Colorado school districts should brace for a cut of 4 to 8 percent in state support for the 2010-11 school year.

CapCASBConf101609That was the message delivered Friday at a Colorado Association of School Boards conference, appropriately titled “Staying Ahead of the Red – Leading in Tough Economic Times.”

Jane Urschel, deputy executive director of CASB, told the conference, “The cut to K-12 in 2010-11 will be in the range of 4 percent to 8 percent. … They do not expect it go beyond 8 percent.”

But, Urschel noted that projected state revenues and spending for 2010-11 still are moving targets, and that previous estimates of cuts have crept upward. “There’s so much we don’t know and so many answers we don’t have. … We hear different things different days.”

“We do recommend that school boards budget conservatively. … Discuss what your budget would look like under the scenarios of 4 percent, 6 percent, 8 percent cuts.”

State aid to K-12 schools in the current, 2009-10 budget year is about $3.7 billion.  A 4 percent cut in 2010-11 would trim that by $150 million (about $180 per student), 8 percent by $300 million.

State school spending in the current year is expected to be trimmed by just under 2 percent, $110 million, after the legislature convenes in January.

Urschel’s comments wrapped up a presentation that also included Natalie Mullis, chief economist for the Office of Legislative Council, and Mary Wickersham, a policy advisor in the state treasurer’s office.

Mullis noted that because state revenue drops have been so steep, “I think the state legislature is going to have to deal with major policy changes” in 2010.

Wickersham said one of those policy debates will be over Amendment 23, the constitutional formula that requires annual per-pupil state school aid to increase by inflation plus 1 percent.

“There is an ongoing conversation about what is covered by Amendment 23,” she said. Much of that conversation is about the “factors,” formulas that give individual districts increased amounts of aid based on such things as size, declining enrollments and cost of living.

“Nobody wants to cut K-12, but as you see, this is an impossible situation. … You have to be able to come up with that money [overall required budget cuts] someplace,” Wickersham said.

Because state funding for colleges already has be cut to the minimum allowed by the federal stimulus law, she said, “Higher education is off the board; you can’t cut higher education any more.”

So, K-12 spending, which consumes more than 43 percent of the state general fund, is a target, regardless of A23.

School support also may be vulnerable to A23’s core formula, because state economists are projecting deflation this year will reduce the amount required to be spent.

State Rep. Christine Scanlan, D-Dillon, told the conference, “There has been some concern that schools weren’t feeling the pain” of state budget cuts. “Schools will feel the pain.”

At a later breakout session, Glenn Gustafson, chief financial officer for Colorado Springs District 11, gave board members some tips for how to handle the looming cuts.

Noting that 80-85 percent of district costs are salaries, he said, “In the end we’re talking about how much people get paid – or how many people are paid.”

He also advised boards to start 2010-11 budgeting soon and take steps like holding vacancies open now to save money that may be needed later.

“You’re going to want to go through a more public process than in the past,” because issues like class size will have to be considered. “I know no one likes to talk about class sizes, but in the end you’re going to have those conversations.”

Trimming employee benefits, furlough days and shorter school years may also be on the table for some districts, he warned.