School districts face perfect storm in balancing budgets
School districts are in the middle of a budget nightmare.
Balanced budgets are due to the state by June 30. But administrators don't know what the state's per pupil funding will be, because the state has postponed finalizing its budget until the fall.
They can't estimate how many pupils they will have, due to pandemic uncertainty.
And the state could also cut funding for the current fiscal year, because its own revenues are so uncertain.
Peter Spadafore is with the Michigan Association of Superintendents and Administrators. He says the situation is a mess.
"It means layoffs," says Spadafore. "It means increased class sizes in a time when we're encouraging to reduce the number of pupils per classroom; all sorts of things that are going to be really problematic if we do not see a second round of stimulus dollars from Washington."
Spadafore says if the state cuts funding for this fiscal year, districts will be forced to drain their rainy day funds, if they have them, or go into deficit spending, which is against state law and would force the state to enter into deficit reduction plans with those districts to avoid takeovers.
He says Michigan school districts need a billion dollars this year to make up for the expected shortfall, and a billion dollars next year as well.
In addition, Spadafore says school district costs are going to increase because of preparations that must be made due to the coronavirus pandemic.
He says one estimate is that the average increase in costs solely due to the pandemic is $1.7 million per district.