By J. PATRICK PEPPER
DEARBORN — The budget crisis in Dearborn Public Schools deepened last week with two actions taken by Gov. Jennifer Granholm that could result in an additional funding loss to the district of about $7.2 million.
Granholm on Oct. 19 signed a school-aid bill previously approved by the Legislature, but vetoed a special funding source that was supposed to provide DPS with about $4.9 million this year.
The funding category, known as “hold harmless” or 20J, was created as a way to maintain high-spending school districts’ budgets when school finance reform was passed in 1994.
Granholm’s veto eliminates $51.5 million from 39 eligible districts, among which DPS is second only to Livonia Public Schools in terms of funding lost, and only by about $1,000. The governor said state legislators left her “no choice” but to make the veto, because the school-aid bill they approved Oct. 8 was funded insufficiently.
The bill passed by legislators was reliant on at least $100 million in speculative revenue from yet-to-be-approved measures and didn’t account for less-than-projected sales tax revenues – the primary funding source for K-12 education.
“My veto reflected what I am supposed to do, which is pass a balanced budget,” Granholm said at a news conference.
The news got worse Thursday, when Granholm announced a pro-rata cut to public schools’ foundation grant of $127 per student. Granholm’s cut comes on top of the $165 per student cut legislators already had approved in their school-aid bill.
Combined, the two cuts mean about $292 less for every Michigan student compared to 2008 levels. For the 18,000-student DPS district, that equals about $5.25 million.
“It’s been a very difficult week for K-12 schools in Michigan,” Granholm said. “We have never seen times in Michigan like this where we’ve had to cut like this.”
Rep. Gino Polidori, D-Dearborn, who voted for the initial school-aid bill, called Granholm’s cuts a “disaster” for DPS, but said he understands her position.
“They sent her a bill with no revenue. I mean, we can send her bills all day, but if there is no revenue to pay for them, what does it matter?” Polidori said. “She says we just need to work on (Republicans) on some revenue.”
Working on Republicans could prove easier said than done for Polidori and fellow Democrats. Senate Majority Leader Mike Bishop, R-Rochester, has been steadfast that the budget can be balanced through cuts and stimulus money and has characterized Granholm’s cuts as political posturing to pressure legislators into raising taxes.
“There is not sufficient support in the Senate Republican caucus for tax increases, and for you to think otherwise is a mistake,” Bishop said in a letter to Granholm.
Legislators have until Nov. 1 – when the state’s continuation budget expires – to either come up with more revenue or let the cuts stand as they are.
But as the politics play out Lansing, the realities are hitting home in Dearborn. DPS officials already had expected $11 million less in funding than last year, a figure reflected in the budget passed by school board members in June.
However with the proposed cuts at the state level, that number could nearly double to $21.3 million, or about $1,183 per student.
The cuts could force drastic midyear changes for the district. With about 85 percent of the district’s spending tied to employee compensation, it’s likely that several teachers will be receiving pink slips this semester.
“There’s a process involved, so this stuff probably wouldn’t end up happening until November, but it would probably force us to combine classes (mid-semester),” DPS spokesman David Mustonen.