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February 2017

SUPERINTENDENT’S NEWSLETTER

February, 2017

I guess its about time to give the people of USD223 a synopsis of what is currently happening with the State in regards to school finances.  Sad to say, the wheels are turning slowly at the Capital.  

 

Of course, as you know, the governor claimed he was producing a structurally balanced budget.   And after it’s unveiling, the governor’s staff asserted the budget was indeed structurally balanced.  But it’s not.  Not even close.  Unfounded claims and assertions can’t make it so.

Kansas faces a giant gap between recurring revenue and recurring expenses, a gap that opened up immediately when revenue dropped sharply upon implementation of the 2012 income tax cuts.  Subsequently, the last four fiscal year budgets have all been structurally unbalanced, the general fund kept barely solvent by using up reserves, grabbing money from the other funds, borrowing, and one-time tricks.  In each of those years, Kansas became poorer—bank accounts depleted, debt way up, and credit rating down.

 

The governor’s revised FY 2017 budget and newly proposed FY 2018/FY 2019 budget brings more of the same!  The governor’s budget recommends three main items to address the $350 million shortfall:

  • Borrow.  The governor proposes to borrow $317 million to be paid back over 7 years.  If the Legislature agrees, that would increase expenses over the next 7 years, widening the structural imbalance.
  • Don’t pay bills.  In order to stay financially afloat in FY 2016, the state simply did not pay $87 million worth of bills, including $75 million owed to school districts.  The bills were carried over to FY 2017 to be paid as soon as money was available.  The governor now recommends not paying those bills at all.  (A $96 million KPERS bill also went unpaid in FY 2016, with a promise that it would be paid with interest in FY 2018.  The governor also now recommends not paying that.)
  • Cut K-12 education. Facing a $350 million deficit in the current fiscal year (ending June 30), some state legislators are considering across-the-board spending cuts for state programs, including K-12 education.  Under this scenario, Kansas school districts would see a reduction of $219 million, or 8.56 percent reduction this school year!   At this point in the school year, school operating costs, which comprise mainly salaries and benefits, are mostly fixed. Thus, cuts at this time of the year would be greatly detrimental.   

It should be noted that since 2009, state school funding has been cut, school funding has fallen behind inflation and Kansas has fallen behind in its financial commitment to schools in relation to other states.  This all falls on the heels of the three-court judges making a ruling soon on whether the State has adequately funded K-12 education the past several years. For all school districts in Kansas, we are in a very uncomfortable holding pattern waiting for our State leaders to make decisions for all our students’ education.  Hopefully, good educational funding decisions will be made soon.

 

Brian Cordel, USD223 Superintendent