DPS budget roller coaster continues

Times-Herald Newspapers


DEARBORN — It’s been a dramatic three months for Dearborn Public Schools.


Starting in December, district administrators engaged teachers, parents, principals and maintenance workers in a dialogue on how to right a 2010 operating budget projected to be $11 million in the red.


After consulting with stakeholders, administrators came up with a plan to eliminate all but $1 million of the deficit – albeit contingent on $5 million in concessions from teachers in upcoming labor negotiations – and in January presented the recommendations to the school board.


Not a week later, Gov. Jennifer Granholm presented her own budget recommendations to state legislators. At face value, the education cuts weren’t as bad as district officials were expecting. Per-pupil funding, largely viewed as the benchmark for educational funding, was going to be cut by $59 in Granholm’s plan, and district administrators already had anticipated a $100 cut when they came up with the $11 million figure.


However, the governor’s proposed cut to certain categorical funds – 20j or “hold-harmless” and 31a for “at-risk” students, specifically – dealt a crippling blow to the district’s finances, to the tune of about $6 million.


Hold-harmless funding was enacted in 1999 as an amendment to former Gov. John Engler’s 1994 school finance reform initiative, or Proposal A, as it is commonly known. Its purpose is to allow a district to maintain its pre-Proposal A spending level if it exceeds the state maximum set by the measure. Granholm’s cuts would amount to a $617,000 reduction in such funding.


At-risk funding is given to students who exhibit low achievement on the Michigan Educational Assessment Program test in math, reading, or science or fail to meet curriculum objectives in English-language arts for kindergarten through third-graders.


The specter of the further cuts led district officials to orchestrate a massive public awareness campaign. Fliers were sent, phone calls were made and parent-teacher groups rallied — all with the aim of convincing state legislators that the cuts would devastate a district already facing a budget only two-thirds what it was in 2000.


On Feb. 17, however, Congress passed the American Recovery and Reinvestment Act, which precludes states from cutting per-pupil funding as a condition for receiving any of the $787 billion in aid it authorizes. Granholm retracted her recommendation, instantly eliminating $1.8 million from the budget deficit.


Passage of the act also raised the possibility that federal funding could be used to help offset other budget shortfalls. But as details emerged, it became clear that much of the money earmarked in the bill was headed to Title I – a program for schools with a large percentage of poor students – and Individuals with Disabilities Education Act programs. Some schools and students in the district would qualify under both, and the help would be welcome, district officials say.


Still, stimulus euphoria led many DPS stakeholders to believe that the district was out of the woods – or at least back to a manageable level of cuts – at a time when it still isn’t known whether Granholm’s categorical cuts will come to fruition, DPS spokesman David Mustonen said.


“We are cautiously optimistic, but people need to understand that the budget woes are not done and over just because of the stimulus,” he said.


Mustonen also said he’s heard differing accounts of what will happen when state legislators vote on the budget. Ask a representative, he said, and they’ll say the cuts are done and won’t happen. But, Mustonen said, ask a professional organization that monitors policymaking in Lansing, and they’ll tell you they are still on.


According to Mustonen, the current best-case scenario is about $9 million in cuts. That figure is reflective of all of other structural budget shortfalls the district accounted for in initial projections, minus the anticipated cuts in state funding.


The worst case is about $15 million, which would include Granholm’s cuts to 20a and 31j, he said.


But until district administrators get a better grasp on what Lansing will do, the amount of money remains in limbo. The district has until June to submit its budget and, in the meantime, officials will move forward under the assumption that their $11 million projection was right from the start.


As for why the district is not preparing for a worst-case scenario with so much uncertainty abounding, Mustonen pointed to the events of the last few months.


“This has all been so fast moving and everything is in such a state of flux, that at this point, it would be difficult to predict what’s going to happen next,” he said.