Contracted Out: An unprecedented look at Maryland public school spending

Billions of local, state and federal tax dollars go to funding Maryland’s public schools every year — and now, it will be easier for you to find out how your local school district spent that money.

That’s because the Local News Network at the University of Maryland has published an easily searchable database where you can look up your school district’s vendor payments over the past four years.

That database and an accompanying series of stories comprise “Contracted Out,” a project compiled over the past seven months by students and faculty at the UMD Philip Merrill College of Journalism. The “Contracted Out” database provides a comprehensive and unprecedented itemization of school contract spending statewide.

“If there is any corruption out there, it’s through these contracts,” said Marguerite Roza, director of Georgetown University’s Edunomics Lab, a research institute that studies education funding data.

“Contracted Out” gives local journalists and the general public something they’ve never had before: an easy way to review school district vendor payments.

The “Contracted Out” database contains information from all 24 public school districts in Maryland, with the ability to break out individual districts. The database includes every vendor that was paid over $25,000 by each district between the 2018-2019 and 2021-2022 school years.

The Local News Network turned more than 26,000 rows of raw data into news the public can use. School district payments for health insurance, buses, computers and meals — it’s all there.

Still, there are limits to the data:

• Vendor payments account for only a small portion of school funding in Maryland or any other state. Roza said the vast majority of school spending — 80% to 90% of it — goes to teacher and staff salaries, not vendors.
• The data used to construct the “Contracted Out” database — most of it obtained through the state’s Open Data Portal — lacks detail. Most districts only have to report payments of more than $25,000, the name of the vendor and the zip code where the vendor is based. A quirk in state law requires only Baltimore County Public Schools to say why they spent what they spent.
• School districts have differing policies regarding which services they contract out and which they handle in-house. For example, some districts have their own bus fleets while others hire contractors to transport students.
• Districts also disagree on what constitutes a vendor payment. Most notably, some list state and federal taxes as vendor payments, but others exclude them from the data. For that reason, any district-by-district comparison of overall vendor payments would not be statistically valid.

Even so, the data that’s online serves a useful purpose, said Matthew Streett, assistant director in the state’s Office of Legislative Audits.

“I look at it from a transparency and accountability standpoint,” Streett said. “The public wants to know where their taxpayer dollars are going when it comes to educating students.”

Streett’s office routinely audits school district spending, as do district officials and inspector general offices in individual counties. Meanwhile, the Office of the State Inspector General for Education performs audits based on tips about possible wrongdoing. You can find details about some of the recent audits here.

Those audits can spot big trouble. For example, an internal review of contracting in Montgomery County Public Schools last year found evidence of irregularities in the district’s transportation department. A criminal investigation then led to a guilty plea to a felony theft charge by the department’s former assistant director, as well as a guilty plea to a misdemeanor charge by the department’s former director.

But the checks and balances on school spending don’t depend primarily on auditors and investigators. School boards review and authorize vendor payments, said Milton E. Nagel, executive director of the Maryland Association of Boards of Education.

“Maryland procurement laws apply to school districts,” he said. “School districts can’t go out and stroke a million-dollar check to a vendor without going through a bid process.”

But Roza said school boards rarely go over vendor contracts line by line.

“They end up going into a consent agenda, and the whole board goes, ‘Everybody want to approve the 91 contracts that we have coming before the board this month? All in favor? Aye,’” she said.

In most states, those contracts are published only in a school board’s minutes, not online like in Maryland, Roza said.

But the Local News Network found big problems with the school contracting data on the state’s Open Data Portal.

When work on the project began in January, huge chunks of data from four of the five largest school districts in the state were missing. Data was missing from several smaller districts, too — even though a 2019 act of the General Assembly requires districts to report vendor payments of over $25,000 with the Department of Budget and Management.

Student journalists and Local News Network Director Jerry Zremski spent months prodding districts to comply with the law and provide the missing data. The last to do so, Baltimore City and Baltimore County, didn’t do that until early June.

Derek Willis, lecturer in computational and data journalism at Merrill College, then completed the work his students had begun: cleaning up the data so that every vendor was listed by the same name.

A team of 38 student journalists reviewed the incomplete data before the spring semester ended and Zremski studied the late-arriving data.

Their key findings will be included in the accompanying stories, but local journalists around the state and citizens may also want to take a close look at the data. As Roza noted, the people closest to the local school districts — reporters and citizens who live in those districts — will be the ones most likely to spot questionable vendor payments.

In doing so, Roza said, people should remember one thing about school district vendor data: scandal can be rooted in them. She cited a case from Chicago, where the former CEO of the public school district ended up spending nearly three years in federal prison because she steered tens of millions in no-bid contracts to her friends.

And Richard Henry, the state’s inspector general for education, encouraged the public to contact his office if they see anything in the contracting data that seems suspicious.

“I always encourage individuals to give us a call, and if they want to remain anonymous, they can remain anonymous,” Henry said. “We continue to encourage outreach to all members of the education profession throughout the state and throughout the county governments to report any type of waste, fraud and abuse.”