DOD Overseas Schools: Compensation Adequate for Recruiting and
Retaining Well-Qualified Teachers (12-DEC-02, GAO-03-19).
The Department of Defense (DOD) overseas schools educate more
than 70,000 children of military service members and DOD civilian
employees throughout the world. In order to ensure the continued
success of this school system, the National Defense Authorization
Act for Fiscal Year 2002 directed GAO to assess whether the DOD
overseas teachers' compensation package is adequate to recruit
and retain qualified teachers. The act also required GAO to
determine whether any revisions to the law governing DOD overseas
teachers' salaries were advisable.
-------------------------Indexing Terms-------------------------
REPORTNUM: GAO-03-19
ACCNO: A05403
TITLE: DOD Overseas Schools: Compensation Adequate for
Recruiting and Retaining Well-Qualified Teachers
DATE: 12/12/2002
SUBJECT: Teacher salaries
Overseas dependents schools
Hiring policies
Employee benefit plans
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GAO-03-19
Report to Congressional Requesters
United States General Accounting Office
GAO
December 2002 DOD OVERSEAS SCHOOLS
Compensation Adequate for Recruiting and Retaining WellQualified Teachers
GAO- 03- 19
DOD overseas teachers* compensation compares favorably to that of U. S.
teachers. In general, DOD overseas teachers receive a standard federal
benefit package, including health and life insurance and coverage under
the Federal Employees* Retirement System. Many DOD overseas teachers also
receive allowances, such as a living quarters allowance, that U. S.
teachers do not receive. On average, salaries for DOD overseas teachers
are higher than U. S. teachers* salaries. Despite the generous
compensation package, there is some dissatisfaction among overseas
teachers regarding health care.
DOD has little difficulty recruiting and retaining well- qualified
teachers for overseas schools. In school year 2001- 02, DOD recruiters
filled over 99 percent of vacant teacher positions. Based on
certification, experience, and education, the quality of DOD overseas
teachers is high. Virtually all teachers in DOD schools are certified in
the subjects or grades they teach. DOD may have some difficulties
recruiting and retaining teachers in a few subject areas and geographic
locations, but any such difficulties do not appear to threaten the quality
of the overseas teachers workforce.
DOD has developed a process for determining and paying teachers* salaries
that meets statutory requirements. Although this system is time- consuming
and burdensome, techniques that could address these difficulties do not
meet legal requirements. Given DOD*s success recruiting and retaining
well- qualified teachers, it is not advisable at this time to revise the
law.
In School Year 2001- 02, DOD Operated 155 Overseas Schools in 14
Countries.
Source: DOD.
England Germany Iceland Netherlands Belgium
Italy Bahrain Portugal Spain
Greece Turkey Korea
North South
Japan
DOD OVERSEAS SCHOOLS
Compensation Adequate for Recruiting and Retaining Well- Qualified
Teachers
www. gao. gov/ cgi- bin/ getrpt? GAO- 03- 19. To view the full report,
including the scope and methodology, click on the link above. For more
information, contact Marnie Shaul, (202) 512- 7215. Highlights of GAO- 03-
19, a report to the
Senate and House Armed Services Committees.
December 2002
The Department of Defense (DOD) overseas schools educate more than 70, 000
children of military service members and DOD civilian employees throughout
the world. In order to ensure the continued success of this school system,
the National Defense Authorization Act for Fiscal Year 2002 directed GAO
to assess whether the DOD overseas teachers* compensation package is
adequate to recruit and retain qualified teachers. The act also required
GAO to determine whether any revisions to the law governing DOD overseas
teachers* salaries were advisable.
Page i GAO- 03- 19 DOD Overseas Schools Letter 1
Results in Brief 2 Background 3 DOD Overseas Teachers* Compensation
Package Is Set by Law and
Regulations and Generally Compares Favorably with That of U. S. Teachers 9
DOD Appears to Have Little Difficulty Recruiting and Retaining
Well- Qualified Teachers for the Overseas School System 18 The Current
Process for Determining and Paying Teacher Salaries
Is Time- Consuming, but DOD Has Little Flexibility to Modify This Process
Because of Statutory Requirements 21 Conclusions 25 Agency Comments 25
Appendix I Scope and Methodology 27 Alternative Techniques for Determining
and Paying Teacher
Salaries 28
Appendix II GAO Contacts and Staff Acknowledgments 35 GAO Contacts 35
Staff Acknowledgments 35
Tables
Table 1: Overseas Educators School Year 2001- 02 Salary Schedule for
Schedule C Employees: Comprehensive Schedule for Educators and Specialists
10 Table 2: Allowances Available to DOD Civilian Employees
Stationed Overseas 12 Table 3: DOD Overseas Teachers* Average Salary
Compared to
Average Salaries of U. S. Teachers by State, School Year 2000- 01 13 Table
4: DOD Overseas Bachelor of Arts Teachers* Starting Salary
Compared to Average Starting Salaries of U. S. Teachers with BAs by State,
School Year 2000- 01 15 Table 5: Number of Districts Sampled by Sample
Size and Strata 29 Table 6: Estimated Margins of Error for Selected Sample
Sizes, at
95% Confidence 30 Table 7. Stability Results Across 3 Years 32 Table 8:
Projections of Mean Salary for School Year 2001- 2002 33 Contents
Page ii GAO- 03- 19 DOD Overseas Schools Abbreviations
AFT American Federation of Teachers DFAS Department of Defense Finance and
Accounting Service DOD Department of Defense DODDS Department of Defense
Dependents Schools DODEA Department of Defense Education Activity FEA
Federal Education Association FEHB Federal Employees Health Benefits FEGLI
Federal Employees Group Life Insurance FERS Federal Employees Retirement
System NCES National Center for Education Statistics NEA National
Education Association OEA Overseas Education Association OFT Overseas
Federation of Teachers OPM Office of Personnel Management TSP Thrift
Savings Plan
Page 1 GAO- 03- 19 DOD Overseas Schools
December 12, 2002 The Honorable Carl Levin Chairman The Honorable John W.
Warner Ranking Minority Member Committee on Armed Services United States
Senate
The Honorable Bob Stump Chairman The Honorable Ike Skelton Ranking
Minority Member Committee on Armed Services House of Representatives
Policymakers are interested in maintaining the high quality of the
Department of Defense (DOD) overseas schools in the future. These schools
educate over 70,000 children of military service members and DOD civilian
employees in 14 foreign countries. In school year 2001- 02, DOD operated
155 schools overseas and employed roughly 6,200 instructional staff. Due
to congressional interest in maintaining the high- quality of education in
these schools, the National Defense Authorization Act for Fiscal Year 2002
directed us to assess whether the DOD overseas teachers* compensation
package is adequate to recruit and retain qualified teachers and to
recommend any necessary revisions to the law governing DOD overseas
teachers* salaries.
To address the issues raised in the mandate, we answered three key
questions:
1. What is the compensation package for teachers in DOD overseas schools,
and how does it compare with compensation for teachers in the United
States?
2. To what extent do DOD overseas schools experience difficulties
recruiting and retaining well- qualified teachers?
3. What is the process for determining teacher salaries and paying
teachers, and which aspects of the process, if any, could be improved?
United States General Accounting Office Washington, DC 20548
Page 2 GAO- 03- 19 DOD Overseas Schools
To answer these questions, we reviewed laws, regulations, and policies on
salary, benefits, and allowances for DOD overseas teachers, as well as for
other federal civilian employees overseas. We also examined DOD
promotional materials, planning documents, and information provided to DOD
overseas teachers. We conducted a literature review on teacher quality,
compensation, and demographics in the United States. We analyzed salary
data on U. S. teachers and DOD overseas teachers, as well as demographic
data on DOD overseas teachers. Finally, we interviewed officials in
several DOD offices and representatives of teachers* unions. We performed
our work between January and November 2002 in accordance with generally
accepted government auditing standards. For additional information on our
scope and methodology, please see appendix I.
The DOD overseas teachers* compensation package is composed of salaries,
benefits, and allowances that are set by law and regulations and, in
general, compares favorably with U. S. teachers* compensation. DOD
overseas teachers* salaries are governed by a 1966 law, which requires
that they be equal to teacher salaries in urban school jurisdictions with
populations of 100,000 or more. As federal civilian employees, DOD
overseas teachers are eligible for a standard federal benefit package,
including benefits such as health and life insurance. Many DOD overseas
teachers are also eligible for allowances that are set by the U. S.
Department of State. For example, they may receive a living quarters
allowance for the cost of rent and utilities, among other expenses. On
average, salaries for teachers in DOD overseas schools are higher than
those for U. S. teachers, and starting salaries for DOD overseas teachers
are nearly 6 percent higher than the average starting salary for teachers
in the United States. U. S. teachers also do not receive the allowances
that many DOD overseas teachers receive. Despite the competitive
compensation package, dissatisfaction exists among DOD overseas teachers
regarding health care access and costs.
DOD appears to have little difficulty recruiting and retaining well-
qualified teachers for overseas schools. In school year 2001- 02, DOD
recruiters filled over 99 percent of vacant teaching positions in the
overseas school system. Statistics on common measures of teacher quality,
such as certification and educational attainment, show that the DOD
overseas school teacher workforce is highly qualified. For example,
virtually all newly hired teachers in DOD overseas schools are certified
in the subjects or grades they teach, and roughly two- thirds of DOD
overseas teachers hold advanced degrees, compared to 46 percent of public
school teachers Results in Brief
Page 3 GAO- 03- 19 DOD Overseas Schools
in the United States. The quality of the DOD overseas teachers may
contribute to the high student- achievement level in these schools.
Studies show that teacher quality is a strong predictor of student
achievement. In general, DOD appears to have little difficulty retaining
teachers. While the agency does not have sufficient empirical data to
confirm the absence of retention difficulties, agency officials we spoke
with said that any retention difficulties the agency has are limited to
specific geographic locations, such as Japan, Korea, and Bahrain. Because
DOD is consistently able to fill vacant positions with well- qualified
teachers, any retention difficulties that do exist do not appear to
threaten the quality of the teacher workforce.
Though the current process for determining and paying teacher salaries is
time- consuming, DOD has little flexibility to modify it because of
statutory requirements. The law requires that salaries be equal to the
average salary for teachers in urban school jurisdictions with populations
of 100,000 or more. On the basis of this requirement, DOD collects salary
data from more than 230 school jurisdictions in incorporated places of
100,000 or more. The agency collects these data through at least January
10 of each school year in order to meet the requirements of an arbitration
agreement with one of the teachers* unions. Because the courts have
interpreted the law to mean that DOD must pay overseas teachers the same
amount for the same year as the U. S. urban teachers, DOD pays teachers
their salary and benefit increases retroactively. Teachers typically
receive these increases at or near the end of the school year. The salary
determination and payment process creates some administrative burden for
the agency. We identified alternative techniques, such as projecting
salaries, that could make this process less time- consuming and less
burdensome. However, DOD cannot use these techniques because they do not
meet legal requirements. Despite any administrative inefficiencies, DOD*s
success maintaining a high- quality teacher workforce suggests that there
is no immediate need to change the law.
The Department of Defense Education Activity (DODEA) oversees all DOD
schools in the United States and abroad. The Department of Defense
Dependents School System (DODDS) is the entity within DODEA that manages
DOD*s overseas schools. In school year 2001- 02, DODDS Background
Page 4 GAO- 03- 19 DOD Overseas Schools
operated 155 schools in 14 countries 1 (see figs. 1 and 2) and employed
roughly 6,200 educators, including both traditional classroom teachers and
instructional staff, such as school psychologists, nurses, and counselors.
Classroom teachers comprise over 90 percent of all DOD overseas educators.
They are represented by two different teachers* unions: the Federal
Education Association (FEA) and the Overseas Federation of Teachers (OFT).
2 Although classroom teachers and instructional staff are paid on
different salary schedules, both groups are subject to the same salary
determination and payment process.
1 DODDS operates schools in Bahrain, Belgium, Cuba, England, Germany,
Greece, Iceland, Italy, Japan, Korea, The Netherlands, Portugal, Spain,
and Turkey. DOD schools in Guam and Puerto Rico are part of the Department
of Defense Domestic Dependent Elementary and Secondary Schools (DDESS).
2 The Federal Education Association is a unit of the National Education
Association; the Overseas Federation of Teachers is an affiliate of the
American Federation of Teachers.
Page 5 GAO- 03- 19 DOD Overseas Schools
Figure 1: DOD European Area Schools
Note: DOD also operates an overseas school in Cuba.
England Germany Iceland Netherlands Belgium
Italy Bahrain Portugal Spain
Greece Turkey
Izmir Lajes
Incirlik Ankara
Larissa, Greece Sevilla
Rota Manama La Maddalena
Livorno Aviano
Vicenza Naples Sigonella Giessen
Hanau Bamberg Schweinfurt Wuerzburg Grafenwoehr Hohenfels Vilseck Ansbach
Garmisch Bad Aibling Spangdahlem
Bitburg Wiesbaden Darmstadt Bad Kreuznach Baumholder Ramstein
Kaiserslautern Heidelberg Mannheim Stuttgart Menwith Hill
Alconbury Lakenheath London Croughton Keflavik Brussels/ Shape Afcent
Source: DOD. Azores
Page 6 GAO- 03- 19 DOD Overseas Schools
Figure 2: DOD Pacific Area Schools Korea
North South
Seoul Osan AFB
Pusan Chinhae
Taegu Yokota Zama/ Atsugi
Misawa Yokosuka Honshu
Kyushu Iwakuni
Sasebo Kadena AFB Okinawa Okinawa
Japan
Source: DOD.
Page 7 GAO- 03- 19 DOD Overseas Schools
Legal requirements and union arbitration agreements form the basis for the
DOD overseas teachers* salary determination process. Prior to 1959,
teachers in DOD overseas schools were paid according to the General
Schedule, the standard pay schedule for many federal government employees.
These salaries did not reflect teachers* academic backgrounds or
qualifications. As a result, DOD overseas teachers* salaries were
significantly lower than those paid to public school teachers in the
United States. Congress attempted to remedy these inequities in 1959 by
passing the Defense Department Overseas Teachers Pay and Personnel
Practices Act (Pay and Personnel Practices Act). 3 This law directed the
heads of each military department in DOD 4 to fix rates of basic
compensation *in relation to the rates of basic compensation for similar
positions in the United States.* However, these rates of compensation
could not exceed the highest rate of basic compensation for similar
positions of a comparable level of duties and responsibilities under the
municipal government of the District of Columbia.
Upon passage of the Pay and Personnel Practices Act, DOD officials met
with representatives of the Overseas Education Association (OEA) 5 and the
National Education Association (NEA) to develop procedures governing its
implementation. In 1960, these parties agreed to establish an annual
review of compensation schedules as compared to the rates of compensation
in urban school jurisdictions with populations of 100,000 or more. 6
Although all parties agreed to this process, annual per- pupil spending
limitations enacted by Congress effectively lowered the compensation paid
to DOD overseas teachers below the salary schedule devised through the
annual review. 7 To correct this problem, Congress amended the Pay and
Personnel Practices Act in 1966 and set into law the
3 Pub. L. 86- 91 (1959). 4 In 1959, the secretary of each branch of the
military was responsible for the overseas schools in that branch. 5 The
OEA was later renamed the Federal Education Association (FEA).
6 This benchmark was used for comparison *because most of the teachers
were recruited from urban areas with a population of 100,000 or more.* See
Crawford v. United States,
179 Ct. Cl. 128 (1967). 7 Each year between 1961 and 1965, DOD asked for
an increase in the per- pupil limitation in order to raise teacher
salaries. Congress granted an increase in full only twice during those
years. According to the historical background included in Crawford v.
United States,
Congress was apparently reluctant to increase the per- pupil limit because
it considered the additional benefits that overseas teachers received as
part of their compensation.
Page 8 GAO- 03- 19 DOD Overseas Schools
procedures that DOD and the teachers* associations had agreed to in 1960.
8 The amendment provides that DOD fix the basic compensation for overseas
teachers at rates equal to the average of the range of rates of basic
compensation for urban school jurisdictions with populations of 100,000 or
more. 9
Since 1966, the DOD overseas teachers* salaries have been the subject of
numerous legal actions. Among the most significant for their impact on
DOD*s salary determination and payment process are a class action law suit
in 1973 and an arbitration decision in the early 1980s. In 1973, seven DOD
overseas teachers sued the U. S. government, claiming that DOD*s methods
for determining teacher salaries were inconsistent with the Pay and
Personnel Practices Act. Specifically, the teachers argued that DOD*s
process of determining teacher salaries based on the previous year*s
salaries in U. S. school jurisdictions resulted in salaries unequal to
those paid to teachers in the United States. The court ruled that timing
was an essential component of compensation and that, therefore, salaries
used for comparison purposes should be from the same school year. 10 The
result of this court case was the establishment of the payment system that
DOD currently uses to determine and distribute salary payments to DOD
overseas teachers.
In 1982, an arbitration decision was issued, which resolved a grievance
the OEA filed relating to the salary schedule that had been set for school
year 1979- 80. In part, the OEA contested DOD*s use of an August 1, 1979,
cut- off date for salary data because it excluded the salary increases
that many U. S. school teachers received in the second half of the school
year. The arbitrator held that by using the August 1 date, DOD did not
meet the statutory requirement that it set salaries *equal to the average
of the range of rates* of the group of teachers identified in the statute.
Subsequently, DOD and OEA reached an arbitration agreement, which requires
DOD to
8 In responding to the committee*s request for comment, the Bureau of the
Budget argued that the amendment would result in rates above the national
average for similar positions in the United States and should include data
from cities with smaller populations, which *would provide a broader and
more realistic comparison with non- Federal salaries and would be more
consistent with practices for other Federal white- collar positions.*
9 Although the amendment states that DOD overseas teachers* salaries be
based on salaries in U. S. urban school jurisdictions with populations of
100, 000 or more, DOD has interpreted this to mean school districts in
urban or *incorporated* places with populations of 100,000 or more. Pub.
L. 89- 391 (1966).
10 March v. United States, 506 F. 2d 1306 (D. C. Cir. 1974).
Page 9 GAO- 03- 19 DOD Overseas Schools
collect salary information for its annual survey through at least January
10 of each school year. The Department of Defense Civilian Personnel
Management Service, Wage and Salary Division conducts this survey and
generates the DOD overseas teachers salary schedule each year. 11
The DOD overseas teachers* compensation package, which includes salary,
benefits, and allowances, is set by law and regulations and generally
compares favorably with U. S. teachers* compensation. Since 1966, DOD
overseas teachers* salary schedules have been set equal to average teacher
salaries in school districts in incorporated places with 100,000 or more
people. Their benefits are set by regulations published by the U. S.
Office of Personnel and Management (OPM). DOD overseas teachers also may
receive allowances determined by the U. S. Department of State and
additional services, such as access to on- base gyms and social clubs. The
compensation package generally compares favorably with compensation for U.
S. teachers. Starting and average salaries for DOD overseas teachers are
higher than those of teachers in the United States. U. S. teachers
typically do not receive the allowances and services that many DOD
overseas teachers receive. While the compensation package generally
compares favorably with that of U. S. teachers, it appears that many
teachers are dissatisfied with access to health care in many overseas
locations.
The Defense Department Overseas Teachers Pay and Personnel Practices Act,
as amended in 1966, requires that DOD overseas teachers* salaries be equal
to average salaries in U. S. urban school districts. DOD overseas teachers
are paid on a salary schedule, which reflects both their level of
education and years of experience. (See table 1 for the school year 2001-
02 salary schedule.)
11 DOD overseas teachers are schedule C federal employees. Pay schedule C
applies to elementary, middle, and high school classroom teachers and
teachers of English as a Second Language, Special Education, Reading
Improvement Specialists, Vocational/ Technical Instructors, and Nurses. In
addition to the schedule C pay plan, using the same survey process, the
Wage and Salary Division creates salary schedules for substitute teachers,
social workers, guidance counselors, psychologists, management and
education specialists, principals, and assistant principals. DOD Overseas
Teachers* Compensation Package Is Set by Law and Regulations and Generally
Compares Favorably with That of U. S. Teachers
DOD Overseas Teachers* Salaries Set by Law, and Benefits and Allowances
Set by Regulations
Page 10 GAO- 03- 19 DOD Overseas Schools
Table 1: Overseas Educators School Year 2001- 02 Salary Schedule for
Schedule C Employees: Comprehensive Schedule for Educators and Specialists
Teachers* Level of Education Step BA BA+ 15 BA+ 30 MA MA+ 15 MA+ 30
Doctorate
1 31,775 32,840 33,905 34,970 36,035 37,100 38,165 2 32,920 34,070 35,225
36,375 37,525 38,680 39,830 3 34,065 35,300 36,545 37,780 39,015 40,260
41,495 4 35,210 36,530 37,865 39,185 40,505 41,840 43,160 5 36,355 37,760
39,185 40,590 41,995 43,420 44,825 6 37,500 38,990 40,505 41,995 43,485
45,000 46,490 7 38,645 40,220 41,825 43,400 44,975 46,580 48,155 8 39,790
41,450 43,145 44,805 46,465 48,160 49,820 9 40,935 42,680 44,465 46,210
47,955 49,740 51,485 10 42,080 43,910 45,785 47,615 49,445 51,320 53,150
11 43,225 45,140 47,105 49,020 50,935 52,900 54,815 12 44,370 46,370
48,425 50,425 52,425 54,480 56,480 13 45,515 47,600 49,745 51,830 53,915
56,060 58,145 14 46,660 48,830 51,065 53,235 55,405 57,640 59,810 15
47,830 50,045 52,325 54,540 56,755 59,035 61,250 16 49,000 51,260 53,585
55,845 58,105 60,430 62,690 17 50,170 52,475 54,845 57,150 59,455 61,825
64,130 18 51,340 53,690 56,105 58,455 60,805 63,220 65,570
Notes: *15+* means 15 graduate credit hours; *30+* means 30 graduate
credit hours. Steps 15, 16, 17, and 18 are not annual steps. Rather, they
are longevity steps payable upon completion of 4 years service in steps
14, 15, 16, and 17, respectively.
Source: DOD.
As federal civilian employees, many DOD overseas teachers are eligible for
a variety of other benefits in addition to basic compensation (salary). In
general, federal civilian employees are eligible to participate in the
Federal Employees Health Benefits (FEHB) program and the Federal Employees
Group Life Insurance (FEGLI) program and are covered by the Federal
Employees* Retirement System (FERS), which includes the Thrift Savings
Plan (TSP). 12 However, not all DOD overseas educators are eligible for
these benefits. The type of appointment a teacher holds can alter the
benefit package he or she receives. For example, federal employees hired
as temporary employees with appointments not to exceed 1 year are not
12 Some employees may be covered under the Civil Service Retirement
System, the Federal retirement program prior to FERS. In general, these
employees were hired by the Federal government before FERS became
effective on December 31, 1983.
Page 11 GAO- 03- 19 DOD Overseas Schools
eligible for health insurance. 13 Although DOD overseas teachers hired in
the United States are mostly permanent employees and therefore eligible
for all benefits, local hires 14 (teachers residing and hired abroad) are
often employed under time- limited appointments. However, local hires who
are on time- limited appointments can be converted to permanent
appointments once they meet all requirements, which allows them to receive
full benefits. In addition, almost all local hires are spouses of military
and DOD civilian personnel and thus receive these benefits indirectly
through their spouses.
In addition to salary and benefits, some teachers are also eligible to
receive allowances such as a living quarters allowance, a post (cost-
ofliving) allowance, and the cost of shipment of household goods and an
automobile. These additional allowances are the same as those available to
other DOD civilian employees stationed overseas and similar to those
available to other federal employees stationed overseas. These allowances
are primarily governed by regulations set by the Department of State. 15
DOD has some flexibility to limit these allowances, but may not exceed the
scope of the regulations set by State. 16 For instance, although State
allows civilian employees overseas to receive an education allowance, the
wardrobe portion of Home Service Transfer Allowance, and the wardrobe
portion of the Foreign Transfer Allowance, DOD overseas teachers do not
receive them. 17 See table 2 for an explanation of each allowance
available to DOD civilian employees stationed overseas.
13 If these employees continue in their temporary positions beyond 1 year,
they become eligible for health insurance. In this instance, the employee
must pay both the employee*s and employer*s share of the premiums.
14 A local hire is an employee who was offered and appointed to a position
in the same foreign area where he or she was already residing. 15 These
regulations are outlined in the Department of State Standardized
Regulations (DSSR). 16 DOD rules concerning these allowances can be found
in the Department of Defense Civilian Personnel Manual 1400. 25- M,
Subchapter 1250, *Overseas Allowances and Differentials.*
17 The wardrobe portion of these allowances is intended to offset the cost
of clothes for those employees relocating to significantly different
climates.
Page 12 GAO- 03- 19 DOD Overseas Schools
Table 2: Allowances Available to DOD Civilian Employees Stationed Overseas
Allowance Description
Advance of pay Up to 3 months salary may be advanced when assigned to a
foreign post. Danger pay Percentage of basic compensation (15, 20, or 25%)
paid for imminently dangerous
conditions when the official U. S. community is the target of political
violence. Difficult- to- staff incentive differential Percentage of basic
compensation (15%) for serving at an agency- determined difficultto- staff
post, which has a 20% or 25% post differential. Educational travel
allowance Allows for one round trip annually between schools attended in
the United States and
the foreign post of assignment, which is primarily intended to reunite a
full- time undergraduate college, technical, or vocational school child
with the employee/ parent serving the U. S. government in the foreign
area. Evacuation payments Paid when an employee/ family member( s) are
authorized or ordered to evacuate a
foreign post. Extraordinary quarters allowance Provided when employee and
family members must partially or completely vacate
permanent quarters during foreign tour due to circumstances that make the
kitchen or entire home uninhabitable. Foreign transfer allowance Available
when transferring from the United States to a foreign area or between
foreign
areas to help defray the cost of moving, such as temporary lodging, meals,
vehicle registration, and a driver*s license. Foreign travel per diem
allowance Consists of lodging, meals, and incidental expenses. Home
service transfer allowance Available when transferring from a foreign area
back to the U. S. as long as the
employee agrees to work 12 more months for the U. S. government. This is
also available to family members who relocate to the United States
following the death of the employee assigned overseas. Living quarters
allowance Provided for private leased quarters in lieu of government-
provided housing intended
to cover most if not all expenses for rent, utilities, and other allowable
expenses. Permanent change of station (PCS) travel Paid when an employee
is transferred or reassigned to another geographical locality
through a permanent change- of- station move requiring a residence
relocation. Post (* cost of living*) allowance Paid when the overall cost
of goods and services at the foreign post are at least 3%
above the cost of the same goods and services in the Washington, D. C.,
area. Post (* hardship*) differential Percentage of basic compensation (5,
10, 15, 20, and 25%) for environmental
conditions significantly worse than the United States. Renewal agreement
travel (RAT) Government furnished round trip transportation for the
purpose of returning home to
take leave between overseas tours upon completion of prescribed tour of
duty and after entering into a new transportation agreement at an overseas
post. Separation travel allowance Government furnished return travel to
the employee*s place of actual residence when
separating from Federal service; employee must meet certain requirements
to receive this allowance. Separate maintenance allowance Paid to help
maintain family member( s) at other than the foreign post of assignment.
Temporary quarters subsistence allowance Assists with *temporary* lodging,
meals, laundry, and dry cleaning in the foreign area
prior to occupying permanent quarters (for up to 150 days) or upon final
departure from the foreign post after vacating permanent quarters.
Sources: Department of State, Summary of Allowances and Benefits, 2001,
and Department of Defense, Joint Travel Regulations (JTR), volume 2.
Generally, these allowances are available only to teachers who are
recruited in the United States. These allowances (except post allowance
and danger pay, which all teachers are eligible for, regardless of where
they are hired) are not considered salary supplements or entitlements.
Page 13 GAO- 03- 19 DOD Overseas Schools
Rather, they are intended to be recruitment incentives for U. S. citizen
employees living in the United States to accept employment in foreign
areas. In each of the last 2 years, over 90 percent of locally hired
teachers were spouses of active duty military or DOD civilian employees.
Thus, though these teachers may not be eligible for these allowances in
their own right, they do receive them through their spouses. Furthermore,
locally hired teachers may become eligible for these allowances if
transferred to a new post.
DOD overseas teachers* salaries compare favorably to U. S. teachers*
salaries. On average, salaries for teachers in DOD overseas schools are
higher than the U. S. national average teacher salary. 18 The average
salary in DOD overseas schools for school year 2000- 01 was $47,460, while
the national average for the same year was $43,250. On a comparative
basis, the average DOD overseas teacher*s salary ranked the twelfth
highest among average teacher salaries in the 50 states and the District
of Columbia for school year 2000- 01. (See table 3.)
Table 3: DOD Overseas Teachers* Average Salary Compared to Average
Salaries of U. S. Teachers by State, School Year 2000- 01
Rank State Average Salary
1 Connecticut 53,507 2 California 52,480 a 3 New Jersey 51,955 4 New York
51,020 a, g 5 Michigan 50,515 a 6 Rhode Island 50,400 a 7 Pennsylvania
49,528 8 District of Columbia 48,488 a 9 Alaska 48,123 10 Illinois 47,865
e 11 Massachusetts 47,789 c
12 DODDS 47,460
13 Delaware 47,047 14 Maryland 45,963 15 Oregon 44,988 b
18 The difference in average salaries may, in part, reflect the higher
level of experience and educational attainment among DOD overseas
teachers, compared to the average U. S. teacher. DOD Overseas Teachers*
Compensation Package Generally Competitive with U. S. Teachers*, but
Health Care an Issue
Page 14 GAO- 03- 19 DOD Overseas Schools
Rank State Average Salary
16 Nevada 44,234 b 17 Indiana 43,000 18 Ohio 42,892 19 Minnesota 42,212 c
20 Washington 42,143 21 Georgia 42,141 22 North Carolina 41,496 23
Wisconsin 40,939 c 24 Hawaii 40,536 25 Virginia 40,247 c 26 Colorado
39,184 27 Texas 38,359 28 New Hampshire 38,301 29 Vermont 38,254 30
Florida 38,230 31 South Carolina 37,938 32 Alabama 37,606 a 33 Tennessee
37,413 34 Idaho 37,109 35 Kentucky 36,688 c 36 Arizona 36,502 37 Iowa
36,479 c 38 Utah 36,441 39 Maine 36,373 40 West Virginia 35,888 41 Kansas
35,766 c 42 Missouri 35,091 43 Arkansas 34,729 d 44 Wyoming 34,678 a 45
Nebraska 34,258 46 Louisiana 33,615 c 47 New Mexico 33,531 a 48 Montana
33,249 49 Oklahoma 32,545 f 50 Mississippi 31,954 e 51 North Dakota 30,891
52 South Dakota 30,265 a American Federation of Teachers estimate.
b Includes employer portion of employee pension contribution where
applicable. c Includes extra- duty pay. d Includes health care
contributions where applicable. e Includes employer pension contribution
and extra- duty pay where applicable. f Estimated to exclude fringe
benefits at 6 percent in Oklahoma.
Page 15 GAO- 03- 19 DOD Overseas Schools
g Median salary includes extra- duty pay. Sources: American Federation of
Teachers and Department of Defense.
In the same year, the starting salary for a DOD overseas teacher with a
Bachelor of Arts (BA) degree ($ 30,700) was 6 percent higher than the
average starting salary in the United States ($ 28,986) for a teacher with
a BA. Furthermore, if starting salaries for DOD*s overseas teachers with a
BA in school year 2000- 01 are included in the ranking of average,
starting salaries in each state and the District of Columbia, the DOD
overseas school system ranked twelfth highest. (See table 4.)
Table 4: DOD Overseas Bachelor of Arts Teachers* Starting Salary Compared
to Average Starting Salaries of U. S. Teachers with BAs by State, School
Year 2000- 01
Rank State Average Salary
1 Alaska 36,293 2 California 33,121 3 New York 32,772 a 4 Delaware 32,281
5 Connecticut 32,203 a 6 District of Columbia 31,889 7 Georgia 31,314 a 8
Illinois 31,222 e 9 Pennsylvania 31,127 10 Massachusetts 31,115 a 11 New
Jersey 30,937 a
12 DODDS 30,700
13 Maryland 30,321 14 Texas 29,823 15 North Carolina 29,786 16 Nevada
29,413 b 17 Michigan 29,401 a 18 Rhode Island 29,265 19 Hawaii 29,204 20
Alabama 28,649 a 21 Virginia 28,139 22 Tennessee 28,074 23 Oregon 27,903 b
24 Indiana 27,311 25 Washington 27,284 26 Missouri 27,173 27 Oklahoma
27,016 f 28 Minnesota 27,003 29 Arizona 26,801 a
Page 16 GAO- 03- 19 DOD Overseas Schools
Rank State Average Salary
30 Colorado 26,479 a 31 South Carolina 26,314 32 Wisconsin 26,232 33
Vermont 26,152 a 34 Louisiana 26,124 a 35 Iowa 26,058 36 Kansas 26,010 a
37 New Mexico 25,999 a 38 Florida 25,786 39 Kentucky 25,027 40 New
Hampshire 25,020 a 41 Ohio 24,894 42 West Virginia 24,889 43 Wyoming
24,651 a 44 Utah 24,553 45 Arkansas 24,469 d 46 Nebraska 24,356 47 Maine
23,689 48 Idaho 23,386 49 Mississippi 23,292 50 South Dakota 22,457 51
Montana 21,728 52 North Dakota 20,675 a American Federation of Teachers
estimate.
b Includes employer portion of employee pension contribution where
applicable. c Includes extra- duty pay. d Includes health care
contributions where applicable. e Includes employer pension contribution
and extra- duty pay where applicable. f Estimated to exclude fringe
benefits at 8 percent.
Sources: American Federation of Teachers and Department of Defense.
While U. S. teachers generally receive similar benefits to those of DOD
overseas teachers, they do not receive the allowances that overseas
educators generally receive, such as the living quarters allowance. In
addition to these allowances, DOD overseas teachers often have access to
military base stores, which sell discounted and duty- free goods, and to
recreational facilities on base, such as gyms and social clubs.
Page 17 GAO- 03- 19 DOD Overseas Schools
Although DOD overseas teachers receive the standard health care benefit
for U. S. civilian government employees, 19 employees stationed overseas
face challenges with regard to health care access. Representatives of
teachers* unions told us that there is dissatisfaction among teachers with
access to health care in many overseas locations. In addition, in July
2001, the Assistant Secretary of Defense for Force Management Policy
reported that *the availability and cost of medical care for DOD educators
employed overseas is a significant problem.* 20 While civilian employees
are often allowed to use military treatment facilities, access to these
facilities for civilian employees is on a space- available basis.
Civilian employees stationed overseas, like the DOD teachers, are limited
to fee- for- service insurance plans because no health maintenance
organizations are available in foreign posts. Whether care is provided at
military or host nation facilities, civilian employees must pay when
services are rendered and request reimbursement by their medical
insurance. This can often mean large out- of- pocket expenses for doctor*s
visits and treatments. 21 In addition, health care providers at military
medical treatment facilities are not recognized as authorized preferred
providers by the health plans available to overseas employees, so
reimbursement rates are often lower than for preferred providers in the
United States. Furthermore, when civilian employees must use host nation
medical facilities, they often face challenges, such as differences in
language, culture, and health practices. For example, a teacher may have
difficulty explaining his or her medical history to a doctor who does not
speak English. DOD is unable to change the health insurance available to
civilian DOD employees, including the DOD overseas teachers, because their
health insurance package is set by a governmentwide policy for civil
servants.
19 Employees who are spouses of active duty military personnel can receive
health care benefits through their spouses. 20 Assistant Secretary of
Defense, Report on Compensation, Allowance Structure, and Access to
Medical Services for DOD School Teachers in Overseas Areas (Washington, D.
C. 2001).
21 Military treatment facilities do bill other insurance companies for
inpatient services, but they do not have the capability to bill for
outpatient services.
Page 18 GAO- 03- 19 DOD Overseas Schools
In general, DOD has been successful in recruiting and retaining
wellqualified teachers. In school year 2001- 02, DOD recruiters filled
almost all vacant teaching positions in overseas schools. The DOD overseas
teacher workforce is highly qualified, with virtually all DOD overseas
teachers certified in the subjects or grades they teach. DOD also does not
appear to have difficulty retaining teachers, although some agency
officials and a representative of a teachers* union suggested retention
difficulties exist in a few specific geographic areas.
In school year 2001- 02, DOD recruiters filled over 99 percent of vacant
classroom teaching positions. More than one agency official we spoke with
confirmed that DOD has little difficulty recruiting teachers for overseas
schools. This year, DOD has received approximately 8,500 teaching
applications, far more than the approximately 900 teaching positions
available. DOD*s success in filling vacancies appears consistent across
the 10 districts in which its overseas schools are located. The lowest
success rate for filling classroom teaching vacancies in school year 2001-
02 was 99.77 percent (for vacancies in the Heidelberg, Germany district),
while 7 of the 10 districts filled all their vacancies for that school
year.
The availability of teachers and the attractiveness of the DOD overseas
schools to potential hires may be factors that aid recruitment. DOD has a
ready supply of potential teachers living abroad. Roughly one- third of
DOD overseas teachers are hired locally. In school year 2001- 02, spouses
of military or DOD civilian employees made up 47 percent of new hires. It
is DOD policy to give them preference over teaching candidates living in
the United States when applying to the system, provided that they are
qualified. DOD overseas schools also have qualities that make them
attractive to teachers. Representatives of teachers* unions indicated in
interviews that the excitement of living abroad combined with the
familiarity of working in an American school attracts many teachers to the
DOD overseas school system. In addition, DOD*s recruitment video cites the
system*s competitive pay and benefits as a reason for joining the system.
DOD Appears to Have
Little Difficulty Recruiting and Retaining WellQualified Teachers for the
Overseas School System
DOD Generally Successful Recruiting Well- Qualified Teacher s
Page 19 GAO- 03- 19 DOD Overseas Schools
DOD*s vigorous recruitment program may also contribute to DOD*s success
attracting applicants. Recruitment activities include job fairs; a student
teaching program; advertisements in professional, military, and on- line
publications; participation in the Troops to Teachers program; 22 and on-
site recruitment at college campuses. In recent years, DOD recruitment
personnel have focused on enhancing the diversity of their teacher
workforce. To that end, they have established student teaching agreements
with Historically Black Colleges and Universities and the Hispanic
Association of Colleges and Universities to attract minority applicants.
As part of its recruitment efforts, DOD has also developed an on- line
application system for teaching candidates in order to facilitate the
application process. Since this system was made available, the number of
applicants to the system has more than doubled. Another important
recruitment tool is the use of advance job offers, offers made to
applicants before actual vacancies have been identified and that do not
specify a job location. The advance offers program is used to help DOD
overseas schools compete with U. S. school districts for exceptional
educators because U. S. schools tend to make job offers well in advance of
the DOD overseas schools. Advance offers are also used to recruit minority
teachers and increase the diversity of the DOD overseas teacher workforce.
While recruitment is generally successful, agency officials and
representatives of teachers* unions have indicated that DOD experiences
some difficulties recruiting teachers for certain subjects, such as
special education, math, and science. It is not surprising that DOD has
some difficulty recruiting teachers for these subjects. According to a
1996 report by the National Center for Education Statistics (NCES), 20- 29
percent of U. S. public schools with vacancies in the subject areas of
bilingual and special education, math, science, and English- as- a-
Second- Language report difficulty filling them.
DOD officials also report challenges filling vacancies in some locations.
According to DOD officials and representatives of the teachers* unions,
areas like Japan, Korea, and Bahrain are not as attractive to teachers
because the culture and language are significantly different from their
own. Of the 20 substitute teachers hired to fill full- time positions by
DOD
22 Troops to Teachers is a federal program that helps discharged and
retired military personnel become certified and employed as teachers in
public schools.
Page 20 GAO- 03- 19 DOD Overseas Schools
in school year 2001- 02, 19 were located in schools in Japan. 23 This
figure suggests that while DOD may be able to fill virtually all of the
vacancies in that country, it must use some nonpermanent teachers to do
so. DOD can fill positions in less desired locations by sending teachers
there from other schools in the system. All teachers sign mobility
agreements upon accepting permanent employment with DOD, which allows the
agency to send them wherever they are needed, though administrators seek
to avoid compulsory reassignment. At the same time, DOD can pay teachers
recruitment bonuses, a tool that could help the agency address any
recruitment difficulties. DODEA recently received authority to pay these
bonuses and has not yet offered any. While it may be more difficult to
recruit teachers for some subject areas and locations, DOD*s success
filling vacant positions with well- qualified teachers suggests that any
recruitment difficulties are relatively minor.
DOD overseas teachers are well- qualified, with virtually all teachers in
DOD schools certified in the subjects or grades they teach. 24 Almost
twothirds of DOD overseas teachers hold advanced degrees, compared to 46
percent of public school teachers in the United States. Further, 73
percent of DOD teachers have at least 10 years of teaching experience.
These well- trained teachers could be a major factor behind the schools*
high student- achievement level, an indication of the strength and success
of the DOD overseas school system. Research has linked teacher quality to
student performance. Data show that students in DOD overseas schools
perform above the national average on the National Assessment of
Educational Progress (NAEP) and the Terra Nova Achievement Test. For
example, in 1998, only two states had a higher percentage than the DOD
overseas schools of eighth graders who performed at a proficient or higher
level on the writing portion of the NAEP. Notably, DOD overseas schools
have made significant progress in closing the performance gap between
minority and white students. Compared to state- by- state rankings of
minority eighth graders in 2000, DOD minority eighth graders ranked second
on NAEP math scores.
23 This figure applies to classroom teachers for school year 2001- 02
only, not to all instructional staff. 24 U. S. General Accounting Office,
BIA and DOD Schools: Student Achievement and Other Characteristics Often
Differ from Public Schools*, GAO- 01- 934 (Washington, D. C.: Sept. 28,
2001). Based on Certification,
Experience, and Education, the Quality of DOD Overseas Teachers Is High
Page 21 GAO- 03- 19 DOD Overseas Schools
Agency officials and representatives of teachers* unions told us that, in
general, DOD overseas schools do not have a problem retaining teachers.
While the agency does not have sufficient data to calculate retention
rates by location, agency officials we spoke with said that any retention
difficulties the agency has are limited to a few geographic areas, such as
Korea, Japan, and Bahrain. In addition, union representatives told us that
teachers who join DOD*s overseas school system generally tend to stay in
the system for many years. Because DOD is consistently able to fill vacant
positions with well- qualified teachers, any retention difficulties that
exist do not appear to threaten the quality of the teacher workforce.
DODEA recently obtained authorization to offer retention bonuses to
teachers, a tool that could be used to address these difficulties. The
agency has not yet offered any such bonuses.
DOD has developed a process for determining and paying overseas teachers*
salaries to meet the requirements of the law and subsequent court cases
and arbitrations. DOD*s process for collecting salary information and
issuing a new salary schedule for DOD overseas teachers takes roughly 8
months. Once the new salary schedule is set, DOD must pay teachers their
annual salary increases, and some allowance increases, retroactively.
Teachers typically receive these retroactive payments near the end of the
school year. The process for recalculating the teachers* salaries and
paying them retroactively causes some administrative burden for the
agency, in terms of both workload and cost.
Each year, in order to meet legal requirements, the DOD Wage and Salary
Division surveys urban school districts for salary data through at least
January 10. It identifies these urban school districts by using the Census
Bureau*s list of incorporated places with populations of 100,000 or more.
For school year 2001- 02, the division surveyed 230 school districts. It
began planning in August, mailed out surveys in October, and continued
data collection* including follow- up calls* through March. The data
collection includes information on the minimum and maximum salary paid to
a teacher with a BA degree, the minimum and maximum salary paid to a
teacher with a Ph. D. degree, the number of pay lanes, the number of
regular and longevity steps, and the number of days in the school year.
With these data, the Wage and Salary Division calculates a schedule of DOD
Generally Appears to
Have Little Difficulty Retaining Teachers
The Current Process for Determining and Paying Teacher Salaries Is
TimeConsuming, but DOD Has Little Flexibility to Modify This Process
Because of Statutory Requirements
DOD*s Process for Determining the Annual Salary Schedule Results in
Retroactive Payments and Some Administrative Burden to the Agency
Page 22 GAO- 03- 19 DOD Overseas Schools
earnings for DOD overseas teachers. 25 As part of the calculation for this
schedule, the Wage and Salary Division reviews the number of steps and
salary lanes in U. S. urban school jurisdictions to ensure comparability.
The survey process takes 12 people a total of 1,680 hours (or 42
workweeks) to complete. The salary schedules for the current school year
are usually completed in April or May. (See fig. 3.)
25 As part of this process, the Wage and Salary Division also collects
salary data and computes salaries for social workers, school
psychologists, guidance counselors, and school administrators.
Page 23 GAO- 03- 19 DOD Overseas Schools
Figure 3: DOD Overseas Teachers Salary Calculation Process Timeline
Once the salary schedules are complete, Wage and Salary Division personnel
meet with representatives from the FEA and agency officials to discuss the
results of the survey. Once all parties agree on the results, the new
salary schedule is issued.
The courts have interpreted the Pay and Personnel Practices Act as
requiring that DOD overseas teachers be paid the same salary that the U.
S. teachers in DOD*s comparison group receive for the same year. Because
School year begins: Teachers receive pay based on previous year's salary
schedule
Fiscal year begins August September October November December January
February March April May June
August: DOD Wage & Salary begins planning to collect wage data from urban
areas of population > 100,000 DOD Wage &
Salary issues new salary schedule DOD meets with
FEA to agree on results of survey DOD
mails surveys to selected school districts in the urban areas
DOD staff makes 2- 3 phone calls to selected school districts to followup/
request completed survey
January 10: Earliest date DOD completes data collection
DOD analyzes data & collects outstanding data
DOD sends salary schedule to Defense Finance & Accounting Service for
processing
DOD Payroll scans for errors
Retroactive salary increases distributed to teachers at end of school year
Sources: DOD, Civilian Personnel Management Service, Wage and Salary
Division, and Department of Defense Education Activity.
Page 24 GAO- 03- 19 DOD Overseas Schools
the salary schedule is typically issued near the end of the school year,
overseas teachers receive their pay increases retroactively. Usually, the
overseas teachers receive these increases just prior to the end of the
school year. In addition, since some allowances, such as the post
allowance, are based on salary, teachers may also receive retroactive
payments for allowance increases.
This retroactive pay process results in some administrative burden for the
agency in terms of workload and cost. First, the process increases the
agency*s workload. DOD spends additional time each year processing,
reviewing and entering the pay and allowance increases. The Defense
Finance and Accounting Service (DFAS) calculates the amount of each
teacher*s new salary and retroactive payments, while the DODEA personnel
office must correct the official personnel forms 26 for all affected
employees. In addition, field staff help recalculate adjustments to any
extra duty pay teachers may have received during the year. 27 Once this
work is completed, the DODEA payroll office receives the data for record
keeping purposes, reviews them, and corrects any coding errors. Second,
the process can complicate DODEA*s management of its budget. Each year,
DOD officials predict how large the retroactive pay increase will be in
order to plan the budget. If this prediction is too low, DODEA personnel
must find the necessary funds to pay for the difference. Because payroll
comprises over 70 percent of DODEA*s budget, this task can be a difficult
one. A large enough difference in the predicted and actual amounts of the
pay increase can have an impact on DODEA*s budget. For instance, in school
year 2001- 02, DODEA officials expected the salary increase to be about
3.6 percent, but it was actually 5.2 percent. As a result, they had to ask
the Office of the Secretary of Defense for the necessary funds to address
this problem. Finally, the process results in some costs to the agency.
DFAS charges DODEA an annual fee for determining and processing the
retroactive pay increases. Last year, this fee totaled roughly $78,000.
26 The Notification of Personnel Action (Standard Form 50), published by
the U. S. Office of Personnel Management, is used to notify employees and
payroll offices of personnel actions and to record the action in the
employee*s Official Personnel Folder.
27 Extra duty pay may be due to teachers who serve as coaches for athletic
teams, or advisors for student newspapers, yearbooks, drama clubs, or
other extracurricular activities.
Page 25 GAO- 03- 19 DOD Overseas Schools
Alternative techniques exist, such as sampling and projection, that could
make the salary determination and payment process less time- consuming and
less burdensome; however, they cannot meet legal requirements. Given the
moderately burdensome nature of the current system, we reviewed the
current salary determination method and explored whether alternatives
could take less time. While these alternatives might be more efficient,
they would not be in compliance with the law. For instance, DOD could
project overseas teachers* salaries each year based on the degree to which
salaries for U. S. urban teachers increased in past years. By projecting
teacher salaries the salary schedule could be completed prior to the
beginning of the school year, rather than near the end. This would
eliminate the need to pay teachers retroactively, thus saving time and
money. However, because projections would not guarantee the same result as
the survey, this method would not meet the law*s requirement that DOD
overseas teachers* salaries be *equal to* the salaries of U. S. urban
teachers. Therefore, DOD would still have to survey the U. S. schools, and
pay any difference between the projections and the survey results to the
teachers retroactively. While alternative methods of salary determination
exist, such as sampling, they would not reduce the workload or
administrative burden. For more information on alternative salary
determination techniques, see appendix I.
DOD overseas schools play a critical role, educating more than 70,000
children of parents in the armed services and the federal civilian
workforce. To date, agency officials have successfully recruited and
maintained a well- qualified teacher workforce for these schools. These
well- trained teachers could be a major factor behind the schools* high
student- achievement level. While the salary determination and payment
process is time consuming and involves some administrative burden, DOD*s
success recruiting and retaining well- qualified teachers indicates that
there is no immediate need to change the law.
The Department of Defense provided oral comments on a draft of this
report. DOD concurred with the content of the report. DOD also provided
technical comments, which we incorporated as appropriate.
We are sending copies of this report to the Secretary of Defense,
appropriate congressional committees, and other interested parties. We
will also make copies available to others upon request. In addition, this
report will be available at no charge on the GAO Web site at http:// www.
gao. gov. Techniques That Could
Make the System Less Time- Consuming and Less Burdensome Cannot Meet Legal
Requirements
Conclusions Agency Comments
Page 26 GAO- 03- 19 DOD Overseas Schools
If you or your staffs have any questions about this report, please call me
at (202) 512- 7215. Other contacts and contributors to this report are
listed in appendix II.
Marnie S. Shaul Director, Education, Workforce and
Income Security Issues
Appendix I: Scope and Methodology Page 27 GAO- 03- 19 DOD Overseas Schools
The National Defense Authorization Act for fiscal year 2002 directed GAO
to assess whether the Department of Defense (DOD) overseas teachers*
compensation package is adequate to recruit and retain qualified teachers
and to recommend any necessary revisions to the law governing DOD overseas
teachers* salaries.
To address the issues raised in the mandate, we developed three key
questions:
1. What is the compensation package for teachers in DOD overseas schools,
and how does it compare to compensation for teachers in the United States?
2. To what extent do DOD overseas schools experience difficulties
recruiting and retaining well- qualified teachers?
3. What is the process for determining teacher salaries and paying
teachers, and which aspects of the process, if any, could be improved?
To answer question one, we reviewed laws, regulations, and policies on
salary, benefits, and allowances for DOD overseas teachers 1 and other
federal civilian employees overseas. We also analyzed salary data on DOD
overseas teachers and U. S. teachers and conducted a literature review on
teacher compensation in the United States. Finally, we interviewed DOD
officials to confirm our understanding of the total compensation package
and eligibility rules related to benefits and allowances.
To answer question two, we analyzed data on DOD overseas teachers (such as
the number of newly hired teachers in each of the past three years; the
number of teachers in each school; the number of teachers hired from the
United States; the number hired from overseas; and the number
1 The Defense Department Overseas Teachers Pay and Personnel Practices Act
fixes the compensation for traditional classroom teachers, as well as
other teaching positions. It defines teaching positions as *duties and
responsibilities which involve*( i) classroom or other instruction or the
supervision or direction of classroom or other instruction; or (ii) any
activity (other than teaching) which requires academic credits in
educational theory and practice equal to the academic credits in education
theory and practice required for a bachelor*s degree in education from an
accredited institution of higher education; or (iii) any activity in or
related to the field of education** In addition, the National Defense
Authorization Act for Fiscal Year 1997 (Pub. L. 104- 201) amended the act
by adding to the definition of teaching position *[ duties and
responsibilities] are performed by an individual who carried out certain
teaching activities identified in regulations prescribed by the Secretary
of Defense.* Appendix I: Scope and Methodology
Appendix I: Scope and Methodology Page 28 GAO- 03- 19 DOD Overseas Schools
who are spouses of DOD military or civilian employees) and reviewed DOD
promotional materials, planning documents, and information provided to
teachers in the DOD overseas school system. We also interviewed DOD
officials and representatives of the two teachers* unions that represent
DOD overseas teachers. Finally, we conducted a literature review on
teacher quality and its relation to student performance.
To answer question three, we reviewed laws, court cases, arbitration
documents, regulations, and policies on the DOD overseas teacher salary
determination and payment process. We also interviewed DOD officials about
implementation of this process and its impact on the agency. Finally, we
explored alternative ways to determine and pay teacher salaries that could
potentially improve efficiency and reduce costs. Specifically, we
considered the use of sampling and salary projection.
We explored stratified sampling as one possible way to determine DOD
overseas teachers* salaries. Using a sample would allow DOD to contact
fewer schools to obtain salary data, thus potentially saving time and
money. Estimates derived from stratified random samples are typically more
precise than estimates derived from simple random samples of the same
size. 2
Currently, DOD surveys 231 urban school districts. DOD provided us with
data on four salary/ education categories, the BA minimum salary (BA min),
the BA maximum salary (BA max), the Ph. D. minimum salary (Ph. D. min),
and the Ph. D. maximum salary (Ph. D. max), for each of the
2 In a stratified random sample, the population is divided into a number
of subpopulations, called strata. An independent probability sample is
drawn from each stratum. In a simple random sample, the independent
probability sample is drawn from the entire population. Stratification
improves the precision of the estimates because the variance within each
stratum is often lower than the variance in the overall population.
Alternative
Techniques for Determining and Paying Teacher Salaries
Sampling
Appendix I: Scope and Methodology Page 29 GAO- 03- 19 DOD Overseas Schools
231 urban school districts it surveyed for school year 2001- 02. We
defined strata by dividing the population, all 231 districts, into three
groups, based on salary data. We defined the low stratum as those school
districts with a BA min value of $28,533 or lower, the high stratum as
those school districts with a Ph. D. max of $62,413 or greater, and the
medium stratum as any district that did not fall into either of the other
strata. This stratification resulted in 60 school districts for the low
stratum and 70 districts for the high stratum; the remaining 101 districts
were placed into the medium stratum.
We examined four different sample sizes: a 20 percent sample, a 30 percent
sample, a 40 percent sample, and a 50 percent sample. For instance, for
the 20 percent sample we selected 20 percent of the districts in the low
stratum, 20 percent of the districts in the medium stratum, and 20 percent
of the districts in the high stratum. Table 5 shows the total number of
sample districts and the number in each stratum for the four different
sample sizes before any adjustment for nonresponse. 3
Table 5: Number of Districts Sampled by Sample Size and Strata Sample
strata 20% sample 30% sample 40% sample 50% sample
Low s tratum12 18 24 30 Medium s tratum21 31 41 51 High s tratum14 21 28
35
Total 47 70 93 116
Source: GAO analysis.
For the four sample size options, we determined margins of error for the
average salaries in each of the four education/ salary categories. The
margin of error is a measure of how precise the estimates of the average
salary are and refers to the fact that these estimates will differ from
the average salary calculated using the overall population. 4 These
margins of error are presented in table 6.
3 There may be some nonresponse with the data because some school
districts may not report data for each salary/ education category. 4 The
margin of error reflects sampling error; it is the error that results from
taking one sample instead of examining the whole population. The smaller
the margin of error, the more precise is the estimate of the average
salary.
Appendix I: Scope and Methodology Page 30 GAO- 03- 19 DOD Overseas Schools
Table 6: Estimated Margins of Error for Selected Sample Sizes, at 95%
Confidence Salary variable of interest
20% Sample stratified
sample size of 57
30% sample stratified
sample sze of 85
40% sample stratified
sample size of 113
50% sample stratified
sample size of 141
BA minimum +/- $793 +/- $605 +/- $486 +/- $397 BA maximum +/- $1831 +/-
$1399 +/- $1122 +/- $916 Ph. D. minimum +/- $924 +/- $706 +/- $566 +/-
$462 Ph. D. maximum +/- $1266 +/- $967 +/- $776 +/- $633
Note: The original sample sizes were increased to account for potential
nonresponse. The nonresponse adjustment takes into account that some of
the values for the four salary variables are missing.
Source: GAO analysis.
For both the 20 percent sample and the 30 percent sample, at a confidence
level of 95 percent, the margins of error in each of the four education/
salary categories were all within +/- $1,900 for the average salary. 5 For
both the 40 percent sample and the 50 percent sample the margins of error
were all within +/-$ 1, 200, at a confidence level of 95 percent. This
means that DOD could reduce the size of the annual survey from roughly 230
districts to 141 6 *in the case of the 50 percent sample* with estimated
margins of error ranging from +/- $397 to +/- $916, depending on the
salary variable. In other words, we would expect with a 95 percent level
of confidence that the average BA min salary calculated from the sample
would be within +/- $397 of the average salary calculated from the entire
survey population.
Initially, DOD would have to survey all districts to define the strata but
in subsequent years it would rely on this stratification to draw its
sample. However, DOD*s efforts to sample would be affected by the
stability of the salary strata used. If the school districts in the sample
frequently changed strata, then over the course of several years of using
the original stratification definitions, there would be increased
variability in the estimation. We tested for stability by using DOD*s
actual data for 3 years,
5 Confidence intervals are used to indicate the precision of an estimate.
If we could take repeated samples from our population and construct a
confidence interval for each sample mean, we can expect 95 percent of the
resulting intervals to include the true value of the population mean.
6 See note on table 6.
Appendix I: Scope and Methodology Page 31 GAO- 03- 19 DOD Overseas Schools
and found that there was a substantial shift of schools across strata over
time.
To examine the stability of our strata, we used the salary data DOD
provided us for each of the urban school districts it surveyed in school
years 1999- 00, 2000- 01, and 2001- 02. Taking the data from the first
year, we grouped the school districts into three strata: low, medium and
high. We defined the low stratum as those school districts with a BA min
value of $27,000 or lower, 7 the high stratum as those with a Ph. D. max
of $57,000 or greater, and the medium stratum as those that did not fall
into either of the other strata. This same stratification scheme was used
for 2 additional years of school district salary data. Thus, the strata
definitions were based on the salary data from the first year. In
subsequent years, some districts moved from one stratum into another. As
they did so, the original stratification no longer reflected the most
recent ranking of the school districts* salaries. As a result, the margins
of error for the average salary in each education/ salary category
increased. For example, the margin of error for the BA min average salary
increased from +/- $440. 60 in the base year to +/- $697.80 in the third
year. In other words, there was a 26 percent deterioration over one year
and a 60 percent deterioration over 2 years for the BA min category.
Considering the four education/ salary categories, the larger the percent
deterioration, the greater the movement of districts across strata and the
less stable the strata. Table 7 shows the increased margin of error over
time, the percent deterioration over time and the salary ranges for each
of the four education/ salary categories.
7 These strata definitions differ somewhat from those used for sample size
determination. For this stability analysis, we developed strata
definitions based on salaries in school year 1999- 00, and determined the
extent of the deterioration of the stratification over time by using three
years of salary data, including 1999- 00. However, for sample size
calculations, we used the most recent data available, school year 2001- 02
salaries, to determine strata definitions.
Appendix I: Scope and Methodology Page 32 GAO- 03- 19 DOD Overseas Schools
Table 7. Stability Results Across 3 Years Variable of Interest
Year I 1999- 2000
Year II 2000- 2001
Year III 2001- 2002 BA Min
Estimated Margin of Error 440.6 557.0 697.8 % Deterioration over Time
(Base Year) 26.4% 58.3% Actual Mean $ 29,124 $ 30,701 $ 31,776 95%
Confidence Interval $ 28,683 * $ 29, 565 $ 30,143 * $ 31, 258 $ 31,077 * $
32, 474
BA Max
Estimated Margin of Error 1, 395.8 1, 411.1 1, 446.0 % Deterioration over
Time (Base Year) 1. 1% 3. 6% Actual Mean $ 43,490 $ 45,778 $ 46,644 95%
Confidence Interval $ 42,094 * $ 44, 887 $ 44,366 * $ 47, 189 $ 45,198 * $
48, 091
PHD Min
Estimated Margin of Error 676.8 731.2 846.8 % Deterioration over Time
(Base Year) 8. 0% 25.1% Actual Mean $ 35,227 $ 36,927 $ 38,169 95%
Confidence Interval $ 34,549 * $ 35, 904 $ 36,195 * $ 37, 659 $ 37,322 * $
39, 016
PHD Max
Estimated Margin of Error 886.0 1, 048.3 1, 167.2 % Deterioration over
Time (Base Year) 18.3% 31.7% Actual Mean $ 55,259 $ 58,106 $ 59,800 95%
Confidence Interval $ 54,372* $ 56, 145 $ 57,057 * $ 59, 155 $ 58,632 * $
60, 968
Note: The percent deterioration was calculated as follows:
% deterioration in one year = margin of error in year I * margin of error
in year II
**********************************
margin of error in year I % deterioration in 2 years = margin of error in
year I * margin of error in year III
***********************************
margin of error in year I Thus, the percent deterioration* increase in the
margin of error* can be gauged from the base year, Year I (1999- 2000), to
Year III (2001- 2002).
Source: GAO analysis of DOD data.
As noted above, the estimated margin of error and the percent
deterioration over time indicate that there was considerable shifting over
time of districts across strata for all salary/ education categories
except the BA max. Consequently, if sampling were used, the strata would
need to be redefined and new samples selected frequently in order to
minimize the
Appendix I: Scope and Methodology Page 33 GAO- 03- 19 DOD Overseas Schools
variability in the salary estimates. To do this, the entire population of
urban school districts would need to be surveyed.
We explored projection as a way for DOD to pay overseas teachers their
current- year salaries from the beginning of the school year, rather than
retroactively. Our projections and the associated margins of error are
shown in table 8.
Table 8: Projections of Mean Salary for School Year 2001- 2002 Variable of
interest Projection
equation Actual mean salary 2000- 2001 Actual mean salary
2001- 2002 Projected mean salary 2001- 2002
Projected mean 95% margins of
error
BA min Y = 1.0557 * X $ 30,701 $ 31,776 $32,411 +/- $2,893 BA max Y =
1.0504 * X $ 45,778 $ 46,644 $48,085 +/- $4,155 PhD min Y = 1.0472 * X $
36,927 $ 38,169 $38,670 +/- $3,851 PhD max Y = 1.0525 * X $ 58,106 $
59,800 $61,157 +/- $5,127
Source: GAO analysis of DOD data.
We made our projections for 2001- 02 based on DOD salary data from school
years 1999- 00 and 2000- 01. We applied a rate- of- change model to the
first two years of data to calculate estimates of the annual rate of
change for each of our four education/ salary categories. Our model took
the form
Y = aX where a is the estimated rate of change X is the salary from school
year 1999- 00, and Y is the salary from school year 2000- 01. Having
calculated values for a, we then substituted in values for school year
2000- 01 for X in order to calculate projected average salaries for school
year 2001- 02. Projection
Appendix I: Scope and Methodology Page 34 GAO- 03- 19 DOD Overseas Schools
As an example, to calculate the projected mean salary in school year 2001-
02 for the BA min category, we used the equation in column two (Y= 1.0557*
X). For X we substituted 30,701, the value in column three, the actual
mean salary for school year 2000- 01. Multiplying this value times 1.0557
(the mean increase for BA min from school year 1999- 00 to school year
2000- 01) gave us the projected mean salary for school year 2001- 02
displayed in column five. This projected mean salary will not be the same
as the actual mean salary, because salary projections include an
assumption about the annual rate of growth in earnings, and this assumed
growth rate is likely to differ from the actual growth rate. In the
particular examples shown, the mean salaries we projected were similar to
the actual mean salaries. 8 However, the projections could fall anywhere
between the confidence limits, indicating the variability attached to
these projections. Table 7 shows that the 95 percent confidence interval
for the BA min salary would range from $29,518 to $35,304.
8 Statistical testing showed that the actual and projected mean salaries
were not significantly different.
Appendix II: GAO Contacts and Staff Acknowledgments
Page 35 GAO- 03- 19 DOD Overseas Schools
Harriet Ganson (202) 512- 7042, gansonh@ gao. gov Melinda Bowman (202)
512- 3542, bowmanm@ gao. gov
In addition to those named above, Elizabeth Field, Barbara Smith, Kris
Braaten, Emily Williamson, Jon Barker, Barbara Alsip, and Patrick
DiBattista made key contributions to this report. Appendix II: GAO
Contacts and Staff
Acknowledgments GAO Contacts Staff Acknowledgments
(130119)
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