As the “fiscal cliff” deadline nears without resolution, anyone and anything that relies on federal funding is getting increasingly nervous.
But schools can breathe a little easier than most other recipients of federal aid.
That’s because most districts’ write their budgets for an academic year, so the bulk of the cuts won’t be felt until the beginning of the 2013-2014 school year.
Still, if a deal isn’t reached and the automatic set of tax hikes and budget reductions take effect, schools would see a roughly 8 percent reduction in federal aid.
That doesn’t sit well with any school administrators, but folks at poorer urban and rural districts are even more worried. That’s because poorer schools tend to rely on federal funding more than their better-off neighbors.
“We do receive dollars based on our poverty level which is much higher than the surrounding districts,” says John Scanlan, Chief Financial Officer for Cleveland Schools. “So you do feel that hit more probably in your larger urban districts with high poverty levels.”
Scanlan says the programs that would be hardest hit include free and reduced lunch programs, special education programs, and those serving English language learners. But, he points out, those are also services that the district has to provide no matter what, meaning reductions on the district level would come from elsewhere.
While K-12 schools largely get a delay in “cliff” consequences, the impact would be immediate for many higher education institutions that rely heavily on research funding, and federal financial aid would likely see reductions too.