A recent policy brief from the Center on Regional Politics, “A Tale of Haves and Have-Nots,” forecasts the fiscal future for all 500 school districts in PA for the period 2017-18 through 2021-22. The brief projects budget shortfalls for almost 300 districts, requiring them to reduce expenditures through program cuts or raise additional revenue. Additionally, even some districts whose fiscal condition is improving may be doing so from a base that is inadequate to support the needs of their students. Overall fiscal conditions are improving in aggregate, with revenues catching up to expenditures, but that masks continued fiscal stress for most districts and the persistent gulf between those with surpluses (“the Haves”) and those with shortfalls (“the Have-Nots”).

It is important to note that projected shortfalls indicate the level of fiscal stress districts are expected to encounter, not actual deficits. By law, districts cannot operate under a deficit budget. Similarly, those districts with projected surpluses will have funds to restore or partially restore program cuts since the 2008 recession, and in some cases, upgrade and enhance their instructional programs, and maintain staff aimed at improving student outcomes.

Some of the funding problems for districts can be explained by comparing revenues from the state BEF (Basic Education Funding) and SEF (Special Education Funding) subsidies with the state-mandated expenditures for Charter School Tuition and Net PSERS (Pennsylvania School Employees’ Retirement System). PSERS is paid through a combination of local and state funding, with Net PSERS reflecting the amount of local funding required to pay the districts’ share of the total PSERS amount. The projected five-year state funding subsidy increases for BEF and SEF, $667 million, is far less than the projected increase in Net PSSERS and charter school payments,, $1.23 billion.

Visit the A Tale of Haves and Have-Nots: The Financial Future of Pennsylvania School Districts post to view interactive graphics and PA school district maps, including options to view 5-year projected shortfalls and surpluses as a percent of major expenditures, and 5-year projections for the gap between state subsidies and mandates, as well as groupings by PA House and Senate districts.

View the full report

View the Research at a Glance.

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