Traverse City Record-Eagle

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January 31, 2013

School aid fund may have districts making cuts

TRAVERSE CITY — Early revenue projections for the Michigan School Aid Fund suggest public districts throughout the state face another round of tough decisions about next year's budget.

Recent revenue estimates show $200 million less funding for schools across the state in 2013-14 compared to this year, based on a $54 million deficit and the exclusion of $150 million in "one-time" dollars previously promised to districts, Traverse City Area Public Schools Superintendent Stephen Cousins said.

Paul Soma, TCAPS' Chief Financial Officer, said that, if early projections remain accurate, TCAPS could face $1 million to $1.5 million in state funding cuts on top of the district's current $1 million budget shortfall.

"If we just go with those revenues we will be looking at up to $2.5 million in cuts after we've been cutting for years and years," Soma said.

Roughly 100,000 students are enrolled in TCAPS, meaning every $1 million in lost funding results in cuts of $100 per student. But Soma cautioned not to read too much into early projections.

"There is some sense of reality to them but they are estimates and they are subject to change," Soma said. "I never overreact to the first news."

The next step in the state budget process occurs Feb. 7, when Gov. Rick Snyder releases his office's preliminary budget.

Soma will present a projected 2013-14 budget to the TCAPS Board of Education shortly after the release of the governor's preliminary budget.

Board members could face "tough calls" and "difficult choices" at that point, Soma said, adding it's too early to elaborate on what those choices might entail.

"We're holding our breath right now, waiting to hear more information," he said.

Officials from other districts in the region also declined to discuss how their budgets could change ahead of Snyder's budget release.

Frankfort-Elberta Area Schools Superintendent Tom Stobie said his district, an out-of-formula district that receives the majority of its funding from local, non-homestead property taxes, greatly benefited over the last two years from the "one-time" funding allocations.

One of these allocations was called Best Practice Incentive and provided $52 per-pupil funding increases to districts that met 7 of 8 requirements, like offering online instruction to students and obtaining competitive bids for non-instructional services.

It remains unclear whether the Best Practice Incentive and other "one-time" funding sources will be included in Snyder's proposed budget.

"Our hopes are it will continue, but who knows what will happen," Stobie said.

Snyder will introduce his preliminary budget to Michigan lawmakers next month. Appropriations Committees from each house of the legislature then assign appropriations bills to subcommittees for hearings and analysis.

Michael Hill, superintendent of the Traverse Bay Area Intermediate School District, and several other northern Michigan superintendents plan to travel to Lansing on Feb. 13 to discuss public school funding with lawmakers.

"We will be there providing our input," Hill said.

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