School district budget deficits are everywhere
Even when a fiscal cliff is in plain sight, it can be hard to avoid. Here’s why.
Happy weekend, readers! We are preparing for anywhere between four and 12 inches of snow on the mountain today. Yesterday, my husband and I set about making the necessary preparations. To him, that means salting our driveway and prepping the snowblower. To me, that means going to the grocery store to make sure we had all the ingredients to make cookies and hot cocoa. (Just one example of the many ways we balance each other out.)
This morning, I’m writing about public education and the large deficits opening up in K-12 schools. (The same is true for higher education but I’ll address that at a later point.) Federal pandemic funds for schools expire next school year and that’s playing a big role. But why should aid that everyone knew was temporary have this kind of effect? Read on.
Public education’s fiscal cliff
Public schools received a total of $190 billion in additional federal aid across three separate pandemic relief funding bills. That pool of money, called the Elementary and Secondary School Emergency Relief Fund, or ESSER, was intended to help schools address educational issues and disparities arising from the pandemic.
For the past few years, Georgetown University’s Edunomics Lab notes, “District leaders have more money at their disposal than ever before. Normally leaders spend budget seasons trying to pare back planned expenditures to match their revenue reality. But with ESSER, districts had to come up with new ideas for how to spend one-time funds within a limited time period.”
(The Edunomics Lab is the best resource around on what’s going on with ESSER. I highly recommend exploring their data.)
Because the pandemic exacerbated and widened gaps in learning access and outcomes, school districts that had a higher percentage of students from lower-income households received more funding than wealthier districts. They also had a lot of flexibility in deciding how to use the funds. Examples include: PPE, technology, building upgrades to reduce health hazards, creating programs to track and reduce learning loss, and professional development for teachers and staff.
But for the upcoming budget season, all that is going away.
Schools have until Sept. 30 to obligate (decide how to spend) their ESSER funds.
They must spend their funding by the end of January 2025.
States can apply for a 14-month spending deadline extension on behalf of school districts.
Dozens (if not hundreds) of school districts across the country are reporting budget deficits for the 2024-25 school year and warning of things like staff cuts, consolidation and other belt-tightening measures.
Facing budget shortfall, SF school board votes to cut over 900 unfilled positions
Seattle School Board approves plan to reduce $105 million deficit
WDC (Minnesota) School Board cuts school district budget, raises rates
FNSB (Alaska) School District projecting largest ever budget deficit
Houston-area school districts facing multi-million dollar budget deficits
To solve $150 million budget gap, Memphis school district may cut 675 jobs
“This is the kind of stuff that we just normally don’t see,” Edunomics Lab Director Marguerite Roza told The Providence Journal. “It’s going to be very chaotic, and districts are going to have to work really hard this winter to solve these problems.”
What’s more, because more funding went to higher-need districts, their fiscal cliff is much steeper than others.
But everyone knew this was coming. Why is it still causing so much disruption?
A big part is how funds have been spent. According to the Edunomics Lab, roughly half the funds we know about were spent on labor costs.
20 states have not reported details on how districts spent their ESSER funds
Browse states’ ESSER spending plans submitted to the U.S. Department of Education
How districts are spending—and how they’ll soon be cutting
In the 22 states that provide some spending detail, labor totaled just under 50% of expenditures, according to Edunomics Lab data. We know through state plans that a lot of relief funding to recruit and retain teachers was intended for spending that (unlike salaries) can be pulled back. I.e., “Grow Your Own” programs, offering financial incentives, providing staff mental health supports and creating alternative licensure routes.
But federal guidance also allowed funds to be used for salary increases.
K12 Dive reports that some states are using relief funding to employ evidence-based strategies to strengthen the educator workforce. A partnership in Georgia, for example, created a mentoring program for new special education teachers across the state. In Memphis, school staffing increased by almost 2,000 since 2020. (Tennessee is one of the states that doesn’t detail spending.)
Either way, pulling back on things like teacher retention and support services is a blatantly bad idea in a public sector that is chronically underfunded, underappreciated and experienced a mass exodus of talent and experience during and after the pandemic.
“The root cause of educator exhaustion and frustration is a lack of support and respect, not a perceived inability to manage stress.” - Beyond Burnout: What Must Be Done to Tackle the Educator Shortage | NEA
So, what can districts do? Other than ask states (which are going to be dealing with their own budget problems for fiscal 2025) for more money?
Step one will likely be cutting vacant positions, as San Francisco Unified has done. After that:
The Hechinger Report notes that community services such as vaccine clinics and mental health services may be the first to go.
Memphis schools is considering, among other things, cuts to tutoring and extending learning and changing the way schools are grouped for administrative purposes to eliminate some 323 leadership roles.
Who’s to blame for education’s fiscal cliff?
It’s easy to say that school boards and administrators should have seen this coming and not spent so much money on stuff that would be hard to give up. But—especially in high-need districts—it would have been downright irresponsible to blow it all on Chromebooks, iPads, home hotspots and building upgrades while ignoring the things that actually do help student learning outcomes and teacher burnout.
To a large degree, the fact that there is an education fiscal cliff at all speaks more to public education’s chronic underfunding (by the feds and states) than it does to the particular spending choices of school districts. That so much ESSER money has so far gone toward people—teachers, aides, counselors, interventionalists, nurses, administrators—compared with shiny tech is as big a sign as any that schools are starved for the meaningful supports their students need.
Often, we simplify public education to an input-output situation: spend more, get better outcomes. But in the same way that cops have had to learn how to deal with mental health emergencies, today’s public schools are burdened with more than just teaching. For many kids, school is their only source for a nutritional meal or mental health services. It’s where they can find a trusted adult and perhaps their only access to heating or air conditioning.
In the end, saving ESSER-funded efforts will require tradeoffs and making intentional choices. It won’t be easy.