Expert says school districts face a tough financial road ahead

Governor Chet Culver is urging legislators to use reserves for restoring $100-million dollars taken from public schools by his earlier across-the-board state budget cut. He also asked legislators to make education a priority as lawmakers address the tough budget issues. The president of the Iowa School Finance Information Services, Larry Sigel, says the financial stress on public schools is unprecedented.

“In the over 10 years I’ve been working directly with school districts, I’ve never seen this level of intensity and concern,” Sigel says. One example is the Independence district in northeast Iowa, where Superintendent Devan Embray says they need to eliminate 18-position and close an elementary school building, or they face bankruptcy. Embray says they’ve lost enrollment and the state funds that go along with it, but have tried to keep up the number of programs they offer.

Embray says they feel very passionate and strongly about their programs and have tried to keep them on as long as they can. He says it is difficult to make cuts when you have two or three hundred people who want to keep the programs. Embray says if the district doesn’t offer some programs students can open enroll to other schools. Siegal says the Independence budget stress is symptomatic of a bigger problem.

Sigel says the districts have experienced declining enrollment and haven’t kept up by cutting their costs, so there are 70 to 80 districts in the same type of situation as Independence. Sigel says the larger size of the Independence district compared to rural districts, doesn’t provide financial comfort.

He says they are twice as large as the average size of districts in Iowa with over 14-hundred kids. Sigel says the budget situation is going to affect all schools whether they are the largest or the smallest and he says no district is going to get a free ride when it comes to the budget. Some districts look at consolidating, but Sigel says consolidation is often a mirage…

Sigel says consolidation doesn’t save that much money as it doesn’t deal with the overriding fact that districts are losing kids. He says if you take two 300 enrollment school districts wit declining enrollment and combine them, all you end up with is one twice as large with declining enrollment and you haven’t solved anything.

Sigel says the reason most districts ultimately consolidate is to improve or maintain programs for kids. Sigel says while every little bit helps, restoring Governor Culver’s budget cuts isn’t a long-term remedy either.

Sigel says just restoring the cut isn’t going to help districts, as he says there’s a murky state aid picture ahead and he says other things are merging to create a “perfect budgetary storm” for school districts. Sigel predicts the dramatic school budget issues will continue over the next several years.