Group sends SOS to state to change school financing model

LANSING, MI – Michigan school districts are bracing for per-pupil cuts of at least $400 in the 2010-11 school year unless the Legislature and governor take rapid steps to secure additional money for K-12 education.

Districts are already taking drastic steps as they struggle to deal with the minimum $165-per-student cut in the current school year, fueling concern from every corner of the state, said Tom White, who chairs Save Our Students, Schools and State. The coalition of 16 school organizations is working to convince Michigan lawmakers to fix Michigan’s school financial picture.

“The funding mechanism for public schools is broken and the School Aid Fund this year totaled about $10.5 billion – $1 billion less than two years ago,” said White. “In fact, school finances are in even worse shape than they were in 1994, when voters approved the landmark Proposal A, shifting K-12 financing from the property tax to the sales tax. The situation is untenable.”

Dozens of schools around the state are already cash-strapped, and may be pushed into deficit status, the equivalent of bankruptcy, according to White and David Martell, executive director of the Michigan School Business Officials and a member of SOS. The looming financial disaster has schools scrambling to stay afloat, from closing schools and cutting positions to operating on a four-day school week.

“As we all know, Michigan schools continue to face tremendous economic uncertainty and the answers to our survey are a clear sign that the state’s budget crisis is having a direct impact on teaching and learning in our schools,” said Martell.

Martell’s organization recently surveyed local school district business officers about their financial status. More than 300 districts responded to the “Survey of Pain” and the results were disturbing:
•    86 percent of districts expect additional teacher and staff layoffs in the 2010-11 academic year
•    85 percent expect class size will continue to grow, resulting in less individual interaction between a student and a teacher.
•    21 percent of school districts expect to close at least one school building in the coming year.

The cuts will be on top of the 3,000 teachers, administrators and support staff already laid off this year. Officials say that without a quick injection of cash to schools, almost 4,000 additional layoffs could occur in the near future.

“We urgently need to reform our educational finance system and we are in desperate need of new ways to fund our schools,” said White. “We live in a pass-fail world and if Lansing doesn’t pass something – and soon – we will all fail.”

During Michigan’s decade-long recession, people have cut back on major purchases and the sales tax has become a much less reliable revenue source, White explained. That’s why SOS supports Gov. Jennifer Granholm’s proposal to reduce the sales tax from 6 percent to 5.5 percent and expand the tax to cover a broad array of services such as haircuts, lawn care, dry cleaning, legal services and tickets to sporting events. The additional revenue– about $400 million – would be earmarked exclusively for K-12.

SOS also supports the Governor’s proposed reforms of the retirement system for school employees that is run by the state. Her proposal offers incentives for retiring, and reduced benefits for current and future retirees.

To help contain spiraling health care costs, the SOS supports the legislation that would require that all school employees pay a portion of their health care premiums. “Most of the member organizations of SOS represent school employees. They recognize we all need to make sacrifices to help fix the problems with school funding,” says White.

“Michigan has been in a recession since 2001. When recovery comes, it will be slow,” said Martell. “Unless we have major restructuring in our tax base and education delivery process, schools will continue to have significant budget challenges. This survey is a snapshot of the measures that school districts are taking to stay alive.”

SOS has taken the lead to rally for school financing change in Michigan and has been joined by a number of local groups, including the Ann Arbor Public Schools PTO Council, which recently formed an advocacy committee to educate both the community and legislators about the severity of the current school funding situation.

According to a recent e-mail update from the SOS group, it has hosted a statewide rally at the Capitol this month, testified before the House Committee on Education and the State Board of Education and hosted two news conferences to get the word out about the critical need for school funding reform. Members also have had private meetings with legislators to share their concerns and encourage action.

“We may have to go back in larger force to Lansing,” said White in his update. “We’re hopeful of a solution in the coming weeks but many legislators will tell you they don’t believe anything will happen until after the November election. That’s too late for schools. We need to make sure that Lansing is held accountable for what happens to schools and students in the fall if they don’t get this resolved before then.”

The following education groups make up SOS Michigan:
Michigan Association of School Boards
Michigan Association of School Administrators
Michigan School Business Officials
Michigan Association of Secondary School Principals
Tri­County Alliance
Michigan Association of Intermediate School Administrators
Middle Cities Education Association
School Equity Caucus
Michigan Association for Supervisions and Curriculum Development
Michigan Negotiators Association
Michigan Elementary and Middle School Principals Association
Michigan Association of Administrators of Special Education
Michigan Association of Middle School Administrators
Michigan Parent, Teacher and Student Association
Michigan High School Athletic Association
Michigan Association of Pupil Transportation
Michigan School Public Relations Association


Governor’s 2011 Budget Proposal
• Projection that School Aid Fund will be $410 million in deficit for 2010-2011 which translates to $255 per pupil.
• Budget Plan would not reduce per-pupil funding beyond current level.
• Plan would extend sales tax to services and reduce tax rate to 5.5 percent.
• Michigan Business Tax would be phased out over 3 years.
• Michigan Promise Grant would be reintroduced as a $4,000 tax credit for students who graduate and work in Michigan for at least 1 year.

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