Alabama’s per-pupil spending has fallen over 20 percent since 2008, according to a report issued Thursday by the Center on Budget and Policy Priorities.
The Washington-based think tank said percentage-wise, Alabama’s cuts were the second-largest in the nation, eclipsed only by Oklahoma. Alabama’s spending per student fell an inflation-adjusted $1,242, the largest decline in the nation.
The report noted the the sharp effect the recession had on state revenues. Alabama’s Education Trust Fund budget relies on sales and income taxes, which rise and fall with economic conditions. The ETF’s budget hit an all-time peak of $6.7 billion in the FY 2008 year, which began on October 1, 2007, just prior to the stirrings of the recession. Two years later, the budget had fallen $1.4 billion, to $5.3 billion, and could have fallen even further without stimulus funds from the federal government.
“Emergency fiscal aid from the federal government initially helped prevent even deeper cuts, but it ran out before the economy had recovered, and states have disproportionately chosen to address their budget shortfalls through spending reductions rather than a more balanced mix of service cuts and revenue increases,” the report said.
The report also cited cuts to ongoing federal aid sources as contributing to the situation.
Economic recovery has helped shore up the fund, and lawmakers approved a modest two-percent pay raise for education personnel in last year’s budget. In 2011, the Legislature approved legislation that increased teachers’ minimum payments into their retirement funds by 2.5 percent.
The 2014 Education Trust Fund is budgeted to receive $5.7 billion in the next fiscal year, starting on Oct. 1. Due to restrictions on taxation and local governance in the Alabama Constitution, the ETF provides the bulk of funding for Alabama schools.
The report warned that cuts to education spending could have adverse effects on state economies.
“Local school districts typically have little ability to make up for lost state funding on their own,” the report said. “As a result, deep state funding cuts lead to job losses, slowing the economy’s recovery from the recession. Such cuts also counteract and sometimes undermine important state education reform initiatives at a time when producing workers with high-level technical and analytical skills is increasingly important to a country’s prosperity.”
– posted by Brian Lyman