An end to emergency federal funding and the threat of mid-year cuts could disrupt economic recovery.

School districts, already operating in their fourth consecutive year of budget cuts, do not anticipate returning to pre-recession funding levels for several years. In a new survey from the American Association of School Administrators (AASA), school leaders report continued erosion of fiscal resources as the worst recession in recent history continues to impact state and local budgets.

The study, “Weathering the Storm: How the Economic Recession Continues to Impact Schools,” is the twelfth in a series of AASA studies examining the impact of the economic recession on schools. The study is based on a survey of 528 school administrators from 48 states in February 2012.

Respondents project new budget cuts in the 2013-14 school year, though the projected cuts might not be as deep as in the earlier years of the recession. Twenty-nine states are projecting budget shortfalls of $44 billion for FY 2013.

Respondents also identified factors that could undermine whatever fragile economic stability is starting to take hold in their communities, including the end of emergency federal funding and the very real threat of drastic mid-year cuts related to across-the-board federal budget cuts, known as sequestration. School districts are bracing for the edge of the funding cliff that comes when funds from the American Recovery and Reinvestment Act and the Emergency Education Jobs Fund run out this school year. Administrators are bracing for potentially deep cuts (9.1-percent reductions) in January 2013, stemming from the Budget Control Act and sequestration.

“While the survey data show glimmers of potential easing of recessionary pressures, the potential threats to economic stability still loom large,” said Daniel A. Domenech, AASA’s executive director. “Our surveys document how unprecedented fiscal hardship has forced district and school administrators to answer increasingly complex and tough questions over these last years.”

According to the survey…

School districts across the nation continue to report a breadth and depth of budget cuts.

  • More than three quarters (81.4 percent) of respondents described their district as inadequately funded, down only slightly from 84 percent in Dec. 2010.
  • Nearly three-quarters (71.2 percent) of school districts reported a cut in state/local revenues between 2010-11 and 2011-12.

Stop-gap efforts to avoid/minimize job cuts were short-lived, and reductions in force will continue to be a reality in the near future.