Analyst : “Atomic Bomb” Budget Cuts to K-12 are Historic but Necessary

Last week, Michigan Lt. Gov. Brian Calley said Gov. Rick Snyder’s budget plan would hit the state capitol like an “atomic bomb.” The cuts presented in Snyder’s  proposed 2012 budget for K-12 education are indeed historic, but shouldn’t have been unexpected, says Michael Van Beek, the education policy director at the Mackinac Center for Public Policy.

Snyder’s budget calls for a $470 reduction in the per-pupil foundation allowance, which is the formula the state uses to determine funding for schools. Adjusted for inflation, Van Beek said that would send funding back to 1999 levels.

Snyder has $8.8 billion set aside for K-12 basic school operations - $8.7 billion for per pupil foundation allowance payments and $62.1 million for intermediate school districts.

“From the public school point, this is unprecedented,” Van Beek said.

But, he says the need for cuts of this magnitude was necessary due to large federal government budget patches that could not continue.

“This should have been totally expected. … We’ve been bailed out by the federal government,” said Van Beek.

Federal government assistance for Michigan’s School Aid Fund jumped from just $122 million in 2000 to $2 billion in 2009, according to the Michigan Department of Education. Before inflation, this was a 1,539 percent increase.

“The districts can make up for a lot of this reduction if they get their employee benefits to somewhat approach private sector averages,” Van Beek said. “Right now, you hear from the public school establishment that this is the end of the world. It’s not.”

Public school districts such as Saline and West Bloomfield pay for 100 percent of the health care insurance premiums for their staff, offering plans that require zero deductibles from the employee. Meanwhile, the average employee in Michigan contributes more than 20 percent toward their health care premium, and the average employee nationwide contributes more than 25 percent.

Massive public employee protests have been triggered in Wisconsin this week, in part because GOP Gov. Scott Walker is asking that state’s teachers and other public employees to contribute 12.6 percent toward their health care premiums – half the national average.

Van Beek says extremely low health insurance co-pays for public school employees are still the norm for many districts.

“That is still prevalent,” Van Beek said.

The state teachers’ union issued a press release that stated Snyder’s budget “recommends (but does not mandate) schools outsource non-instructional services and increase employee contributions toward health insurance.”

“Gov. Snyder says he wants to create jobs,” said Doug Pratt, director of public affairs for Michigan Education Association, in the press release. “You don’t do that by slashing funding to schools that are preparing our children for the workforce. We need real, balanced solutions that can move Michigan and our economy forward.”

Michigan’s public school teachers are amongst the highest paid in the nation.

In terms of gross domestic product per-capita, Michigan is now one of the ten poorest states in the nation.