Schools Dodge Bu llet Now, But Worry Remains (NC)

July 9, 2010

The good news for educators in Davidson County, Lexington and Thomasville is that no massive layoffs occurred this year due to reduced funding from the state. The bad news – not only for school system employees but also students and parents – is that a large number of jobs could be lost a year from now. That gives federal, state and local legislators a year to figure out how to prevent that happening, since they provide the funding.

Some systems in North Carolina anticipated losing teaching positions for the coming year in light of the state budget reductions. The three systems in Davidson County were able to avoid this situation thanks to wise budgeting, funds from other sources and leaving a few vacancies unfilled. That means students and parents should see little impact from the state reduction, at least in the first half of the 2010-11 school year.

But problems could surface as soon as January. If Congress doesn’t reimburse North Carolina for Medicaid costs, state legislators could be forced to fill a $519 million hole in this fiscal year’s budget. That could necessitate mid-year reductions, which would be extremely disruptive to the educational environment.

The issue only worsens next school year, when federal stimulus funds run out. Using such one-time infusions deals with an immediate need and saves jobs and programs, but the piper must be paid when that money runs out. That is what has school administrators concerned as they look ahead.

No easy answers exist. Additional federal money would be one answer, but this option has ramifications for the nation’s debt. And unless that money becomes an ongoing revenue source, eventually it will end . Commissioners and city councils could raise taxes to offset loses, but this hits taxpayers in the wallet as the economy continues to sputter.

One option that needs thorough investigation is the use of proceeds from the N.C. Education Lottery. The distribution formula may need some adjustment to return more money to schools; after all, that was the original intent when the state adopted the games. Legislators also need to consider lottery funds as an ongoing revenue source, too. Local administrators shouldn’t have to guess from year to year whether that money will be available.

Ideally, lottery money would be used for one-time expenses such as the construction of a new school. But when a large number of teaching positions is at risk, then those funds may be redirected to ongoing costs. Commissioners and boards of education could find themselves forced to make difficult decisions between buildings and staff positions.

Everyone hopes for an economic rebound that could lessen any potential reductions from the state. But rather than sit around and hope that happens, contingency plans need to be in the works now to prepare for the worst. Education holds the key to future success for North Carolina’s youngsters, and adults must make decisions that ensure they have the best opportunity to succeed.