AUSTIN – Teacher incentive pay programs in Texas school districts have produced higher test scores, higher state accountability rankings, improved teacher morale, and less teacher turnover, according to “Paying for Results: Examining Incentive Pay in Texas,” a report released today by the Texas Public Policy Foundation with funding from The Eli and Edythe Broad Foundation.

“In order to lift America’s schoolchildren up to once again be competitive with their peers in other countries, we must focus resources on reinvigorating our public school systems,” said Eli Broad, founder of The Eli and Edythe Broad Foundation. “Nearly every other industry already connects compensation to measurable results – it is time that the education industry also adopts this standard practice to reward our most deserving teachers and better serve our students. This Texas Public Policy Foundation report provides a valuable roadmap for other school districts around the country to effectively provide better pay for better teachers.”

The report features four Texas school districts that have implemented incentive pay programs: Austin ISD, Dallas ISD, Houston ISD, and Lamesa ISD, looking at each district’s history with incentive pay, and its specific approach to program structure, eligibility, goals, and results.

Brooke Terry, an education policy analyst at the Texas Public Policy Foundation and the report’s lead author, said many school districts limit their flexibility to meet district goals by paying teachers with an antiquated single salary schedule that rewards all teachers equally regardless of performance. Some school districts are bucking this trend by strategically targeting their limited resources to attract talent in shortage areas, reward excellent teaching, and improve student achievement.

Strategies include: providing annual shortage stipends to teachers in the high-demand fields of math, science, bilingual education, and special education; offering signing bonuses to top teaching talent; paying stipends to teachers who agree to work in low-performing schools; and rewarding star teachers with sizable bonuses.

“Lamesa’s incentive pay program – the oldest in the state – has produced tremendous gains in reading, math, and science test scores among all grade levels and demographics,” Terry noted. “The incentive pay plan has improved teacher morale to the point where the district even uses it as a recruiting tool.”

The report provides specific policy, logistical, and communication recommendations for other school districts interested in implementing incentive pay programs to improve their local schools and increase student learning.

“Texas students need to compete in a 21st century economy, but school districts continue to rely on a 1920s system for paying teachers that rewards inputs and ignores results,” Terry said. “School board members and superintendents should replace their district’s single-salary schedule with a more flexible compensation system that takes into account subject matter expertise, work ethic, performance reviews, market conditions, and overall ability in the classroom.”

The Texas Public Policy Foundation is a non-profit, free-market research institute based in Austin, Texas.

Brooke Terry is an education policy analyst at the Texas Public Policy Foundation.

The Eli and Edythe Broad Foundation is a national venture philanthropy established by entrepreneur and philanthropist Eli Broad to advance entrepreneurship for the public good in education, science and the arts. Mr. Broad is a renowned business leader who built two Fortune 500 companies from the ground up over a five-decade career in business (SunAmerica Inc. and KB Home). The Broad Foundation’s education work is focused on dramatically improving urban K-12 public education through better governance, management, labor relations and competition.

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