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K-12 schools prepare for funding boosts, cuts in new budget

May 1, 2015

As Indiana's fast-growing suburban districts breathe a sigh of relief with more funding on the way, many urban and rural districts are bracing for drastic cuts under the state's new budget and experts say there might not be a middle ground between the two.

In the final hours of the 2015 legislative session, both the House and Senate agreed Wednesday on a new $31 billion budget plan, which includes a 2.3 percent increase in K-12 funding each of the next two years.

Republican Gov. Mike Pence and GOP leaders have supported a shift in funds to growing suburban districts in an attempt to shrink the gap in per-child funding between growing and shrinking school districts.

Democrats argue that the lack of investment in low-income districts will lead to a decline in education quality, which will eventually cause more students to leave.

Either way, a cash boost for one side means a loss for the other, said Robert Toutkoushian, a funding consultant for Hamilton Southeastern Schools and a professor at the University of Georgia.

"I think you're always going to see this tug of war," Toutkoushian said. "As soon as they start tinkering with the funding formula and try to give more money to certain school corporations then it's going to come at the expense of others."

Republican Senate President Pro Tem David Long said the state's school funding should be based on enrollment, with more money going toward schools with the most students.

"I think we're doing well by our urban schools, but clearly they're losing kids and there's no changing that," Long said. "We used to give a minimum guarantee and that just wasn't fair to the rest of the school districts."

That funding plan, however, includes cuts to more than a third of Indiana's nearly 300 school districts.

House Democratic Leader Scott Pelath of Michigan City called Indiana's final budget a "necessary compromise" between the needs of growing school districts and those in communities with many children from low-income families.

"It has always been a matter of balance," Pelath said. "It's always been a goal to try to do both things simultaneously. (Republicans are) only interested in doing one of the things."

Pelath said the Legislature should have given the hardest-hit urban and rural districts a "breather" from cuts instead, allowing them to adapt to shrinking resources.

"We don't do that for them," Pelath said. "We throw them to the wolves."

Most schools with funds on the chopping block were just relieved they weren't hit harder.

The House proposal would have resulted in about a 6 percent loss of funding for Indianapolis Public Schools, which has seen enrollment steadily decline as more families flock to suburban areas.

In the final budget, IPS will see a 2.8 percent decrease, a loss of about $17 million over the next two years.

"While this financial plan projects a loss in funding for IPS, we are thankful the cuts are not as severe as in initial budgets," IPS Chief Financial Manager Paul Carpenter-Wilson said in a statement Friday.

Others schools could be forced to close.

"It's not a popular decision," Toutkoushian said. "But eventually it gets to the point where you have to start looking at it from a policy perspective."

Suburban districts, which typically have students from higher-income families, will receive more funding increases over the two-year plan to address a shortage of resources required to serve their growing populations.

"It just has required us to try to do a lot more with a lot less," said Bev Smith, a spokeswoman for Hamilton Southeastern, which has a student-teacher ratio of about 28-1.

Smith said the funding boost will help the district hire more staff and close its $2.2 million deficit.

The budget proposal has been sent to Gov. Pence's desk for approval.

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