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Michigan’s school budget season isn’t quite over yet.
Though the legislature has approved a school budget for the 2024-25 school year and most districts have approved their own budgets, some of the state’s school leaders say they are buying time as they advocate for a supplemental budget to cover the costs of a 90% cut in state grants they anticipated getting for student mental health and safety initiatives.
Administrators are also pushing lawmakers to pass legislation that would make permanent reductions to districts’ mandated payments into the state retirement system. They say that move would make the savings school systems are promised for the 2024-25 school year – about $400 more per student – recurring money that can be used for ongoing expenses, such as teacher salaries.
With minimum per-pupil spending remaining at $9,608 this year, administrators say this year’s budget amounts to a cut in state funding.
“I think districts are trying right now to understand the impact of the state budget and then figure out how they can patch things together to continue services for student mental health and safety without a dedicated funding source – but also pay for wage increases for teachers and staff,” said Dan Behm, executive director of Education Advocates of West Michigan, which represents the legislative positions of 45 districts.
RJ Webber, superintendent of Northville Public Schools, said his district, like many others, will now have to find ways to reallocate funding.
Northville was counting on $1.5 million in mental health and safety funding. Now, it will receive $122,000.
The dollars had previously paid for school resource officers, two-way radios, programming to teach kids communication skills, and internships for staff interested in school mental health careers.
“Now, those are things we have to revisit,” said Webber.
The superintendent said the school system is considering moving money from its general fund to cover some of the costs.
“That kind of loss of funding will have an impact on us,” he said. “But we are seeing where we can nip and tuck to try to keep cuts away from classrooms.”
Ypsilanti Community Schools will have to reallocate other state funds to keep three positions that were partially funded by the mental health and safety grants, said Superintendent Alena Zachery-Ross.
The district will also have to shelve plans to address some safety needs identified as being priorities through a threat assessment and staff surveys. A “Mindfulness and Restorative Practices” training for staff the district planned offering for the first time this year will also not take place.
The Coloma Community School District will be able to roll over remaining funds from this school year to continue mental health and safety programs next year, according to its superintendent, David Ehlers.
But if the state’s dedicated funding for those areas does not return for the 2025-26 school year, the district will have to make cuts, he added.
Nikolai Vitti, superintendent of Detroit Public Schools Community District, said the school system may also have to revisit programs such as school nurses for the 2025-26 budget. But if the state makes the reduction in retirement contribution obligations permanent, that won’t be the case.
Districts that had money left over in their general fund balances this school year will be less likely to have to make cuts.
“Most districts carry a fund balance,” said Behm. “Those dollars are not dedicated to anything. They are there to smooth out uncertainties in funding.”
This year, the fund balances will serve as a buffer for districts to “buy a little time” to see if the legislature is likely to pass a supplemental budget for mental health and safety, Behm said.
“Districts would rather buy more time than lay people off – people who are really hard to find,” he added.
Not every district has a buffer. Nine traditional public school systems were identified as having low general fund balances in June by the Michigan Department of Treasury. Thirteen charter schools are also identified as having low fund balances.
The traditional public school districts with low fund balances include Flint Community Schools, Waldron Area Schools, North Adams-Jerome Public Schools, South Lake Schools, Tahquamenon Area Schools, Ann Arbor Public Schools, Chippewa Hills School District, Madison District Public Schools, and Wayne-Westland Community Schools.
Webber said the reduction in the districts’ obligation to pay into the Michigan Public School Retirement System, or MPSERS, isn’t the same as an increase to per-pupil funding.
Gov. Gretchen Whitmer had proposed lawmakers approve a 2.5% increase in per-student funding.
“It’s upsetting because that would have meant $1.6 million to our district that is now zero,” said Webber.
The superintendent, like many other administrators, argues that public educators overpaid into the state retirement system for years.
“The education community looked at that and said why don’t we pump that money back into kids and communities?” said Webber.
But without a guarantee that the savings will continue, districts shouldn’t allocate the funds to recurring expenses, said Behm.
“We don’t want a situation where we’re living year-to-year with uncertainty about major cost items in budgets,” said Webber. “That inhibits districts’ ability to plan long term and put programs in place that have positive impact for students year after year.
Zachery-Ross said a more permanent solution would help districts plan for the future, negotiate with staff, and navigate big projects.
If the MPSERS contribution rate were to go up again in future years, Ehlers said the minimum per-student funding would have to increase significantly to offset that loss and to keep up with rising costs of labor and operational expenses.
A bill introduced in early June by Rep. Matt Koleszar, a Democrat from Plymouth, would have reduced school systems’ required MPSERS contribution through 2030. Another bill co-sponsored by Sen. Kevin Hertel, a Democrat from St. Clair Shores, would have similar measures.
The legislature failed to enact either bill before its break starting July 1. Sessions will begin again July 30.
Hannah Dellinger covers K-12 education and state education policy for Chalkbeat Detroit. You can reach her at hdellinger@chalkbeat.org.
