Gov. Jennifer Granholm’s decision on Monday to make additional cuts in state funding to some of Michigan’s school districts means an additional $3.7 million loss to the Ann Arbor Public Schools in its current fiscal year, which began July 1.
In addition to $165 per-pupil cuts that were already anticipated, Granholm vetoed a portion of a bill that specified school-aid payments to be made to the state’s “hold harmless” districts, one of which is AAPS. She vetoed that item in a comprehensive K-12 school-aid bill that she signed on Monday. The new cuts of $233 per pupil will take effect unless the state legislature overrides her veto.
AAPS superintendent Todd Roberts told The Chronicle this morning that combined with the previous $165 per-pupil cuts, the Ann Arbor district now must deal with a $6.4 million loss in funding for the current fiscal year. They’ll likely need to tap their $28 million fund equity – the equivalent of a district’s savings account – as well as make cuts to services, trying to identify those that will be the least disruptive to the schools, he said.
Roberts said that Monday’s action at the state level makes it even clearer for the need to take more local control of school funding – referring to a proposed countywide millage that’s on the Nov. 3 ballot. [See Chronicle coverage: "Does It Take a Millage?"] “If we’re going to rely on [the state], then shame on us,” he said.
The millage proposal calls for collecting 2 mills annually over a five-year period. If the millage is approved by voters, it would be included in the December 2009 tax bill, and available for schools in the current fiscal year, Roberts said. It would help, he said, but not totally cover the loss in state funding.
The millage would raise $30 million to be equally distributed on a per-pupil basis throughout each of the county’s 10 school districts. Because Ann Arbor is by far the largest district, AAPS would receive about $11 million annually.
Roberts said they hadn’t yet identified specific items to cut from the budget, noting that their situation isn’t as dire as some other districts in Michigan. He described what other school officials in the state are contemplating – scenarios that include eliminating transportation completely, or simply running current programs until funding runs out, then ending the school year early.
Districts also expect additional state cuts early next year, Roberts said, unless the legislature takes action “other than argue with each other.”
The districts being affected by Granholm’s veto are “hold harmless” districts, which were created by the passage of Proposal A in 1994. That ballot initiative was designed to create more equitable funding across all districts and to keep property taxes from escalating dramatically, but it also took away, to a significant degree, local control over school funding.
When Prop A took effect, these “hold harmless” districts were receiving revenues higher than a $6,500 per-pupil base level set by the state at that time. Rather than have their funding lowered, the “hold harmless” districts were allowed to levy an additional millage to make up the gap. For Ann Arbor, that amount is $1,234 per pupil, or 4.42 mills. (The millage rate varies depending on property values, in order to generate a fixed amount of $1,234 per pupil.) In addition, “hold harmless” districts also receive a line item known as 20J, which provides $233 in per-pupil funding – the amount vetoed by Granholm on Monday.