Hamilton County: Stimulus may not aid school budget

Even if Hamilton County Schools receive an estimated $21 million from the federal government, the district’s $20 million budget hole likely would remain unfilled, officials said Monday.

Local public schools are poised to receive about $10 million in programs for poor students and another $11 million for special education in economic stimulus money, according to the U.S. House of Representatives’ Education and Labor Committee.

None of that restricted money could be used for the school system’s general purpose fund to offset the projected deficit, Chief Financial Officer Tommy Kranz said.

“It will be helpful to the students who participate in those programs,” he said. “What it’s not going to be helpful for is the general purpose budget issue that we have.”

The exact amount of money school districts will receive or the rules that will govern its spending has not been decided, Mr. Kranz said. The American Recovery and Reinvestment Act will provide additional funds for education technology, school improvement money for schools failing to meet benchmarks set out under the No Child Left Behind Act and an undesignated fund to be used at the discretion of each state’s governor, he said.

Mr. Kranz said he hoped at least some of the money, which is meant to lesson the economic impact on both K-12 and higher education, makes its way to Hamilton County Schools.

“From a selfish standpoint, I‘d like to see it all go to K-12. That, in my opinion, is the core, the base for everything else we do,” he said. “But that’s not my choice.”

If Gov. Phil Bredesen were to use the money to increase the state’s portion of education funding, Hamilton County could receive about $12 million in Basic Education Program funds, which could help ease the current budget strain, Mr. Kranz said.

Although the governor’s spokeswoman Lydia Lenker said officials still are determining how the discretionary money could be spent, Gov. Bredesen himself said he likely would steer clear of using it to fund BEP.

“We’re not moving (BEP) forward with the stimulus because that money goes away and just leaves the next governor with a problem,” he said. “I want to do that as we’re able to afford it on a continuing basis.”

The stimulus money will be given to school districts over the next two years only, so Gov. Bredesen said he plans to focus the bulk of it on one-time capital expenses.

“There’s certainly a lot of capital needs for modernization,” he said. “We’d like to eliminate portables (classrooms), for example, and we’re trying to get some clarity on whether that qualifies for use of money.”

The governor also said “there’s no question” that some of the stimulus money will scale back the deep cuts to higher education across the state.

Mr. Kranz said he recently received an e-mail from state Education Commissioner Timothy Webb saying he was meeting this week with education officials in Washington, D.C., to learn how the funds can be used, and when to expect them.

“We may start seeing funds within the next 45 to 60 days,” Mr. Kranz said.

Staff Writer Herman Wang contributed to this story.