The picture is so stark, said Sen. Sam Kitzenberg, D-Glasgow, that he made an unsuccessful push at a meeting of the interim Education and Local Government Committee to convene a special legislative session to spend more dollars for schools. He urged the panel to ask Gov. Brian Schweitzer to convene a one-day Legislative session.
“I'm the kind of person who thinks you have to face reality,” said Kitzenberg, who is also running for the office of superintendent of public instruction. Reality, he said, is that many schools are going to run out of money at the beginning of the 2009 fiscal year beginning next July.
There are many reasons behind the budget problem, Jim Standaert, a legislative fiscal analyst, told the committee.
His analysis showed that
40 percent of Montana's school districts would need mill levy increases just to maintain current budgets in July, when the 2009 fiscal year begins. What's worse, state law caps the maximum amount of money any school district may spend. More than half - 52 percent - of the districts facing cuts next summer are already at or above their maximum budget, meaning they cannot have a mill levy and must cut their budgets.
Some of the problem, Standaert said afterward, is due to declining enrollments. The state pays school districts a certain amount of money for every child enrolled. If fewer students are enrolled, the district gets less money.
Some of the problem is uniquely local, Standaert said. Bozeman Public Schools is one of the biggest losers in the mix, with a potential $1 million budget shortfall. Standaert said Bozeman schools are in a pinch because housing there is so expensive, the district must pay teachers more to keep them. But by doing so, they have spent up to their maximum budget and cannot appeal to local taxpayers for more.
The crunch is hitting in July, Standaert said, because of the way the Legislature divvied out school money. The state budget is set on a two-year cycle. In the first year of the cycle - the year schools are in right now - lawmakers increased school spending by almost 8 percent. But in the second year - the one beginning next July - the increase falls to just 1.9 percent.
Ultimately, Standaert said, Montana may want to think about paying for education in a way that is not so tightly married to student enrollment.
Another problem, said Darrell Rud, with the School Administrators of Montana, is inflation and the rising cost of energy and gasoline. The market for school teachers nationwide also is very tight. Montana must give teachers raises that at least keep up with inflation or the state's teachers fall behind economically, he said afterward.
“Lots of states are eager to gobble up our teachers,” he said.
Even as the budget was being finalized last spring, many school districts complained that the education increases approved by the Legislature went largely to pay for new programs lawmakers created and for one-time spending, not to address inflation in schools' day-to-day operating budgets.
Representatives of the Montana Quality Education Coalition, which organized the successful lawsuit decided in 2004 that spearheaded increases in school funding, also addressed the committee. Its analysis showed that many schools face million-dollar shortfalls if they hope to give teacher pay increases of at least 3 percent, as well as cover rising health insurance, retirement and inflationary costs.
Billings elementary and high schools face a $3.5 million shortfall. Schools in Butte face a $979,000 shortfall. Helena schools face $1.6 million budget shortfall. The analysis did not include Missoula schools.
It appears unlikely that a special session will materialize. Lawmakers may call themselves into special session by getting 76 of the 150 lawmakers to agree, but that has happened only once since 1973. Or the governor can call a special session.
House Speaker Scott Sales, R-Bozeman, said he is fundamentally opposed to the idea. With two students at Bozeman High School, Sales said has a vested interest in the problem, but believes a fix can wait and that schools should have spent their money more prudently.
“They knew what they had,” he said. “They knew what the legislature had given them to spend. They should have had their ducks in a row before increasing their spending. That's what I do in the private sector.”
The sentiment seemed to cross party lines. David Ewer, Schweitzer's budget director, said the governor's office was similarly opposed to calling lawmakers back to Helena.
“We don't need a special session,” he said.
Ewer said the governor and lawmakers pumped many tens of millions of dollars into education this spring. The state is currently paying to educate more children than are even enrolled in Montana schools, he said, specifically to address the problem of declining enrollments.
He said the governor and lawmakers decided to “front end” the spending increases so schools could get caught up on needed spending faster.
“The issue of school funding is perennial,” Ewer said. “There will likely be any number of circumstances pertaining to an individual school district's (finances), but those are issues that should be addressed in the regular session.”
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