RD82 - Technical Report: Cost of Competing Adjustment for School Divisions in Northern Virginia
Executive Summary: The cost of competing adjustment (COCA) is the recognition of additional costs that certain school divisions in Northern Virginia incur because they compete for staff in a more expensive labor market. Recognition of these costs increases the funding that Northern Virginia school divisions receive from the state. Nine school divisions have received the COCA since the mid-1990s; another nine divisions on the outer perimeter of Northern Virginia have received a reduced or “phased-in” COCA since 2007. The current amount of the COCA is based on how the state compensated its employees in Northern Virginia in the mid-1990s. The Chairman of the Senate Finance Committee requested that the Joint Legislative Audit and Review Commission (JLARC) review the COCA. The Governor’s 2012-2014 budget had proposed not providing the COCA for support personnel although the General Assembly subsequently restored part of that amount. Northern Virginia is the state’s most expensive labor market based on average wages and cost of living, and Northern Virginia school divisions pay salaries that are higher than elsewhere in the state, but typically lower than average salaries in the Washington, D.C. area. Based on changes in Virginia’s economy over the years, the state could refine the divisions it recognizes for a COCA. The state could also update the amount of the COCA that it recognizes through the Standards of Quality (SOQ) formula. Based on three different approaches, the cost to the state could range from about $140 million to $340 million. |
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