State Funding for K-12 Schools Still Hasn't Recovered from the Recession

WASHINGTON—States are still providing less per-pupil funding for schools from kindergarten to 12th grade than they did before the financial crisis in 2008, according to a report released by the Center on Budget and Policy Priorities on Thursday. The declines in educational investments might put states and the country in trouble, when they need well-trained workers with high technology knowledge in the global economy.

The report collected data on the funding distributed through states' major education funding formulas, excluding local property tax revenue or any other source of local funding. Additional adjustments were made in a few states to reflect specific situations. Hawaii, Indiana and Iowa were not included in the report because of the lack of necessary data, the report stated.

At least 30 states, including Oklahoma, Alabama, Arizona and Idaho, provided less funding per student for the 2014-15 school year than before 2008, the report found. Among the 30 states, 14 of them reported a decrease of greater than 10% in educational funding.

Oklahoma had the highest percentage cut in its funding for k-12 schools at 23.6% or $857 per student, followed by Alabama, with a cut of 17.8%. That state also had the highest dollar cut of $1,128 per student.

The state funding cuts can be attributed to the slow recovery of state revenues, the rising costs of state-funded services, reduced federal aid to states, and the states' reluctance to raise new revenues, according to the CBPP report.

"Cuts have been particularly deep when inflation and other cost pressures are considered," the report added.

Seventeen states increased funding. North Dakota had the highest percentage increase at 31.6%, at $1,329 per student. Alaska followed that state with a 16.4% increase and had the highest dollar gain, at $1,351 per student.

"Most states are providing more funding per student in the new school year than they did a year ago," the CBPP said in the report. "But funding has generally not increased enough to make up for cuts in past years." New Mexico, for instance, has increased its funding for per student by $124, or 1.8%, compared to one year ago, but that is still 8.1% less than its 2008 level.

State funding cuts for k-12 schools have big consequences for local school districts, which try to make up for the cuts by scaling back educational services raising more local tax revenue to cover the gap, or both, according to the CBPP. It's difficult for local school districts to find additional revenues after the recession, the group said.

In addition, the cuts have slowed the economy's recovery from the recession. Federal employment data show that teachers and other employees have been cut since mid-2008. There have been 330,000 jobs cut in local school districts between 2008 and 2012, the report found. These job losses have also reduced the purchasing power of families, thus causing problems for economic recovery.

More importantly, the cuts in educational funding have hindered education reforms and high-quality education provided by school districts, according to the study. When producing workers with high-level techniques and analytical abilities are demanded in the future work place, such cuts in funding for basic education will threaten the nation's economic future, the report concluded.

Why do states have such deep cuts on educational funding? Incomplete recovery of state revenues, rising costs of state-funded services, fallen federal aid to states, and states' lack of raising new revenues are considered as the major reasons, according to the CBPP study.

"Cuts have been particularly deep when inflation and other cost pressures are considered," added the report.

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