How Much Raising The Debt Ceiling Could Cost Indiana Schools If Deal Isn't Reached

July 11, 2012 | 10:03 AM

By Rachel Morello

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The American Association for School Principals released a report Tuesday detailing how schools are bracing for the possibility of across the board federal spending cuts, writes Alyson Klein for Education Week:

Of those surveyed, 69.4 percent are betting they’ll have to cut professional development, and 58.1 percent say they’d expect to cut enrichment, after-school, and other programs. More than half — 54.8 percent — say they anticipate laying off instructional staff. And 54.9 percent expect to boost class size. (The AASA surveyed 1,060 school administrators in 49 states and the District of Columbia in June.)

The vast majority of districts — 90 percent — also say their states are in no position to help them absorb or offset the cuts.

Klein explains the cuts are automatic — the result of the deal Congress brokered last year to raise the debt ceiling — and could range from 7.8 to 8.4 percent. The idea is that the threat of such steep cuts should be enough to get both sides to compromise, but that’s not happening.

“Pretty much no one in Congress wants to see the cuts happen, but so far, lawmakers have been unable to come up with a plan to avert them,” Klein writes.

The National Education Association also released a report Tuesday with a state-by-state breakdown of what’s at stake if Congress can’t find a solution. The report’s projections are based on cut levels from the Congressional Budget Office and the non-partisan Center on Budget and Policy Priorities.

Here’s how potential cuts would likely impact Indiana:

• A loss of more than $20 million in federal Title I funding, which helps schools with large populations of students from low income families. Nationally, more than $1 billion is in play, and cuts would return funding to pre-2008 levels.
• About $20 million in cuts to federal IDEA grants to help offset the cost of providing special education. This could affect some 12,500 Indiana students who receive services.

• About $9 billion in funding cuts for Head Start, the early childhood program for low income families. Between 370 and 400 jobs in Indiana could be affected.
• A loss of more than $730,000 in school improvement funding, which goes to “turnaround” chronically low performing schools. Seven Indiana schools received school improvement grants during the 2010-11 school year.
• About $110,000 in cuts to rural education funding. Nationally, 1.7 million students enrolled in rural districts between 1999 and 2009, the last year data was available. Cuts would return funding to pre-2002 levels.

The mandatory cuts won’t affect Pell Grants, the loans that help low income students attend college.