With Louisiana’s revenues greatly reduced in the wake of two hurricanes, and thousands of students still displaced from their home districts, state lawmakers will meet this month to figure out how to distribute money for the remainder of the 2005-06 school year.
Gov. Kathleen Babineaux Blanco has told legislators to report for a special session beginning Nov. 6 to address the state’s dire fiscal straits and decide how to trim spending until the end of the fiscal year. Although the Democratic governor hasn’t announced the agenda for the 12-day session, developing a plan to finance schools is almost certain to be on it, state officials say.
Less certain is whether lawmakers will take up the calls by some to expand charter schools and offer vouchers to students in New Orleans, the state’s largest school system.
According to recent estimates, state revenues are expected to fall $1.5 billion short of the original projections of $18.7 billion for the current fiscal year. What’s more, school districts battered by Hurricanes Katrina and Rita will lose revenue from property and sales taxes, both of which finance schools, and districts unscathed by the storms still need to be compensated for their added expenses from enrolling displaced students, state officials added last week.
“We have a real challenge,” said Leslie Jacobs, a member of the state board of elementary and secondary education. “We have out-of-the-ordinary expenses and simultaneously a major loss of revenue, both local and state.”
While finances will be the center of the discussion in the session, the formal agenda depends on what Ms. Blanco includes in her formal call of the session. The state constitution requires the legislature to address the content of the governor’s call, and prohibits lawmakers from going beyond it. Ms. Blanco must issue the call five days before the session begins.
Although the state board of education and local officials are debating charter schools in New Orleans and the possibility of providing vouchers for displaced students, state lawmakers don’t know if those issues will be part of the governor’s agenda.
They said, however, that tensions between the state and members of the New Orleans school board could lead to a debate over how the district is governed. (“Divided New Orleans Board Debates Reopening Schools,” Sept. 28, 2005.)
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“That state board has had their fill … and is getting closer every day to a takeover,” said state Rep. Jim Tucker, a Republican who represents sections of New Orleans and neighboring Jefferson Parish. But the legislature would need to pass laws to allow state officials to usurp the locally elected board’s power.
“There is increasing restlessness that something needs to happen with the New Orleans public schools because there’s continued infighting,” Ms. Jacobs said. “We have such an opportunity to rebuild and re-create what was one of the worst school districts in the country, and it would be a shame to lose that opportunity.”
Financial Fallout
Hurricane Katrina hit the New Orleans area Aug. 29 and its floodwaters covered most of the city and the neighboring parish of St. Bernard. Most schools in New Orleans and St. Bernard will be closed for the school year. Wind and other storm damage also closed schools for several weeks in nearby parishes such as Jefferson, St. Tammany, and St. Charles. (“Gulf Coast Schools Prepare to Reopen Amid Uncertainties,” Oct. 5, 2005.)
On Sept. 24, Hurricane Rita hit southwestern Louisiana, devastating the rural areas there.
With almost 200,000 Louisiana private and public school students displaced from their homes, the state must adjust its school finance formula to reflect districts’ current enrollments, Mr. Tucker said. Districts’ monthly per-pupil allocations from the state are based on enrollment figures collected last October.
Now, however, some districts are virtually empty, while others are “bursting at the seams” with displaced students, Mr. Tucker said. The legislature will need to develop a short-term formula that “reflects where children are,” he said.
But he said New Orleans and other districts with no students or with small enrollments would still need state aid to pay expenses such as salaries for remaining staff members and debt service.
New Orleans officials said last week that they were applying for a $100 million loan from the Federal Emergency Management Agency. The loan would ensure the district has enough money to pay its bills for the rest of the school year, said Sajan P. George, the district’s interim chief operating officer.
The legislature also will need to find places to cut spending, Mr. Tucker and Ms. Jacobs agreed.
Although the state’s budget shortfall could be as high as $1.5 billion, state officials estimate Gov. Blanco could make $300 million of cuts on her own and could tap the state’s rainy-day fund. That would leave $600 million in cuts for the legislature to make, according to a report on the hurricanes’ impact on the state budget prepared by the state education board’s finance committee.
Louisiana lawmakers would need to make the cuts to meet the state’s constitutional requirement to balance its budget. Schools are likely to absorb some of those cuts, the report said. Louisiana has allocated $2.9 billion for pre-K-12 education in the state’s fiscal 2006 budget, a 3 percent hike over the previous fiscal year.
“Other than the federal government giving us help,” Ms. Jacobs said, “there is no other option.”
