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NLS, other districts await details from state about payment shifts

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NEW LONDON -- At this time of year, most school districts across the state have wrapped up discussions about the following year's budget and are preparing to send budget plans to the state before the June 30 deadline.

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This year is perhaps more challenging than most years, however.

As Gov. Tim Pawlenty attempts to balance the state budget, many of the state's school districts -- including New London-Spicer Public Schools -- sit in limbo, waiting for any news about what kind of funding cuts will come their way.

"The unknown is difficult as we prepare for the 2009-10 school year," said NLS Superintendent Paul Carlson. "Even though they say the schools won't be affected by unallotments, schools will be affected by (payment) shifts."

Carlson reported Tuesday to the School Board about some of the projected scenarios resulting from the Legislature failing to balance the budget while in session. However, no matter which scenario, Carlson said the district knows the next two years will be financially difficult.

"In my opinion, if the Legislature received a report card this year, it would be an 'incomplete' report card," Carlson said, also mentioning how the Legislature and governor "were unable or unwilling to move from their positions to reach a compromise."

In 2009-10 and 2010-11, Carlson said, "Districts will be relying heavily on their fund balances."

For the most part, Carlson said, school districts will endure 0 percent state funding increases during the next two years. This will be a struggle, he said, when districts have seen only an annual 1.5 percent funding increase for the last 17 years while inflation grows at a 3 percent clip.

"Now that we're at 0-0, it's going to be very difficult for school districts," Carlson said.

For districts like NLS, he said, these years will also be tough be-cause districts don't have the healthy fund balances to fall back on for a rainy day, or in this case, a rainy two years.

However, Carlson said, the state funding cap could turn into a "good opportunity to look at how we spend our money" and to involve the district staff in the process.

On the other hand, NLS could weather the 0 percent funding increases a little easier than most districts by the second year. In November, local voters approved the district's request for a levy increase. Starting in January 2010, the district will introduce a new $597-per-student operational levy.

"We're very fortunate that our community members supported the increase in our operating levy," Carlson said. " ... But next year will be a very tight year for us."

Of his seven years as superintendent, Carlson said this has been the most difficult in terms of budget planning because of the "unknowns" and how late in the year the district is still discussing ideas based on little state funding information.

Last month, NLS cut $300,000 from its 2009-10 budget to counter a projected enrollment decline in 2009-10 and other funding losses. "But is that going to be enough?" Carlson said. "That's still a question we probably won't know."

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