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Overall state education aid to localities will fall by $69 million; a few counties will gain money

The Baltimore Sun

State funding for local schools would plunge by $69 million next year under Gov. Martin O'Malley's plan to eliminate a nearly $2 billion shortfall in Maryland's budget, a change that would hit poorest districts hardest.

Under the 2010 budget proposal introduced this week, Baltimore would receive $23 million less than in the current school year and Prince George's would be cut by $35 million. Baltimore County would lose $8 million. The belt-tightening comes after years of robust growth in education spending under the landmark 2002 education funding plan known as the Thornton formula.

"The impact is devastating," said Baltimore schools chief Andres Alonso, calling the cuts "the effective rollback of Thornton."

In unveiling the budget Wednesday, the O'Malley administration said it had protected preK-to-12th-grade education funding from the deepest cuts, and in fact, dollars for schools would increase over last year by $68 million overall.

That figure is the result of an extra $135 million for the state's retirement system for teachers and school administrators. The governor has, in fact, proposed reducing the dollars that flow into local school system operating budgets.

For the past six years, state aid to education has been increasing at a rapid pace. Schools have gotten about $2 billion more than in the 2001-2002 school year, when the legislature voted to redo the school funding formula. Thornton has resulted in more money for those jurisdictions with high numbers of special education and poor students as well as those learning English.

Earlier this month, a consultant's report said the increase in funding was responsible for sharp gains in test scores, and a national education magazine ranked Maryland schools No. 1 in the nation.

The news from Annapolis brought harsh words from Alonso, who said the city expected an increase based on rising enrollment. This school year, the city system reversed 40 years of enrollment declines and gained 1,000 new students.

"Adequacy is no longer a part of the conversation," Alonso said. "How do we have the first enrollment increase in four decades and lose over $20 million in actual revenues? It's economizing on the backs of the neediest students in the state."

Administration officials contend that O'Malley has made historic investments in education and has set aside $1 billion for school construction, including $260 million proposed for this year. They also note that local governments balked at picking up teacher pension costs, an option the governor abandoned when crafting his budget.

"The governor's unprecedented investment in K-12 education is a commitment that is upheld in this budget," spokesman Shaun Adamec said. "The overall investment went from $5.3 billion last year to $5.4 billion this year [fiscal 2010]. There has been a $932 million increase over three years."

O'Malley fully funds the Thornton education funding plan - formally known as the "Bridge to Excellence Act" - in his budget, according to aides. Some jurisdictions received decreases when the numbers were run in the formula, which takes into account a variety of factors including enrollment, the contribution of local governments and the jursidictions' wealth.

The governor did change other formulas, such as a cost-sharing arrangement for special-needs students, including those who are sent away to private schools when the public system can't adequately serve their needs. In Baltimore, that could account for $10 million of the decline, according to state officials.

"The proposed cuts will be devastating to school systems. They are taking boards off the Bridge to Excellence, and children will fall through the cracks," said Bebe Verdery, education director for the Maryland branch of the American Civil Liberties Union. "There is no doubt this will directly hit the classroom."

The administration did not give school systems the 1 percent increase that they had been promised, and it didn't include a planned increase in the optional geographic cost-of-education index, which is designed to provide additional money to school systems where the cost of living is highest.

Not all the state's jurisdictions were critical of the cuts. Bob Mosier, an Anne Arundel County school system spokesman, said districts had feared the state might ask them to take over the responsibility for funding teacher pensions.

"I think, overall, we're pleased he didn't choose to shift the teacher pensions, which would have been an incredibly harsh blow to us and to all school systems," Mosier said.

Anne Arundel would lose about $5 million, or 1.8 percent of its state aid.

"Obviously, we know and have known that there are going to be cuts of some kind. I don't think the fact that the governor had to make some very difficult decisions is a surprise to anybody," Mosier said. "It certainly could have been worse. Not that it won't hurt, but it could have been worse."

Sen. Verna L. Jones, a Baltimore City Democrat and member of the Budget and Taxation Committee, acknowledged that the funding cuts are a problem but said that school systems also indicated that making localities pick up pension costs would "decimate" them.

"Choices will have to be made," she said. "Which is the worst of two evils? Do you do the cuts the way we do now or do you shift teacher pensions?"

One concern was what appeared to be inequity in funding for certain districts. Montgomery, one of the wealthiest counties in the nation, would receive $27 million more next year, while many of the districts with large numbers of poor children received cuts.

Budget analsysts say the discrepancy might be the result of relatively slow growth in Montgomery's tax base compared with other counties and the city. Montgomery also had an enrollment increase and has high numbers of students learning English.

"It is extremely unfortunate that the two districts that contributed mightily to the recent ranking as the state with the best schools in the nation will be impacted most by revenue shortfalls," said John White, a spokesman for Prince George's County, referring to that district and to Baltimore. "Our two districts have the most children challenged by poverty."

School leaders in Baltimore County did not return calls seeking comment.

The state's financial situation could change significantly with an infusion of aid through a federal stimulus package that's being considered in Congress. O'Malley assumes in his budget that the state would receive $350 million as part of that package, but state officials say that could be a conservative estimate.

Some of the federal money is expected to be earmarked for education.

"The state is in a very tough financial situation, and the governor has got to balance the budget," said Sen. Jim Rosapepe, a Democrat who represents Anne Arundel and Prince George's counties. "But we don't know yet what the state is going to get from the federal stimulus package. The governor has been nipping and tucking wherever he can until then."

Sun reporters Nicole Fuller and Sara Neufeld contributed to this article.

SCHOOL SPENDING

Proposed education spending changes in Maryland's fiscal 2010 budget

District .............................. Proposed 2010 ........... change ....................Pct. change

........................................................... budget ..... .........from 2009

Baltimore City ................... $811,391,000 ............ -$23,591,000 ........... -2.8%

Baltimore County .............. $508,143,000 ............ -$8,465,000 ........... -1.6%

Carroll ................................ $139,046,000 .............. -$4,028,000 ............ -2.8%

Harford .............................. $207,329,000 .............. -$3,417,000 ............ -1.6%

Howard .............................. $196,216,000 .................. $628,000 ............. 0.3%

Montgomery ..................... $449,413,000 ............. $27,083,000 ............ 6.4%

Pr. George's ..................... $871,833,000 ............ -$35,241,000 ............. -3.9%

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