Could state budget merger hurt?

Published 10:14 am Monday, January 16, 2012

Following years of proration and cuts to the education budget, local superintendents aren’t optimistic about plans to merge education and general fund budgets in the state.
Alabama Gov. Robert Bentley has proposed a merger of the two funds and will present the proposal to legislators in the upcoming session of the governmental body. The amendment he plans to present was first announced when Bentley spoke to a Birmingham club last week.
Both the General Fund and education budgets have suffered through proration and other cuts in recent years.
In Escambia County, a school system in better-than-average fiscal shape, the combining of the two funds could still cause financial cuts and overall setbacks according to Interim Superintendent Randall Little.
“Needless to say I hope it can be avoided,” Little said. “We don’t need to merge.”
Little said despite the passing of two tax bills in 2007 that benefit the public school system, the Board of Education is still working to get into a position to move forward instead of simply maintaining the status quo.
In the Brewton City Schools system, financial cuts have continued to cause wounds to an already battered budget.
City Schools Superintendent Lynn Smith said the education budget is already hurting and “can’t take much more.”
“I’d hate to think they would put the funds together and cut more money from education and use it in other areas,” Smith said. “We can’t take any more cuts.”
The county school system has also seen reduction after reduction in available funds for education.
“Since 2009 Escambia County alone has already been reduced almost $6 million by the state,” Little said. “The proposed education budget for this fiscal year is $5.6 billion. They say if everything goes well we won’t have to face proration, but the reason we are not going to face proration is that $5.6 billion has already been cut out.”
The changes proposed by Bentley aren’t uncommon across the United States in other areas, but Smith said the timing for this proposal is a little muddled.
“This proposal seems like a wasted effort right now,” Smith said. “Other states do this when there has been surplus funds in the budgets. But, with both budgets being where they are, I can’t see that this change would be of benefit to anyone.”
Smith said both the education and general funds are suffering this year with proration likely in many areas.
“Neither fund is adequate to serve the budgets right now,” Smith said. “If you had a lot of cash, I could understand that. But, right now, what good is it going to do us next year? I don’t see how it’s going to help anybody next year.”
With Medicaid and the prison system in dire need of funding, along with other areas of the budget, the shortfalls in the general fund are tremendous, as is the education budget, Smith said.
State Rep. Alan Baker agrees the way to handle the shortcomings of the General Fund is not the merging of the two budgets.
“Gov. Bentley and his staff are facing a $400 million short fall in the General Fund budget,” Baker, R-Brewton, said. “They’re exploring all options; however, I’m opposed to consolidation of the General Fund and education budget as a single budget.”
Baker said he believes a consolidation of the two funds would not solve the current problems with the General Fund and would serve to shortchange education in the process.
“The state has not shown, past or present, a posture of over funding education,” he said. “The thing that I see is that this action would do nothing to increase the bottom line additional revenue needed by our state to fund education and the other state services.”
Even with shortfalls in education funding continuing to loom, Little said Escambia County’s school system is still in good shape, due largely in part to the passing of the tax bills, but added if the merger caused more cuts that status could change.
“Fortunately the citizens of Escambia County are strong, ardent supporters of public education,” he said. “They renewed the bills a few years ago and helped put in a sound fiscal position. But you’re looking at another major cut on top of a major proration. Every percentage point will cost us conservatively $250,000.”
Little said the county is already facing the challenges of operating with a reduced staff that will eventually have to be replaced, which means more money being spent each month.
“In 2009 our payroll was almost $2.3 million,” Little said said. “Now it’s $1.9 million. Do we plan to replace those people down the line? Yes, but that will be more money per month.”
If Bentley’s plan to merge the two funds is successful, it will make Alabama the 48th state to operate using one large budget. Little said despite his opposition to the amendment, he is sympathetic toward the governor’s situation.
“The General Fund is important,” Little said. “That’s a tough decision. He’s caught between two economic black holes. The solution to it is not going to be an easy one.”
Smith agreed the situation is precarious and should be carefully considered before making drastic changes.
“I know the general fund is a real mess right now,” Smith said. “The budgets can be awfully political. But, now, it’s not as political as it once was because there just isn’t any money to fight over. I just can’t see what the real benefit is in all of this.”
Smith said with all of the issues facing law makers, he isn’t expecting a big change in budgets for the upcoming year.
“I’d be really surprised is this proposal gets enough steam to move forward,” Smith said. “But, then again, I’ve been surprised before.”

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