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Dear districts: These are the glory days. Are you ready for tomorrow’s financial pain?

BY Laura Anderson
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Marguerite Roza

Published January 30, 2019 on Flypaper, Thomas B. Fordham Institute

Just like the years leading up to 2008, the last few years have yielded stronger growth in funds for schooling. And just like in 2008, there are signs of trouble ahead. While we can’t predict how an economic downturn will affect every district, we can anticipate some big-picture trends, and in doing so potentially help insulate school systems from needless churn, better equipping them to make it through the inevitable downturn ahead without extinguishing public good will.

We know state revenues are likely to dip, hitting hardest the districts in the 21 states that are more reliant on state funding today than a decade ago. We know district obligations climb when the economy takes a hit. We know labor in education feels like a fixed cost, making it tough to cut spending. And we know it doesn’t take much to destabilize a district. But districts have a chance to strategically prepare for the inevitable downturn by reducing recurring costs and resisting more hiring; shifting budget choices to schools, allowing them to protect what matters most; and building trust around money and engaging community in tradeoffs.


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