Tuesday, February 8, 2011

What does a Billion Dollars Buy? Pennsylvania School Districts Will Soon Find Out

The Harrisburg Patriot-News has an article that all parents and community members of the Ridgway Area School District should read. The Corbett administration is telling school districts that there will be a 1 billion dollar “hole” in education funding for the next school year. Yes folks, that a billion with a capital B! In other words, the money that the Commonwealth gives the school districts as part of the “basic education funding” will be 1 billion dollars less. The ramifications for education across the state, and in Elk County, are enormous. Basically, the Commonwealth will be funding school districts at the 2006-2007 school year level. The reason for the enormous shortfall is explained in detail in the article, but can be summed up easily.

1. The Commonwealth has been using “stimulus” funds for the past two years to supplant State aid in education funding. That stimulus funding is now gone and is not being replaced.

2. The mismanagement of the pension fund by the State government is now impacting the school districts with school district contributions to the fund increasing from approximately 5% to over 20% in the upcoming years. For my blog about the pension “crisis”, please follow this link.

3. State revenues are down because of the poor economy. (As an aside, it is repugnant to me that the current lawmakers in Harrisburg will not consider a tax on natural gas extraction but would rather cut services to citizens of the State. Oh by the way, Pennsylvania is the only state without an extraction tax.)

The school district has been preparing for the day when the stimulus funds “go away”. What does this mean for RASD? The numbers are interesting. The school district gets about 56% of its total budget from the State. Our budget for the current year included $5,176,702 of basic education funding. The basic education funding for 2006-2007 was $4,599,000 and that is what we are being told to expect for the upcoming budget year. That difference, my friends, is large. The district has prepared for this day in the following ways:

1. The district has no debt service and is not planning any building projects in the future.

2. The district has been using a 5 year budget projection model to guide financial decisions for the past two budget cycles. By following the budget projections, the school district has

a. Reduced teaching staff by five positions in the last year.

b. Offered an early retirement incentive that is saving the school district over 2.2 million dollars over the course of five years.

3. The school district budget is 4% smaller than it was two years ago.

4. The school district has reduced spending across all levels of the budget including professional development, supplies, and many other areas.

What does the future hold? “Sacred cows” will have to be on the table for consideration during budget talks. Although Ridgway is not to this level of concern yet, many school districts in Pennsylvania will be forced to consider the following items or they will not be able to stay open. These items include:

1. Class size policies limiting the number of children in the classroom will have to be reconsidered

2. The role of athletics in the school system (“pay to play” or deleting them all together).

3. Art, music, technology or any other class work that is not required for graduation must be looked at.

4. Limit or eliminate all A.P. classes

5. Library services reconsidered

6. World language offerings reconsidered

7. Transportation requirements reconsidered

Again, RASD is NOT to this level of concern yet, but rest assured, there will be school districts in Pennsylvania forced into these types of decisions in the upcoming months. Ridgway Area School District is not in debt and has been planning for this event for two years which puts us in a better situation than most schools in the State. RASD and the school Board never believed that there would be some magical "fix" for the funding crisis after the stimulus money was gone. So the district is in better shape then most. However, the school district is heading into some uncharted territory over the next few years. The political climate in Harrisburg is one that is not sympathetic toward helping public service organizations (large multi-national corporations are another matter). I am confident that RASD will weather the storm, but I anticipate that our educational program will look considerably different at “the other end” of this trying period.

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