Midyear cuts in federal school funding
no longer a threat – for this year, at least

Top officials of the Kentucky Department of Education have confirmed that the word out of Washington, D.C., is that the specter of a midyear reduction in federal school funding for such programs as Title I and special education is no longer a threat – for this year.

However, unless Congress acts in the coming months to address a law that requires across-the-board cuts over the next decade, Kentucky stands to lose as much as $61 million a year, starting July 1, 2013, according to the Kentucky School Boards Association.
 

News of the U.S. Department of Education notice broke earlier this week in a story on the Education Week magazine website and was posted to KSBA’s Facebook and Twitter pages that evening. That story may be viewed here.
 

During a webinar for the state’s superintendents, Education Commissioner Terry Holliday and Associate Commissioner Hiren Desai spelled out the short-term relief and remaining long-term implications of the federal budget process known as sequestration.
 

“There were a lot of folks who speculated about mid-year cuts, me being one, and that allowed us to put pressure on the White House and the U.S. Department of Education to give us some answers for you guys. We were hearing different things from different offices of the U.S. Department of Education,” Holliday said.
 

“What we did hear Friday was this update on sequestration that there will not be any midyear cuts to federal programs. The only program that might have a mid-year cut is impact aid, so those of you who have military bases or large forestry (federal designations) you may want to look into that. But no mid-year cuts to Title I, Title II, IDEA (Individuals with Disabilities Education Act),” he said.
 

Desai further explained the clarification.
 

“The U.S. Budget Control Act of 2011 required Congress to put into place certain spending cuts by January of 2013.  Since Congress failed to act in time, we have automatic spending cuts as of Jan. 2, 2013,” Desai said. “Up until last week, we were a little unclear when those cuts actually would go into effect and which programs would be affected. We were notified by the U.S. Department of Education on Friday that even if sequestration goes into effect on Jan. 2, there will be no reductions in any federal funding that you will receive on Oct. 1, 2012.”
 

But both KDE officials warned that future cuts remain a real cause for concern, and urged Kentucky school leaders to spell out the impact to their U.S. representatives and senators.
 
“You need to be ready for those cuts for the 2013-14 school year,” Holliday said. “If you did plan for cuts this year, you’re probably in good shape. You can spend federal money over a three-year period, so you can use money that you don’t spend this year to offset cuts next school year. If you did plan for midyear cuts, you’re ahead of the game.
 

“What we’re really asking everybody to do is to talk specifically to your Congressional delegation, because this will have a huge impact to schools and teachers for the next 10 years if we don’t do something,” the commissioner said.
 

“If sequestration goes into effect on Jan. 2, it will impact federal funding as of July 1, 2013, and will be in effect for a 10-year period. Current estimates are that this will be a cut of as high as $61 million to Kentucky educational funding a year over 10 years. That’s a lot of money,” Desai said.
 

“While we may breathe a sigh of relief in planning for this school year, we need to be cognizant that there will be a significant impact next year. We urge you to speak to your Congressional delegation,” he said.
 

The July 24 superintendents’ webinar will be archived on the KDE website in the near future.
 

From Ky. School Boards Association