Idaho banks on federal aid to help balance school budget

BOISE – It might have seemed surprising that the state Board of Education voted unanimously in support last week of Gov. Brad Little’s proposed 5% cut to the public school budget, but the surprise is lessened if you do some math: The holdback would cut $98.7 million from schools, but at the same time, schools will get $91.2 million in federal aid to offset some of the cuts.

“That was a big part of the conversation,” said Linda Clark, the state Board of Education member and retired superintendent of the state’s largest school district who made the motion to approve the holdback. “Your math is encouraging.”

“Having lived through 2008 to 2011, we know what this can do to school budgets,” said Clark, who headed the West Ada School District during that major recession and the resulting cuts. “So we felt it was very important to try to protect instruction and to try to identify those areas that could be helped somewhat by the federal money, knowing it wouldn’t be a total offset.”

The federal money is not a one-to-one offset to the specific cuts; some of the cuts, like freezing movement on the teacher “career ladder,” rather than granting $26.6 million in raises that lawmakers approved this year at the governor’s urging, won’t be offset by the federal funds. They just won’t happen this year.

But large portions of the cuts targeted to classroom technology, professional development for teachers and funding for information technology staff will be offset, plus additional boosts, as the state makes a much bigger push into digital and distance learning than was ever anticipated when lawmakers set the school budget for the coming year.

Here’s the breakdown of the federal funds Idaho schools will get (figures rounded):

• $43.1 million from the Elementary and Secondary School Emergency Relief, or ESSER, allocation under the CARES Act; this money isn’t part of the state’s allocation of $1.25 billion from the CARES Act, but arrived separately and goes directly to schools. It’s already begun being distributed.

• $4.8 million, also from ESSER funds, for specific needs in Idaho K-12 schools, including remote learning, devices, connectivity and professional development.

• $9.3 million from the Governor’s Emergency Education Relief, or GEER, fund, which comes under the CARES Act but is separate from Idaho’s $1.25 billion allocation and is targeted directly at digital or blended learning costs in K-12 public schools. A separate chunk of GEER funds went to career-technical and higher education. Like the ESSER funds, the state has until Sept. 30, 2022 to finish expending the funds.

• $4.1 million in reimbursements to Idaho school districts and charter schools for COVID-19-related expenses such as sanitizing supplies and moving classes online. This funding comes from the state’s $1.25 billion and must be spent by the end of December 2020.

• $30 million for blended learning, including devices, connectivity, learning management systems and professional development in K-12 schools. Like the $4.1 million above, this funding comes from the state’s $1.25 billion, was approved by the governor’s Coronavirus Financial Advisory Committee, and must be spent by the end of December.

Total: $91,177,935.

Idaho’s state fiscal year started July 1, and includes the entire next school year, but with the varying deadlines for spending the federal aid, it all fits together.

The governor’s public schools holdback plan, developed over the past several months by a K-12 Emergency Council of stakeholders including state and local education officials, the state board and the administration, also includes a $21 million cut in discretionary funding to school districts and charter schools. While that’s not directly offset by the federal funds, officials say some districts are currently using some of their discretionary funds to cover items that will be boosted by the federal funds.

The impact will vary by district, but Greg Wilson, senior education adviser to the governor, and Gideon Tolman, public school financial analyst for the governor’s Division of Financial Management, say the hope is that overall, it’ll balance out.

“None of this stuff is one-to-one,” as far as offsets, Tolman said. Some of the federal funds will be distributed differently among Idaho’s schools than the state-budgeted funds being cut, for example, along with some differing time frames.

During the state board meeting, Clark said a good example of the offsets is the $10 million cut to classroom technology included in the holdback plan, compared to the $30 million investment into technology-related costs for blended learning. “It does help to soften it a bit,” she said.

The career ladder boost was Little’s signature legislation this year, and the state board considered it a prized accomplishment as well, but Clark said, “You know what the alternative is: The alternative is looking at staff cuts, which directly impacts instruction.”

That’s what happened to Idaho schools during the Great Recession, when West Ada schools alone had to cut $28 million and eliminate 14 paid days for its employees, including nine school days and five professional development days. A year later, the nine school days were added backed thanks to a voter-approved supplemental property tax levy that must continually be renewed by voters; the professional development days were never replaced, there or across the state.

Clark vividly remembers “having sat through those terrible reductions,” and said, “The budget was in such a terrible shape that everybody took the deep hits.”

“Things like professional development are always the first things that get cut,” she said. “And in this situation right now, the professional development is very important, so it’s important that those federal dollars are available for that. Because we have a whole lot of training that needs to happen as we’re changing the whole delivery model for education.”

She and other board members worry that with the pandemic and resulting economic turmoil, school districts will find it harder to keep passing their existing supplemental levies. “The term ‘supplemental levy’ is a true misnomer in the funding world,” Clark said. “Those are general fund levies to support the regular budget, and in most cases they are a result of the last downturn.”

It used to be that when Idaho had holdbacks, or midyear budget cuts after lawmakers already have set the budget for the year, schools were exempted, because of the devastating impact such cuts can have after the school year’s already started. The first time a holdback was applied to schools in Idaho was in 2002, when then-Gov. Dirk Kempthorne ordered the first permanent holdback to Idaho schools, cutting $23.3 million. Previously, either governors or lawmakers made up any midyear cuts to schools from budget reserves.

Kempthorne exempted schools from another holdback in 2003, but since then, several holdbacks have applied to schools along with other agencies of state government, at least partially.

Idaho closed out its fiscal year June 30 with a $186.3 million balance left over – $70.7 million because state tax revenues in the end exceeded forecasts, $55.6 million that lawmakers purposely left unspent in the budget for the year, and another $60 million from a combination of 1% holdbacks Little imposed this spring, including on schools, and reversions from state agencies that held off on spending part of their budgets this year. The state also has more than $400 million in budget reserve funds.

Still, the Little Administration is forecasting big shortfalls in the coming year and those following it in the wake of the coronavirus pandemic, requiring it to parcel out the rainy-day funds over several years.

Clark said, “I think this is a very cautious and prudent approach, and I think that that’s why there was unanimous support for it from the board. It’s well thought-out, and based on input that the governor received from a broad range of stakeholders and a lot of discussions.”