UC Berkeley

This study examines contracting out for public services to the private sector and the increased use of consultants as examples of the growing reliance on new public management strategies in public education. Although the extant literature has examined aspects of educational resource inequality, the growing privatization of core educational services, and education facilities bonds, scholars have not yet sufficiently considered the implications of education facilities finance policies for equity or as part of the broader privatization trend. To address these conceptual and topical gaps, this mixed methods dissertation draws on the tools of fiscal sociology and critical policy analysis to examine how California education finance policies have shaped the current system of school district debt financing over time, the sociopolitical factors (such as district median household income) that influence how districts interact with private organizations in the bond process (such as the level of involvement of private organizations and the fees paid to these organizations per student, and how these fees have changed over time), and how school districts’ experiences with school district debt financing policies vary.

Despite record spending on school construction in the decade leading up to the 2008 recession, investment in school facilities attended by minority and low-income students was far less than for their white and middle class counterparts (Filardo, Vincent, Sung, & Stein, 2006). Student access to equitable facilities in many states is largely determined by local wealth, voters’ willingness and ability to raise their own taxes to finance school construction through bond sales, and the nuances of state policies. Though the state of California has improved its educational funding policies over time, inequitable facilities funding persists despite policy reforms. In California, when districts prepare to construct and modernize educational facilities, they typically work with a team of private consultants and contractors to navigate the municipal bond financing process.

Findings indicate that California’s policy goals for providing equitable facilities for students fall short when school districts implement facilities policies, given the inadequacy of state funding mechanisms. The state’s reluctance to equitably fund facilities and the Governor’s plans for impending state disinvestment have allowed for an environment where private actors not only flourish, but also influence the policy process. Shortfalls in state support and training have led to the rise of private actors in the facilities financing industry that have stepped in to fill—and profit from—the void. I find that financial expertise comes at a high cost, particularly for elementary school districts and districts with lower median household income. School districts vary in their ability to pay for financial expertise, and when combined with existing political and ethical problems with a highly variable field of consultants and contractors, the absence of clear state guidance leaves school districts with varying abilities to implement complex state facilities policies, contributing to facilities inequities. When considered alongside the escalating costs school districts are paying for services on the operations side of the budget, these findings help portray the fuller extent to which resources are being transferred from the public to the private sector through contracting in an increasingly neoliberal system that already forces school districts to compete with one another for dwindling state funding.

Though this research has demonstrated that the field of contractors and consultants profiting from contracts with school districts for facilities financing, modernization, and construction is complex and growing, the issue is not whether there is “too much” privatization. Policies that have allowed for the rise of privatization in educational facilities financing and the implications of increasing privatization are far more consequential for educational inequity. I find that privatization impacts the distribution of power and resources between school districts and private actors, and affects facilities outcomes, particularly with regard to equity. California’s leaders will allow facilities to remain inequitable as long as the system for financing schools relies foundationally on disparate local property wealth and as long as school districts feel pressured to pay for financial expertise to navigate and compete within a complicated system. There remains a compelling need for state action to ensure educational equity for all students. I conclude that research on school facilities finance must shift its focus from efficiency and bond election outcomes to a broader consideration of the sociopolitical implications of privatization for educational equity.