Friday News Roundup: Week of January 11-15

At Ed Money Watch, we discuss and analyze major issues affecting education funding. In our Friday News Roundup, we try to highlight interesting stories that might otherwise get overlooked. These stories emphasize how federal and state policy changes can affect local schools and districts.

Alabama Governor Releases 2011 Budget Proposal, Assumes Second Federal Stimulus

Colorado Lawmakers Work to Close Budget Gaps, Rush to Qualify for Race to the Top

Iowa Education Committee Approves School District Budget Regulation, Charter School Shift

Maryland Governor Calls for Moderate Tuition Increase in Public Universities

Tennessee Governor Proposes New Higher Ed Funding Formula

Alabama Governor Releases 2011 Budget Proposal, Assumes Second Federal Stimulus
Alabama Governor Bob Riley this week released his budget proposal for fiscal year 2011. The $6.1 billion budget assumes an increase of almost $500 million over the fiscal year 2010 budget – a figure that assumes another round of federal stimulus funding. Governor Riley said much of the increase in funding would be spent on education, some of which would come from a combination of federal stimulus funds from the already passed American Recovery and Reinvestment Act. The increase also relies on two significantly more tenuous funding streams – growth of about 2 percent in the state’s Education Trust Fund and about $200 million in funds from a second stimulus package not yet passed by the U.S. Congress. On the other hand, Governor Riley’s budget would cut about $100 million in spending from the state’s General Fund. More here…

Colorado Lawmakers Work to Close Budget Gaps, Rush to Qualify for Race to the Top
Colorado lawmakers returned to work this week, immediately focusing on the state’s $1.5 billion budget gap and its Race to the Top application. Because of the looming January 19^th application deadline, lawmakers skipped over the usual ceremonies at the beginning of the legislative session and went straight to work on crafting reforms that would allow the state to qualify for a piece of the $4.35 billion federal competitive grant program. This work comes on top of the urgent need to close the $1.5 billion budget gap for the current fiscal year. Though no plan is yet in place, Senate Republicans have warned that the budget cannot be balanced through new taxes and fees alone. Lawmakers are also hard at work crafting legislation to create jobs – a major priority for the coming year according to State Senate President Brandon Shaffer. More here…

Iowa Education Committee Approves School District Budget Regulation, Charter School Shift
The Iowa Senate Education Committee this week approved two proposals from Governor Chet Culver. The first would require school districts to spend down their cash reserves before raising property taxes, and the second would ease the state’s limit on charter schools. The proposal from Governor Culver requiring school districts to spend down cash reserves came in response to concerns that his 10 percent across the board budget cut would cause school districts to raise property taxes in order to balance their budgets. The legislation doesn’t specify how much school districts can keep in their reserves – it lets the state’s School Budget Review Committee work with the school districts. In a bid to qualify for the federal Race to the Top competitive grant program, the committee also approved a plan to ease the state’s limit on charter schools. The legislation also lays out concrete steps for dealing with failing schools. Both of these steps are moves to align state policy with the priorities outlined in the Race to the Top guidelines. The proposals from the committee will now move to the full Senate for debate. More here…

Maryland Governor Calls for Moderate Tuition Increase in Public Universities
Maryland Governor Martin O’Malley this week called for a “moderate” increase in public university tuition. The call came as state legislators returned to Annapolis for a 90-day legislative session, much of which will be spent trying to fill a $2 billion gap in the fiscal year 2010 budget. Governor O’Malley had previously prided himself on fulfilling his campaign promise to hold university tuition steady, but in light of the drastic budget shortfall he believes the tuition freeze must now come to an end. The details of the tuition increase will be released next week when Governor O’Malley releases the rest of his spending proposal. More here…

Tennessee Governor Proposes New Higher Ed Funding Formula
Tennessee Governor Phil Bredesen this week announced a proposal to change the state’s higher education funding formula to reward institutions for meeting graduation rate goals. The new funding formula would represent the first time in state history that colleges and universities have had concrete graduation rate goals, and it ranks 40^th in the country for four-year degree graduation rates. Funding for higher education institutions is currently tied to enrollment instead of graduation rates. Some higher education officials worry that the new formula would lead to grade inflation, faculty layoffs, and a radical change in college culture. But for Governor Bredesen, it is a key component of the state’s higher education system makeover. Some of Governor Bredesen’s plan requires legislative action, but most will be carried out by state higher education boards. More here…

Briefly Noted

• Washington Governor Christine Gregoire restores funding for 1,500 public preschool slots and child care subsidies for working families in new budget.