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A regular update from the Edunomics Lab at Georgetown’s McCourt School. 
By Chad Aldeman
Never before have we seen districts spend this heavily on vendor contracts.
 
The monumental surge in contracting is being fueled by the infusion of federal relief funds. Lots of relief money is going to labor, but based on data from our ESSER dashboard, we estimate that 20-30% is going out the district door via contracts for purchased services, curriculum, supplies, one-time-projects, and more. If those numbers hold, that works out to a massive $40-60 billion jump in contracting during the three rounds of funding. 
There’s a clear upside to all this contracting. Some innovative vendors can provide critical tech-based tools to support learning. Also with vendors, districts can add temporary capacity while avoiding recurring obligations. That’s especially important when dealing with one-time money, like ESSER funding.
 
Here’s the problem: in many districts, these contracts deserve more attention than they’re getting. 

It’s the district’s job to ensure those contracts deliver real value for students. It takes effort to write a smart contract

It also requires smart approval processes to clarify costs and outcomes, ensure transparent vetting, align incentives and activities, and create systems to regularly monitor progress. Some districts have used our “Grid” tool during the contracting process to help. (BTW, can anyone help us with a better name for “The Grid”?)
With so many districts stretched to the breaking point, many are shortchanging the contracting process with a slew of no-bid contracts approved without discussion as part of the board’s consent agenda. 

That breeds distrust among stakeholders. There’s no doubt contracts come with real risks to district leaders. We’ve seen too many school boards in hot water or superintendents lose their jobsor even end up in jailover money spent on contracts. Think it can’t happen in your district? Think again.
 
Word to the wise...Be aggressively transparent.
 
A note to vendors: brace yourselves for the end of procurement-palooza. The 2024-25 school year represents a “perfect storm” as ESSER expires. As Marguerite warns in EdWeek’s Market Brief, the coming fiscal cliff could put contracts on the chopping block as district leaders go through their budgets line by line to protect personnel from cuts. Plan accordingly!

And a note to school board members: the district’s finances are your responsibility. We’re here to help...
This 4-part virtual workshop starts Feb. 23rd and is designed to help school board members face an increasingly complex financial landscape and make strategic, sustainable spending decisions on behalf of students. Learn more and register here. Cost is $850. Scholarships are available; best to apply early for those. For questions, please email Jordan.Tollefson@georgetown.edu.

Speaking of contract transparency: Chicago Public Schools maintains a comprehensive contracts database with awards by fiscal year, including those issued under COVID-19 Emergency Authority. The lists are publicly accessible on the CPS website and include links to the contracts.
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As always, please don’t hesitate to reach out with insights or suggestions: Chad.Aldeman@georgetown.edu
Connect with us on Twitter:
@ChadAldeman, @MargueriteRoza, @EdunomicsLab
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Edunomics Lab is a Georgetown University research center exploring and modeling complex education finance decisions to inform education policy and practice.
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