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Budget Includes Changes To Funding Of Enrollment Growth

North Carolina finally has a budget.  Governor Pat McCrory on Thursday signed the 260-page spending plan into law.  It’s come with a few surprises, including what the state’s chief financial officer calls the biggest change in how the state funds public schools since the 1930s.  That's because the state will no longer automatically pay for the number of additional students districts enroll each year.  

WFAE's Lisa Miller and Mark Rumsey discussed the change. Here's a transcript of their conversation:

MR: So break this down for us a little more.  How have education budgets traditionally funded enrollment growth?

LM: Okay, so, North Carolina is a growing state. That means public schools have to educate more and more students.  CMS alone adds about three thousand students each school year.  Up until now, the state budget has automatically factored that growth into the next year’s budget.  For example, budgeters look at how many new students districts are expected to grow by, and figured out how many new teachers and teacher assistants and a whole bunch of other resources those additional students will require. That’s factored into the next year’s budget.  Administrators let districts know in March how to plan for the following school year.  This is how the state has been doing it for decades.

MR: How is it changing?

LM: Instead, of automatically funding that growth, those funds traditionally set aside for the extra students will have to compete against all other budget needs and priorities.  Philip Price is the Department of Public Instruction’s chief financial officer.  He says that means districts will have a much harder time planning.

"Once you establish formulas for public schools and you need to hire and recruit every year for the next year, if you don’t know how many teachers you’re going to be able to hire or if you’re even going to get funding for that growth, you will not know that until the General Assembly adjourns," Price said.

LM: And if the session ends in August like it did this year, and districts do indeed get that money for growth….it’s hard to hire more teachers then.  Here’s CMS Superintendent Heath Morrison:

"That’s maybe the most important part of this that we lose…not only the potential of having overcrowded classes until the corrections are made, but it’s the caliber of the teacher in the classroom." 

The worst case scenario for districts is lawmakers will decide not to pay for that growth. 

MR: Why did lawmakers decide to do this? 

LM: Many lawmakers didn’t know it was in the budget when they voted.  I had no luck reaching one of the main budget writers Representative Nelson Dollar today.  But he told the Raleigh News and Observer this change will make it easier for people to understand the budget, since in past years, he says it looked like lawmakers were cutting the education budget when they were merely adjusting it because the amount of growth was lower than initially projected.  He also said the General Assembly will always fund enrollment growth.