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Lack of Funds Could Close Many School Districts : Education: Finance experts warn that the crisis will worsen unless states increase funding and find more equitable ways to distribute it.


CHICAGO — Classes in the city schools were supposed to start Sept. 8.

But 411,000 children spent last week on playgrounds, at home, in libraries and in YMCAs while the school board, the governor, the mayor, state lawmakers and city teachers tried to figure out how to balance the school district's budget, plagued by a $298-million deficit.

Linda Guerrero, for one, was not happy about summer's extension. "I'm bored," said the prospective sixth-grader, who was hanging from the monkey bars at a park next to her deserted North Side school. Her mother, too, wants classes to begin, she said, "because the house will be cleaner and we will learn."

The Chicago Sun-Times has been publishing essays by children who bemoan being left on the city's mean streets and wonder if their chances for college admission have been hurt.

This school district may be the biggest to shut down for lack of money--as opposed to the asbestos crisis that has kept New York City schools closed--but it is certainly not the first. And school finance experts warn that it won't be the last unless states come up with more money for education and more equitable ways to distribute it.

"The dam is going to break, and you're starting to see the trickles," said Deborah Verstegen, a University of Virginia professor of education finance and policy.

Schools in Kalkaska, Mich., closed their doors months early last March when voters rejected a property tax increase.

In Greene County, Ala., the declining fortunes of a greyhound racing track that had helped pay for new teachers and library books led school to open a week late last month.

School officials from rural Mt. Morris, Ill., have notified the state that they may have to close their system's doors in January, Illinois school Supt. Robert Leininger said.

And the school district for North Chicago, a suburb in Lake County, voted to disband altogether last year. Five surrounding school systems, alarmed that they might have to take on the expense of educating North Chicago's 4,000 students, challenged the dissolution plan.

The district was saved by a one-time infusion of $800,000 in state aid, along with a telethon on the local cable channel that netted $120,000. But North Chicago school officials already are fretting over next year.

Deep cuts already have been made in the past three years, said Business Manager Martin McConahay. The teaching staff was reduced by 10% and class sizes ballooned. It is not unusual to find 42 students in a high school biology class or 50 in a gym class.

Maintenance, custodial and secretarial workers are supplied by a private contractor now.

"I'm trying to dig up volleyball uniforms for the next game," McConahay said with a sigh. "We have the shirts, but we do need the pants. We used the volleyball pants for baseball last spring, and they got kind of beat up."

The school board, McConahay said, has "reserved the right" to file again with the state for dissolution.

What many of these districts have in common is a poor property tax base--either because the residents themselves are poverty-stricken, because of voter revolts over rising tax bills or because, as in the case of North Chicago's Great Lakes Naval Training Station, a large swath of territory is exempt from tax rolls.

It is to property taxes that many districts turned when states would not ante up the money they needed.

"When state budgets get in trouble, then education gets in trouble," said G. Alan Hickrod, director of the Center for the Study of Educational Finance at Illinois State University. "And state budgets are in trouble."

Los Angeles school officials can testify to that. As California government coffers were depleted by the poor economy, state lawmakers cut education funding. Property taxes were constrained by Proposition 13. In the past four years, the Los Angeles Unified School District was forced to slash more than $1.2 billion of its $3.9-billion budget.

Last winter, the Los Angeles system teetered on the brink of insolvency when a judge temporarily refused to allow school officials to impose employee pay cuts. This year, the district's financial health is so precarious, Supt. Sid Thompson said recently, that it could be pushed into bankruptcy "with a featherweight."

In Illinois, the state now contributes 33% of school district budgets, down from 48% a decade ago.

The state's financial "watch list," which had fewer than a dozen entries 10 years ago, now notes that 110 of 940 school districts are on the road to fiscal disaster. "And that list is going to grow," Leininger said.

Oddly, Chicago is not on the list. The city's problems stem from a state requirement that the district not spend more in any one year than it takes in--a requirement that would have shut down more than half of the state's school systems this year, Leininger said.

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