Heading Over the Funding Cliff?

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It almost goes without saying that getting advance payments on stimulus dollars in order to balance current years’ budgets is a perilous path. This notion – which Rhode Island legislators are advocating – just allows states to delay, until the very last minute, balancing their budgets without this extra cash.

Many observers are deeply concerned about filling the void when the stimulus money dries up – whether it’s accelerated or not. Though the national economy is showing signs of improvement in some sectors, state budgets will hardly be able to fully recover by the time the stimulus money disappears.

Turns out, too,  that there’s an even more immediate risk. Rhode Island Education Commissioner Deborah A. Gist warned the state’s General Assembly yesterday that pulling forward more federal stimulus money from next year in order to balance the state budget this year could jeopardize the state’s ability to access those stimulus funds altogether.

She explains that, in order to receive stimulus funds, states have to prove they haven’t cut K-12 spending significantly or relative to all budget cuts. If Rhode Island pulls stimulus education funds forward and uses them for the non-education portion of the budget, it could run afoul of that federal requirement.

Rhode Island isn’t alone, we should note, in using or trying to use the bulk of its education stimulus dollars today and leaving less for the next fiscal year. As this story indicates, several states–including Alabama, Arizona, Georgia, Nevada, New Jersey and Washington–have already used all of their stimulus education funding, leaving zero of those dollars for the coming school year. We hope they aren’t setting themselves up to drop off the funding cliff.

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One Response to “Heading Over the Funding Cliff?”

  1. tjsadowski Says:

    You left out the part about the train wreck which occurred on the way to the cliff. Actually, it is multiple train wrecks, as have occurred in my state. Someone pulls you from the train and puts you on another train which also wrecks, ad infinitum.

    I understand the politics of this but it is an issue not likely to go away. States need to rethink their priorities and for what is a priority rethink what their approach is. There will be few arguments over what is important. There should be more about whether it is something government can and should do. If you want true transparency how about a discussion of exactly what we expect to happen when we apply government money, our money, to an issue. Will it make a difference, of what kind, by how much and for how long?

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