Policy Changes Can Help Districts Avoid a Funding Cliff

By Kristi L. Bowman

When fiscal year 2012 begins later this calendar year, we will see many school districts hit what education law and policy experts call the “funding cliff ”: Revenue from state and local sources will not yet have rebounded—state and local governments are usually the last to recover from a recession—and the billions of dollars of federal stimulus funding poured into public schools over the past two years will nearly have run out.

Sadly, some districts already have plunged down that cliff.

Consider California, where 16 percent, or 174, of the state’s 1,042 school districts are on what California calls its “financial watch” list. In Illinois, 11 percent, or 94, of the 868 districts are on either the “financial watch” or “early warning” list. Ohio has designated 10 of the state’s 613 school districts to be in “financial emergency,” and Arkansas has labeled eight of its 305 school...