His observations are truly disconcerting. Be sure to click on the table at the end to enlarge it.
thom
Observations and Conclusion
A substantial part of the current crisis is due to the fiscal decisions made by previous administrations, General Assemblies, and many local governing bodies. It is unfortunate that long term tax policy often has been based on highly energized national, state and local economies that inevitably forces reexamination of policy during the most difficult times. The most obvious example is the so-called car tax relief that biennially forces the transfer of $1.9 billion state revenue to the localities. The transfer of these replacement revenues from the state to the localities should be phased out, perhaps over two or more biennia. Under current fiscal conditions, this would be a painful political process, both for the state and the localities. It is also unfortunate that when the commonwealth substantially increased state funds for public schools for FY 2005, most localities either decreased or level-funded their local appropriations for public schools. If the localities had followed this seldom-seen lead of the state, fiscal disparities among local school divisions would have been reduced and the current budget reductions would not have been as devastating to the public schools. On the other hand, it is fortunate that Virginia has the potential, without the need to make extraordinary fiscal effort, to remedy the current fiscal plight confronting public schools and other governmental agencies.
The state budget reductions for public schools have affected negatively the quality of public schools throughout the commonwealth and especially in the lower fiscal capacity school divisions. Not all of the local responses to budget reductions have been harmful, and in some instances likely have increased cost efficiency without affecting educational quality. However, freezing personnel salaries for several years could well prove harmful to public schools Although reductions have been determined through the LCI, the equalization component of the state formulae, the lower fiscal capacity school divisions suffer the most. Since the lower capacity school divisions depend primarily on state aid to fund their budgets, reductions in state aid inevitably result in larger total budget reductions for the lower fiscal capacity school divisions.
Both the executive and the legislature have relied exclusively on cost containment and have implemented massive budget reductions for virtually all state agencies in order to balance the state budget. The reductions have fallen particularly hard on public education, both higher education and elementary and secondary schools. Neither the current executive nor the legislature has considered seriously modest tax increases in order to remedy the budget shortfall. Both have attempted to convince the public that their constitutional obligation to provide and maintain a high quality system of public schools has been fulfilled by engaging in a series of charades. These charades include use of federal stimulus funds to fund Basic State Aid and reductions in the caps for the number of support personnel to lower the costs required to fund the SOQ. History continues to repeat itself as the General Assembly has again completely stripped funds from the 200-year-old Literary Fund.
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