from the bcct:
Schools surviving budget impasse
By: GARY WECKSELBLATT
Bucks County Courier Times
Though the lack of a state budget has prevented school districts from collecting money due from Harrisburg, area schools expect to be able to pay their bills for several months despite no agreement in the Legislature.
Local schools rely more on property taxes than state funding. So despite missing their July and August payments from the Commonwealth because of the budget impasse, the Aug. 31 deadline for homeowners to get a reduced rate on their property taxes boosted district coffers just as students arrived for their first day of school.
"That's really saving us right now," said David Matyas, business administrator for Central Bucks, which receives about 15 percent of its budget from the state. "That'll keep us solvent through January, February."
A critical portion of the argument going on today in Harrisburg - as it has for most of the year - involves school funding. Democrats and Republicans attempting to fill a $3.3 billion budget hole are at odds on how the American Recovery and Reinvestment Act, or stimulus money, should be spent.
Republicans want to drop baseline funding and plow stimulus money over it to increase education spending by 11 percent. Gov. Ed Rendell and Democrats prefer to use the stimulus for new programs and increase funding by 19 percent. Rendell has also called for a 16 percent increase in the personal income tax, which does not have enough support to pass either the Senate or House.
Area educators, not surprisingly, support the governor's spending plan because it would mean more money for their schools.
However, Bucks County state Reps. Frank Farry and Marguerite Quinn said their constituents would be big losers under Rendell's proposed tax.
According to state department of education statistics based on 2006 income data, residents in the Neshaminy School District would pay an additional $9.7 million in taxes and the district would get back $650,000, Farry said.
Quinn, whose district includes portions of Central Bucks, Palisades and Pennridge, said her constituents would pay $28 million for $2 million in funding.
Despite those numbers, and the tax increase notwithstanding, educators have been on board with Rendell's beefier budget.
At a rally last month, Lisa Andrejko, superintendent of Quakertown schools, said stimulus money "must be used to supplement and not supplant. That's the true definition of stimulus. It cannot be used for current expenses."
However, a study released by the American Association of School Administrators found that states across the country have enacted the budget model supported by Republicans in the General Assembly.
Titled "Schools and the Stimulus: How America's Public School Districts Are Using ARRA Funds," the study points out that the need to fill federal, state and local budget shortfalls has become a sizeable obstacle many districts nationwide have been unable to overcome.
The survey of 160 school administrators from 37 states conducted in July and August, stated that "more than two-thirds of respondents replied that the stimulus dollars are either filling funding gaps or represent only marginal growth in funding levels."
Mike Braun, business manager for Upper Moreland, is against that format of stimulus spending. "We want to have it as a building block not as a stop gap measure," he said.
Said Matyas, "Anything from the federal government comes with strings attached, so it's not wide open how we can use that money."
In the meantime, he said the district was in a "conserve mode. Everything we can do to conserve cash right now is how we're proceeding. We're squeezing every nickel we can."
Timothy Vail, Centennial's business administrator, said his district should be OK through late November. The district is investing in fewer long-term packages to keep tax revenue more liquid, he said.
Pennsbury spokeswoman Ann Langtry said her district will feel the impact by February or March. That's why officials there have been trying to hold down spending, conserve cash, and use other budgeted revenue, she said.
Democrats said this week their latest spending plan totals $28.1 billion, which House Majority Leader Todd Eachus said represents a nearly $1 billion reduction from their previous proposal but more than the state spent in the last year. Democrats have talked about various potential new taxes, but have not said which ones they would use to sustain that spending level.
House Minority Leader Sam Smith countered this week with an alternative plan that he said would reduce spending by 2.5 percent, to $27.5 billion, without a major tax increase.
Democrats stressed the need for additional recurring revenues to avert projected budget shortfalls of $4.5 billion in 2010-11 and $8.8 billion in 2011-12, largely due to the expected cutoff of federal economic stimulus funds and growth in mandatory expenses such as Medicaid, state prisons, and state-employee pensions.
Republicans argued cutting spending immediately would help reduce potential shortfalls in the future.
