Published Online: March 1, 2010
Published in Print: March 3, 2010, as School Funding on Block Again as States' Fiscal Pain Continues

K-12 Cuts Loom Again as States' Fiscal Woes Continue

With Budget Gaps Growing, About Half Expect K-12 Cuts

Budget pressures still have a tight grip on most of the states and are already leaving governors and lawmakers little choice but to cut as they prepare, debate, and settle on new funding for public schools.

About half the states are poised to slash spending on K-12 education in fiscal 2011, while another handful are expected to keep funding level for public schools, said Daniel G. Thatcher, a fiscal and education policy associate at the Denver-based National Conference of State Legislatures.

Only a small number of states—Massachusetts and Pennsylvania among them—are proposing any kinds of increases, and those are modest, he said.

It may be several more years before many states begin to see their revenues recover from the recession that officially began in December 2007, and that grim fiscal reality could result in widespread teacher layoffs and spikes in class sizes in school districts across the country, Mr. Thatcher said.

And in the coming budget year, as federal economic-stimulus money from the American Recovery and Reinvestment Act begins to recede, budget gaps in many states could grow even wider. For fiscal 2011, the estimates for 35 states put their collective budget gap at $55 billion, according to the NCSL.

U.S. Secretary of Education Arne Duncan said late last month that he is “very concerned” about such fallout.

“I worry, literally, about hundreds of thousands of jobs this fall,” Mr. Duncan said during a meeting with some of the nation’s governors in Washington.

‘Classroom Experience’

In Virginia, Gov. Bob McDonnell, a Republican who took office in January, has proposed deep cuts to K-12 funding as part of his plan to close a roughly $2.2 billion shortfall in the upcoming two-year budget. His proposal, which has sparked widespread protest from education advocates across the state, would carve $731 million out of the $11.4 billion public schools’ budget over the next two years.

Gerard Robinson, Mr. McDonnell’s appointed education secretary, wrote a letter to educators around Virginia to justify the governor’s proposed K-12 reductions. Public schools, he wrote, bore little or none of the brunt of spending cuts in recent years, while other government services had been cut significantly.

“Governor McDonnell came to the conclusion that in order to fairly distribute necessary spending reductions, K-12 would have to participate to a larger extent than in previous years,” Mr. Robinson wrote. “Based on prior increases in spending over the past decade, we are confident that these reductions can be absorbed while the classroom experience for our young people remains at the highest level.”

The Virginia Education Association, however, strongly disputes any suggestion that the decreases, if adopted, would spare the classroom. The 60,000-member affiliate of the National Education Association estimates that as many as 28,000 school-based jobs would be shed. Budget-writing committees in Virginia’s House of Delegates and Senate late last month adopted smaller cuts to K-12 education than those pitched by the governor, but the two houses must resolve their competing budget plans by the middle of this month.

In a written response to Secretary Robinson, VEA President Kitty Boitnott contends that while K-12 spending was lowered in the last budget cycle, federal stimulus dollars backfilled most of those reductions.

“But that money is gone and the cuts now remain,” she wrote.

Some states, such as Alabama, held off on spending all their stimulus money in fiscal 2009 and 2010, as a way to avoid the so-called “funding cliff” when the aid ends and to help soften the blow in fiscal 2011 and beyond.

“What we decided to do was prorate our education budget so that we would have some of that money to put into our 2011 budget,” Alabama Gov. Bob Riley, a Republican, said in an interview.

Still, Gov. Riley said, his state will probably have to continue to make K-12 spending reductions, especially if no more federal stimulus dollars materialize.

“We’ll have to look at things like rotating our school buses every 12 or 13 years, instead of every 10 years,” he said.

New Jersey Impact

In New Jersey, Gov. Chris Christie—Virginia Gov. McDonnell’s fellow Republican newcomer—has also roiled the K-12 community with a recent executive order to halt $475 million in aid to schools. The move will force school districts to tap their surplus and rainy-day funds to make up the shortfall. The governor must close a $2.2 billion gap in the state’s roughly $29 billion current budget.

Like Mr. McDonnell, Gov. Christie maintained that the cuts would not harm schools this year, but education groups said the fallout would hit districts hard in fiscal 2011, especially if speculation that the governor’s new budget would seek further reductions in school spending proves true. Gov. Christie is slated to release his fiscal 2011 budget plan on March 15.

“Next year, our schools will be starting from a deficit position because of the executive order,” said Steven Baker, a spokesman for the 203,000-member New Jersey Education Association, an NEA affiliate. “And we have no idea yet how much of a cut we might be facing when the governor releases his new budget.”

Mr. Baker said districts are being told to prepare for a 15 percent reduction in K-12 spending in fiscal2011, a scenario that would be a “double whammy.” In the Cherry Hill district, for example, officials are preparing for teacher layoffs that could number nearly 200 out of a teaching corps of 1,200, he said.

California Pain Continues

In California—where public schools have collectively lost $17 billion in state aid over the past two years—district leaders, community organizations, and education advocacy groups are mounting a fight against what they warn would be another $3 billion blow to K-12 funding in Gov. Arnold Schwarzenegger’s budget plan for 2011.

The governor, a Republican who will leave office early next year because of term limits, proposed an $83 billion spending plan that he said spares public schools from further spending cuts by meeting the state’s Proposition 98 school funding guarantee.

But education officials said that would be the case only if the governor carried out a proposed change in the state revenue structure that would effectively lower the bar for its obligation to schools and community colleges.

To fight back, two different groups—in strongly worded letters to Secretary Duncan—are asking federal education officials to scrutinize the governor’s proposed K-12 spending as they review California’s application for its final share of the stimulus program’s State Fiscal Stabilization Fund.

The groups assert that the governor’s budget writers are using accounting maneuvers that give the appearance that California will meet the so-called “maintenance of effort” provision of the federal economic-stimulus law. That provision requires states to preserve K-12 funding at no less than 2006 levels. Maintaining that minimum funding is a condition for states to receive money from the stabilization fund.

The letter delves into technical accounting issues, but basically asks Mr. Duncan to enforce the maintenance-of-effort rules so that the K-12 cuts would not be so severe next year.

“We greatly appreciate the federal government’s investment in schools,” the letter says. “In this time of brutal state cuts to education, federal American Recovery and Reinvestment Act funds have served as a lifesaver for California students and schools. We also understand the federal government must be sensitive to the financial problems faced by states.

“However, the maintenance-of-effort assurance that California recently submitted to your office,” the letter continues, “seems to seek federal cooperation to cut schools disproportionately and with impunity.”

Vol. 29, Issue 23, Pages 15,18

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