States

In Ala. Budget Crisis, It’s Schools vs. Colleges

By Bess Keller — March 07, 2001 4 min read

A compromise between Alabama’s K-12 schools and the state’s higher education community failed to gel in the legislature late last week, leaving colleges and universities more likely to bear the brunt of more than $260 million in mandated budget cuts this fiscal year.

Earlier in the week, the higher education institutions escaped—at least temporarily—an even bigger hit when the Alabama Supreme Court stayed a lower court order that had blocked cuts to almost all K-12 expenditures. The court order resulted from a lawsuit brought by the Alabama Association of School Boards and individual school districts.

The stay was granted after an appeal from Gov. Donald Siegelman and several universities. The suit is now before the state high court.

Those events widened the rift between the state’s two education sectors, which share a trust fund fed by sales and income taxes. When revenues from those taxes sag, as they started to do at the end of last year, state law requires proportionate cuts to education spending.

Faced with controversy over the reductions he announced at the beginning of last month, most notably the lawsuit, the Democratic governor called the legislature into special session on Feb. 22 to deal with the education funding crisis. At the same time, Gov. Siegelman put forward a package of bills that he said would moderate the effect of the $266 million in cuts he was obliged to make to the combined $4.3 billion budget for K-12 and higher education.

When that package stalled last week in the legislature, which is controlled by Democrats, the governor proposed a modification to it designed to soften the blow to the state’s colleges and universities. That attempted compromise would have provided higher education institutions with a state bond issue of $60 million to make up for some of the money they would lose under his budget-cutting plan.

“This plan is fair to K-12 and it is fair to higher education,” the governor argued at the time.

But university presidents rejected that modified proposal, complaining that bonds would unwisely mortgage their future operations, because the money would have to be paid back. As a result, lawmakers declined to take up the proposal.

The special legislative session was set to end on March 5. The governor said last week that if the session closed without legislative action on the education cuts, he would carry them out according to an opinion of the state attorney general rendered at the governor’s request last week.

The opinion states that salaries of all K-12 public school employees must be protected from any cutbacks, an interpretation that would have the effect of deepening the reductions to colleges and universities.

If the state winds up implementing cuts conforming to that opinion, the nearly $3 billion that the state is slated to spend on K-12 education in the current fiscal year would fall by about 4 percent. Higher education, meanwhile, would suffer cuts totaling roughly 11.5 percent of its state funding, state officials say.

Sharing the Pain

Under the proportional cuts required by current law, the K-12 and higher education sectors would have faced equal reductions totaling 6.2 percent of their budgets.

Even though lawmakers failed to embrace the modified version of the governor’s plan, as of late last week they still had before them his original Feb. 22 package. Under that plan, K-12 education would be cut by an estimated 4.4 percent while colleges and universities would undergo a projected 9.9 percent reduction.

Some legislative leaders last week acknowledged that the battle between advocates for the two education sectors had been fierce.

“The two groups are basically at each other’s throats,” said Jeffrey B. Woodard, the chief of staff for House Speaker Seth Hammett, a Democrat who is also the president of a state community college. “The influence of higher ed is stronger in the Senate,” he added.

Others have noted that House members have often lined up behind the Alabama Education Association, the National Education Association affiliate that represents most of the state’s public school teachers. In the debates, many House members have held that colleges and universities have more money in reserve and greater flexibility in raising and spending money than public schools do, and therefore can better absorb short- term cuts.

Even the more moderate cuts “stand to cripple K-12, and we are already one of the most poorly funded school systems in the country,” said Susan Salter, the spokeswoman for the Alabama Association of School Boards. She added that districts are under pressure to meet academic standards that the state has raised in the past several years.

But a representative of the state’s public colleges suggested last week that they could ill afford to bear the brunt of the cuts.

Lawsuit Threatened

Proposals to safeguard K- 12 employees from salary cuts “leave our instructors in an unprotected position, but put K-12 teachers in a protected area,” said Gordon Stone, the executive director of the Higher Education Partnership, which represents all 15 of Alabama’s public colleges and universities. He said the state’s colleges and universities would file suit if the state carries out the cuts according to the attorney general’s opinion.

Meanwhile, Sandra Sims-deGraffenried, the executive director of the school boards association, laid the blame for the legislative impasse on a lack of planning. “We didn’t have a game plan that was firm and set,” she said, “and as a result, we’ve had lots of filibuster, controversy, and somewhat of a tug of war.”

The shortfall problem is not likely to correct itself in the near future. The latest revenue figures show two major components of the education fund—collections from the sales tax and corporate income taxes—down 3 percent compared with a year ago. The fund also draws on individual income taxes, which were up over a year ago, but which generally show the effects of an economic slowdown later than the other two revenue sources.

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A version of this article appeared in the March 07, 2001 edition of Education Week as In Ala. Budget Crisis, It’s Schools vs. Colleges

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