Districts Left in Doubt Over Federal Funds (MO)

August 13, 2010

When President Barack Obama signed an emergency education spending bill this week, supporters said it would almost immediately send $10 billion to states — including more than $600 million in Missouri and Illinois — to spare thousands of teacher jobs.

Now some educators are puzzled over how and when the money will actually reach schools.

One top Missouri budget official is uncertain whether the state will even distribute all the new federal funds this year.

Meanwhile, leaders at many school districts — including several in suburban St. Louis — are assuming they will be left with little to none of the windfall.

For example, the $190 million headed to Missouri won’t likely bring 35 teachers back to work at Lindbergh, the only St. Louis County school district forced to lay off a significant number due to the recession.

"It’s not fun to be on the wrong end of irony," said Pat Lanane, Lindbergh’s chief financial officer. "I have no expectati on that we’ll do any better this time."

That’s because the rules for distributing the federal money wouldn’t direct the funds to all school districts equally.

Federal officials say states can hand out the money through their existing state school funding formula or based on a school district’s level of poverty assistance. Both of those options would favor poorer school districts with low local property tax support.

And that would leave St. Louis area districts such as Lindbergh, Parkway, Kirkwood, Brentwood, Pattonville and Clayton — which rely chiefly on local funding — with little to none of the federal funds.

Meanwhile, other Missouri districts — such as Hazelwood, Riverview Gardens and Fort Zumwalt — which receive more state aid through the funding formula, stand to gain the most.

Officials at those districts say the extra money could prevent future cuts to teacher jobs, but that it is not a remedy for all financial shortfalls facing states and school districts.

"(It) begins to help plug a little bit of the hole, but that is not the state’s only concern," said Kevin Supple, chief financial officer in Francis Howell School District. "Still, this is very welcome news."

Illinois schools have faced a state budget crisis even more severe than those in Missouri. This year, the state owes more than $1.4 billion in back payments to schools. Dozens of teachers in several districts in St. Clair and Madison counties were handed pink slips last spring. The emergency federal spending approved this week would send $415 million to the state.

Superintendents in Illinois are cautiously optimistic.& lt;br />

"People are encouraged, but nobody really knows what to expect," said Brad Harriman, superintendent in the St. Clair County Regional Office of Education.

The U.S. Department of Education has estimated the money would support about 160,000 education jobs nationwide, including 3,300 teacher and school staff jobs in Missouri as well as 5,700 in Illinois.

But some are critical of the emergency spending.

Michael Podgursky, an economist with the University of Missouri-Columbia who studies education data, said schools nationwide have added to payrolls in rates that have far exceeded enrollment growth.

"The idea that they might slim down a bit is not a bad one," he said. "The more bodies you put on the payroll, the more expensive it becomes. Give them money to spend to keep the schools running, but don’t encourage them to add more to the payroll when really they might not need it."

Still, the Missouri National Education Association called the legislation a victory for Missouri students, parents and public schools.

Spokeswoman DeeAnn Aull said it’s difficult to pinpoint the number of teacher layoffs during the last year in Missouri because many receive pink slips in the spring but are called back for the new year once the district has a better idea of how many students will enroll.

U.S. Education Secretary Arne Duncan has said he wants to make the money available to school districts as quickly as possible, and Obama signed the bill almost immediately Tuesday evening.

The same federal legislation included money for Missouri for Medicaid, an d the Missouri Legislature had already agreed to set aside any assistance to make up for shortfalls in fiscal year 2012.

But no decision was made about emergency education funding, and state Budget Director Linda Luebbering said she was waiting for more guidance from federal officials to determine if all the $190 million in school aid must be spent this year.

Last month, Missouri schools chief Chris Nicastro joined Duncan in support of the emergency public school funding. After the measure passed, she sent a memo to districts saying she didn’t yet know how the money would be distributed.

The Illinois State Board of Education also was unsure, but a spokeswoman said distribution through the general state aid formula was likely. During the last two years, more than $100 billion in federal stimulus has helped states and school districts shore up school spending. Even so, many Missouri schools have made cuts to full-day kindergarten, art, music, Parents as Teachers and summer school.

Midyear in the last budget, a slump in state revenue prompted Missouri to cut $43 million from the state’s school funding formula. In the St. Louis region, that meant shortfalls nearing $1 million or more for some districts.

This year, the Missouri Legislature approved an education budget that keeps spending in the school formula equal to last year’s level. To do so, the state relied heavily on about $253 million in previously approved federal stimulus money.