Every Student Succeeds Act (ESSA) and the Calf-Path

The poem, The Calf-Path, by Sam Foss is a delightful poem. The poem can be downloaded in Word below on this page. There is also a soothing reading of the poem at this link to YouTube, https://www.youtube.com/watch?v=ZLWSF-nOvbI  Take 5 minutes and enjoy.

The Calf Path poem is the origin of the phrase, “Paving the cow path.”  This phrase, used in various industries, is applied to situations where new work is being layered onto prior makeshift work, when instead it would be better to redo the underlying work first. 

It is believed that Foss’s inspiration for the poem was the city of Boston. When the city of Boston was new and unpaved the city fathers decided against laying out a regular street plan and instead merely paved the paths that had been worn by cattle. The implication is that this has resulted in a chaotic inefficient street plan that lacks logic. The admonition not to “pave the cow path” is supposed to remind us not to enshrine a makeshift legacy solution. 

The greatest significance of ESSA is that it transfers authority for K-12 education, a great power, from the federal government to states. With great power comes great responsibility. So, ESSA imposes an accountability requirement – states must provide school-level financial reporting. The foundation for that new reporting is an SEA's legacy chart of accounts (COA).  For many SEAs, their COA is the result of many iterations of paving the cow path, and their COA structure is no longer efficient, effective, or flexible.

The phrase, provide school-level financial reporting, to a non-K-12 finance person sounds simple. It is not, for most. For the past 40 years, the National Center for Education Statistics (NCES), a quasi-governmental federal agency, has maintained an excellent lighthouse example of a best practice chart of accounts (COA). Any state education agency (SEA) that rigorously follows the NCES COA specification, and data discipline, could easily comply with this school-level financial reporting requirement. However, few, if any, SEAs significantly follow both the NCES model’s code specifications and data discipline.

Some SEA COA do not include the key component for school-level financial reporting – a location/school code. Others have cow path-like legacy data structures that have evolved based on path-of-least-work priorities, which tend to migrate a data structure from normalized, relational characteristics toward flat file characteristics. In short, their data structures are capable to produce a specific legacy regulatory report, but not new reports to address tomorrow’s questions – and cannot provide useful school-level reporting without much mitigating work to compensate for inadequate accounting data structure.  

Satisfying the ESSA reporting requirement for school-level financial reporting is only the threshold to building a new barn – it is not the barn. Today, many SEAs are consumed with the difficult task of satisfying ESSA’s threshold requirement, as opposed to ESSA’s most significant implication, building the state’s new barn for K-12 education – exercising the state’s new powers. 

SEAs are pursuing school-level fiscal reporting solutions with various workgroups through organizations like the Council of Chief State School Officers (CCSSO) and others. Much of that work is focused once again on the least-time, least-cost solution to produce a single new report to comply with ESSA’s new requirement. The asphalt trucks are lining up to lay another layer of paving upon legacy COA cow paths by the end of fiscal year 2019. Are there alternatives?

The alternative is to do more than just comply — to lead. Use this opportunity to reevaluate legacy COA structure. First, there are questions that need to be asked. The idea of school-level reporting has been around for more than a decade, and the exemplary NCES COA model, which would make that task easy, has been around even longer. So, ask: Why is this such a difficult task for my state? When you drill down on this question, the answer will most likely lead you back to your state’s legacy COA structure. Ask also about ESSA’s goal and intent.

ESSA’s accountability requirement is more than just reporting a total expenditure amount by school. ESSA’s intent is for states to: increase fiscal transparency; include and empower local decision-makers (principals), parents, taxpayers, and other stakeholders in decision-making; and ensure equity, with emphasis on under-served students. 

ESSA’s intent suggests a need for highly flexible, and comprehensive fiscal data and analyses at the school-level, by instructional program, by function for every demographic represented in the student and community populations. Not only does a state need to use a school location code, it needs to have other well-disciplined COA code dimensions for funds, functions, objects, programs, grants, sources of revenues, and for cascade relationships through the layers of administration to classrooms and teachers. 

Today, it is impractical to replace Boston’s cow path road layout with a more efficient design because it would require tearing down all the buildings. Similarly, in some cases, it might be impractical to replace a state’s cow path COA accounting structure with a more efficient and disciplined structure over-night. Here are the practical options:

Most Aggressive for Most Gain – Plan a 3-year course of action to migrate an existing, under-performing COA structure with a highly efficient and effective structure that will better meet future reporting needs. That structure might look much like the NCES COA structure, one that borrows from the best expertise in accounting and technology. 

Fastest Thoughtful Approach – Keep using the COA structure you are using today, and layer on to that a low cost, low effort crosswalk to a reporting model that can help you meet the ESSA requirement before the end of fiscal year 2019. The overlay model can be used to meet many (but likely not all) of the other expectations of ESSA reporting for transparency, decision-support, and equity. The “thoughtful” part of this solution is that working with this model would help an SEA to understand and write an effective requirements document for doing a more aggressive replacement of the existing COA design down the road.  

For any state that chooses to lead as opposed to just comply with ESSA, EduAnalytics would be pleased to help assess your current COA structure, consider the two above options, or partner with you to implement of a long-term solution. Instead of just paving the legacy COA cow path, EduAnalytics stands ready to help you engineer your own new path built on best practices and independent professional accounting and systems expertise. Call us. 

The above text, and a more detailed description of Chart of Account issues, is contained in a downloadable EduAnalytics White Paper below.  Also see the "Engagement" web page.