Muddling Through
Why do districts often avoid or delay responding to declining enrollments? Because managing contraction is much more difficult than managing growth. District leaders must confront political conflict, deep-seated professional norms, and internal bureaucratic resistance. While administrators often rely on data (such as birth rates and building capacity) in proposing school closures, community residents typically respond emotionally, wanting above all to save their neighborhood school. Closing schools threatens individual and community interests immediately, whereas the benefits of operating a larger district more efficiently and effectively are not easily articulated and take time to realize. This inherent conflict stands in the way of rational compromise on structural reforms. Then and now, districts can coast for years using “the fine art of muddling through,” to borrow a phrase from the political scientist Charles E. Lindblom.
Between 1968 and 1979, Cleveland lost 63,000 students but postponed all school closings and increased its teaching staff. New York City lost 50,000 students in four years between 1971 and 1975 but closed no schools and increased staffing. Chicago only closed a handful of schools despite losing 96,000 students between 1971 and 1979. Los Angeles also lost 100,000 in eight years but closed no schools.
In smaller districts, the pattern was the same. In the suburbs surrounding Chicago, a district with a peak enrollment of 3,435 in 1969 lost 13 percent of its enrollment in four years (a decrease of 253 students), yet no official record documented the decline in school board minutes, newsletters, or school memoranda during those years. Instead of reducing personnel, the district increased its certificated staff from 168 to 180 people during the decline.
Today, districts of all sizes are following the same pattern.
In New York City, the nation’s largest district is spending $290 million a year to prevent budget cuts at schools that have lost or are projected to lose enrollment, according to a Chalkbeat analysis of Education Department data.
In Austin, Texas, the district has lost 20 percent of its enrollment, more than 17,000 students, over the last 15 years and now faces a deficit amounting to 20 percent of its budget. An analysis for the Austin American-Statesman “found that district leaders spent years delaying difficult decisions as enrollment plummeted—preserving staffing levels, operating dozens of under-enrolled campuses and maintaining programs that became increasingly expensive to sustain.”
By 2025, 24 of the district’s 115 schools enrolled fewer than 300 students, requiring the district to spend $40 million annually to subsidize their continued operation. Even after closing 11 schools last November, the district ended the 2025–26 fiscal year with a year-end deficit of $95 million. After drawing down its reserves to avoid cutting staff, the district projected a $180 million deficit for the 2026–27 school year. The school board approved $205 million in cuts, after adding back over $20 million to the budget through on-the-spot adjustments to ensure a full-time librarian at each school regardless of enrollment. The district claims the remaining $5 million is a “surplus.”
In making the case for proposed budget reductions to the board and the public, Superintendent Matias Segura hardly mentioned enrollment declines and instead blamed the state for not providing sufficient funding to meet district costs. “We’re at a point where there’s very little that we can do to get back to a balanced budget that doesn’t create disruption and ultimately reduce the number of staff in Austin ISD,” Segura said. “And we didn’t get here overnight, and we didn’t get here by accident.”
In California, where enrollment has been declining since 2014, dozens of districts sit on the state’s financial watchlist as they continue spending while enrollment declines. Michael Fine, CEO of the state’s Fiscal Crisis and Management Assistance Team, says no district leaders should be surprised. “Districts all over the state are dealing with many of the same issues. From my standpoint as an advocate of best practice, there should be nobody on the list because the two predominant factors are predictable,” Fine said, referring to declining enrollment and less revenue. “Why weren’t they dealing with these a year ago, two years ago, and three years ago?”
