Tuesday, October 28, 2008

Michigan School Funding - Waiting for the shoe to drop!

While I've been ready to post the next in this series - a detailed look at how funds flow from the biggest sources (state restricted funding sources, federal funding, and the state legislature controlled funding) - economic turmoil has me hesitant to publish any dollar figures.

The reason is simple; the 2008/2009 state budget was based on figures from the May 2008 Revenue Estimating Conference. Those numbers (a total state budget estimated at $42.95 Billion) are guaranteed to be wrong - the numbers will be lower. The question is how much lower. For schools the question is simple, will it be bad enough for the dreaded "PRORATION". Simply put, will the state take back the $56 to $112 per student increase we were promised (and budgeted for)? It would not be the first time (it was done in 2003/2004 to the tune of $74/student ) and some cut seems inevitable. Here are the facts straight from the Senate Fiscal Agency update October 21, 2008 (not yet published).

Some basics:
  • Michigan's economy has improved little from the 2001 recession.
  • Employment has declined by 494,900 jobs (10.5%) since June 2000.
  • From August 2007 to August 2008 employment FELL an additional 69,500 jobs.
  • Payroll employment is projected to DECLINE 1.8% in 2008 and 1.5% in 2009.
  • That makes 9 consecutive years of job losses in Michigan.
Add these facts to the recent events in the national economy, the potential to lose a major company entirely (Chrysler) and it all points to a very large shoe dropping, in fact it may be a boot.

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