Districts Report Bad News on Finances

(From Christina A. Samuels’ District Dossier blog, published at edweek.org. Click here for the main page of her blog.)
 

By Christina Samuels on June 29, 2011 7:41 AM 

School districts are facing a grim financial future, and the situation won’t get better any time soon, according to a survey of more than 400 districts conducted by the Washington-based Center on Education Policy.

The American Recovery and Reinvestment Act pushed off the inevitable for many districts, but those funds are disappearing, while state and local revenue continues to plunge. About 84 percent of the districts surveyed anticipate funding cuts in school year 2011-12, and the cuts are being seen in all types of districts: urban, rural and suburban.

“School people are just running out of ways to limit spending,” said Jack Jennings, the organization’s president and chief executive officer, in an interview. “They’re just at their wits’ end.”

Released today, the nationally representative survey of school districts was conducted between February and May of 2011. Surveys were sent to 955 districts and 457 districts responded. Because the sample was random and survey results were weighted, the findings can be generalized to school districts across the country.

Mr. Jennings said the center was anticipating about 400 responses, so was surprised that more than 50 more district leaders responded to the survey. “School districts want the public to understand what’s going on,” he said.

About 70 percent of districts received less money in 2010-11 than they had the year before. For the 2011-12 school year, 84 percent of districts anticipate funding cuts, the survey found. And federal stimulus funds are no longer a cushion for districts. States and districts are required to spend their stimulus money by Sept. 30, 2011.

Looking back to the last school year, about 85 percent of districts with funding decreases in 2010-11 made some type of staff cuts. Those districts represented about 53 percent of all districts in the country.

Districts tried to tilt staff reductions toward teachers of noncore academic subjects: 68 percent of the districts making cuts did so in those areas, while 54 percent made staff reductions in core areas. Districts also furloughed teachers and reduced benefits to save money.

Looking to the upcoming school year, about 57 percent of the districts anticipating funding reductions plan to specifically cut teaching jobs; 50 percent plan to cut administrative staff.

The closest parallel to today’s weak economy is the recession of the early 1980s, which was marked by high inflation and President Reagan’s cut in federal education spending. But this recession is deeper and broader, Jennings said. Plus, “far more is being asked of the schools, and they’re getting less money.” Districts should start working on sharing cost-cutting ideas with each other, because the downward trend is expected to continue for the near future, he said.

The survey did note that school officials tended to appreciate the federal stimulus, Eighty-nine percent said their district was better off for having received the money, even though the funds may have just delayed inevitable staff reductions for two years.

“But two years ago, people were concerned about going into a depression,” Jennings said. “The stimulus helped. Unfortunately, the federal government isn’t coming to the aid of school districts anymore.”

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