Stimulus gone, schools in bind

Posted: March 11, 2012

Eric Boehm

is a staff writer for

PA Independent (

Federal stimulus money warped Pennsylvania's education budget both upward and downward during the last three years, and the state's 500 school districts and 12.6 million taxpayers are beginning to see the consequences.

Beginning in the 2009-10 budget year, Pennsylvania school districts received a boost in funding from the federal stimulus. At the same time, the state reduced its spending level for basic education, allowing the federal dollars to make up the difference.

Now, in the first state budget after the federal stimulus has disappeared, a $500 million reduction in state spending on education is the result of the federal stimulus increasing, and then decreasing, education dollars.

Lawmakers and school districts are left to grapple with the problem.

In many state districts, Education Secretary Ron Tomalis said Monday, the federal stimulus was folded into the general operating costs, creating a hole when the temporary funds vanished.

"It basically created the scenario where the difficulties we're addressing today should have been addressed years ago," Tomalis said during a budget hearing with the House Appropriations Committee. "It just kicked the can down the road, and it delayed the impact."

Since Gov. Corbett is unwilling to crank up state spending to make up the difference, school districts will have to deal with the overall funding reduction by either cutting services or increasing local property taxes.

Democratic lawmakers slammed Tomalis and Corbett for reducing education funding from its pre-stimulus levels. Pennsylvania spent about $5.8 billion on basic education in the year before the stimulus. This year, Corbett has proposed spending about $5.3 billion for basic education.

"If you look at the main line items that fund K-12 education in Pennsylvania, getting away from the semantics and urban legend, it looks to all of us like . . . our support for our schools has gone down," said State Rep. Matthew Bradford (D., Montgomery).

However, most of that reduction took place in previous budgets, though it was hidden by stimulus funds, and the gap is only now becoming apparent, Tomalis said.

"State support for K-12 public education went down quite a bit a couple of years ago," Tomalis said. "It was back-filled with federal funds and then grown with federal funds on, in essence, a credit card that was going to go away."

In 2009, the legislature and Democratic Gov. Ed Rendell approved a budget that used about $650 million in stimulus money for education, while the state's share of education spending was cut by about $350 million. School districts saw more than $300 million extra that year, while the state's reduction was hidden by stimulus money.

From the perspective of a school district, however, dollars are dollars. And now that the federal money is gone, the reduction in state spending is causing problems, said State Rep. Matt Smith (D., Allegheny).

"If you're a school district . . . and you're getting $5 million or $10 million, your concern isn't really where that money is coming from," Smith said.

U.S. Education Secretary Arne Duncan and state lawmakers had warned the districts about using the stimulus dollars wisely because the money would go away after a few years, Tomalis said.

Some districts followed that guideline, but others did not, and now each one has a different story, said State Rep. Bill Adolph (R., Delaware), chairman of the House Appropriations Committee.

"When that stimulus money was appropriated, school districts were informed that it was one-time money," Adolph said. "Some used it for what it was for and others created some programs, and they are now looking for where the money comes from."

Tomalis' department wants to give districts more flexibility because their largest expense is generally labor costs, which are negotiated at the local level. As a result, changes are being made in how the state plans to fund basic education this year. Corbett has proposed combining a series of previously separate line items into a single "Student Achievement Education Block Grant" program, which, the administration said, would give school districts more flexibility in how state dollars are spent at the local level. In the process, the administration would reduce funding by about $20 million from last year for that collection of line items.

The Pennsylvania State Education Association, the state's largest teachers union, has been sharply critical of Corbett's proposed budget and has warned that districts will be forced to increase property taxes.

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