Funding cut - Grant program

• $12.4 million - Title
• $7.7 million - IDEA
• $2.9 million - Vocational rehabilitation
• $1.8 million - Teacher quality
• $838,000 - 21st Century
• $738,000 - Supplemental education
• $750,000 - Work study

During the Kentucky Department of Education's monthly superintendent webinar March 26, Associate Commissioner Hiren Desai acknowledge that "there's a lot of confusion out there about this.

"We do not have information that shows district-by-district breakdown of cuts. We've only been told that there will be a net 5 percent reduction in those programs starting July 1," he said. "We will get those allocations in May and make them available to you at the district level, so you can adjust your budgets."

Some of the confusion Desai attempted to address dealt with the federal and state fiscal years involved and the time frame in which federal funds can be spent.

"The federal fiscal year operates on a different numerical system than the state fiscal year. The reduction is going to be effective federal fiscal year 13 but school year 13-14. Keep in mind that federal fiscal year 13 means school year 14 for your purposes," Desai said, emphasizing that no federally funded school programs will be cut through the remainder of this state fiscal year.

While there will be a net statewide reduction of 5 percent to most federally supported school programs, districts are advised to plan for a reduction of between 8 percent and 10 percent, because, as Desai explained, different factors will affect how the cuts hit different districts.

"Title I grants rely on census and poverty data. It could be that although there is a net reduction of 5 percent in Title I (statewide), your district may receive a little bit larger cut because of census and population data," he said. "For example, for Jefferson County, we know that, although Title I will be cut 5 percent statewide, Jefferson County's Title I reduction will be 9.9 percent (due to that district's census, population and poverty numbers). So we recommend that you budget for an 8 to 10 percent cut to each federal program. Be conservative."

And Desai stressed that unless Congress changes the budget law, districts will be planning for these cuts to continue and mount.

"The sequestration language in federal law is for a period of 10 years. You should plan for 8 to 10 percent at the district level each year," he said. "For example, if your current Title I allocation is $1 million, you should plan to receive $900,000 next year and $800,000 the next year to be safe.

"Right now, the law as written, over 10 years, this would result to a 50 percent reduction in federal funds. So that should do two things to you: No. 1, plan conservatively; and No. 2, keep up the pressure on Washington to take a good look at these cuts," he said.

Another point of clarification for district leaders centered around which federal fiscal year's funds are affected and which are not. "Federal (allocations) are based on a 27-month grant cycle," Desai said. "I know a lot of you are still spending federal fiscal year 12 funds today, so it may be that you don't touch your federal fiscal year 13 funds until next school year or even in the spring. When you get to the first three months of your (new district) fiscal year - July, August and September - you'll have an opportunity to use three different sets of federal funds - FY 11, FY 12 and starting FY 13. If you're not using federal fiscal year 13, you're not going to face a cut.

"For example, if your source of funding for a project is federal fiscal year 12 funding, you would not have a cut because those are funds you received before the cut. But if you were going to use funds from federal fiscal year 13, you would plan for a cut," he said.

"But you really need to go ahead and plan now and make adjustments in your budget for these federal cuts," he said. "We've heard from a lot of districts that they are going to have to make staffing reductions. So I urge you be thinking about that now instead of waiting to next spring, because if it's tough now, it will be even harder next year."

In fact, in an instant poll taken during the webinar, representatives of 57 districts watching the event live responded to questions about their planning for the impact of sequestration cuts as it related to personnel. Eight-nine percent said they would be reducing personnel, and of those districts, 96 percent said the cuts would involve teachers.

In response to questions, Desai said KDE's understanding is that so-called "hold harmless" portions of the total federal funding that districts receive would be protected from cuts, but he cautioned his agency needed to seek further clarification from the federal government on that issue.

He also said that federally funded school meal and nutrition programs - other than the lightly-used milk support program - are not being cut by the sequestration action.

This story was posted on 2013-03-29 08:08:13

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