School Aid Budget Takes Spending Cut

SCHOOL AID BUDGET TAKES SPENDING CUT – Facing the prospect of having $150 million less to spend than anticipated after the January Revenue Conference, the Senate Appropriations K-12, School Aid and Education Subcommittee reported its proposed budget which makes major revisions to the spending plan envisioned by Governor Granholm. The constrained spending proposal eliminated the Governor’s plan for smaller high schools and her call for all-day kindergarten schooling. It also made significant reductions to the proposed increase in the overall per pupil foundation grant proposing an increase of roughly 1.9 percent instead of the 3 percent for which the Governor had called. Subcommittee and Senate Appropriations Committee Chair Ron Jelinek (R-Three Oaks) did note the proposal included an historic decision by creating a fund for schools to deal with infrastructure needs. The plan would take a portion of the funding Ms. Granholm suggested be used to create her proposed small high schools to create competitive grants the successful schools could use to reduce existing debt, make immediate repairs or place in a sinking fund.
Saying the subcommittee’s final product was predicated on “a shortage of money,” Mr. Jelinek also warned that other legislation could have an adverse impact on the spending plan. Specifically, Mr. Jelinek warned, legislation proposing reductions in property taxes for those who have seen the value of their homesteads tumble during the mortgage credit crisis or suspending the “pop-up” tax would further reduce available revenues for schools and require additional reductions in state spending.
While the measure—the state’s largest single spending plan—was sent to the full Senate Appropriations Committee on a unanimous vote. The proposal would allocate a total of $13.375 billion an amount 2.8 percent higher than the amount allocated in the current year’s budget. However, the proposal does total $150 million less than the overall spending level advocated by Governor Granholm in her Executive Budget proposal. Reacting to the measure, a gubernatorial spokesperson said Ms. Granholm was disappointed with the proposal but also realized it was early in the appropriations process. The spokesperson also criticized the plan’s use of a two-part per student increase ranging from $70 to $140 per pupil that also awarded another $40 per pupil to school districts where the per-student foundation allowance was $8,433. The spokesperson, who claimed it was too early in the process to assume major revenue reductions, also argued the two-tier plan with the extra monies essentially rewarded “richer” school districts in an “anti-Robin Hood” fashion.