States’ Fiscal Woes Raise Anxiety Level on School Budgets

A long-projected revenue chill is beginning to bite in a number of states, putting pressure on education policymakers to defend existing programs—and, in some cases, forcing them to prepare for the worst if budget cuts become a reality.

The causes vary, from slack property-tax receipts in Florida to a chronically sluggish economy in Michigan. But the result is the same: financial uncertainty as school districts head into the 2007-08 school year and begin planning in earnest for the next budget cycle.

Complicating that picture is worry on the part of some economists—reinforced by the continued national housing slump and a gloomy Sept. 7 jobs report from the U.S. Department of Labor—that the worst...