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Sales tax slump hurts schools dealing with more students, less cash

POSTED: February 29, 2008 5:01 a.m.
Tom Reed/The Times

Construction workers move roof parts across the top of the new Gainesville Middle School under construction near New Holland. The school is one of several local projects funded by the Special Local Option Sales Tax.

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GAINESVILLE — Area school systems have been battling state funding cuts for years.

And if January’s numbers are an indication, they might be seeing a slump in 1-cent sales-tax revenue, which they’ve used for years for construction and renovation projects to keep up with fast-growing enrollments.

The $1.8 million collected in January was "considerably lower than (amounts) we have been experiencing," said Will Schofield, Hall County schools’ superintendent.

Monthly sales-tax checks flowed in to the tune of $2 million and higher in 2007.

"Combine this (lower amount) with millions of dollars of continued (state) cuts and we will continue to look at new ways to fund opportunities for boys and girls," he said.

A weakening economy taking its toll on school budgets isn’t a local or Georgia phenomenon.

School board members from across the country say they’re bracing for leaner times forced by the nation’s economic downturn.

Board members in Washington last week for an annual conference said shortfalls in state budgets coupled with pessimistic predictions about local revenues are forcing them to look for ways to trim next year’s budgets, which they are working on now.

About half of the states are facing projected budget shortfalls, according to the Center on Budget and Policy Priorities, a Washington-based research group.

Hall County schools’ annual budget topped $200 million this year for the first time, up from $186 million in 2006-07. Gainesville’s budget is at $47.6 million, up from nearly $46 million in 2006-07.

Both systems are gearing up for new budget seasons, with new fiscal years to start July 1.

Janet Allison, Gainesville city schools’ financial director, plans to give a time line for budget approval at the Gainesville City Board of Education’s meeting Tuesday night.

"Gainesville has already felt the budget crunch, as our local revenues did not meet projections last year," said Steven Ballowe, Gainesville’s superintendent.

"As a result of the past year, combined with the uncertainty of the current economy, the board and administration placed a freeze on much spending in August."

City school officials also are putting off construction of a sixth elementary school, needed to relieve overcrowding in its other elementary schools, that had been planned for the fall of 2009.

Next fiscal year’s state budget calls for $141.5 million less in funding for school systems.

The state began imposing "austerity cuts" earlier this decade when a troubled economy resulted in a revenue shortfall. But even as the economy improved, the state continued the cuts, which now have added up to about $1.5 billion statewide.

"While I am optimistic that the House and Senate may buck the governor’s intent to extend the austerity cuts, I am not optimistic that local revenues will keep up with our growth and needs, nor will state funding approach fully funded levels," Ballowe said.

Schofield said that regardless of economic predictions, the nation’s student population continues to swell.

"To expect education costs to remain stable while student populations increase dramatically is a bit naïve," he said. "Additionally, the type of students entering schools in this nation are more diverse and have greater special needs than ever before."

Also, "in spite of our rising poverty rates, federal revenues have actually remained neutral or decreased," Schofield said.

The Associated Press contributed to this report.


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