Michigan’s K-12 Budget in Major Jeopardy

Gov. Jennifer Granholm on Monday vetoed K-12 school aid payments to school districts that get among the highest per-pupil payments statewide. Some of the 39 districts get more than $11,000 a year per student, almost $4,000 more than poorer districts. They'll now be more in line with the basic foundation grant unless lawmakers override her veto. The cut will cost those 39 districts $51.6 million. Overall, the Democratic governor vetoed $54 million in spending from the budget. School aid payments are to go out Tuesday.

School districts were getting at least $7,316 for each student this academic year until the new K-12 education budget passed this month. Now that Granholm has signed it, most will get the equivalent of $165 less per student, a cut of about 2.9 percent. But some will see even bigger cuts under Granholm's veto — the districts that were spending more on education when Proposal A changed the way schools are paid for in 1994. They've retained their larger payments as the lowest per-pupil amount for students has gradually risen.

The larger cuts double the loss per student for some of the 39 districts, said Brad Biladeau, government relations director for the Michigan Association of School Administrators. "They have no choice but to make severe cuts that will close down classrooms," he said. Losing the extra money would mean $4.9 million less for Livonia Public Schools and a cut of the same amount for the Dearborn City School District. The Walled Lake Consolidated School District would get $4.7 million less and Warren Consolidated Schools would get $3.8 million less. Districts ranging from Saugatuck to Detour and East Lansing also would see decreases.

School officials have said even the $165-per-student cuts will lead to layoffs, crowded classrooms and fewer preschool programs. More districts could face severe financial trouble as they struggle with falling enrollment and a lingering recession. Districts will have the flexibility to trim spending from programs of their choosing as long as they agree to consolidate services to reduce costs. Michigan Education President Iris Salters said the $54 million Granholm vetoed from the school aid budget and the threat of more cuts to come shows the state needs to change how it pays for education and other services. "We have a chronic budget problem, and cuts aren't making it go away," Salters said in a release.

In her letter to lawmakers announcing she had signed the K-12 budget, Granholm warned that unless lawmakers raise more money for schools, districts could see even bigger cuts than the ones included in the bill. State law requires school payments be cut if there's a deficit. She said the shortfall could be as much as $264 million in the $12.9 billion K-12 budget. Some lawmakers have said they plan to raise more money for districts, but they haven't sent any revenue bills to her desk. Lawmakers didn't pass the school aid bill until late Oct. 8, a week after the fiscal year started. “By presenting me a school aid budget for fiscal year 2010, you prevented an immediate fiscal crisis in our public schools. However, unless you act to fully fund this budget, it is only a matter of weeks before that crisis confronts our schools with additional destructive midyear cuts," Granholm warned in a letter to lawmakers.

Michigan is operating under a temporary deal that expires Oct. 31. Granholm has said limited tax and fee increases are needed in a yearlong budget to pay for college scholarships, Medicaid, K-12 education and money local governments use for police and fire protection. Republican Senate Majority Leader Mike Bishop has said he sees no need for additional tax revenue. The governor is waiting on six budget bills Bishop is withholding. Those bills could go to her Tuesday, or later in the week.

Rebutting charges that her veto of $52 million for higher-spending school districts was a political move, Gov. Jennifer Granholm said today the Republican-controlled Senate "left me no choice" but to slash the money. "My veto reflected what I was supposed to do, which is to sign a balanced budget," Granholm said at a news conference this afternoon. The governor added she may have to cut more money from schools once the state treasurer and House and Senate fiscal experts reach a consensus on the recession-caused shortfall in the school aid fund. Those cuts could come in the form of pro-rata reductions as soon as next month.

Most districts are absorbing a $165 per student cut, and the 39 districts that are victims of the veto will lose an additional amount. State Budget Director Bob Emerson said the pro-rata cuts could be as much as $120 per student. The governor made a plea to Senate Majority Leader Mike Bishop, R-Rochester, "to raise the money ($100 million) he pledged to raise" for school aid. She also asked Senate Republicans to consider revenue increases for college scholarships, Medicaid and local police and fire protection. "I ask him (Bishop) not to be rigid but be willing to compromise," Granholm said, flanked by a couple dozen education officials who joined her in a call for more revenue for school aid.

For his part, Bishop said the governor "breached her fiduciary responsibility" by vetoing the money for the 39 districts, money that they were promised to avoid spending reductions under Proposal A school finance reforms passed by voters in 1994. He charged that Granholm's veto amounted to "extortion" and a "full-fledged hatchet job" on these districts. "The veto clearly was done to get a reaction from the Legislature," he said. "The only reaction she wants is a tax increase."

He said the veto "will hit school districts in a way we can't comprehend." Bishop added that he fears the loss of $1.1 million at this point in the school year will especially hurt the Avondale district. "I genuinely fear Avondale will be pushed over the edge with this," he said. The Senate sent to the governor this morning the final six bills to complete the budget for the fiscal year that started three weeks ago. Bishop sent Granholm a letter saying he expects her to sign the bills and warns her not to veto spending items. "Do not veto portions of these budgets with expectation that money will be reappropriated at a later date," he wrote. "There is not sufficient support in the Senate Republican caucus for tax increases, and for you to think otherwise is a mistake."

Granholm has promised to sign the bills but said she's likely to make line-item vetoes. She would not elaborate today on what those vetoes would entail. The spending bills are for higher education, general government, community health, human services, state police and energy, labor and economic growth. The Senate lifted a procedural block to the budget measures without debate. The budget bills are the last of 15 sent to Granholm, who has signed the others with some line-item vetoes. The state has been operating under a continuation budget since Oct. 1, when lawmakers couldn't come to agreement on a budget for the 2010 fiscal year. She urged school leaders, especially in those districts, to call on lawmakers to adequately fund school aid. The governor said 24 school districts are in deficit status.

Oakland County Executive L. Brooks Patterson called the school funding cuts "a stab in the back of public education in Michigan." "Granholm has gone from the 'Education Governor' to the 'Eradication Governor,' " Patterson said. "The gurgling you'll hear during this fiscal year will be the sound of school districts across our region going under." Wayne County Executive Robert Ficano said Granholm should not use schoolchildren as pawns in a political battle over funding for schools. Granholm's veto "may be an attempt to pressure the Legislature to come up with more money for schools," Ficano said in a statement. "Balancing any budget is difficult in these trying economic times. But let's keep our children out of the political process."

Thus, it is clear that if education is the future, the latest cuts to the K-12 budget will hurt many school districts but at the same time, it hurts children who are in need of the resources they can get in these tough economic times that shows education is the gateway to the future. So it’s clear that if the state of Michigan is serious is about funding education than it needs to figure out other ways for the state to generate funds to fund education. Now at the same time, the cuts in funding to education also give many school districts an opportunity to perhaps create public-private partnerships to fund programs in the district that usually districts provide for students. Michigan’s K-12 budget should not prevent us as communities from making sure our youth get the resources necessary to achieve academically and that’s why schools and school district should not simply adjust their budgets to make sure they are balanced for the upcoming school year. However schools and school district should seek partnerships with local businesses, religious groups and others to help fund projects in the district that can help in the progress of student achievement.

Still the budget cuts and the per pupil loses will be painful but it also creates a greater opportunity for school districts to develop strong partnerships that can help deliver the quality of education greater than we have ever delivered it in many parts of the state. It takes a village to raise a child and the latest state budget cuts shows that it will literally have to take all hands on deck to educate our youth like never before. Thus we all have to cheap in to help our youth achieve academically.