As required by a law that passed last year, the Joint Finance-Appropriations Committee this morning held a special hearing on the Public Education Stabilization Fund, the rainy-day fund for schools, to consider transferring more money into it to make up for withdrawals made over the past year. Senate Education Chairman Dean Mortimer, R-Idaho Falls, emphasized “how important this is for our educational community – I’m grateful and glad we’re making this consideration.”
After reviewing the status of the fund – the past year saw a withdrawal of $20.78 million, largely because more students showed up in Idaho classrooms than was projected, and also due to higher than expected expenses for students taking advanced classes, and it now has a balance of about $65 million – the joint committee took no action today. Gov. Butch Otter has recommended making a $32 million transfer to PESF in the coming year, fiscal year 2019, to cover both the past year’s withdrawal and another that’s anticipated during the current year.
Several JFAC members had questions about how PESF works; it has no dedicated funding source, only gaining money when transfers are made into it, plus a small amount of interest earnings. If projections for student enrollment or other costs are low, money is automatically transferred out of the fund to make up the difference. If the projections used to set the public school budget are higher than needed, the excess money automatically transfers into PESF.
Sen. Shawn Keough, R-Sandpoint, JFAC co-chair, said, “This is really an important rainy-day fund. Having been here, with the co-chair, when we tapped this, it’s really been instrumental in helping stabilize our education budgets.”