Zero increase in state funding appears likely at ACGC this year

GROVE CITY -- School districts that are planning budgets based on what state aid may be don't have a lot of options.

"Our choices are zero or zero or negative one," said Sherri Broderius, superintendent at the Atwater-Cosmos-Grove City School District.

Talk among school superintendents from rural and metro schools includes a lot of nervousness about how schools will be financed in the future in Minnesota, said Broderius.

"We're very, very frightened," she said. "I've heard terms like train wreck and implosion."

For the first round of next year's budget-setting process, the ACGC School Board will be plugging in a big fat zero.

But just to be safe, the district's business manager will be running the numbers again with a negative state aid figure, said Broderius.

After Gov. Tim Pawlenty's decision to take away previously approved funding through the unallotment process, a negative state aid figure for schools isn't out of the realm of possibilities again next year.

Unallotment is the term given to the power of the governor to reduce expenditures in order to prevent a deficit.

A shift in when the state is sending its aid to schools, which has forced some districts to borrow money with interest payments, has also taken a nip out of real dollars schools receive.

"I just want to be incredibly conservative," said Broderius, who took over as superintendent this summer.

At the meeting Monday, Broderius said the ACGC School Board agreed not to expect an increase in state funding. The district will decide in January whether to base its 2010-11 budget on a zero change or a negative 1 percent change in state funding.

Also included in ACGC's formula is a projected increase in enrollment. With nearly 800 students currently enrolled, the district saw a slight bump in enrollment this year and is expecting the same next year.

The board will also consider estimated expenses and revenue the district will receive from an excess levy that was approved by voters in 2008.

ACGC started receiving new levy revenue in May and it currently makes up 17 to 19 percent of its total revenues. Broderius said the district is being "very cautious" in how it's spending that money now. A few things have been added back to the budget that had been removed when the district was in statutory operating debt, including a new math curriculum, she said.

The board is also trying to determine how to use federal stimulus money, which Broderius said has tight restrictions attached to it.

She stressed that the $492,991 the district is eligible to receive from federal "stabilization" stimulus funds is "not new money" even though "there are people out there who believe it is."

It simply replaced the general education aid that was unalloted in August, she said. The difference is that in the past the state made regular disbursements to schools, and now schools must apply for the money.

"We have to go asking for that money," Broderius said, and that requires additional paperwork.

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