Cliff-Notes on the "One-Two Punch!" (Non-compliance Race to the Top)

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'Funding Cliff' Looms Large for States

Michigan Gov. Jennifer Granholm talks about school funding cuts along with state budget director Bob Emerson, left, during a press conference in Lansing, Mich., Oct. 22. Gov. Granholm said that school funding would be slashed by $127 per student and would take effect in 30 days unless revenue is found to avoid the cuts.
—Al Goldis/AP

By Erik W. Robelen

Premium article access courtesy of Edweek.org.

Amid a still-shaky economy, a troubling reality is starting to set in for states and school districts: The budget situation may get a lot worse when the federal economic-stimulus spigot runs dry.

The hope of the Obama administration and Democrats in Congress has been that the $787 billion in the American Recovery and Reinvestment Act—including some $100 billion for education—would soften the pain of the recession and help drive a recovery.

But as helpful as many state and local officials have found the once-only stimulus aid in coping with current and anticipated revenue shortfalls, it creates some awfully big holes to fill when the money begins to run out late next year in what’s widely known as the “funding cliff.”

Experts also caution that the recovery of state and local coffers is likely to significantly lag behind any progress in the national economy generally. For one thing, state budgets are largely supported by individual income and sales taxes, which will likely be slower to catch up.

“States are bracing themselves for prolonged fiscal difficulties,” said Todd Haggerty, a research analyst at the Denver-based National Conference of State Legislatures. “When you couple the absence of federal ARRA funds with still-declining revenues, it puts states in a difficult situation.”

An October report issued by the White House in cooperation with the U.S. Department of Education highlighted the extent to which ARRA money in the $48.6 billion State Fiscal Stabilization Fund has already “restored” significant shares of K-12 education funding in states.

But a close look by Education Week at data submitted to the department by the states about how they planned to spend the money shows that 36 states will have to fill a collective gap of at least $16.5 billion to return to fiscal 2008 state spending levels for K-12 education.

And that figure does not reflect the more recent revenue shortfalls many states have since encountered.

The Education Department has urged states and districts to be careful to “minimize the funding cliff” when the stimulus aid ends by using the money for purposes “that do not result in unsustainable continuing commitments.”

But some analysts say that idea runs counter to the stimulus law’s emphasis on using the money to save and create jobs. Indeed, the White House announced Oct. 19 that states had already reported saving or creating at least 250,000 jobs in education with the federal aid.

“Saving and creating jobs implies expenditures on salaries, and salaries are inherently ongoing expenses,” said Jennifer S. Cohen, a policy analyst at the New America Foundation, a Washington think tank. “They create funding cliffs, because once the money runs out, you’ll have to continue funding them.”

Spending Pace Varies

The pace at which states are allocating money under the state-stabilization fund varies widely, Ms. Cohen noted.

“States that are in worse fiscal trouble are front-loading the spending,” she said, citing Arizona, California, and Illinois among those that planned to use all of the money to shore up their budgets for the current fiscal year and for the prior year.

In Alaska, meanwhile, none of that aid is expected to go out until fiscal 2011.

Illinois used about $1 billion in state-stabilization aid to bolster its budget for the fiscal year that ended June 30, and plans to use the remainder, approximately $1 billion, for the current budget year, fiscal 2010, according to Matthew E. Vanover, a spokesman for the Illinois state board of education.

“Certainly, there is some major concern at this point in time because next fiscal year, beginning July 1, in order to just remain the same, we have to come up with an additional $1 billion for education,” he said. That’s out of a total of more than $7 billion in state aid for schools, he said.

Benjamin S. Schwarm, an associate executive director of the Illinois Association of School Boards, said: “The question is, what happens after this, when you don’t have that [money] coming in. ... Everybody around here keeps referring to it as the ‘cliff,’ and I don’t think it’s good.”

By contrast, in South Carolina, the legislature opted not to release any of the state-stabilization money for last fiscal year. The state is allocating about half its expected total of $359 million in such funds this fiscal year, and the second half the following year, said Betsy Carpentier, a deputy superintendent in the South Carolina Department of Education.

At the same time, she said, virtually all of the additional dollars districts are getting in other parts of the stimulus package—such as from the Title I program for disadvantaged students and under the Individuals with Disabilities Education Act—are going out this fiscal year. In all, South Carolina districts are receiving $335 million in preK-12 stimulus support beyond the state-stabilization aid, Ms. Carpentier said.

Deborah L. Elmore, a spokeswoman for the South Carolina School Boards Association, said that while the stimulus aid has been a huge help, it has taken the state only so far, given that South Carolina has suffered through several recent rounds of midyear budget cuts.

“It helped to keep the hole in the bottom from being a lot wider,” she said. “Unless the economy turns around, we’re left with falling through the bottom again.”

Maryland state schools Superintendent Nancy S. Grasmick said that, in her state, the stabilization money is being used both for this fiscal year and the following one.

“I think we’ve tried to structure something that would prevent us from really experiencing this cliff that we know will ultimately occur when the money runs out,” she said. Ms. Grasmick said she and Gov. Martin O’Malley, a Democrat, have told districts, “Please do not use this money to hire new positions, because when the money runs out, we don’t want to be in a position of having to terminate people.”

Instead, they have urged districts to think of the funds as onetime expenses, she said, such as to investments in technology or new instructional materials “that will yield some long-term benefit.”

‘A Lagging Indicator’

Meanwhile, a new report from the American Association of School Administrators, based in Arlington, Va., suggests that in many school districts around the country, federal stimulus aid has not been able to avert cuts to programs and staffing levels.

The AASA surveyed 875 school administrators from 49 states and the District of Columbia. More than one-third of the respondents said they were unable to save any core teaching jobs as a result of the stimulus money.

In addition, the percentage of districts increasing class sizes grew almost sixfold between the 2008-09 academic year and the current school year, to 34 percent from 6 percent, the survey data showed. The percentage of districts reporting cuts to their school bus transportation routes and availability doubled to 20 percent this school year, from 10 percent last academic year.

The AASA report suggests the worst may still lie ahead for many districts.

“Unfortunately, school districts’ economic welfare appears to be a lagging indicator, even further behind the still less-than-stable remainder of the economy,” the report says. “There is an unmistakable ‘one-two punch’ school districts are bracing themselves for as they budget for the 2010-11 school year. Not only is that when the [stimulus] funds are expected to end, it is also the likely low point for state and local budgets.”

A new report from the NCSL offers some grim budget news, too. It says the “steep revenue falloff in FY 2009 will not be the bottom for many states.” More than half the states expect a further decline in fiscal 2010, the report says.

On top of that, Mr. Haggerty of the state legislatures’ group said, at least 21 states have already reported midyear budget gaps.

“So you’re looking at a good number of states [with] some pretty large and significant budget gaps just a few months into the new fiscal year,” he said.

Concerns about the looming end to the stimulus program have raised questions about whether there might be a second round of federal legislation to extend the aid. The White House has been careful to avoid any suggestions that it’s planning to seek additional assistance.

But Jack O’Connell, the state superintendent in California, suggested that more aid should be on the table.

“While we have been told, count on this as one-time money, ... I don’t think it’s inappropriate [to have a second round],” he said, “absent economic recovery.”

William G. Milliken (Urban) State Park & Harbor Dedication

MDSTA Fall Conference 2009 Report?

A little something to SUSTAIN the "Mission of Never-Ending Unfolding Tommorrows" (And it alone Edures!)

Now I Become Myself

How do you find the right work, the work that you alone are called to do? The first step is to ask a different question... 

 

by Parker Palmer

posted Mar 31, 2001

What a long time it can take to become the person one has always been. How often in the process we mask ourselves in faces that are not our own. How much dissolving and shaking of ego we must endure before we discover our deep identity—the true self within every human being that is the seed of authentic vocation.

I first learned about vocation growing up in the church. I value much about the religious tradition in which I was raised: its humility about its own convictions, its respect for the world's diversity, its concern for justice.

But the idea of vocation I picked up in those circles created distortion until I grew strong enough to discard it. I mean the idea that vocation, or calling, comes from a voice external to ourselves, a voice of moral demand that asks us to become someone we are not yet—someone different, someone better, someone just beyond our reach.

That concept of vocation is rooted in a deep distrust of selfhood, in the belief that the sinful self will always be “selfish” unless corrected by external forces of virtue. It is a notion that made me feel inadequate to the task of living my own life, creating guilt about the distance between who I was and who I was supposed to be, leaving me exhausted as I labored to close the gap.

Today I understand vocation quite differently—not as a goal to be achieved but as a gift to be received.

Discovering vocation does not mean scrambling toward some prize just beyond my reach but accepting the treasure of true self I already possess. Vocation does not come from a voice “out there” calling me to become something I am not. It comes from a voice “in here” calling me to be the person I was born to be, to fulfill the original selfhood given me at birth by God.

The birthright gift

It is a strange gift, this birthright gift of self. Accepting it turns out to be even more demanding than attempting to become someone else. I have sometimes responded to that demand by ignoring the gift, or hiding it, or fleeing from it, or squandering it—and I think I am not alone. There is a Hasidic tale that reveals, with amazing brevity, both the universal tendency to want to be someone else and the ultimate importance of becoming one's self: Rabbi Zusya, when he was an old man, said, “In the coming world, they will not ask me: ‘Why were you not Moses?' They will ask me: ‘Why were you not Zusya?'”

We arrive in this world with birthright gifts—then we spend the first half of our lives abandoning them or letting others disabuse us of them. As young people, we are surrounded by expectations that may have little to do with who we really are, expectations held by people who are not trying to discern our selfhood but to fit us into slots. In families, schools, workplaces, and religious communities, we are trained away from true self toward images of acceptability; under social pressures like racism and sexism our original shape is deformed beyond recognition; and we ourselves, driven by fear, too often betray true self to gain the approval of others.

We are disabused of original giftedness in the first half of our lives. Then—if we are awake, aware, and able to admit our loss—we spend the second half trying to recover and reclaim the gift we once possessed.

Wearing other people's faces

When we lose track of true self, how can we pick up the trail? One way is to seek clues in stories from our younger years, years when we lived closer to our birthright gifts. A few years ago, I found some clues to myself in a time machine of sorts. A friend sent me a tattered copy of my high school newspaper from May 1957 in which I had been interviewed about what I intended to do with my life. With the certainty to be expected of a high school senior, I told the interviewer that I would become a naval aviator and then take up a career in advertising.

I was indeed “wearing other people's faces,” and I can tell you exactly whose they were. My father worked with a man who had once been a navy pilot. He was Irish, charismatic, romantic, full of the wild blue yonder and a fair share of the blarney, and I wanted to be like him. The father of one of my boyhood friends was in advertising, and though I did not yearn to take on his persona, which was too buttoned-down for my taste, I did yearn for the fast car and other large toys that seemed to be the accessories of his selfhood.

These self-prophecies, now over forty years old, seem wildly misguided for a person who eventually became a Quaker, a would-be pacifist, a writer, and an activist. Taken literally, they illustrate how early in life we can lose track of who we are. But inspected through the lens of paradox, my desire to become an aviator and an advertiser contain clues to the core of true self that would take many years to emerge: clues, by definition, are coded and must be deciphered.

Hidden in my desire to become an “ad man” was a lifelong fascination with language and its power to persuade, the same fascination that has kept me writing incessantly for decades. Hidden in my desire to become a naval aviator was something more complex: a personal engagement with the problem of violence that expressed itself at first in military fantasies and then, over a period of many years, resolved itself in the pacifism I aspire to today. When I flip the coin of identity I held to so tightly in high school, I find the paradoxical “opposite” that emerged as the years went by.

If I go farther back, to an earlier stage of my life, the clues need less deciphering to yield insight into my birthright gifts and callings. In grade school I became fascinated with the mysteries of flight. As many boys did in those days, I spent endless hours, after school and on weekends, designing, crafting, flying, and (usually) crashing model airplanes made of fragile balsa wood.

Unlike most boys, however, I also spent long hours creating eight- and twelve-page books about aviation. I would turn a sheet of paper sideways, draw a vertical line down the middle, make diagrams of, say, the cross-section of a wing, roll the sheet into a typewriter, and peck out a caption explaining how the air moving across an airfoil creates a vacuum that lifts the plane. Then I would fold that sheet in half along with several others I had made, staple the collection together down the spine, and painstakingly illustrate the cover.

I had always thought that the meaning of this paperwork was obvious: fascinated with flight, I wanted to be a pilot, or at least an aeronautical engineer. But recently, when I found a couple of these literary artifacts in an old cardboard box, I suddenly saw the truth, and it was more obvious than I had imagined. I didn't want to be a pilot or an aeronautical engineer or anything else related to aviation. I wanted to be an author, to make books — a task I have been attempting from the third grade to this very moment.

From the beginning, our lives lay down clues to selfhood and vocation, though the clues may be hard to decode. But trying to interpret them is profoundly worthwhile — especially when we are in our twenties or thirties or forties, feeling profoundly lost, having wandered, or been dragged, far away from our birthright gifts.

Those clues are helpful in counteracting the conventional concept of vocation, which insists that our lives must be driven by “oughts.” As noble as that may sound, we do not find our callings by conforming ourselves to some abstract moral code. We find our callings by claiming authentic selfhood, by being who we are, by dwelling in the world as Zusya rather than straining to be Moses. The deepest vocational question is not “What ought I to do with my life?” It is the more elemental and demanding “Who am I? What is my nature?”

Everything in the universe has a nature, which means limits as well as potentials, a truth well known by people who work daily with the things of the world. Making pottery, for example, involves more than telling the clay what to become. The clay presses back on the potter's hands, telling her what it can and cannot do—and if she fails to listen, the outcome will be both frail and ungainly. Engineering involves more than telling materials what they must do. If the engineer does not honor the nature of the steel or the wood or the stone, his or her failure will go well beyond aesthetics: the bridge or the building will collapse and put human life in peril.

The human self also has a nature, limits as well as potentials. If you seek vocation without understanding the material you are working with, what you build with your life will be ungainly and may well put lives in peril, your own and some of those around you. “Faking it” in the service of high values is no virtue and has nothing to do with vocation. It is an ignorant, sometimes arrogant, attempt to override one's nature, and it will always fail.

Joining self and service

Our deepest calling is to grow into our own authentic selfhood, whether or not it conforms to some image of who we ought to be. As we do so, we will not only find the joy that every human being seeks—we will also find our path of authentic service in the world. True vocation joins self and service, as Frederick Buechner asserts when he defines vocation as “the place where your deep gladness meets the world's deep need.”

Buechner's definition starts with the self and moves toward the needs of the world: it begins, wisely, where vocation begins—not in what the world needs (which is everything), but in the nature of the human self, in what brings the self joy, the deep joy of knowing that we are here on earth to be the gifts that God created.

Contrary to the conventions of our thinly moralistic culture, this emphasis on gladness and selfhood is not selfish. The Quaker teacher Douglas Steere was fond of saying that the ancient human question “Who am I?” leads inevitably to the equally important question “Whose am I?”—for there is no selfhood outside relationship. We must ask the question of selfhood and answer it as honestly as we can, no matter where it takes us. Only as we do so can we discover the community of our lives.

As I learn more about the seed of true self that was planted when I was born, I also learn more about the ecosystem in which I was planted—the network of communal relations in which I am called to live responsively, accountably, and joyfully with beings of every sort. Only when I know both seed and system, self and community, can I embody the great commandment to love both my neighbor and myself.

There are at least two ways to understand the link between selfhood and service. One is offered by the poet Rumi in his piercing observation: “If you are here unfaithfully with us, you're causing terrible damage.” If we are unfaithful to true self, we will extract a price from others. We will make promises we cannot keep, build houses from flimsy stuff, conjure dreams that devolve into nightmares, and other people will suffer—if we are unfaithful to true self.

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Parker J. Palmer, writer, teacher, and activist, has been named one of the 30 most influential senior leaders in higher education. From Let Your Life Speak: Listening to the Voice of Vocation, John Wiley & Sons, 2000. Excerpted by permission of Jossey-Bass, Inc., a subsidiary of John Wiley & Sons, Inc.

AFTER the STIMULUS (Beware Bubbles and Sharp Objects)

TIME MAGAZINE

Can the World Agree on a Stimulus Exit Plan?
By Michael Schuman / Hong Kong Thursday, Oct. 22, 2009

During the dark days of the global credit crunch a year ago, policymakers around the world had a generally easy time coordinating decisions. As asset prices tanked, lending dried up and growth shriveled, governments and central banks were forced to take similar steps — pump up fiscal spending and slash interest rates to support growth and unfreeze financial markets. Now, as an economic recovery emerges, governments are hoping for another coordinated effort to exit from their massive stimulus plans, including near-zero interest rates. That intention was clearly laid out during the September G-20 summit in Pittsburgh, Pa. The leaders of the world's 20 most influential economies pledged to "withdraw our extraordinary policy support in a cooperative and coordinated way."

Yet what sounds so simple on paper will be far more complicated in the real world of economic policymaking. The problem is that the upturn isn't as synchronized as the downturn. Countries are emerging from recession at different speeds, with each facing its own special mix of inflationary pressures and unemployment — both of which affect decisions for monetary and fiscal policy. "We won't get the kind of coordinated response that is the rhetoric of the G-20," says Paul De Grauwe, professor of economics at the University of Leuven in Belgium. "Each country is going to look at its own interests."
(See TIME's special "Out of Work in America.")

That possibility is already becoming a reality, as signs appear that central-bank policies are beginning to diverge. On Oct. 6, Australia became the first G-20 nation to raise interest rates, hiking its key rate by a quarter of a percentage point, to 3.25%. With "inflation close to target and the risk of serious economic contraction in Australia now having passed," Reserve Bank of Australia Governor Glenn Stevens said in a statement, the central bank decided that it was now "prudent to begin gradually lessening the stimulus provided by monetary policy." Meanwhile, in other industrialized nations still suffering from high unemployment and yawning excess capacity, policymakers are in no hurry to tighten. In the U.S., the Federal Reserve has indicated that it won't act aggressively anytime soon on its key interest rate, which remains in a zero to 0.25% range. "It seems likely that the recovery will be less robust than desired," William Dudley, president of the Federal Reserve Bank of New York, said in an early October speech. "This means that the economy has significant excess slack and implies that we face meaningful downside risks to inflation over the next year or two." The Fed's key interest-rate target, he added, "is likely to remain exceptionally low for 'an extended period.' "

A haphazard exit from stimulus measures, with countries going their separate ways, could pose its own set of problems. In this era of globalization what one government does in one corner of the world can have a knock-off effect on economies in another corner. For example, countries that raise interest rates ahead of others could end up attracting money from foreign investors seeking a higher return, potentially draining funds away from economies that are still badly in need of investment. Or if too many governments turn off the stimulus tap too quickly, global demand could fall sharply. "An unruly rush to the exits is no better in a global financial crisis than in a crowded theater," wrote Adam Posen, a member of the Bank of England's Monetary Policy Committee, in the Financial Times in September.
(See pictures of retailers that have gone out of business.)



Though governments are aware of the dangers of an uncoordinated exit, they prefer to keep their options open, since they must also address domestic political concerns. That means clearly defined time frames or targets for any exit could prove hard to achieve. The financial crisis "is affecting differently every country. Every country will have to define its exit strategy in its own time," Portugal's Finance Minister, Fernando Teixeira dos Santos, reportedly said at a conference of European Union ministers earlier this month in Sweden. "I don't think that we can have a precise, or a common, schedule. In my perspective, we need a flexible approach," he said.

Nowhere is the policy challenge bigger than in Asia. With the region's recovery gaining pace more quickly than elsewhere, it could be the first region to face inflation pressures. In China, growth is rapidly returning to pre-crisis levels. On Oct. 22, China reported that its gross domestic product grew by a healthy 8.9% in the third quarter, from the same period a year earlier. Inflation in China "will rise faster than in most other major economies and will therefore justify earlier and stronger-than-expected rate hikes," wrote Jun Ma, an economist at Deutsche Bank in Hong Kong, in a September note. Concerns are also mounting that continued loose monetary policy in Asia could fuel dangerous and unstable asset price bubbles, especially in property. There has been some speculation in financial markets that South Korea's central bank could raise interest rates in the coming months to cool a roaring housing market. Frederic Neumann, an economist at HSBC in Hong Kong, says Asian central bankers might need to hike rates by four percentage points over the next year — much more than is expected from the Fed — in order to quash inflation and asset bubbles. "This is the real test for Asia: the region's central banks have to hike earlier and far more aggressively than the Federal Reserve," Neumann says.

However, Neumann and other economists question if Asia will take such action, even if it does prove necessary. By raising rates ahead of the rest of the world, Asia could attract capital flows and put pressure on its currencies to appreciate. Stronger currencies would make Asian exports more expensive — a consequence policymakers in the region's trade-dependent economies might wish to avoid. "Unless you are really forced to do something independent of the Federal Reserve, you are probably not going to go that route," says Duncan Wooldridge, an economist at UBS in Hong Kong.

In the end, some economists believe that a coordinated global exit strategy, especially in regard to monetary policy, will ultimately happen, but by default. The Federal Reserve holds so much influence in the world economy that other central banks might be wary of deviating too far from its policy. "The nature of the coordination is not that bankers sit around a table and do things together," says the University of Leuven's De Grauwe. "The nature is that some of the big guys make a move and force everyone to move." In the global recovery, as in the downturn, everyone may sink or swim together.

THINK "The New Untouchables" STIMULUS!

 NEW YORK TIMES

 

October 21, 2009

Op-Ed Columnist

The New Untouchables

By THOMAS L. FRIEDMAN

Last summer I attended a talk by Michelle Rhee, the dynamic chancellor of public schools in Washington. Just before the session began, a man came up, introduced himself as Todd Martin and whispered to me that what Rhee was about to speak about — our struggling public schools — was actually a critical, but unspoken, reason for the Great Recession.

There’s something to that. While the subprime mortgage mess involved a huge ethical breakdown on Wall Street, it coincided with an education breakdown on Main Street — precisely when technology and open borders were enabling so many more people to compete with Americans for middle-class jobs.

In our subprime era, we thought we could have the American dream — a house and yard — with nothing down. This version of the American dream was delivered not by improving education, productivity and savings, but by Wall Street alchemy and borrowed money from Asia.

A year ago, it all exploded. Now that we are picking up the pieces, we need to understand that it is not only our financial system that needs a reboot and an upgrade, but also our public school system. Otherwise, the jobless recovery won’t be just a passing phase, but our future.

“Our education failure is the largest contributing factor to the decline of the American worker’s global competitiveness, particularly at the middle and bottom ranges,” argued Martin, a former global executive with PepsiCo and Kraft Europe and now an international investor. “This loss of competitiveness has weakened the American worker’s production of wealth, precisely when technology brought global competition much closer to home. So over a decade, American workers have maintained their standard of living by borrowing and overconsuming vis-à-vis their real income. When the Great Recession wiped out all the credit and asset bubbles that made that overconsumption possible, it left too many American workers not only deeper in debt than ever, but out of a job and lacking the skills to compete globally.”

This problem will be reversed only when the decline in worker competitiveness reverses — when we create enough new jobs and educated workers that are worth, say, $40-an-hour compared with the global alternatives. If we don’t, there’s no telling how “jobless” this recovery will be.

A Washington lawyer friend recently told me about layoffs at his firm. I asked him who was getting axed. He said it was interesting: lawyers who were used to just showing up and having work handed to them were the first to go because with the bursting of the credit bubble, that flow of work just isn’t there. But those who have the ability to imagine new services, new opportunities and new ways to recruit work were being retained. They are the new untouchables.

That is the key to understanding our full education challenge today. Those who are waiting for this recession to end so someone can again hand them work could have a long wait. Those with the imagination to make themselves untouchables — to invent smarter ways to do old jobs, energy-saving ways to provide new services, new ways to attract old customers or new ways to combine existing technologies — will thrive.

Therefore, we not only need a higher percentage of our kids graduating from high school and college — more education — but we need more of them with the right education.

As the Harvard University labor expert Lawrence Katz explains it: “If you think about the labor market today, the top half of the college market, those with the high-end analytical and problem-solving skills who can compete on the world market or game the financial system or deal with new government regulations, have done great. But the bottom half of the top, those engineers and programmers working on more routine tasks and not actively engaged in developing new ideas or recombining existing technologies or thinking about what new customers want, have done poorly. They’ve been much more exposed to global competitors that make them easily substitutable.”

Those at the high end of the bottom half — high school grads in construction or manufacturing — have been clobbered by global competition and immigration, added Katz. “But those who have some interpersonal skills — the salesperson who can deal with customers face to face or the home contractor who can help you redesign your kitchen without going to an architect — have done well.”

Just being an average accountant, lawyer, contractor or assembly-line worker is not the ticket it used to be.

As Daniel Pink, the author of “A Whole New Mind,” puts it: In a world in which more and more average work can be done by a computer, robot or talented foreigner faster, cheaper “and just as well,” vanilla doesn’t cut it anymore. It’s all about what chocolate sauce, whipped cream and cherry you can put on top. So our schools have a doubly hard task now — not just improving reading, writing and arithmetic but entrepreneurship, innovation and creativity.

Bottom line: We’re not going back to the good old days without fixing our schools as well as our banks.

THINK Mayoral "BIG PICTURE" Education STIMULUS!

An Education Stimulus for the Nation's Cities

By Gregory A. Ballard, Cory Booker, and Karl Dean

Given the beating that city and state budgets have taken in recent months, America’s mayors have come under tremendous pressure to scale back all but the most critical investments in public safety, infrastructure, transportation, and other core services.

But for the nation’s big cities, there can be no true, long-term economic recovery without adequately educating far greater numbers of young people. No matter how steep the fiscal downturn, mayors must redouble local efforts to improve graduation rates and—no less important—to create meaningful educational options for the staggering numbers of adolescents who have been pushed aside or have given up on school altogether.

We therefore argue that one aspect of school reform—expanding high school options and alternatives—deserves to be ranked as a top priority for the nation’s mayors and school superintendents. A new generation of innovative high school models offers rigorous academic coursework, supports for students who face personal challenges outside of school, and opportunities for returning students to both catch up on what they have missed and prepare themselves for college and careers. For students who have not been well served by traditional “one size fits all” high schools, these programs offer a second chance to realize their full potential.

—Jonathan Bouw

In each of our three midsize cities, the schools lose roughly 4,000 students every year. Over their lifetimes, these students each earn about $260,000 less than high school graduates, pay about $60,000 less in taxes, and put an enormous strain on our health-care, criminal-justice, and social-welfare systems. They represent yet another generation that could have contributed to the civic and cultural life of our communities.

We are convinced that even a modest investment in well-designed alternative high schools can have a major impact on the dropout problem, and, by extension, the economic and social burdens dropouts place on our communities. Indeed, we see a movement to provide much broader high school options for all students as an essential piece of any long-term strategy for the economic, civic, and cultural recovery of our cities.

Our three cities are place-based partners in the Alternative High School Initiative that has been managed by Big Picture Learning and the National League of Cities under a grant from the Bill & Melinda Gates Foundation. Through this initiative, our cities are beginning to make strong, systemic efforts to reach out to young people who have left school or have begun to drift away. We are in the midst of opening an array of high-quality high school options, so that all our young people can achieve academic proficiency, earn a high school diploma, and be prepared to pursue postsecondary education. Launching and expanding these alternatives, we have found, requires that city and school leaders be receptive to schools that are innovative, often started from scratch, and sometimes managed by entities other than local districts.

Newark, N.J., for example, has introduced what amounts to an education stimulus package to reclaim its dropouts. Through a partnership that includes the Newark public school system, Essex County College, and nonprofit organizations such as Gateway to College, Diploma Plus, Communities in Schools, and Big Picture Learning, the city will have launched eight new alternative schools and programs focused on dropout prevention and recovery during the 2008-09 and 2009-10 school years. These efforts eventually will serve between 1,000 and 2,000 young people—a sizable portion of those who have left the system.

Indianapolis and Nashville, Tenn., are continuing their successful partnerships with Big Picture Learning. Its alternative school model created in Providence, R.I.—the Metropolitan Regional Career and Technical Center, known as the Met—combines demanding academic work and experiential learning, boasts a national graduation rate of 92 percent, and regularly meets adequate-yearly-progress goals in all of its schools nationwide.

In addition, Indianapolis has already opened four new Diploma Plus schools, a model that targets students who are overage and undercredited, and a YouthBuild program that blends construction training with a return to school for dropouts. Next year, Nashville also plans to open a Diploma Plus school, and will launch a Gateway to College program, which provides high school dropouts between the ages of 16 and 20 with a means to complete their diplomas while also earning significant college credits. The city also plans to start a new YouthBuild program.

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What have we learned from these efforts? We have come to understand that for alternative programs to flourish, mayors must work closely with school leaders and play an ongoing, hands-on role, going well beyond their customary involvement in education.

Specifically, to the extent that it is possible, mayors can identify and offer available space within their cities to house alternative high schools. Further, they can lead the reform of municipal policies, such as zoning restrictions or rules governing access to public transportation, that might prevent local alternative schools from finding homes or attracting students from other parts of their cities.

Mayors also can champion increased front-end investment for principals and teachers to be trained in new approaches to teaching and learning that work with students who have had bad experiences in traditional high school environments. It is rare that a school district has funding to pay the professional-development costs for launching many new schools at once. In our cities, we have combined public and private money with the help of a broad range of community funders and partners, including philanthropic foundations, higher education institutions, and nonprofit organizations.

Equally significant, launching these efforts requires true leadership from the city agencies that support young people. Students leave school for many reasons—health challenges, problems in the justice or foster-care system, family conflicts, and so on. We therefore need to be sure that city departments are providing or are forging strong collaborations with relevant county and state agencies to provide all the necessary support services for young people and their families. In our cities, we have convened meetings of the heads of various city agencies to brainstorm new ways to collaborate on education and youth development and to create interagency agreements and realign services when necessary.

Many of our alternative high schools are operated and managed by groups outside the local school district. Indianapolis was the first city in the nation to be granted chartering authority by the state legislature. As a result, Mayor Gregory Ballard’s office is able to tap per-pupil funding for new alternative high schools opening as charters.

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Other cities and school districts can learn from our efforts. It is possible to hold students to high standards while also allowing them to learn at their own pace and in ways that respect their singular talents, interests, and learning styles. Reclaiming students who have left or are drifting away requires a broad array of interventions and innovations, as well as flexibility in regulation, which requires municipal leadership at the highest level.

Regardless of the size of the nation’s cities or the economic troubles they face, urban dropout rates are too sizable to overlook. As civic leaders across America explore ways to stimulate their economies, we urge them to spark the growth of alternative high schools and dropout-recovery programs in their communities. The development and expansion of these student-focused, project-based schools can change the odds for the most underserved students. And they have the power to transform the dynamic of leaving school early into a culture of graduating from high school ready for college and work.

But it will take leadership from mayors, who, as our experience illustrates, can be catalysts for change, ensuring adequate resources and buildings, appropriately trained staffs, flexibility, and expanded options—crucial elements of the education stimulus America’s cities so desperately need.

WHAT a DIFFERENCE a DAY MAKES!

BUDGET CLASHES

As they bicker, strife grows

GRANHOLM SAYS SHE HAD TO VETO; BISHOP CALLS IT ‘EXTORTION’

By CHRIS CHRISTOFF

FREE PRESS LANSING BUREAU CHIEF

LANSING — The Capitol crackled with defi­ance, dismay and doctors in white smocks Tues­day, as new skirmishes in the state budget war erupted on several fronts.

Outside, hundreds of doctors with signs and bullhorns rallied for and against legislation to impose a 3% tax on all physicians.

Inside, Gov. Jennifer Granholm defended her Monday veto of $51.5 million for 39 of the state’s highest-spending school districts, including 26 in suburban Detroit. She said she had no choice because the school budget the Legislature sent her was unbalanced.

“There will be additional cuts, perhaps soon,” she warned, as state economists met to assess the state’s worsening finances.

Senate Majority Leader Mike Bishop, R­Rochester, denied Granholm’s charge that $60 million in revenue was missing to pay for a near­ly $11-billion school budget. He called Gran­holm’s veto “extortion” but pledged not to raise taxes.

Clearly, the gulf between the two most im­portant people in the process was deeper by day’s end.

School officials caught in the middle com­plained that students were being held hostage and blamed both the governor and Legislature. Meanwhile, Bishop sent Granholm six more budget bills with a warning not to veto any items in the bills. But Granholm hinted that she would and said more money is needed to fund college scholarships, help cities and support Medicaid.

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Veto threats loom for budgets

Granholm presses for new taxes, fees

By CHRIS CHRISTOFF and KATHLEEN GRAY

FREE PRESS STAFF WRITERS

LANSING — The ink from Gov. Jennifer Granholm’s veto of $51.5 million for 39 school districts was barely dry Tues­day when she received six more budget bills, and hinted that more vetoes are coming.

State budget director Bob Emerson cautioned that all school districts may face more cuts of as much as $120 per pu­pil this year, as tax revenues continue to weaken.

Granholm’s veto sent shock waves through the Legisla­ture. She laid blame on Senate Majority Leader Mike Bishop, R-Rochester, and pressured lawmakers to approve more revenue to fund schools and other programs that were slashed in the new budget bills she received Tuesday — col­lege scholarships, revenue sharing to local governments and Medicaid payments to doctors, hospitals and nursing homes.

Bishop released the six bud­get bills Tuesday after holding them for more than two weeks after the Legislature approved them. He warned Granholm not to veto line items, saying Senate Republicans would not restore them.

Granholm, surrounded by 18 of the state’s top education lobbyists, said that without more money, many school dis­tricts face insolvency. She called for a public campaign to urge the Legislature to ap­prove new taxes and fees that she and House Democrats sup­port.

Among them: a freeze in the personal income tax exemp­tion (which is scheduled to get an inflationary increase); a re­duction in tax credits for busi­nesses; an increase in the tax on non-cigarette tobacco prod­ucts; a cut in tax credits for filmmakers, and new liquor li­cense fees for bars to remain open after 2 a.m. and on Sun­day mornings.

Granholm said the state needs to make systemic re­forms for the short and long term. On Tuesday, the short­term impact put many law­makers face-to-face with fiscal crisis in their local school dis­tricts.

“In a panic, hysterical about what these cuts mean. That was my phone call from my su­perintendents,” said Rep. Le­sia Liss, D-Warren, whose main school district, Center Line, stands to lose $570,000.

Rep. Marie Donigan, D-Roy­al Oak, said she was frustrated that legislators can’t compro­mise, as sales tax revenues de­cline and leave even less mon­ey for schools and other essen­tial services. The Royal Oak school district stands to lose $1.5 million under Granholm’s veto.

“This is scary stuff,” Doni­gan said.

Rep. Hugh Crawford, R-No­vi, represents three school dis­tricts — Northville, Novi and Walled Lake — that would lose more than $8.3 million in state funding because of Granholm’s veto.

“She’s playing games and didn’t have to do that,” he said. “I’ve never been exposed to do­ing business this way.”

Crawford said he has no plans to vote for new taxes but would be willing to look at a freeze on the Earned Income Tax Credit, which is used by low-income taxpayers.

“I have a granddaughter who is going to college, and I wasn’t happy about taking away her scholarship,” he said, referring to the $4,000 Prom­ise Scholarship eliminated by the Legislature. “But it’s going to be incumbent on schools and cities to restructure.”

Three districts in state Rep. Chuck Moss’ district — Bir­mingham, Bloomfield and West Bloomfield — all suffer deep cuts under the veto.

“It’s getting more … difficult to watch these desperate, cyn­ical measures to get more tax­es,” said Moss, R-Birmingham, instead suggesting eliminating the 1% pay increase scheduled for state employees and reduc­ing their benefits.

The easiest short-term so­lution wasn’t mentioned Tues­day: another dip into $184 mil­lion in remaining federal stim­ulus money lawmakers were hoping to save for next year.

Schools frustrated with funding veto

By LORI HIGGINS

FREE PRESS EDUCATION WRITER

Gov. Jennifer Granholm’s veto of $51.5 million in funding for select districts means some school employees will lose their jobs, some districts will deplete their savings and oth­ers will find themselves head­ing quicker into a deficit.

The veto — and the subse­quent finger-pointing that took place Tuesday in Lansing — al­so produced harsh comments for Granholm and the Legisla­ture.

“It’s frustrating and disap­pointing that we’re playing pol­itics with kids,” said Brian Whiston, Dearborn Public Schools superintendent, whose district is to lose $5 mil­lion. “I’ve got to educate these kids this year, right now.”

Dearborn and 38 other dis­tricts statewide — 26 of them in metro Detroit — are among the state’s highest funded. They have been allowed to re­ceive the special money to maintain their high funding levels since Proposal A was en­acted in 1994 with the intent to equalize funding for districts.

In Dearborn, the loss of $5 million is on top of the $165­per-pupil cut all districts in Michigan must deal with and another $1.5 million Dearborn is to lose in funding for at-risk students. Whiston said layoffs are a certainty, though he’ll be soliciting input from employ­ees on how to make up the loss. Whiston said as many as 150 jobs could be on the line.

The West Bloomfield School District already was to end the school year with a def­icit. The loss of $1.5 million will speed that along, said Joey Spano, district spokeswoman. She and others say Granholm and the Legislature are equally to blame for the situation.

“Every parent and every citizen in the state of Michigan should be outraged at this. It’s a dysfunctional system,” Spa­no said.

Superintendents in Livonia Public Schools, which is to lose nearly $5 million, and Royal Oak Neighborhood Schools, which is to lose $1.5 million, an­ticipate they’ll have to dig deep into their reserve funds to cov­er the loss. Livonia Superin­tendent Randy Liepa said he welcomes Granholm to come to his district, review his bud­get and tell him how he can make cuts.

“There has to be some ex­planation to the parents in my community,” Liepa said.


Editorial

Lansing’s failure of leadership reaches the schoolhouse door

As Michigan’s elected leaders continue their diatribes over the state budget, now 10 days away from the next deadline, the dire consequences have begun to hit home.

On Monday, Gov. Jennifer Gran­holm vetoed nearly $60 million of spending in the School Aid Fund bud­get. Senate Majority Leader Mike Bishop immediately denounced the cuts, which fall disproportionately on the state’s most affluent school dis­tricts, but vowed to let them take effect before he and his Republican Senate colleagues authorize a penny of the additional revenue Granholm insists is required to restore them.

What is coming into view now is the sort of state you get when leaders attempt to fix a long-term budget imbalance with short-term changes in only one side of the ledger — a. state that trashes schools, cripples hospi­tals and doctors who treat Medicaid patients, jeopardizes local police and fire services, and breaks promises made to its college students.

The funds Granholm vetoed yester­day are only the leading edge of more wide­spread cuts in K-12 aid. Because tax reve­nues continue to fall short of previous esti­mates, the governor warned that another $120 per pupil may need to be cut, starting perhaps as early as next month. That’s on top of the $165 per-pupil cut included in the budget bill Granholm signed.

Now you can argue, and many people will, about Granholm’s chief line-item veto tar­get: the extra payment that some of the higher-spending school districts have gotten for the last 10 years, an adjustment that was made when the state had ample dollars and which those schools had every right to as­sume had become a permanent part of their annual grants. But nothing is guaranteed in a budget this devastated, and Granholm had few other places to turn.

Those who insist Michigan cannot afford any new taxes may well get their wish. The House has appropriately thumbed its nose at an irresponsible, Senate-produced package to raise roughly $100 million this year.

Meanwhile, the Senate will not act on any House-produced tax increases. So these cuts Granholm ordered Monday look likely to stand.

That’s brutal news to Michiganders, who have long identified K-12 educa­tion as a top priority. With 24 school districts already on the financial edge, the state may not have enough emer­gency financial managers to go around. Outright closures may occur.

Without some additional taxes — or a slowdown in some programmed tax breaks — the news will get worse, and not just for schools. The Senate has sent Granholm the final six budget bills she needs to sign to prevent a state shutdown Nov. 1, along with a message from Bishop that any line­item vetoes she makes will not be vot­ed on again.

That’s fine. The more the governor saves now with line-item vetoes, the fewer cuts will have to be made later.

Granholm noted Tuesday that freez­ing the personal deduction on the state in­come tax could yield $55 million. Other stop­gap measures could produce significant dollars without increasing the general bur­den on hard-pressed taxpayers.

But Michiganders would be better off now if both sides turned their full attention to long-term changes in the way our state rais­es and spends money, such as containing employee benefit costs and adopting a tax regime that captures revenues from every segment of the state’s changing economy.

Even the best long-term reform package — and no one’s holding their breath on that — may not be able to repair the wounds occur­ring right now.

STATUS-QUO INSURED! (At least for another day or so)

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Politics K-12

Your education road map to state and federal politics

Michele McNeil covered education and state government in Indiana for a decade before joining Education Week as a state policy reporter in June 2006. Alyson Klein, who reports on federal education policy, joined the staff in February 2006 after nearly two years at Congress Daily.

« 53 House GOP Members Call for Jennings' Resignation | Main | How Big Is the Stimulus Funding Cliff? »

White House: Stimulus Saved 250,000 Education Jobs So Far

A new report out from the White House Domestic Policy Council estimates that the stimulus package has saved or created 250,000 education jobs so far—most of them probably teachers. (UPDATE: And a good chunk of them are from California. Gov. Arnold Schwarzenegger reported today that 62,204 of these education jobs, or nearly 25 percent of the estimated total, were saved or created in his state.)
The White House has the distinct advantage of being able to look at the first quarterly stimulus reports that states and other recipients of stimulus funds filed with the federal government before anyone else. The rest of us get to look at the reports when they're made public on Recovery.gov Oct. 30.
Even so, much of the 23-page report rehashes data from the already public applications states submitted to gain access to their stabilization funds—data that shows most states said they would use the money to backfill cuts they made, or were going to make, to K-12 education. The White House also drew on anecdotal reports from the media to highlight jobs that were saved in specific school districts. In a press release, the White House says that the stimulus package has enabled states to restore nearly all of their projected education budget shortfalls for fiscal 2009 and 2010. Of course, things are still projected to get much worse for states, based on latest tax collections data.
In the press release, Education Secretary Arne Duncan says: "Early feedback from states also tells us that many districts are using stimulus dollars in ways that will move us beyond the status quo."
Given that most of the money has so far been used to get state K-12 funding levels up to the status quo, it will be most interesting to see what states and school districts report spending their money on. (UPDATE 2: Read Andy Smarick's take on this issue, too.)

STIMULUS FUNDING in JEOPARDY! (NO-Not the Game but because of it!)

State examines whether waiver is needed to keep K-12 stimulus funding

Granholm administration officials are looking at whether Michigan may need to seek a waiver enabling it to keep federal stimulus funds for K-12 education.

The possibility is being considered as state officials examinewhether state funding levels for K-12 education are likely to drop below the “maintenance of effort” compliance levels required by the federal stimulus package, or the American Recovery and Reinvestment Act.

State Budget Director Robert Emerson said at a press conference on Tuesday that any further reductions, beyond those in the school aid budget signed by Gov. Jennifer Granholm on Monday, could jeopardize the federal stimulus funding.

Michigan used about $600 million in federal stimulus funds as part of the fiscal 2009 school aid budget and has allocated an additional $450 million as part of the current-year school budget, leaving about $183 million reserved for use in fiscal 2011.

If Michigan were to be out of compliance with the ARRA, it could potentially have to repay the money. A waiver, however, would avert that and other states have sought and received such waivers.

Emerson and Granholm said there is the potential that Michigan will need to enact additional per-pupil cuts, beyond the $165 per-pupil reductions in the just-signed budget.

Emerson said state Treasurer Robert Kleine and officials at the House Fiscal Agency and Senate Fiscal Agency were meeting on Tuesday to determine the state's current revenue outlook.

He and Granholm said the current school aid budget was underfunded by $60 million, based on May revenue estimates. But the state Treasurer has also indicated that, based on the latest revenue data, the shortfall in the school aid fund could be as high as $264 million.

Granholm on Monday vetoed $54 million in spending measures in the $12.9 billion K-12 budget, including $51.5 million in supplemental payments to districts that get among the highest per-pupil payments statewide.

Taking into account Granholm's veto, that could leave a current-year shortfall as high as $210 million, which could translate to additional, across-the-board cuts of as high as $120 per pupil, unless the Legislature provides additional funding, Emerson said.

At the Capitol press conference, Granholm and an array of education officials from across the state urged lawmakers to pass additional sources of revenue.

Granholm said education is the “thing most important for our economic recovery” and warned of “additional cuts, potentially soon.”

Also on Tuesday, the Senate sent Granholm six remaining budget bills that include controversial cuts like an 11.1 percent reduction in state revenue sharing and an 8 percent cut in Medicaid providers' reimbursement rates.

In a letter accompanying the bills, Senate Majority Leader Mike Bishop, R-Rochester, warned Granholm against vetoing items in the bills with the expectation that the Legislature would pass new sources of revenue to reinstate the vetoed items.

“Please remember that any line item veto you exercise will result in the total elimination of those programs,” Bishop wrote. “Do not veto portions of these budgets with the expectation that money will be reappropriated at a later date to fund the vetoed programs.

“There is not sufficient support in the Senate Republican caucus for tax increases and for you to think otherwise is a mistake.”

Bishop said the final fiscal 2010 budget represents a “bipartisan and bicameral effort that was achieved after months of tough negotiations.”

"WOW, YOU mean we've used ALL of the Federal STIMULUS Monies to merely perpetuate the STATUS-QUO?"

States Feeling Fiscal Squeeze Despite Stimulus

Michigan House Speaker Andy Dillon, left, talks with Rep. George Cushingberry on Sept. 30 in Lansing, Mich. Dillon said Democrats could begin to look at tax increases or other revenue sources to pay for the college scholarship program and lessen deep cuts Senate Republicans want.
$mdash;Al Goldis/AP

By Alyson Klein

Premium article access courtesy of Edweek.org.

Despite the nearly $40 billion infused into state coffers to help steady state education budgets under the federal economic-stimulus package, some states remain in dismal fiscal straits, forcing further cuts to K-12 programs.
States such as Pennsylvania that recently wrapped up protracted legislative sessions were forced to make sometimes-painful adjustments to cope with declining revenues, despite the unprecedented aid under the American Recovery and Reinvestment Act, the stimulus law.
Lawmakers in other states, including New Mexico, are heading back for special sessions to consider further reductions to their budgets for the current fiscal year.
And many states are looking ahead to a time in the federal 2011 fiscal year when money from the State Fiscal Stabilization Fund, a key part of the stimulus program, will no longer be available. That funding, which was intended primarily to backfill cuts that states had already made to education programs, is spread out over two years. In some cases, states have diverted resources from K-12 programs and replaced their own dollars with stabilization funding from the federal government. ("States Stung by Criticism on Use of Stimulus Aid," October 12, 2009.)
“K-12 education has come under pressure that it has not seen in decades,” said Arturo Perez, a fiscal analyst for the National Conference of State Legislatures, based in Denver. “The only bright note is the money provided under the ARRA.”
That cloudy fiscal forecast appears unlikely to brighten any time soon. A report released Oct. 15 by the Nelson A. Rockeller Institute of Government, the public-policy-research arm of the State University of New York, shows that state revenues are faltering and are likely to remain shaky for the next several years.
The study found that those revenues nationwide dropped a record $63 billion in the fiscal year ending June 2009, or roughly twice the amount of money states have gained from the stimulus program so far.
That may help explain why, even with the extra cash, some states still have reduced or eliminated education programs.
For instance, this week Michigan Gov. Jennifer Granholm, a Democrat, was expected to sign the state’s K-12 budget for this fiscal year by Oct. 20, in time for payments to school districts to be doled out. The budget came after lawmakers had passed a continuing resolution to keep programs afloat while the legislature hashed out its spending bills. The budget includes a cut of $165 per pupil in grants to school districts for K-12 students.
In Michigan, the governor has line-item veto power, and it is still unclear whether Gov. Granholm planned to use it on any portion of the education spending bill.
Although state lawmakers sought to give districts flexibility in determining how to find the savings, school officials are struggling to figure out what to trim next, said Brad Biladeau, the associate executive for government relations at the Michigan Association of School Administrators.
“We’ve been cutting administrative expenses and support services to school districts,” he said. “Now school districts are faced with significant cuts that could impact the classroom."

Cuts to Programs

Pennsylvania wrapped up an exhausting legislative session when Gov. Edward G. Rendell, a Democrat, signed the final budget Oct. 9. The measure, which came in more than 100 days behind schedule, offered a mixed picture for K-12 education, said Ronald Cowell, the president of the Education Policy and Leadership Center, a nonprofit organization in Harrisburg, Pa.
“The good news is that there is a $300 million increase,” to $5.5 billion, for basic education funding, which provides the largest amount of aid for school districts, Mr. Cowell said. That amount represents a 5.7 percent increase over last year.
The move was in keeping with a plan, enacted in 2007, to overhaul Pennsylvania’s school finance system. But it will be tough to keep up that level of funding once the state-stabilization dollars provided under the recovery act are gone, Mr. Cowell said.
And other programs that school districts depend on saw substantial reductions, he said. For instance, a $44.7 million program called Classrooms for the Future, which provides technology to schools, was eliminated. A high school reform program was reduced to $3.7 million, from $10.7 million.
“There’s a story to be told about each one of these program cuts,” Mr. Cowell said.
This week, New Mexico is slated to hold a special session to address its budget issues. Lawmakers will work to resolve a deficit of at least $400 million in a budget of $5.5 billion.
Gov. Bill Richardson, a Democrat, has suggested a 3 percent across-the-board reduction in government programs, except for K-12 education.
But some New Mexico legislative leaders say cuts to schools might be unavoidable. K-12 education is receiving $2.4 billion this fiscal year.
“To sit there and say we’re not going to have any cuts in education—60 percent of the budget—is that a realistic proposal or is that just political rhetoric?” said Sen. Tim Jennings, a Democrat. “There ought to be meaningful solutions.”
But districts are going to have a tough time weathering further cuts, said Tom Sullivan, the executive director of the New Mexico Coalition of School Administrators.
“We have some superintendents who may be hanging by a thread who see this as the straw that’s going to break the camel’s back,” Mr. Sullivan said.
And he sees further trouble ahead, particularly if the state doesn’t find a new revenue source for education. Lawmakers in New Mexico used about $165 million in stimulus money to help balance school districts’ books in the current fiscal year, he said, but revenue forecasts have been even cloudier than expected.
That might force the state to tap the remaining $90 million in stimulus funding that so far hasn’t been allocated—leaving much less of a federal cushion to help finance schools in the next fiscal year.
“If that money is held back and used in building [next year’s] budget, then ... we’re not falling off the cliff yet,” Mr. Sullivan said. But, he added, “I’m not sure if they can make it through [this fiscal year] without using some or all of the $90 million sooner than they had hoped.”

‘Funding Cliff’ Coming

Other states are bracing for tough choices in the coming legislative sessions.
Florida has been hit particularly hard with the national downturn in the housing market, and that’s likely to lead to a structural deficit in the years ahead, said Wayne Blanton, the executive director of the Florida School Boards Association.
“We’re sort of at a crossroads,” Mr. Blanton said. He said state-financed programs, including K-12 education, have always benefited from the revenue bump created by an influx of new residents.
But Florida recently lost nearly 60,000 people, the first population drain in decades. “We’re going to take a 15 to 20 percent cut in state services” in the coming years, Mr. Blanton said, if there isn’t a major change in the state’s tax structure.
Right now, K-12 education in Florida is facing a $1 billion budget deficit, but Mr. Blanton said that amount would be closer to $2 billion without the federal help. The total budget for K-12, not including capital costs, was $15.9 billion.
He’s hoping that in the next legislative session, state lawmakers will start thinking about how to finance education after the stimulus money is no longer available.

The Associated Press contributed to this story.