School district mergers likely in budget crunch

DES MOINES - Students, teachers, school administrators and property owners are about to have a tough lesson in math.

An unprecedented plunge in state revenue, eroding student enrollment and the end of one-time federal stimulus aid could push Iowa toward fewer school districts, increased college tuition and higher property taxes.

Normally, education has been shielded from the brunt of state budget cuts. With about 60 percent of state spending going to K-12 schools and higher education, legislators say next year's budget could be an exception to the rule.

“I think we have made it clear coming into this session that there are no sacred cows, that everything is subject to review and that there are few if any areas that will be spared,” said Senate Majority Leader Mike Gronstal, D-Council Bluffs.

The 2010 legislative session convenes Jan. 11, and balancing the fiscal 2011 budget will be a priority.

Iowa's 361 public school districts, 15 community colleges and three regent universities already are struggling to cope with a 10 percent across-the-board cut ordered by Gov. Chet Culver for the current fiscal year. That money won't be restored in fiscal 2011, and school districts will have to rely on their reserves or property taxpayers to meet a 2 percent “allowable growth” commitment.

“I think the challenges are huge,” said Dan Smith, executive director of School Administrators of Iowa and a former superintendent. “All educators, I think, are feeling a great deal of stress. ... We're concerned about providing high quality at a time when we know that revenues are very strained.”

Discussions already have commenced among school districts interested in sharing resources and personnel, consolidating or dissolving to provide students the best educational options and to meet programming and financial pressures.

“It's bringing things to a head,” said Dean Meier of the Cedar Falls-based Area Education Agency 267. He said he would not be surprised if 30 to 50 district mergers take place statewide over the next five to seven years.

“I think it's safe to say that there will be renewed energy around the issue of sharing and consolidation,” Smith said.

Higher education also is under considerable financial stress because cuts this year were covered by one-time federal stimulus funds, said Steve Ovel, a lobbyist for the Iowa Association of Community College Presidents and Trustees. He said funding shortfalls may force the colleges to consider tuition increases of up to 7 percent.

Likewise, the Board of Regents is preparing for more budget cuts. The board will consider in February a 6 percent base tuition increase for the 2010-11 school year. It has already approved a $100 tuition surcharge for the spring semester.

Beyond budget issues, Wendt said lawmakers may consider a uniform K-12 school start date around the fourth Monday in August and a measure to raise the compulsory education age from 16 to 18.