Top pay for top teachers: getting and keeping top teachers may depends on how we pay them.

For as long as most can remember, teachers have been paid the same as their colleagues with the same education and experience, whether they are good or bad. Exceptional teachers who inspire students to learn and grow bring home the same pay check as others whose students make little or no progress. Often there is no extra compensation for teaching poor, at-risk students or traditionally hard-to-staff subjects like special education, math and science. All teachers move up the single salary schedule at the same pace.

For years teachers were, and a good number still are, content with this system. They argue that teaching is different from other professions that thrive with competition. In those professions, variable pay creates competition among employees, which ultimately drives them to work smarter and harder. But many teachers argue that teaching is different because teamwork is an important key to success. They predict that when teachers compete for pay, it interferes with collaboration that is so important for student and teacher success. Representative Bill Thompson of South Dakota, a veteran teacher, agrees. "Nothing helped me more during my first few years of teaching than my unofficial mentors. Performance pay would hurt that process."

Over the past decade, however, researchers, policy experts and educators alike have begun questioning the wisdom of the traditional single salary schedule for teachers in light of recent research. Calls for reform come from respected education researchers such as Allan Odden at the University of Wisconsin-Madison; businessmen such as Louis Gerstner, Jr., former head of IBM and the Teaching Commission; policy experts such as Theodore Hershberg at the University of Pennsylvania; and some educators from cities like Minneapolis, Cincinnati and Denver. They argue that it makes good sense to do all that we can to get and keep top teachers--those who really make a difference--by reforming the way we pay them.

State policymakers are calling for reform, too. Just in the past two years, governors from California, Delaware, Georgia, Massachusetts, Minnesota, Mississippi, Rhode Island and Texas have pushed for teachers to be compensated based on knowledge, skills and performance. State legislatures in Florida, Iowa, Minnesota and Texas have, in fact, enacted legislation establishing teacher performance pay programs within local school districts and allocated state funding to support those efforts.

WHY NOW?

Why, after all these years, is now the time for a new approach? Over the past decade, numerous research studies have shown that teaching quality is the most important school-related factor in improving student achievement. With this information, policymakers can now be more confident that policies that help schools to get and keep good teachers will result in better student achievement.

And we must improve student achievement to succeed in the 21st century global economy. An achievement gap stubbornly persists in the nation's schools, where poor students and students of color lag behind. Recent national test results confirm that student achievement in key areas, such as math and reading, has remained relatively flat over the past decade. The nation's business community and math, science and technology experts all are increasingly concerned about this trend. In fact, the National Science Board declared in a February 2006 report, "America's Pressing Challenge--Building a Stronger Foundation," that filling the nationwide vacancy of math and science teachers is of utmost importance. "This nation must make compensation for pre-college science and math teaching competitive with other science, technology, engineering and mathematics career opportunities if we are to recruit and retain the best teachers in science and mathematics," the report argues.

We also know that we are losing teachers--lots of them. The National Commission on Teaching and America's Future predicts that over the next decade, we will lose 2 million of the nation's 3.4 million teachers, mostly through attrition, not retirement. Noted education researcher Richard Ingersoll reports that one-third of new teachers leave after three years in the classroom, and half leave after five years.

States now have better ways to measure student achievement, and therefore teacher performance. Testing is more regular and reliable, and data from those test scores are gathered, aggregated and disaggregated in ways that allow educators to see which students are excelling and which ones are falling behind. Some states, such as Florida, Georgia and Tennessee, also are able to match student data to teacher data to determine which teachers are making a difference. This has helped remove concerns that performance pay might be based on subjective, unscientific methods of assessing teacher performance.

For years, policymakers have struggled with the issue of teacher pay. They have tried to keep their state and local teacher salaries competitive by raising base salary levels. But these raises are not without controversy. They are expensive, and many have argued that they do little to reward and keep good teachers since all teachers benefit from an increase in base salary in the single salary schedule. So many are now saying that the time is right to try a different approach to compensating our nation's teachers.

Iowa Senator Paul McKinley has led the effort for performance pay in his state. He argues that the time is right for reform. "We have students who aren't ready for this global economy, and we have to do something about it. We have a lot of extremely talented, qualified teachers who work day in, day out to make a difference. Recognizing excellence will reward our best and brightest and inspire others to do a better job."

A NEW WAY TO PAY

In general, performance pay systems reward teachers based on their knowledge, skills and performance. The details of how this works, however, are as different as the state or district in which they are implemented. In most cases, teachers participating in the new system receive a base salary similar to their salary under the old system. They also might be eligible for additional pay, sometimes referred to as bonuses, based on meeting certain criteria. This might include teaching in a shortage area or in a hard-to-staff school, exceptional performance, meeting annual student achievement targets, advanced coursework, national certification, professional development, additional responsibility or reaching mastery level. Sometimes it includes team performance or schoolwide successes.

Some systems are based primarily on performance evaluations. Others have multiple factors that trigger pay increases. For example, under Denver's ProComp system, new teachers will start with a base salary of $33,301, and can receive an additional $2,297 for completing a graduate degree or national certification, a $999 bonus for teaching in a hard-to-staff school or subject, and a sustainable $999 for raising student test scores above annual targets. There is no maximum salary for teachers in Denver, unlike in other systems.

In most cases, the new system also looks a bit fragmented, but for good reason. Policymakers have taken a slow, incremental approach to ensure a good design and buy-in from teachers. For example, Denver's ProComp system was the product of a four-year pilot and design phase, and eventually the system earned support from the majority of teachers and taxpayers who funded the effort. Most states implementing performance pay, such as Arizona, Iowa, Minnesota and Texas, have designated underperforming school districts for participation or have allowed school districts to decide whether to opt in and design their own system.

"You want to do it right, so you have to test assumptions," says Senator McKinley. "A poorly designed system allows cynicism to set in and makes teachers question the process."

TRYING IT OUT

In the 1990s, school districts such as Cincinnati, Denver, Douglas County, Colo., Philadelphia and Steamboat Springs, Colo., made headlines with their efforts to revamp their compensation system.

Douglas County became in 1993 the first district to implement a performance pay system. The Douglas County Federation of Teachers and the school board settled on a system that rewarded performance of outstanding individuals and teams. The Douglas County approach is widely viewed as quite moderate in that the district retained most of its single salary schedule, but made satisfactory performance a condition of receiving an increase for years of service, and added a few bonuses.

Denver followed suit when teachers voted to accept a performance pay system in 2004 and voters approved funding in 2005. Denver's ProComp system was fully implemented in January. Current teachers can opt into the system. New teachers are required to join.

Several years ago and early in her career, Andrea Oettinger, a Denver Public Schools teacher, had the opportunity to participate in Denver's pilot program just before full implementation.

"As a new teacher, I really liked the opportunity to earn more if my students made gains. It helped me to set goals for myself and gave me an incentive to meet those goals," she says.

Other districts, however, lost momentum. Steamboat Spring's program never got off the ground as it struggled to design its own performance assessment, and the Cincinnati and Philadelphia systems both suffered from poor implementation, and eventually teachers rejected them.

Despite these setbacks, local school leaders currently are working with teachers in districts all over the country to explore the possibility of district-level reform.

Meanwhile, states are moving forward with reform. There are few local examples from which they can take lessons, and no state has fully implemented performance pay statewide, but governors and legislators are calling for reform. Iowa and Florida made early strides in this arena in 2001, becoming the first states to takes steps toward a performance pay system. Iowa's comprehensive legislation enacted several changes to address projected critical shortages in rural and urban schools in the state. The legislation created career ladders with corresponding salary levels and established a pilot team-based performance pay system providing additional pay when student performance improved. Implementation was halted, however, during the economic downturn, and despite recent efforts, funding has never been fully restored.

This year, the Iowa Legislature passed legislation establishing a commission to recommend and oversee implementation of a new performance pay system. Calling the language too prescriptive, the governor line-item vetoed these provisions and, by executive order, designated Iowa's Institute for Tomorrow's Workforce to carry out similar responsibilities.

This year Florida was set to finally implement E-Comp, a controversial plan that mandated statewide participation and provided bonuses to the top 10 percent of Florida teachers based only on student performance. In May, however, the Legislature replaced E-Comp with a new performance pay plan called Special Teachers Are Rewarded, or STAR. This plan differs by allowing school boards to negotiate with teachers the terms of local programs. The bonuses will still be based largely on student achievement, but the Legislature appropriated enough funding to provide bonuses to at least 25 percent of the state's top teachers. Although this initiative is still unpopular with local unions, many agree that lawmakers made improvements to it.

Arizona also has made strides toward performance pay. In 2000, voters approved Proposition 301 requiring districts to adopt performance pay for teachers. The proposition also included a sales tax increase to fund the reform. Districts are free to develop their own design for the system, and most combine group-level (district, school, or grade) goals to reward performance. However, implementation has not been smooth in all districts. Last session, the Legislature established a 12-member task force to conduct annual evaluations of performance pay efforts.

Minnesota and Texas are the newcomers in this small group of states exploring better ways to pay teachers. In Minnesota, Governor Tim Pawlenty campaigned for compensation reform as part of a larger effort to improve education. Legislators considered several pieces of legislation and enacted a program in 2005 called Quality Compensation for Teachers, or Q-Comp. The system is based on the Teacher Advancement Program, requiring such elements as a career ladder for teachers, professional development and performance pay. Districts and schools must apply to participate.

Senator Steve Kelley, chair of the Senate Education Committee, says the program will ultimately improve results for kids. "It helps send a signal to teachers about school district priorities."

Texas shares a similar story. The Legislature considered performance pay legislation several times, but nothing was enacted. Governor Rick Perry stepped in with an executive order in 2005 requiring the Commission on Education to establish a performance-based pay grant program. Some $100,000 in grants are awarded each year to 100 campuses that show marked improvement in student performance. This May, the Legislature codified the performance pay system during a special session.

Other states, such as Mississippi and Ohio, are considering similar legislation, and Alabama is investigating a performance pay system as part of a comprehensive effort to improve teaching quality.

Whether states can successfully implement a comprehensive statewide performance pay system remains uncertain. Finding the funds and building the political will is difficult. Senator Kelley agrees. He advises legislators to move slowly and involve stakeholders from the very beginning to create political will.

What is certain is that policymakers are interested in reform and are eager to try new, innovative approaches to attracting and retaining high-quality teachers.

RELATED ARTICLE: There's federal funding.

One major obstacle to teacher compensation reform has been funding. Many states already struggle to keep base teacher salaries competitive. Reform efforts in Texas have cost the state $100 million, and the Florida Legislature just set aside $147.5 million for its STAR program. The Minnesota Q-Comp plan has received $86 million in state funding, and Denver property owners are footing the bill for its plan to the tune of $25 million per year.

Now the federal government is supporting the effort. In 2004, President Bush first proposed a $500 million Teacher Incentive Fund as a means to reward teachers and schools making progress in closing the achievement gap and raising student achievement, and to reward those teachers choosing to teach in low-income schools. In early 2006, Congress approved $100 million for the Teacher Incentive Fund.

The specific goals of the Teacher Incentive Fund include:

* Improving student achievement by increasing teacher and principal effectiveness.

* Reforming teacher and principal compensation systems so that teachers and principals are rewarded for increases in student achievement.

* Increasing the number of effective teachers teaching poor, minority and disadvantaged students in hard-to-staff subjects.

* Creating sustainable performance-based compensation systems.

Details of the program were announced on May 1, and states and districts interested in leveraging this federal money to assist with teacher compensation reform scrambled to meet the quick application deadline of July 31. One-year grants will be disbursed in October.

Michelle Exstrom is an NCSL education expert.