Snyder signs education budget: What does it mean for schools?

ALPENA -Gov. Rick Snyder recently signed the education budget, an over $15 billion budget which includes a little boost for public schools through extra funds for K-12 districts’ per-student funding. Alpena Public Schools will be among those receiving additional funds based on it being one of the lower funded districts. Every K-12 district is slated to receive at least $50 more per student, with the lowest-funded districts receiving up to $175, which would raise the minimum aid from $7,076 to $7,251.

“This is a great benefit for our local schools,” 106th District Representative Peter Pettalia said. “About 70 percent of the schools in Michigan are going to be receiving … somewhere between $100 and $175 extra foundation allowance dollars that come in. There is also approximately $330 that is coming in again for another year, that pays down the pension obligation for the teachers pension fund. Then there is a $75 performance potential.”

The $75 for performance potential is known as “Best Practices,” which have required schools in the past to meet seven out of eight criteria to recieve the additional funding.

“We lowered that number down to the $75 level and put money guaranteed into the foundation allowance,” Pettalia said. “There were school districts that were engaging or chasing those “Best Practice” dollars, so this is actually better for those schools.”

Pettalia said he is passionate about school funding in the district, and one of his main concerns is declining enrollment, because with less students in each school, funding goes down substantially.

“If you look at the Alpena Public School system, the lion share of cuts is the fact that there are less students,” Pettalia said. “That’s the biggest challenge.”

Having several years of declining enrollment has substantially lowered the budget of the district, which has made running and maintaining budgets even more difficult.

“I understand the financial challenges that our districts are going through, and I also want to say that the financial challenges are going to be overcome as the economy improves,” Pettalia said. “Finances will increase and more dollars will come back, and it’s all because of an improved economy. If you round off the amount of student enrollment we have, and multiply it by, say, $175, that’s the additional dollars that are going to be going into the Alpena K-12 system. Then you take those per pupil dollars, and multiply it by $329, that’s the amount of taxpayer dollars that are going in to shore up the pension liability.”

Retirement keeps increasing based on less people paying into the system, and accoding to Pettalia, Michigan taxpayers are on the hook to pay those pension obligations per our Constitution. Those obligations come out of K-12 funding. Pension money comes from taxpayer obligation, school personnel puting a certain percent of their paychecks into a pension fund, and the biggest amount gathered is in investments.

“The K-12 money is going into education,” Pettalia said. “The economy is improving in Michigan. The number one funding source for education is sales tax revenue. When we went from four percent to six percent during the Proposal A change, two percent was dedicated to education per our Constitution, so it had to go there. As the economy improves … there’s more sales tax revenue. As that increases, per our constitution, more money will come back into our education system.”

With the school budget increasing, there is still the question whether the funding boost will be enough to keep up with the increasing cost-of operations, and the hope that the additional dollars will continue to have a presence in future education budgets.

“People that send their kids to a school want a good safe environment and a quality education, and that’s what we all strive for,” Pettalia said. “Our K-12 system does a fantastic job in providing quality education in a safe environment.”

Nicole Grulke can be reached via email at ngrulke@thealpenanews.com or by phone at 358-5687. Follow Nicole on Twitter @ng_alpenanews.