Michigan lawmakers are getting a first look at projected state revenues for 2021. The coronavirus pandemic has severely diminished sales and property tax revenues, the main funding sources for K-12 schools.
In March, the coronavirus bore down on Michigan in full force, shuttering businesses across the state and evaporating sales tax revenue to a trickle.
Now, as the May Consensus Revenue Estimating Conference begins, budget analysts are delivering a bleak financial forecast.
That’s bad news for Michigan schools.
Randy Liepa s the superintendent of the Wayne County Regional Educational Service Agency. He says educators are pressing federal and state lawmakers to find ways to help with the impending school funding shortfalls.
That includes dipping into the Michigan Rainy Day Fund.
“We know that they can utilize a portion of those, and I can’t think of a rainier day than what we’re facing right now,” Liepa says.
Senator Wayne Schmidt (R-Traverse City) chairs the Senate K-12 appropriations subcommittee. He says using the state’s $1 billion reserve won’t resolve the problem.
“Even if we were to use all of the Rainy Day Fund, it still wouldn’t plug the hole in the K-12 budget, let alone the rest of the state budget,” says Schmidt.
Schmidt says early predictions show K-12 schools could lose as much as one-quarter of their funding in 2021.
This week, U.S. House Democrats introduced a massive $3 trillion bill dubbed the “HEROES Act.” The sprawling omnibus earmarks $90 billion for the Department of Education to distribute to state K-12 systems. The House could vote on the package as early as Friday, but its course is less certain in the GOP-led Senate.
Senator Schmidt calls himself an “eternal optimist.” He’d like to see federal dollars too. But that’s not his Plan A.
“We can’t bank on that,” he warns. “We need to make sure that our budgets are balanced with the revenues that we have.”
As lawmakers sit down to crunch the numbers, K-12 education will be just one of a myriad of competing interests looking for their share.
By law, Michigan’s budget must be finished by October 1.