(June 5) PASBO/PASA Report: Third Consecutive Year of Cuts to Student Learning Opportunities As School District Finances Continue to Weaken

News Release

HARRISBURG, PA – June 5, 2013—The Pennsylvania Association of School Business Officials (PASBO) and the Pennsylvania Association of School Administrators (PASA) have released the results of their joint annual school budget survey, “Third Consecutive Year of Cuts to Student Learning Opportunities As School District Finances Continue to Weaken.”

The survey reveals that the financial condition of Pennsylvania’s school districts continues to decline, setting off a third round of program and personnel cuts for the 2013-14 school year that will reduce course offerings, increase class size, reduce extra-curricular and athletic programs, and close school buildings across the state. Almost two-thirds of the respondents to the survey indicated they would continue reductions of personnel, both instructional and non-instructional, by not filling vacancies and 20 percent are planning to implement furloughs for 2013-14.

Seventy-five percent of school districts statewide plan to reduce instructional programming in the 2013-14 school year. More districts anticipate they will need to cut instructional programs in 2013-14 than either 2012-13 or 2011-12.

The survey was conducted in April and May as a joint effort of the PA Association of School  Administrators (PASA) and the PA Association of School Business Officials (PASBO). One hundred and eighty seven school districts participated in the survey, a response rate of 37%.

“School districts are being forced to continue cutting core educational programs, creating greater obstacles for success both now and into the future for many of Pennsylvania’s 1.7 million students,” said PASA Executive Director Jim Buckheit.

According to survey results, the effects of flat or reduced state, federal and local funding for schools combined with the simultaneous steep increases in the cost of pensions, health care and other expenses are continuing to deteriorate school district finances. More than half of school district leaders indicate they believe the financial condition of their district will worsen in 2013-14. Only four percent of the respondents indicated their district will be in better financial shape in 2013-14. However, despite the fiscal decline in many schools, the number of districts not raising real estate tax rates is the highest in the last four years.

“The past five years have seen unprecedented and historical changes in both school revenues and expenditures, creating a lethal series of events for school budgets,” said Jay Himes, PASBO executive director. “School payrolls were cut by almost $500 million last year, but mandated increases in costs like pensions offset some of the savings.”

The survey also reveals that schools continue to use reserve funds in record amounts to plug budget deficits. While a small number of districts in the survey (4.3%) indicated they would expect to end 2012-13 with a negative fund balance, many other districts are using alarming amounts of their reserves that will be completely exhausted within five years.

In addition, while there has been a small amount of positive change in some school district tax revenues, these modest gains will be erased by the next fiscal hurdle for schools—federal sequestration. The estimated loss of $50 million in federal funds to school districts will disproportionately impact Pennsylvania’s poorest districts, as these federal programs target disadvantaged and special education students.

The PASBO/PASA survey was delivered electronically to all 500 school districts to determine the impact of the FY 2012-13 enacted state budget and the continuing economic slump on the Commonwealth’s school districts.

A copy of the survey report is available on the PASA website at www.pasa-net.org and the PASBO website at www.pasbo.org.

About PASBO:
The Pennsylvania Association of School Business Officials is a statewide organization with more than 3,000 members, two-thirds of whom are K-12 non-instructional administrators serving in the areas of finance, accounting, facilities, transportation, food service, technology, communications, human resources, purchasing and safety. PASBO’s focus is on educating its members through professional development opportunities as well as keeping them informed on the latest legislative issues affecting school business through workshops, the annual conference, specialty conferences and publications. Business Associate members provide products and services that can improve the operation of schools and support classroom learning.

About PASA:
The Pennsylvania Association of School Administrators represents school superintendents and other school leaders from across the Commonwealth. PASA’s mission is to promote high quality public education for all learners through its support and development of professional leadership.

For more information, contact:
Jim Buckheit, PASA Executive Director at (717) 540-4448
Jay Himes, PASBO Executive Director at (717) 540-9551
Jeff Ammerman, PASBO Director of Technical Assistance

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