A month ago, if you told towns and school boards that big education aid, Education Cost Sharing (ECS) grants and some of the major categorical grants like Transportation, would not be cut in either year of the most potentially disastrous fiscal biennium on record, you would have heard a huge sigh of relief from Windham to Norwalk, from Torrington to New London. In the face of draconian education funding cuts, level funding seemed a very positive outcome. And the immediate reaction to the Governor’s budget announcement last week, that education aid to towns would not be greatly reduced in the next two years, did seem to be positive. But there are a couple of reasons why the education funding picture is still pending the proverbial falling of the “other shoe”.
The other shoe I speak of dangles some 400 miles south in Washington, DC – in the halls of Congress to be more precise. It is tied up in the federal stimulus package, which, despite passage in the House and this weekend’s compromise agreement on a somewhat different version in the Senate, still has a ways to go. The differences in the two versions are significant, particularly in the education provision, and until a reconciliation of the two versions has been worked out, the amount of education stimulus aid CT can expect, and the exact conditions of its use remain uncertain. That outcome could hugely impact the Governor’s proposals for education funding.
The Governor’s budget recommendation for maintaining education aid to towns at 2008-09 levels appears to rest on replacing state education dollars with a huge chunk of revenue from the State Fiscal Stabilization Fund provision of the stimulus package. “Huge chunk” is not a very definitive term, but unfortunately a necessary one, because at this point the two houses of Congress remain very far apart – perhaps as much as $40 billion apart on how much State Fiscal Stabilization Funding will be in the final package. Since the majority of the Stabilization money has been earmarked for education aid, (elementary, secondary and higher education), this creates a huge question. The $79 billion in the House version could be cut by half or more if the Senate version is adopted, and that could mean close to $200 million less Stabilization Aid for CT in 2009-10 alone. Given the percentage (61%) earmarked for education in the original bill, that loss would put at least a $120 million gap in the Governor’s education plans. Will the promise of level education funding in CT’s budget be fulfilled if, in fact, the stimulus funds become much lower than the Governor’s Budget anticipates?
But a second and equally tough question is: Even if the full amount anticipated does come through, and is used to prop up the ECS grant for the next couple of years, what will happen when the stimulus funds stop in 2011? If the state has to add hundreds of millions in general fund dollars back into ECS at that point just to hold it flat – let alone increase it – at a time when economic recovery may just be beginning, education funding in CT will almost certainly face several more difficult years. And yet, who would argue that level funding for the next two years is not a far better fate than drastic cuts? I certainly wouldn’t. But the circumstances under which that may be accomplished, and the ramifications down the road, may be cause enough to turn that sigh of relief into just a plain old sigh.
