The Rhino Times Paul C. Clark on Guilford County, North Carolina's School Budget, governmental propaganda, and what may happen after what could happen next when federal stimulus money runs out

"...Guilford County Schools, in real terms, has had about the same amount of money to spend in each year of the current recession, and has more money to spend for this school year than it did last year.

...After months of hearing "cuts, cuts, cuts," most people think the school system will get less this school year than it did last year.

Not so.

When the school board on August 10 approved a final 2010-2011 budget after months of deliberation,...the final [2010-1011] operating budget...was $598.6 million, $8 million more than the school system's 2009-2010 operating budget of $590.6 million.

And the school system's 2009-2010 operating budget was only $1 million less than its $591 million 2008-2009 operating budget, despite months of discussion about budget cuts.

Are you certain
you’ve not been conditioned to think certain thoughts?

Guilford County Schools Chief Financial Officer Sharon Ozment and the school system's public relations department heavily advertise cuts in state funding, whether or not they materialize.

Does thinking you understand what another says
mean you hear what they mean?

They tend not to mention that the school system's operating budget has increased from the previous year.

Do the few who control the dissemination
of most financial and political information
enjoy relatively disproportionate levels of influence
than the many who don’t?

It's one of the spins they use to make the school system appear to be poorer than it actually is and to downplay its spending.

Is an untruth disseminated as true a lie
if the truth remains unfound through incuriosity?

Another is not mentioning the amount of the school system's total budget in press releases.

Could some of what you think
be what you’re frequently told to think?

For the 2009-2010 fiscal year, that budget was $642 million.

For the 2010-2011 fiscal year, the total budget is $651 million – an increase of $9 million in real terms after months of debates over "cuts."

Can what you think may be
turn out more like what you thought
even if it doesn’t?

...Guilford County Schools could just take its funding cuts with a stiff upper lip, realizing that they are the common lot during a recession. But there's no tradition of doing that in public school systems, where every budget cycle is a much-ballyhooed crisis.

The main reason the school system isn't hurting like everybody else is the federal government. The...the stimulus bill has funneled billions of dollars into state and local governments, much of it earmarked for education.

...Guilford County Schools has had $38.4 million in state funding cut over the last two years. But the school system has received $75 million in federal stimulus money over three fiscal years.

Guilford County Schools expects to get more stimulus money for fiscal 2010-11 that isn't reflected in the $75 million figure. On August 10, Congress passed a $26 billion "jobs bill" – more accurately, a government-jobs bill to fund teachers, police officers and other public sector workers. Guilford County Schools stands to get $14.1 million out of North Carolina's $300 million allotment from that bill.

If the federal government habitually bails out overextended school systems
is it a good idea for school systems to overextend?

Also, North Carolina last week won one of the federal Race to the Top Fund grants that are intended to improve failing schools. North Carolina's grant will be for $400 million, and at least half of that money is expected to go directly to school systems. If $200 million is apportioned to the school systems based on their enrollment, Guilford County Schools stands to get another $10 million or so.

If short term taxpayer subsidies boosts Guilford County School's revenues,
what could some long term unintended consequences be?

The stimulus money does come with strings attached. The federal government specifies what the money can be spent for, but in most cases the stimulus money frees up other money the school board can then reassign.

Congradulations to the Rhino Times' Paul C. Clark
for winning the "George Hartzman Person of the Day Award"
for uncovering and reporting on the fungibility of government budget accounting!!!

...The main problem with the stimulus money is that it's scheduled to run out after the 2010-11 school year, leaving the school system facing, unless the economy recovers, budget cuts that will be genuinely severe in 2011-2012. Not even the federal government can go on indefinitely supporting state and local governments forever.

Can bailouts perpetuate problems instead of solve them?

Some Guilford County school board members say they plan to keep as much of the jobs bill money for 2011-2012, despite the fact that the state and federal government intend it to be spent by September 2011.

Should Guilford County Schools is facing a dire budget outlook,
should the School Board discuss not borrowing any more money than absolutely necessary,
and if not, at what point could the Board and Guilford County's Commissioners
be considered guilty
of financial negligence and fiscal malpractice?

"Save every dime that we can for next year," recommended school board member Paul Daniels. "The forecast we have is gloomy beyond comprehension.""

Paul C. Clark
Rhino Times