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Education Funding

Sour Economy Pinches As ARRA Dries Up, District Survey Says

By Alyson Klein — December 15, 2010 2 min read
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School districts are feeling the squeeze from a still-stuttering economy even as they begin coping with the slowdown in federal funding from the American Recovery and Reinvestment Act, which provided some $100 billion for education, and exhaust the Edujobs fund, which provided $10 billion primarily to stave off layoffs, according to a survey released today by the American Association of School Administrators.

The data shows that the stop-gap efforts couldn’t stave off cuts forever. Now that federal dollars are drying up, districts are still facing shaky revenues.

• Sixteen percent of districts furloughed teachers this school year, and 34 expect similar furloughs next school year.

• Half of districts (48 percent) laid off staff during the 2010-11 school year, and two-thirds expect to do so in 2011-12.

• Three-quarters (77 percent) of districts reported a cut in state/local revenues between the 2009 and 2010 school years. And 82 percent of districts are expecting a cut between the 2010-11 school years.

• Just 6 percent of districts went to a four-day school week in 2010-11 school year, but 17 percent expect they may have to do that next school year.

• More than a quarter (27 percent) scrapped summer-school programs this school year, and 40 percent anticipate doing so in the 2011-12 school year.

• Eight percent closed/consolidated schools for the 2010-11 school year, and 15 percent expect to do so do next year.

There’s been a lot of talk about how pension benefits play into the economic crisis facing schools. AASA surveyed districts about changes to those programs.

• More than two-thirds (68 percent) said that their districts hadn’t changed contributions. Nearly one-fifth (17 percent) reported that their state has reduced its contribution to the state pension plan. Almost one-fifth (15 percent) reported that their state has increased qualifications for pension plans (requiring more years for service and/or older age requirement, etc...).

• Less than one-tenth (5 percent) reported that their district has reduced its contribution to local/district pension plans that their has reduced its contributions to the state pension plan or that the state has reduced its contribution to local/district pension plans.

AASA also asked districts how they are spending edujobs funds:

More than one-third (36 percent) reported that all edujobs dollars are being used in the current (2010-11) school year. One-quarter (24 percent) reported that all edujobs dollars are being saved and will be used in the next (2011-12) school year. One-fifth (21 percent) reported edujobs dollars are being distributed over a two-year period, covering both the 2010-11 and 2011-12 school years.

Superintendent’s policy prescriptions to help schools weather the fiscal storm include items that have long been on AASA’s wish list, such as reauthorizing the Elementary and Secondary Education Act (or providing for regulatory relief if that doesn’t happen) and providing the full federal share of funding to help educate students with disabilities.

A total of 692 school administrators from 44 states completed the survey. The response rate was 20.8 percent.

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