The state's top economists will present their unified projections for state tax revenue tomorrow. This is the number which the legislature must use to create a balanced budget that meets the requirements of our state constitution.
However, over the last two days, the House and Senate Fiscal Agencies - nonpartisan staff working for the Legislature, who comprise two of the three agencies meeting tomorrow - have each released their projections for tax revenue for the current year (ending in September) and the next fiscal year (October 2014 - September 2015).
At first glance, there are a number of things to like about Gov. Snyder's budget proposal in this election year - which is hardly surprising, since he launched his reelection campaign at the same time he released his budget. Several of those things even stand up to closer scrutiny. But all this is against a background of real austerity in K-12 education, so that the executive budget proposal is a bit like having the vise around your head loosened after a long period of tightening: it's a relief, but you are still in the vise.
Districts will get a per-pupil increase between $83 and $111 per pupil, but this still lags inflation.
Most of that increase is made possible by the fact that there are fewer students in Michigan schools this year than originally expected, and the same applies next year.
The biggest increases are in the payments for unfunded liability of the state pension system.
Per-pupil funding left after pension payments are covered has fallen 22% over the last 12 years, after inflation.
Economic recovery is bringing a modest increase in revenues earmarked for the School Aid Fund, but no new revenue sources are being made available to schools.
Even though the state's General Fund is projected to have a much larger increase in revenue, the School Aid Fund continues to pay for some $400 million in higher education costs that used to be covered entirely by the General Fund.
Gov. Rick Snyder claims that that he and his administration have been investing in kids, that there has been “no reduction” in state support for K-12 education.
He says that “it’s not about partisanship, let’s just do the right thing.” We agree with those sentiments: support for strong, community-governed public education should not be a partisan issue, and we should definitely “do the right thing.” We’re still waiting for the governor to propose, and the legislature to pass, a budget that does right by the children of Michigan.
Gov. Snyder then goes on to say that people who argue he’s been cutting K-12 education “have fact issues.” But it is the governor’s facts which need a second look.
Bottom line: Gov. Snyder’s budgets took advantage of the depth of the recession to dig the hole even deeper in the first year to accomplish business tax cuts and other changes, allowing the weak recovery in subsequent years to look much better by comparison – but only if you ignore what things were like before or what things might have been like today had different choices been made. Between the end of earmarked school aid revenue from the Michigan Business Tax, and the diversion of funds to pay for colleges and universities, K-12 schools lost over $1.1 billion, or nearly $740 per pupil, each year because of the changes Gov. Snyder pushed through in 2011.
The Michigan State Legislature approved a final compromise education budget last week, making use of an estimated $140 million in unexpected estimated revenue to make sure that no district saw a net cut per pupil. But despite some of the large numbers being tossed around, the real effect on most students will be almost invisible.
Even after the infusion of an additional $140 million into the school aid budget, school districts will only see very small per-pupil funding increases – that fail to keep up with projected inflation – rather than the cuts previously in the budget. Gov. Snyder’s requested $65 million increase in state-funded preschool programs did receive full funding, however, and some other targeted funding slated for cuts was restored or cut by a lesser amount.
First off, let me thank the hundreds of you who have already contacted your State
Representatives about road funding and the threat to our schools. Your message is important and is getting through.
Many people have asked for a bit more information about this whole deal - and I certainly understand, because it's somewhat complicated. I'm reprinting our earlier action alert below, but let me sketch out what is happening on this issue:
Budgets as they emerged from each chamber are a mixed bag for schools
Both houses of the State Legislature passed their own versions of the K-12 School Aid budget this past week, and the political horse-trading can now begin. While the versions are quite similar, there are important differences that will affect how schools are funded and how much Michigan is able to expand its preschool programs targeted to low-income families. The total amount of proposed spending, however, does not exceed the Gov. Snyder's proposal, and in fact the Senate version comes in some $10 million lower than that.
Both versions of the budgets also include items that worry many supporters of local public education. Provisions requiring districts to permit and pay for students to take online courses from nearly any vendor are reminiscent of "Oxford report" proposals to "unbundle" public education, making local districts a thing of the past. Money earmarked for technology-driven student-centered instruction is seen as a "gift" to the financially troubled and controversial Education Achievement Authority, which the governor and legislative leaders hope to build into a state authority to take over "failing" schools.
As things stand, local school districts can expect a net cut of between $2 and $52 per pupil, though the details vary considerably. Final versions of the budget will not be ready until after the May consensus revenue estimation conference, when top state economists make tax revenue projections for the coming year.
Just before going on their two week spring break, the legislature moved along two key pieces of education legislation.
Two critical bills moved forward in the state House over the last few weeks. They will both have important effects on our public schools, but in different ways:
The House Appropriations subcommittee on School Aid passed a revised version of the Governor’s school aid budget proposal that maintains the same level of spending but actually increases the effective per-pupil cut for most districts.
The House Education Committee reported out the EAA expansion bill on a mostly party-line vote, and the bill passed the full House just before the break after frantic lobbying by EAA supporters.
Testimony on the Fiscal 2014 School Aid Executive Budget proposal
Prepared for House Appropriations subcommittee on School Aid, 19 February 2013
Drawing on the data we used in an earlier article about the Governor’s budget proposal – Eleven percent increase in schools since 2009-10? Not so much. – MIPFS testified before the Michigan House Appropriations Subcommittee on School Aid earlier this week. Our purpose was to point out that the executive budget proposal did not represent an increase in funding available for school operations, despite rhetoric to the contrary. Funding levels were actually much lower than in previous periods, especially after taking inflation into account, despite the smaller number of pupils.
MIPFS called for a significant, real investment in preschool through secondary education so that our public schools could do the job we have asked of them.