@NCCapitol

Fact Check: Senate claim on school spending is incomplete

Posted June 22, 2012
Updated June 25, 2012

— One of the big debates this year between the Republican-controlled General Assembly and Gov. Bev Perdue, a Democrat, has involved whether the state budget passed this week represents a cut to education spending or not.

While Republicans can claim that state spending on K-12 education is climbing under their leadership, the implication that overall education spending is climbing is false.   

Amy Auth, deputy chief of staff for Senate President Pro Temp Phil Berger, sent a bar graph around to reporters Friday afternoon. This latest salvo in the cut-or-not debate was accompanied by this explanation: 

"The attached graph shows a year-over-year comparison of state funding for K-12 education in North Carolina. As you can see, if our budget became law, it would mean that compared to the last budget enacted by the Democrats in 10-11, the Republican General Assembly will provide about $420 million more in state funding for K-12 education than the Democrats. Our level of state funding for K-12 education for FY12-13 will also be roughly $50 million higher than the Democrats’ K-12 budget for FY09-10."

If you look at the graph, it looks like the General Assembly cut the K-12 education budget heavily in 2010-11. It also seems to show that after Republicans took over in 2011-12 they put more into the schools than was there even 2009-10. In terms of state spending, that is correct.

But the graph is misleading in terms of the money that was actually available to schools. It ignores key pieces of the 2009-10 and 2010-11 budgets. Taking a more complete view, the budget proposed for 2012-13 is actually $330 million less than the one enacted in 2009-10.

History shows school jobs funded by feds

By 2009, the recession was in full swing and states had begun to see their tax revenues diminish. As part of an effort to fight the recession, Congress passed a stimulus package that included "education stabilization" money. This was money that was designated to replace state spending. The 2009-10 state budget money report shows $379.7 million in education stabilization spending coming into North Carolina's budget. Here's how it was described:

"Temporarily reduces the Noninstructional Support Personnel allotment on a nonrecurring basis for both years of the biennium. This reduction will be offset by the appropriation of the federal Education Stabilization Fund (ESF). The ESF will be distributed via the State's primary funding formulae, as defined by Section 7.34 of this bill."

According to the Department of Public Instruction, there was another $398.3 million in education stabilization funds available in the 2010-11 fiscal year. In both years, that money is accounted for as a cut to state spending, because it came from a federal grant, not the state's general fund. While it didn't show up in the state's bottom line, it was still available to schools. 

"The theory was, they (lawmakers) were going to put the money back in the budget when revenues improved," said Phillip Price, CFO for the Department of Public Instruction. Price, who has worked in the past for the legislature, noted that anyone paid with education stabilization money was a state employee. 

It's also worth noting that in 2010-11, local school districts had federal EduJobs money available. This was a separate federal source from the education stabilization stimulus funding. EduJobs went directly to local school districts but was used primarily to pay for positions cut by the state.

A more complete view includes federal funds

While there are some other bits of money that could be counted toward the education funding totals, including state spending, stabilization and EduJobs funding offers a more complete, if rough, picture of what was available to spend on K-12 education. The amounts in the following chart are in billions of dollars:

Budget Source / Fiscal Year2009-102010-11**2011-122012-13*
State Spending$7.456$7.085$7.464$7.506
Education Stabilization$0.380$0.398$0$0
EduJobs$0$0.044$0.258$0
Total (in billions)$7.836$7.527$7.722$7.506

* As approved by the General Assembly. 
** Does not count use of lottery proceeds. 

Those numbers still show a dip in school spending from 2009-10 to 2010-11, but it's not quite as steep as reflected on the Senate's bar graph. One Perdue administration official argued to me on background that the use of lottery money in 2010-11 would further flatten that graph, but I had some questions about its use in the last two years so left it out to ensure I was comparing apples and apples.

What is clear is that there is less money available to public schools in the budget for 2012-13 that is sitting on Perdue's desk than there was in 2009-10. The graph and statement sent by the Senate legislative staff suggests otherwise.

Asked about this discrepancy, Auth replied: 

"The $7.085 B reflected in the graph I sent is the actual enacted budget number for 10-11. If federal stimulus/EduJobs money was a factor in their decision to make changes, that is irrelevant because those federal dollars never went into the state’s General Fund. Instead they went straight to the LEAs."

When I pointed to the language in the budget description, Auth said she would check back with the Senate's budget staff. That was toward the end of the day Friday.

It is accurate to say that state spending is increasing under the Republican legislature, but it is not complete. Whether the current budget is all that the state can afford is a philosophical debate that we won't try to rule on here. However, in terms of actual dollars and cents, it's hard to make the case that public schools will be better off in the coming fiscal year than they were in 2009-10, as the Republican chart and statement infers.

This is the second time this week that the GOP has presented numbers that are somewhat misleading regarding state spending. During a Wednesday news conference, Republican leaders said their budget boosted overall education spending by $251 million over last year. That isn't exactly the case.

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