School Finance

New California budget crafted to persuade voters to support Gov. Jerry Brown’s tax hike

Kansas colleges and universities told to prioritize budget requests

Insolvency threat to New York school districts

Louisiana state-run colleges work out budgets including nearly $66 million less from general fund

New California budget crafted to persuade voters to support Gov. Jerry Brown’s tax hike
California Governor Jerry Brown this week signed into law a fiscal year 2013 budget that relies on voters to approve new taxes that will fund public services, including education. If the tax hikes are not passed in November, the budget triggers $6 billion in automatic cuts, targeted to public education and other programs. A significant portion of those cuts would come from K-12 education -- $5.4 billion -- and a portion of the remainder from community colleges. Additionally, under a provision added in negotiations in the legislature, school districts would have the option to cut costs by shortening the school year from 175 to 160 days per year for two years. The University of California and California State University systems could also each face a $250 million shortfall mid year if the tax increases are not approved, and those school systems could be forced to raise tuition during the 2013 academic year to cover the costs.  If the tax hikes are approved, though, 89  percent of the additional funding provided will be concentrated in K-12 schools and 11 percent in community colleges. More here...

Kansas colleges and universities told to prioritize budget requests
The Kansas Board of Regents this week asked the state’s colleges and universities to revise their original fiscal year 2013 budget requests to reflect their priorities in building and renovating facilities. According to the Board, the original requests were unrealistic, totaling over $160 million, and were unlikely to pass the legislature. The Board is planning to meet with universities next month to identify top-priority projects and rewrite the budget proposals.  Ideally, Board members have indicated, the requests will reflect schools’ greatest academic needs and will be supported by the institutions’ records of using funds for capital improvements.  Large requests include $30 million toward a medical school building at Kansas University, $16 million for technical colleges, and $15 million to expand the Kansas Technology Center at Pittsburg State University. More here...

Insolvency threat to New York school districts
A group of business experts in New York says that nearly one-third of New York school districts will use the entirety of their cash reserves within the next two years unless significant changes are made to state policies. While some lawmakers have criticized school districts for maintaining too large of a “rainy day” fund, that concern seems to be disappearing at an alarming rate -- 81 percent of the districts surveyed stated that they would burn through their cash reserves within five years. A cap on state property taxes and increasing pension costs are partially to blame for the current squeeze. Michael Borges, executive director of the state Association of School Business Officials, the group that conducted the survey, says that New York state laws make it difficult to negotiate with teachers unions to lower schools’ personnel costs, although in many school districts, payroll accounts for more than half their budget, and benefits and health insurance account for nearly another quarter. One option the group has suggested would decrease state funding for special education programs, which in New York far exceeds the federally-mandated level of state funding. More here...

Louisiana state-run colleges work out budgets including nearly $66 million less from general fund
The Louisiana state legislature and Governor Bobby Jindal this month reached an agreement to cut nearly $66 million from Louisiana state-run colleges’ general fund for the 2013 fiscal year that begins July 1. Higher education and health care are the only two categories that are not protected from budget cuts by the state constitution. Once the Board of Regents signs off on the budget, the state’s higher education fund will drop to $993.6 million from $1.6 billion just four years ago. And not all universities face equal cuts; while the University of New Orleans will face an 18 percent cut from fiscal year 2012 levels, the State University of New Orleans faces a 24 percent cut. Schools’ considerations for how to deal with the shortfall run the gamut from tuition hikes to bigger class sizes to staff and faculty layoffs. A two-year-old state law permits institutions to increase tuition by as much as 10 percent annually provided the school meets certain performance criteria; some schools will likely elect to implement the full tuition hike for the 2013 academic year. More here...

Mississippi’s public colleges seek $72 million more

Pennsylvania state House panel acts to restore college spending cuts in budget

New Mexico state spending on special education to drop by $7M

New Jersey Democrats introduce budget, but some lawmakers threaten not to vote

Mississippi’s public colleges seek $72 million more
Mississippi Commissioner of Higher Education Hank Bounds this week asked the state’s College Board to consider additional funding for public colleges in fiscal year 2014. Next year’s 2013 budget will cut spending for state universities by $32 million below 2012 levels, meaning schools will receive $670 million for the fiscal year beginning July 1. According to the schools, though, they will require $72.4 million in additional funds in the following year to increase compensation for faculty and cover increasing pension costs. Bounds stated that Mississippi’s salaries for university faculty members have dropped below those at other schools in the region. As a result, as much as $40 million of the additional funds would be directed to instructor salaries. Legislators will begin writing the fiscal year 2014 budget this fall. More here…

Pennsylvania state House panel acts to restore college spending cuts in budget
Pennsylvania lawmakers are working this week to complete the state’s fiscal year 2013 budget. State universities may be spared the deep budget cuts they faced last year. The budget, which totals $27.7 billion, eliminates a 30 percent funding cut Governor Tom Corbett had recommended for three state universities – University of Pittsburgh, Penn State University, and Temple University – and a 20 percent cut for 14 other state colleges. Instead, all of those schools will receive the same funding level as in fiscal year 2012. The agreement between the governor and the House would also provide $25 million in additional funding for the Educational Improvement Tax Credit, which received $75 million in funding in 2012. A spokesman in the governor’s office said the change is due to higher-than-expected revenue intake. The total spending level in the House plan matches that in the Senate budget passed last month, and exceeds the governor’s proposal by over $500 million. More here…

New Mexico state spending on special education to drop by $7M
According to New Mexico’s Public Education Department, the state’s spending on special education in fiscal year 2013 will drop by over $7 million from fiscal year 2012 levels due to decreases in the reported number of special education students. The state’s total enrollment has not shifted much over the past year, so officials are chalking at least some of the cost reductions up to improved data reported by school districts. School districts in the state receive funding based on student enrollment, with an additional per-student amount tacked on for each reported special education student or English language learner. The state began an audit of student enrollment in special populations last year, examining nine school districts and one charter school in-depth to determine whether their reporting numbers were accurate. After the audit, for which the results were released last week, state officials reported $4 million in questionable or undocumented spending of special education funds, in violation of state laws requiring that special education funds be used for specific purposes. More here…

New Jersey Democrats introduce budget, but some lawmakers threaten not to vote
Democrats in the New Jersey state Assembly this week introduced a fiscal year 2013 budget proposal totaling $31.7 billion. The 2013 budget has been controversial this year in large part because of conflicting views on taxes – Republican Governor Chris Christie wants to cut income taxes, while Democrats in the legislature would provide tax credits based on taxpayers’ property taxes. But Christie’s proposed reorganization and consolidation of several of the state’s universities has also played a part in the turmoil. The plan seems likely to pass the legislature since tweaks brought anticipated costs down from over $1 billion to $40 million. But nine Democrats this week signed a letter to the Speaker threatening to withhold their votes unless Christie’s higher education plan is delayed until later this year. The Democrats’ slim majority in the Assembly means they need those lawmakers’ votes to pass a budget.  More here…

University of Alabama System poised to raise tuition

Georgia’s zero-based budgeting program to focus on education

North Carolina Senate budget plan spends less on K-12 than House proposal

Louisiana colleges poised to raise tuition

University of Alabama System poised to raise tuition
The Finance Committee of the University of Alabama System Trustees this week issued its tuition recommendations for the 2012-13 school year. Under its proposal, in-state students would pay between 7 and 8.6 percent more in tuition and fees this coming fall than they did in the 2011-12 school year, the fifth consecutive year in which the system raised tuition and fees for students. System officials say that legislative cuts have necessitated the tuition hikes. Tuition would increase by 7 percent to total $4,600 per semester at the University of Alabama; 8.5 percent, bring tuition and fees to $4,200 per semester, at the University of Alabama at Birmingham; and 8.6 percent, making tuition and fees $4,397 per semester, at the University of Alabama at Huntsville. Though the Finance Committee has already approved the tuition hikes, the full board still needs to approve the measure. More here…

Georgia’s zero-based budgeting program to focus on education
Georgia Governor Nathan Deal recently signed a law shifting the state to “zero-based budgeting.” Zero-based budgeting will require legislators to carefully study spending for all programs and budget from scratch. Typically, legislators only closely examine programs identified for spending cuts or increases. Supporters hope the new budgeting process will reveal and eliminate waste in government spending. Though the bill only required legislators to scrutinize 10 percent of state programs in fiscal year 2013, they will be required to examine 25 education programs in 2014, including nutrition programs, Regional Education Service Agencies, and agricultural education. The state’s school funding formula is exempt from zero-based budgeting next year because a separate commission, appointed two years ago to review the formula and make recommendations to the legislature, is slated to offer its recommendation before the 2013 legislative session begins. More here…

North Carolina Senate budget plan spends less on K-12 than House proposal
The North Carolina state Senate’s fiscal year 2013 budget proposal would spend $127 million less than the House proposal and allocate less funding to education. The Senate proposal spends less on education than the House budget largely because it does not include one-time funds where the House did. Whereas the House proposal provides school districts with $259 million to fill a funding shortfall created by the loss of federal stimulus dollars a few months from now, the Senate budget does not. The Senate bill also spends less on community colleges, though it would spend more than the House on state universities. Governor Bev Perdue issued a statement denouncing the Senate budget because it declines to include her – or any – proposed new revenue sources; she had previously proposed either a three-quarter cent sales tax increase or a tax on video sweepstakes. More here…

Louisiana colleges poised to raise tuition
The Louisiana Community and Technical Colleges Board of Supervisors voted this week to approve a 10 percent tuition increase across its 16 campuses for the 2012-13 school year. Louisiana’s schools have collectively seen $360 million in budget cuts over the past four years, and the Community and Technical Colleges system will likely see a $21 million decrease in state funding from the current 2012 levels in fiscal year 2013. But schools will not be eligible for the approved 10 percent tuition hike – or any increase – unless they can meet the benchmarks set forth in the state’s 2010 GRAD Act. The GRAD Act requires colleges to meet 52 targets, including improved graduation and retention rates, before they can increase tuition by up to 10 percent. The Board of Regents will issue a ruling on whether schools are eligible to raise tuition later this month for all schools. More here…

The Senate took another step this week towards passing fiscal year 2013 funding for education programs when the Labor, Health & Human Services, and Education Appropriations Subcommittee voted to approve an appropriations bill for those agencies. While the subcommittee hasn’t yet made the bill text available, a summary document reveals some (though not all) key details.

Nearly all federal education programs are funded one year at time through the annual appropriations process, and the Senate Subcommittee vote is a first step in that process. Yet this action is a far cry from the end of the annual appropriations process. In fact, we’d be surprised if Democratic leaders in the Senate bring the bill to a vote before the full Senate, or if Congress manages to finalize fiscal year 2013 education funding at any point before the November elections given that the education funding bill is one of the most contentious. (Fiscal year 2013 begins on October 1, 2012, but Congress is likely to provide stop-gap funding in the meantime.) That means the Senate subcommittee bill is more like a starting point for the Democratic majority in eventual post-election negotiations on fiscal year 2013 education funding with the House of Representatives.

The Senate Subcommittee’s appropriations bill would provide overall funding of $68.52 billion to the Department of Education, a slight increase from the $68.11 billion that Congress provided the Department for fiscal year 2012. That overall spending limit is static due mainly to new spending limits Congress and the president adopted last year as part of a debt ceiling agreement. That agreement, the Budget Control Act, sets an overall appropriations limit of $1.047 trillion for fiscal year 2013. That’s just a $4 billion increase from 2012 to be shared among all federal agencies. You can track the budget and appropriations process on our background page

On the PreK-12 side, the Senate bill would provide Title I funding for economically disadvantaged students and IDEA Part B state grants for special education each an extra $100 million over 2012 levels, up to $14.6 billion and $11.7 billion, respectively. That’s not a huge increase given the size of the programs, but any increase when Congress must keep overall funding flat is good news.

Even some controversial programs would get a bump under the Subcommittee’s bill. For example, the bill would provide Race to the Top, an Obama administration favorite, with $600 million, $51 million more than in 2012. (An unspecified “significant portion” of that money will be reserved for another round of the Early Learning Challenge Race to the Top, according to a subcommittee summary.) Promise Neighborhoods, a relatively new program that provides funding for community-based interventions, would receive $80 million. That’s a $20 million increase from fiscal year 2012. And Investing in Innovation (i3) would be funded at 2012 levels ($149 million). ARPA-ED, however, an innovative research and design program the president floated unsuccessfully in both his fiscal year 2012 and 2013 budgets, would receive a portion of that funding.

The subcommittee made some changes to higher education programs, too. One provision in the bill would ban postsecondary institutions from using federal dollars for marketing purposes or for recruiting students. Senate Health, Education, Labor, and Pensions (HELP) Committee Chairman Tom Harkin (D-IA) with Senator Kay Hagan (D-NC) proposed this change a few months ago as part of the Protecting Financial Aid for Students and Taxpayers Act, primarily targeting for-profit colleges’ allegedly-unethical recruiting practices. (It is unclear whether the appropriations bill includes language identical to the Harkin-Hagan bill or another, more comprehensive version of it.)

In acknowledgement of the national conversation around college costs and completion, the Senate panel also included a new, relatively small-scale initiative. The First in the World program, another proposal the president made in his 2012 State of the Union address but saw rejected by Congress last year, would funnel $40 million in grants to colleges and universities to attempt new cost-cutting and outcome-improving strategies.

Unlike past years, there’s no high-stakes Pell Grant funding battle with the Senate bill. In fact, Congress can cut the 2012 appropriation and still increase the grants that students will get. That’s because last year’s Budget Control Act included a supplemental $7 billion for Pell Grants for fiscal year 2013, and the Department of Education says the program wasn’t as expensive as anticipated over past years, so it’s racked up a surplus that can be spent on the fiscal year 2013 grant.

Separately, an automatic inflationary increase in the maximum grant becomes available in fiscal year 2013 (though that amount hasn’t been finalized yet and the Senate Subcommittee and the Congressional Budget Office differ on how large it will be). The 2010 Health Care and Reconciliation Act provided permanent funding for inflationary increases starting in 2013, so Congress doesn’t need to fund them through the appropriations process. Add it all up and the Senate bill funds a maximum grant of $5,645, up from $5,550 in the past few years. (A detailed table of Pell Grant funding is available here.)

Congress is still a long way from finalizing fiscal year 2013 funding for education programs. But the Appropriations Subcommittee bill at least shows where Senate Democrats’ will start negotiations this fall. Check back with Ed Money Watch throughout the budget process for more updates and analysis.

Last week, President Obama made a somewhat controversial comment about the need to support jobs in the struggling public sector. Then this weekend in his weekly address, the president called on Congress to do just that by passing the American Jobs Act, a $450 billion bill that would help states support public sector jobs. For education jobs the proposal would create a Teacher Stabilization Fund to provide $30 billion directly to school districts to help pay for employment-related expenses like salaries and benefits. The program is quite similar to the existing Education Jobs Fund of 2010, which provided $10 billion to support such expenditures, though that funding expires on September 30^th, 2012. Surprisingly, many states have yet to draw down all of their available funds despite the tight state and local budget climate.

As of June 1, 2012, nearly two years after Congress passed the Education Jobs Fund, states and territories had drawn down 86.9 percent of the available $10 billion. Five states and territories have used all of their funds – Guam, Missouri, Northern Mariana Islands, South Dakota, and the Virgin Islands – and another 11 are close to that point, including Florida, Pennsylvania, and Washington State.

But significant portions of obligated funds remain for many states. In total, 15 states have drawn down 80 percent or less of their available funds.  Alaska, New York, Puerto Rico, Vermont, Virginia, and West Virginia all have 30 percent or more of their funds remaining. This means that New York, for example, has about three months to draw down nearly $240 million before the funds expire.

Texas, which has drawn down 72.6 percent of its funds, has $231 million to spend between now and the end of the fiscal year.

And many of the states with low draw-down rates faced significant budget shortfalls in 2012. According to the Center on Budget and Policy Priorities, New Jersey, which has drawn down 73.2 percent of its $272 million in Education Jobs Funds, faced a $10.5 billion (36.0 percent) budget gap in fiscal year 2012. And despite a budget gap of $3.8 billion (20.3 percent), Minnesota has only drawn down 76.2 percent of its funds.

Even states that have less than 20 percent of their funds remaining may have trouble spending them all in time.  Ohio, for example, has drawn down 85.6 percent of its Education Jobs Funds. However, that remaining 14.4 percent accounts for nearly $53 million, a sizeable chunk of change to spend over three months. This is particularly the case when those months are over the summer, when education expenditures are typically lower than during the school year.

To be sure, these unobligated funds do not indicate that states and school districts are in better financial shape than first thought or that President Obama’s $30 billion Teacher Stabilization fund would be unwelcome. However, the unspent Education Jobs Funds do suggest that Congress should do further analysis before providing more federal funding for education employment costs—especially given that the president has requested three times as much as was provided in the 2010 Education Jobs Fund. Such an analysis would ideally help ensure that those funds are sufficient and properly targeted to the states that need it the most.

Of course, this whole conversation could be moot. Congress was not particularly enthusiastic about the American Jobs Act back in September of 2011 when it was first proposed. After all, $450 billion is a massive amount of funding, equal to half the cost of the American Recovery and Reinvestment Act of 2009. Even more so, it seems unlikely that lawmakers will take to it now as other education topics, such as student loan interest rates, monopolize their attention.

Click here to see data on Education Jobs Funds outlays for all states and territories.

Michigan Senate finalizes 2013 budget, education outlays

Plaintiff school districts, state battle in Kansas school finance hearing

Schools take heavy hit in new Illinois budget

Missouri officials seek fix for school funding formula

Michigan Senate finalizes 2013 budget, education outlays
Michigan lawmakers voted this week to approve fiscal year 2013 K-12 and higher education budgets, the final piece of the state’s full budget. The legislature approved the budgets four days after the legislature’s voluntary deadline of June 1, which Sen. Roger Kahn, chairman of the Senate Appropriations Committee, said was still early enough to give school districts time to plan their own budgets for the upcoming 2013 school year. The budget provides $12.9 billion for public K-12 schools, an increase of 1.6 percent from fiscal year 2012 levels. That money includes an increase in the per-pupil base expenditure of $120 per student over 2012 amounts, up to $6,966 per student. Additionally, public universities will receive $1.4 billion in fiscal year 2013, and the state will spend another $294 million on community colleges. Those totals represent small hikes over current-year levels, but neither the K-12 nor the college and university increases are sufficiently large to make up for cuts to their budgets in fiscal year 2012. More here…

Plaintiff school districts, state battle in Kansas school finance hearing
Kansas is embroiled in a lawsuit over cuts to funding for K-12 schools in fiscal years 2008 through 2013. Fifty-four school districts have filed suit to recover that money, saying that the state has not provided the “suitable” amount of funding needed to educate students as required since a 2006 school finance lawsuit. After the 2006 case, the state legislature increased the base level per-pupil aid including annual adjustments. That funding should have reached $4,492 in fiscal year 2012. During the recession, though, lawmakers cut the base state funding for fiscal year 2012 to $3,780 per student. According to the districts’ attorneys, minority and inner-city students have been the most affected by the cuts. For its part, the state argues that declining academic performance is unrelated to the drop in funding, and says that the current per-pupil funding amount meets the definition of “suitable” financing for education. More here…

Schools take heavy hit in new Illinois budget
Under a fiscal year 2013 budget Illinois lawmakers approved last week, public K-12 schools will face a loss of $210 million in state funding next year, 3.1 percent below current fiscal year 2012 levels. On a per-pupil basis, the state will provide only 89 percent of the required $6,119 per-student base funding in fiscal year 2013, as compared to 95 percent in the current fiscal year. Additionally, the budget will cut 45 percent of funding for low-income students’ school lunches from 2012 levels, and early childhood education funding will decline by 7.6 percent. The early childhood cuts come on top of the loss of about 7,000 slots statewide for young children in fiscal year 2012. Postsecondary education will lose about $152 million, or 5.9 percent, from 2012 levels; $80 million of that will come from public universities. The legislature also cut the state need-based scholarship program for college students by 4 percent, and community colleges will also face a 4 percent cut from current-year levels. Governor Pat Quinn began the process of approving the final budget this week. More here…

Missouri officials seek fix for school funding formula
Officials in the Missouri Department of Elementary and Secondary Education are working to adjust the state’s school finance formula after a budget shortfall led to concerns that some districts would see major increases in funding in fiscal year 2013 while others would see significant drops from their fiscal year 2012 allocations. Lawmakers had hoped to revise the formula, but were unable to agree on a solution before adjourning in May. Though the “state adequacy target,” a base funding level per student, is currently set to increase from $6,131 in 2012 to $6,423 next year, the Department will hold it at fiscal year 2012 levels. However, state funds will be inadequate to reach that frozen funding level. As a result, the state will have to prorate the available funds to districts. If the state’s budget outlook brightens, eliminating the need to prorate the funds, the state will distribute the full $6,131 per student to districts. Any extra funds would go towards increasing the base per-pupil funding level. More here…

North Carolina House seeks to add millions to schools

New Hampshire education funding amendment deal reached

Rhode Island House committee approves $8.1 billion budget plan that boosts school aid

Louisiana Senate panel restores $340 million to state budget cut by House

North Carolina House seeks to add millions to schools
The North Carolina state House of Representatives this week released a fiscal year 2013 budget totaling $20.3 billion. The budget, designed by the Republican-controlled House, includes one-time $250 bonuses and an extra week of vacation for all teachers, but eliminates an existing $121 million reserve earmarked for teacher and state employee performance pay. Legislators did increase funding over 2012 levels, though, for local school districts, including $333 million meant to replace federal stimulus dollars that are set to expire in the current fiscal year. The House budget will also reduce the amount that schools are scheduled to return to the state in the 2013 school year from $503 million to $170 million. The bill includes no new taxes or revenue increases, in stark contrast to Democratic Governor Bev Perdue’s proposal that increased sales taxes by three-quarters of a cent. More here…

New Hampshire education funding amendment deal reached
New Hampshire lawmakers this week reached a deal with Governor John Lynch on a proposed constitutional amendment that would give authority over funding for public schools to the legislature. Since a 1997 state Supreme Court ruling, the state has provided all school districts with a set per-pupil base funding level from state general funds and state property taxes. Legislators, though, would prefer to annually determine the amount of aid distributed per pupil. The language of the amendment would allow the state to prioritize funding to economically disadvantaged districts, and would make it more difficult for stakeholders and advocates to challenge state education laws in court. Three-fifths of each chamber of the legislature must now approve the amendment; if passed, it will be placed on the ballot in November. Two-thirds of voters must vote for the amendment for it to become law. More here…

Rhode Island House committee approves $8.1 billion budget plan that boosts school aid
The Rhode Island state House Finance Committee voted this week to approve an $8.1 billion fiscal year 2013 budget. The budget is higher than the budget Governor Lincoln Chafee proposed earlier this year, which totaled $7.9 billion, and adds about $11 million to public schools over fiscal year 2012 levels. It does not, however, include Governor Chafee’s proposed tax on meals and beverages. Revenue from that plan would have been earmarked for public schools, but a $102.7 million surplus in fiscal year 2012 allowed the legislature to increase school aid without generating additional revenue. In addition, the legislature approved a plan to consolidate the state Department of Elementary and Secondary Education, the Board of Governors for Higher Education, and other state public school and college agencies into one single agency headed by a state education chancellor. More here…

Louisiana Senate panel restores $340 million to state budget cut by House
Louisiana’s Senate Finance Committee this week voted on a fiscal year 2013 budget that increases annual state spending by $340 million compared to an earlier version of the state budget passed by the House. The Senate budget would reverse about $70 million in House spending cuts to public colleges and universities and increases funding from fiscal year 2012 levels.  The Senate’s fiscal year 2013 budget is still about $100 million below Governor Jindal’s original proposal, but is closer to his proposed spending level than the House budget. The Finance Committee, in the same session, approved the transfer of $204.7 million from the state’s rainy day fund to help close a $220 million shortfall in the current fiscal year 2012 budget. The legislature is set to adjourn on June 4, so lawmakers are required to reconcile the differences in their budget bills before then. More here…

Briefly Noted: The Michigan legislature is set to miss its own June 1 deadline to complete the fiscal year 2013 budget due to a disagreement among Republicans over how to divide $36 million in university funding across colleges. The House and Senate have reached an agreement on funding for public K-12 schools, but continue to negotiate the higher education budget.

University of Wyoming reveals more than $15 million in budget cuts

Governor O’Malley signs Maryland tax increase legislation

Kansas tax cuts worry education advocates

New Jersey university planning costs hit $566,000

University of Wyoming reveals more than $15 million in budget cuts
This week, University of Wyoming president Tom Buchanan released a budget proposal that would reduce the state’s operating budget from current fiscal year 2012 levels by $15.7 million annually, beginning at the start of the new fiscal year in July 2013.  The proposal is a response to Governor Matt Mead’s order last month that all state agencies design budget cuts of 8 percent for 2013.  The order was written after forecasts suggested state revenue from natural gas would be lower than anticipated.  Under the University of Wyoming proposal, the school would cut 80 to 125 faculty and staff positions, cutting personnel costs by 3.5 percent.  Additionally, non-personnel spending would be cut by 14 percent in the form of smaller budgets for sports teams, equipment, and technology.  The specific programs that would experience cuts were not identified by the university’s president. More here…

Governor O’Malley signs Maryland tax increase
Maryland Governor Martin O’Malley this week approved two bills passed by the legislature in a special session that would collectively raise taxes by $260 million in fiscal year 2013 in a marathon signing-session that included almost 300 bills.  The bills would transfer some costs of teacher pensions from the state to counties.  In addition, the legislature voted to raise income taxes for the top 14 percent of income earners in the state.  The funds will be used to reverse more than $400 million in pending budget cuts to education and health programs, as well as local aid for municipalities.  The cuts were scheduled to take effect because lawmakers did not pass revenue legislation during the regular session, but during a special legislative session the cuts were averted.  Another bill the governor signed this week raised the age to which students are required to attend school from 16 to 17.  More here…

Kansas tax cuts worry education advocates
Kansas Governor Sam Brownback this week signed a tax reform bill that, according to projections, will leave the state with a $2 to $3 billion budget shortfall within five years, one third of the state’s general fund.  Public school funding consumes about half of the general fund, so education advocates are concerned about potential cuts to school districts.  A report from the state’s deputy commissioner of education Dale Dennis said that if $1 billion in cuts to K-12 schools were put in place, school districts could face substantial strains to their operating budgets, including $29.2 million for Topeka Unified School District. The cuts would be on top of major budget cuts that districts sustained during the recession. Although the governor’s office claims the report is inaccurate because it doesn’t account for his expectations for job growth as a result of the bill’s passage, lawmakers remain concerned.  The governor has suggested other measures – like negotiating with energy companies for lower utility rates – be enacted to fill the hole districts will face. More here…

New Jersey university planning costs hit $566,000
New Jersey Governor Chris Christie introduced a plan earlier this year to restructure several of the state’s largest public universities, including redesigning the University of Medicine and Dentistry of New Jersey and consolidating Rowan and Rutgers universities.  The proposal, introduced in January, has a July 1 deadline.  The governor’s office has required the campuses at the center of the proposal to cover the planning costs associated with the proposed change. The schools will pass on those costs to taxpayers and students through state subsidies and tuition hikes.  A records request reveals that, so far, the schools have spent $566,000 hiring consultants, lawyers, and accountants for the project.  Those figures also do not include the time spent by university staff on the project.  The governor’s office has not issued any public estimates of the cost of the mergers, but is continuing to push the July 1 deadline. More here…

U.S. Secretary of Education Arne Duncan yesterday released the draft of the Department’s proposed application requirements for the Race to the Top-District (RTT-D) grant competition. Congress provided nearly $550 million for Race to the Top in its fiscal year 2012 appropriations; the Department dedicated $133 million of that to another round of the Early Learning Challenge, and the remainder to the new district-level RTT-D. According to the draft application, the Department would award districts or consortia of districts grants ranging from $15 million to $25 million depending on the number of students served. The Department expects to award about 20 grants in total from the program’s nearly $400 million funding. Applicants can also earn extra points by pulling in funds from the private sector or foundations to supplement their federal grant. The Department hopes that the applications will produce high-quality, innovative plans to aid academically-disadvantaged students – and those students may turn out to be middle schoolers.

The district competition, in a departure from the original Race to the Top competition that awarded grants to entire states, focuses specifically on personalized learning. Applicants must propose plans to create personalized instructional environments for students, the only non-administrative requirement in the application.

The summary of the grant competition plan that the Department of Education released yesterday also specifies that, although they will need to demonstrate buy-in from local unions, districts cannot be held back by states’ unwillingness to participate in reform. (Forty-six states plus the District of Columbia submitted RTT state applications; several states have refused to participate on politics or principle.) Multiple districts have the opportunity to apply under one grant as a consortium, even crossing state lines; that will allow the districts to pool resources and create high-quality applications. The Department will also split the states into independent groups for scoring, so districts from states that won under prior Race to the Top rounds (and therefore potentially with more advanced reform systems) are not pitted against districts in states that didn’t win.

Perhaps most compelling, though, the Department’s application proposal states that applicants may structure their proposals to target students in a particular grade, subject, or school. Could this provision mean that the Race to the Top district-level grant competition will have an added focus for middle school students, a group that has demonstrated significant need for academic support?

Perhaps of all the research on the proven benefits of early education and the national focus on college- and career-readiness among high school students has inadvertently excluded the middle grades from the reform conversation. Meanwhile, 8^th grade students have seen far fewer gains in their achievement scores on NAEP—the National Assessment of Education Progress—over the past decade than 4^th graders have.  While the proportion of 4^th graders scoring proficient and above has grown since 2000 by 16 and 5 percentage points in math and reading, respectively, the proportion of 8^th graders scoring proficient has only grown by 9 points in math and 1 in reading. Overall, the 2011 test scores show that only 34 percent of 8^th graders are proficient in reading, and 35 percent in math.

Those academic struggles translate to students’ frustration with school. One study found that in urban public schools, as many as 40 percent of students repeat 9^th grade, and only 10 to 15 percent of those repeaters go on to graduate. Providing at-risk students with intensive academic interventions and comprehensive support in the middle grades could prevent them from entering high school underprepared, lessening the need for remedial learning courses that don’t earn credits towards graduation.  A 2007 report found that over a third of high school dropouts actually drop out in 9^th grade, before they even make it to 10^th grade.

The Department will likely allow applicants for the Race to the Top-District competition to select a specific age group for interventions. District leaders may instinctively elect to focus on high school students because applicants must set a target for high school graduation rates of the students served. But those districts may be better served by focusing on the (oft-neglected) middle grades, ultimately sending better-prepared students through the middle-school-to-high-school pipeline. Earlier interventions could prevent thousands of students from dropping out before they even have the opportunity to get their feet wet in high school.

Check back with Ed Money Watch as we track the RTT-D application and feedback process. For a view of how the RTT-D competition could affect early education, check out this post from our sister blog, Early Ed Watch.

North Carolina House GOP considers merit pay money for schools

Dispute over college tuition roils flagship Texas campus

Alabama education trust fund budget approved

Alaska Governor Sean Parnell vetoes $66 million from Alaska budget

North Carolina House GOP considers merit pay money for schools
North Carolina House Republicans voted in a closed-door meeting this week to reallocate some 2013 funds previously designated for merit pay raises for teachers and other state employees to support teacher salaries and general public K-12 education funding. With $258 million set to expire from the federal Education Jobs Fund, which supports teacher salaries, legislators are working to find replacement state funds and lessen the cuts. The fiscal year 2013 budget contains $121.1 million for the state’s merit pay program. Lawmakers plan to move some of these funds into general funding for K-12 schools to partially replace the Education Jobs Funds. Republican lawmakers have not specified how much funding they will transfer to K-12 schools, and the North Carolina Appropriations Subcommittee on Education is preparing its budget (to be released next week) without the extra infusion of funds. More here…

Dispute over college tuition roils flagship Texas campus
This month, the Board of Regents for the University of Texas system rejected a proposed 2013 tuition increase for in-state students, instead raising tuition for out-of-state students by about 2 percent to more than $33,000. UT-Austin president William Powers Jr. originally proposed the 2.6 percent in-state tuition increase, which would have brought the total cost for those students to over $10,000 a year.  The board vote is in line with Governor Rick Perry’s stated goal of holding in-state tuition costs down to no more than $10,000 through budget cuts. Powers has stated that the school will continue to provide a high-quality education, in spite of the tuition freeze. More here…

Alabama education trust fund budget approved
Alabama lawmakers this week approved a fiscal year 2013 education budget totaling $5.4 billion and sent it to Governor Robert Bentley for his signature. The 2013 budget would cut spending by about $208 million from fiscal year 2012 levels and eliminate about 200 faculty and staff positions in K-12 schools due to an anticipated decline in enrollment. Legislators also made some structural reforms in which they moved funding for several youth programs to the general fund, rather than the education trust fund. Additionally, the budget reduces the total education trust fund by about $190 million in 2013 from fiscal year 2012 levels because a law passed last year requires legislators to move any excess reserves in the fund to a separate reserves account. Nearly 70 percent of the fiscal year 2013 education budget is targeted to K-12 education, while about 27 percent will go to higher education. More here…

Alaska Governor Sean Parnell vetoes $66 million from Alaska budget
This week, Alaska Governor Sean Parnell vetoed more than $66 million in spending from the state’s fiscal year 2013 budget plan.  The governor had previously vetoed far more spending – more than $300 million in fiscal year 2010 and more than $400 million in 2011. Parnell said that the limited cuts in the 2013 budget reflected the legislature’s commitment to holding spending within the governor’s stated spending cap.  The vetoes this year were targeted in part to early childhood education; he cut $1.2 million from the statewide pre-K program and $2.8 million from a parent training program called Parents as Teachers. Still, according to the governor, the state will spend 38 percent more on young children in 2013 than it did in 2012 – almost $14 million total, half of which will come through the Head Start program. More here…