School District-State Budget

As you know all the School Districts in Pennsylvania will be passing their final budget in the upcoming weeks. The State requires that they do so by June 30th of each year.

You also may be seeing articles about the State Budget (in which the Education Budget is part of). In Harrisburg there is debate on whether to use the Federal Stimulus money to replace the State's portion of the Basic Education, Transportation and Special Education Subsidies as well as the various grant programs funded by the State.

According to PSBA (Pennsylvania School Boards Association) the stalemate is apparently over what year to roll back the funding amounts to.

The Republican minority wants to roll back the base numbers to 2007-08 Budgeted Education Subsidies, while the Governor is leaning towards the 2008-09 as a base year.

Depending on which version passes, the Commonwealth could save up to 800 million dollars in state funds (lowering their projected deficit to 2 Billion Dollars) while delivering the full amount of Governor's proposed Education Budget.

What will happen is that the School Districts will pass their budgets by June 30th. What may happen is that the State won't pass its budget by the same date.

If the State Legislative bodies and the Governor can resolve the impasse relatively quickly then there will be no significant impact on the School Districts for 2009-10.

If the impasse drags on into the summer there may be some concerns with the School's in terms of cash flow operations, since the first Subsidy payments are due to the School Districts in August 2009.

Hopefully the budgetary issues can be resolved quickly and we can have a rather uneventful summer.