (ensuring what the military calls “unity of command”). But in Jeffco elementary and middle/high school principals report to different Community Superintendents.
The weakness of middle management in Jeffco has resulted in 150 plus school principals in Jeffco all having a de facto relationship with the Superintendent. Jane Hammond was the last Jeffco Superintendent who actually improved academic performance. When she arrived in Jeffco in the mid-1990s (after successful stints in Maryland and Washington State), she observed that Jeffco wasn’t a “school system” at all, but rather a collection of 150 independent fiefdoms, presided over by princes and princesses of the realm. When she challenged this system, she was forced out, despite having improved academic results.
One critical consequence of this radically decentralized system been that building principals have historically chosen or allowed teachers to develop their own curriculum, instructional materials, and often professional development, with no consistency within Articulation Areas, much less across the district.
Even with a given “articulation area” (i.e., elementary and middle schools that feed to a specific high school) a student could encounter different curricula in elementary, middle, and high school. Given the demonstrated power of consistent curricula and instructional materials (e.g., EngageNY, or Alberta’s Provincial Curriculum), is it any surprise that Jeffco’s approach has produced poor and declining academic result?
Second, in such a radically decentralized and highly politicized system, there is essentially no accountability. As such, in Jeffco poor principals and other leaders have hung around for years — another cause of persistently poor academic results, and a key element of its extremely insular and frequently toxic culture.
Moreover, even when the DAC UIP accurately identified an important root cause of poor academic performance, the Unified Improvement Process was often undermined by selection of initiatives that were either aspirational and ambiguous, or driven by politics and unsupported by evidence.
Even in the rare case where an improvement initiative made sense (eg., switching to Math Expressions as the district’s consistent math curriculum) implementation was almost always poor, and was too often undermined by independently minded principals. And the results of these initiatives were never rigorously and systematically evaluated, much less widely shared either internally or externally.
Finally, two damning independent outside evaluations of the Root Causes of Jeffco’s student achievement decline were conducted in 2017 (by DeliverEd consulting) and 2021 (by Dr. Jaime Aquino, who is now Superintendent of San Antonio Schools). The DAC never mentioned them in its reports to the Board of Education.
In sum, despite the best intentions of the state legislature, in Jeffco, the District Accountability Committee has been an utter failure as a governance mechanism and continuous improvement process, as evidenced by the steady decline in the district’s academic results.
Capital Asset Advisory Committee
The Jeffco CAAC has seen number of very expensive governance failures.
In 2017, 14 Jeffco schools (3 high school, 6 middle schools, and 5 elementary) were operating at less than 65% of capacity. Unlike Jeffco, many school districts use less than 80% of capacity as their criteria for low utilization.
That year the district tried to close five elementary schools. After public protest, only one was closed. It was a Title 1 school, and its students were sent to two other schools that were not Title 1 schools, and thus lacked the per student funding the closed schools had.
After this, Superintendent Jason Glass instituted a two-year moratorium on further school closures. The Board directed Glass to prepare a long-term Facilities Master Plan to guide future closure and new school building decisions.
Glass never provided it to the Board or the public, despite paying $167,000 to an outside facilities consulting firm to prepare it. And the Board never held him accountable for this.
Moreover, despite multiple Freedom of Information Act requests, the district has consistently claimed that no Facilities Master Plan exists. And the Capital Asset Advisory Committee never said anything about this to the Board.
This isn’t surprising, because despite its status as a creation of the board, the CAAC had no civilian chair. Instead, it was co-chaired by the district’s Chief Operating Officer and Director of Facilities.
You read that right. A governance committee was chaired by management.
In 2018, 19 Jeffco schools were operating at less than 65% of capacity (3 high schools, 7 middle schools, and 9 elementary schools).
Two things happened that year that propelled Jeffco towards the crisis it now faces in 2022.
First, to avoid closing middle schools, the district decided to move 6th grade from elementary schools to middle schools.
They claimed that there would be no adverse impact on 6th graders’ academic achievement, and that expanded pre-school programs would fill the now unused elementary school seats.
Both claims subsequently proved to be wrong.
The second major event in 2018 was the CAAC’s recommendation that the district undertake a $705 million dollar Capital Improvement Program. As described in the “Flipbook” given to voters, every school in the district — even those with very low capacity utilization — would receive millions in facility investments.
When it recommended the proposed Capital Improvement Program to the Jeffco Board of Education, not only was the CAAC aware of the 19 schools with less than 65% capacity utilization, but also of adverse enrollment trends.
Jeffco’s 2018 Enrollment Report showed that over the previous 5 years, enrollment in district-run schools had decreased by (2,837) students.
By 2023, district-run schools were forecast to lose another (1,208) students. Moreover, the data showed that Jeffco’s projections had continuously underestimated the loss of students at district-run schools.
Moreover, members of the public also provided detailed analysis of Jeffco’s overcapacity problem.
But the CAAC still recommended the Capital Program and its associated bond issue to the Board of Education.
In November 2018, the $567 million bond issue was barely approved by 1,286 votes (1/4 of 1% of the votes cast).
With two more years to go, today the Capital Improvement Program has $174 million in cost overruns and spending on projects that were never disclosed to voters in 2018.
Management of the Capital Program has been sharply criticized by Moss Adams, which conducted an independent review (Moss Adams is the market leader in conducting such reviews of school bond programs in California, where they are required by law).
The Capital Improvement Program’s many scandals and failings have also been extensively documented on Improve Jeffco Schools, and by me in this, this, and this column here on Medium.
Yet since 2018, apart from one CAAC member’s resignation in protest over the committee’s failure to perform its role, the CAAC’s reports to the Board of Education (always delivered by a member of management) have never been critical of the Capital Program — even when it was revealed that the family company of a CAAC member had received over a million dollars in contracts from the Capital Improvement Program. The member in question was also a long-serving member of the Financial Oversight Committee, to which we now turn.
Financial Oversight Committee
The first thing to note about Jeffco’s FOC committee is the requirement that its “members have a strong background in finance and accounting practices as well as substantial large organization business management expertise.”
For the past decade, very few of its members have met this test. For example, after recent appointments, this is the first time in years that the FOC has had two members who are CPAs, but only one of whom has significant large company experience (remember, Jeffco is an organization with $1.4 billion in annual revenue).
The FOC’s most glaring shortcoming has been its failure to effectively oversee, much less warn the Board of Education about, Jeffco’s dangerously weak system of internal controls and deteriorating financial condition.
The Capital Program is one painful example.
During the 2018 bond campaign, Superintendent Jason Glass repeatedly promised voters that Capital Improvement Program spending would be independently audited.
Along with the Flipbook, this assurance formed the basis for Colorado Community Media’s Jeffco newspapers’ endorsement:
“We applaud the district’s commitment to transparency: A citizens financial oversight committee and independent audit of expenditures will make sure money from the measures is spent as intended. We also commend the district for listening to criticism from its failed bond attempt in 2016, which cited a lack of clarity in how the money would be used. This time, the district has prepared a detailed booklet and website of exactly where the money will go at each school.”
Yet the promised annual independent audits of expenditures were never performed. Instead, the district claimed that its annual financial audit met this requirement — despite denials by Clifton Larson (the district’s independent auditor) that it only audited the accuracy of the district’s accounting, not whether Capital Program spending aligned with what had been promised to voters in 2018.
Nor in its reports to the Board did the FOC ever comment on Moss Adams’ criticisms of the Capital Program’s numerous internal control weaknesses, or criticize the district for failing to implement any of Moss Adams’ recommendations for strengthening Jeffco’s internal control processes.
Instead, in its reports to the Board the FOC seemed much more focused on defending Jeffco from its critics. When the Capital Program was more than $174 million over budget because of cost overruns and spending on projects never disclosed to the voters, and well-after the Moss Adams report had been released, the FOC’s former chairwoman told the Board of Education that it was “just like when you’re doing a project to remodel your bathroom, sometimes projects experience cost overruns.” Really. She actually said that. It’s on video.
A second example of the FOC’s oversight failure came to light after the arrival Tracy Dorland, Jeffco’s new Superintendent, and Brenna Copeland, its new CFO. Both expressed astonishment to the Board that, instead of basing its budget on forecast revenues (as was the practice in every other district they’d seen), Jeffco uniquely created its initial budget based on the previous year’s revenue.
Equally shocking was Jeffco’s practice of thereafter focusing its budgeting discussions only on the allocation of incremental changes in revenue — and not whether the entire $1.4 billion in revenue was being spent efficiently and effectively.
Copeland soon discovered (and promptly informed the FOC and the Board) of one of the reasons for this: Shockingly, a complex $1.4 billion organization was being run using a set of linked spreadsheets, rather than a modern financial planning and management system.
Even worse, these spreadsheets were riddled with errors — some leading to millions of dollars inaccurate budget information — that Copeland had to disclose and reverse.
Moreover, decision authority over spending decisions was so confused and diffuse that budget overruns were rampant and inevitable. And nobody ever seemed to be held accountable for them.
Despite all these disclosures, the FOC said nothing to the Board. Nor did the district’s outside auditor ever publicly comment on them.
The FOC never opened its own investigation of these internal control failures, nor did it recommend an independent audit of the magnitude and severity of Jeffco’s internal control failures. And it never provided the Board with any recommendations about how to improve Jeffco’s internal control environment.
It was almost as though the FOC did not understand its responsibility for the soundness of Jeffco’s internal control environment, either under its Board mandate or Government Accounting Principles. Nor has the Board ever asked for this; perhaps they also don’t understand the critical importance of internal controls in a $1.4 billion organization, and their responsibility for it.
A final governance failure by the Financial Oversight Committee has been its silence for years on the increasingly negative budget and financial implications of Jeffco’s declining enrollment, rising costs, and growing number of severely underutilized schools, much less the wisdom of investing millions of dollars of Capital Program funds in schools that were likely to be closed.
The Jeffco Board of Education
If the DAC, CAAC, and FOC were all guilty of not warning the Board about Jeffco’s worsening problems, with few exceptions the Board itself was guilty of never asking about them, even in the face of highly credible evidence of their existence.
It wasn’t the case that Board members lacked the required expertise. Over the years, they have included people with MBAs and Law Degrees; one was the CFO of a large healthcare organization.
Rather than a lack of ability, the Board’s failure appears to have been due to a lack of willingness to delve into the district’s problems, much less hold the Superintendent accountable for failures to achieve goals (“Board Ends”) or violations of Executive Limitations (both of which are critical to the successful implementation of the Policy Governance model the Board claims to use).
To cite one example: Before Tracy Dorland arrived, one Board member proposed a resolution detailing the many failings of the Capital Improvement Program and demanding an independent Performance Audit. None of the other four Board members seconded the resolution.
Note that when Dorland arrived she too avoided a full independent Performance Audit, and only requested that Moss Adams perform a much more limited review (which still uncovered may failings).
Why was the Board so unwilling to ask questions about Jeffco’s obvious shortcomings, in academic performance, Capital Program management, or budgeting and internal controls?
In my experience, three possible explanations stand out. First, for the past seven years, the majority of board members have been elected with the backing of the teachers’ union. The union’s top priority has always been improving conditions for their members, not uncovering district problems that might interfere with the achievement of their primary goal.
There is no better example of this than this year’s 4–1 board vote to increase employee compensation by $73 million (which, due to annual changes in steps, levels, and inflation will annually increase). That this would trigger the financial crisis that has led to the closing of 16 schools this year, more next year, and almost certainly hundreds of layoffs was apparently not a major concern of the four board members who approved it (though it was the major concern of the one board member not backed by the teachers union who voted against it).
Perhaps this was the reason the Board never asked the Financial Oversight Committee for its assessment of the potential impact of the proposed pay increase.
The second explanation is the deeply insular culture of Jeffco Public Schools, which has, since we moved here from Alberta 12 years ago, repeatedly shown that it harshly reacts to criticism, whether from internal or external parties. Put differently, Jeffco represents the antithesis of a high-performance culture.
Over the years the Board of Education has almost always chosen people who appeared to share this culture to be members of the DAC, CAAC, and FOC. In fact, district management first screens people who apply to serve on these governance committees before they recommended appointees to the Board.
This is a system perfectly designed to perpetuate the Jeffco’s toxic, low-performance culture.
The third explanation is one found in many suburbs — strong opposition on the part of some parties (e.g., realtors and economic development officials) to any criticism of their local school district. Better to hide its problems rather than trying to fix them.
Unfortunately, kicking the can down the road works only as long as there’s some road left. When it runs out, you end up like Jeffco.
Conclusion
If the many governance and management failings detailed herein had occurred at a $1.4 billion public company instead of a $1.4 billion school district, it would have been front page news in the global business media, and triggered reactions ranging from an avalanche of litigation (e.g., shareholder derivative suits against board directors) to attacks by activist investors or an outright takeover by a better performing company.
But that didn’t happen.
The K-12 media has been silent, and the business media uninterested in the deepening crisis, management, and governance failures at the nation’s 39th largest school district.
As a result, and despite Jefferson County’s educated, affluent population, the district’s academic performance has deteriorated for years, enrollment has continuously declined (and with it district revenues), and school underutilization has worsened. Yet the number of district employees and total compensation cost have continued to rise.
As Herbert Stein famously warned, “If something cannot go on forever, it will stop.” In Jeffco, it finally has.
The district now faces a severe financial crisis, with forecast budget deficits totaling more than $130 million over the next three years.
Meanwhile, Capital Program cost overruns and spending on projects never disclosed to voters have ballooned to $174 million — and still rising. Millions now must be spent on the schools receiving students from the 16 elementary schools being closed.
Many people would like to blame the multiple crises now facing Jeffco on failures of district management. But this misses a deeper root cause.
The district’s crises refledt the complete failure of Jeffco’s governance processes.
Worse, this governance failure is deeply rooted in the district’s insular and toxic culture, which over the years has been extremely resistant to criticism, much less substantial change.
A $1.4 billion public company in the same situation would almost certainly see its stock price collapse, and then either be acquired or enter Chapter 11 bankruptcy proceedings.
But neither will happen in Jeffco, where Colorado’s regulations for state takeover of school districts are extremely weak (e.g., compared to Massachusetts), and, to avoid bankruptcy, state law provides for the imposition of emergency taxes on county residents when a school district exhausts its financial reserves.
Given the district’s multiple governance failures, and the deeply rooted culture that underlies them, it is difficult to be optimistic, either about Jeffco or the prospects for substantially improving the performance of other school districts that share many of the same pathologies.
And that is very bad news for our nation.
Tom Coyne is an executive at Britten Coyne Partners, a turnaround expert, and a former member of the Jeffco District Accountability Committee. He is married to Jeffco Public Schools Board Director Susan Miller. The opinions in this column are Coyne’s alone.
