Association for Public Policy Analysis & Management

In 2015, the 84th Texas legislature created Texas Education Code 12A Districts of Innovation, which granted public schools the ability to operate with flexibility comparable to existing Texan charter schools (TASB Legal Services, 2017). Prior to 2015, traditional Texas public schools were subject to restrictive regulations typical of most public schools across the US. This contrasts with the flexibility available to their charter counterparts, which are typically able to create their own hourly and daily schedules, hire untraditional and uncertified teaching candidates, and set their own standards for teacher-student ratios. However, after the 2015 passage of Texas Education Code 12A, school districts can now access these flexibilities by submitting a school board-approved District of Innovation plan. To date, over 700 districts have taken the state up on this offer.

The Texas District of Innovation law was motivated by charter schools proponents, who have argued that freedom from regulation allows for innovations within charter schools, which in turn spur academic achievement for students (TASB Legal Services, 2016). While there is suggestive evidence that flexibilities in staff contracts and instruction time help charters increase student academic achievement (Abdulkadiroǧlu et al., 2011; Angrist et al., 2016), less is known about whether the flexibilities granted by charter school policies are generalizable to traditional public schools.

This paper, the first to describe and evaluate the impact of the Texas District of Innovation law, aims to understand which districts choose to pursue District of Innovation Status and which laws they choose to exempt themselves from. To do this, I use a rich set of administrative data to examine factors which may lead districts to pursue specific exemptions. To identify the impact of deregulation, I use a difference-in-difference design comparing change over time in Innovation districts versus traditional public schools that declined to pursue Innovation status. For robustness, I also use the same difference-in-difference design to compare the Innovation districts to charter schools which were already broadly exempt from state education regulations.

The Texas context is a unique opportunity to study the effect of deregulation and to understand how districts would use flexibility from regulation if given the opportunity. These results have important implications for ongoing charter school debates and for the design of regulations on traditional public schools across the country.