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State Aide funding for this year was $7,085 per-pupil, with districts also receiving a one-time payment from the Sate of $23 per student to help with expenses.

Due to the anticipation of no increase in the amount for the upcoming year, parents, students, and employees face big changes in the near future as schools try to tackle anticipated budget shortfalls. As districts struggle to maintain budgets in the black, many are finding it necessary to make major cuts to do so.

At the core of the trouble are possible reductions in State Aide, along with increased expenses.

Budgets hearings were held recently in all districts to approve final budget revisions for the 2006-07 school year and adopt proposed budgets for the 2007-08 school year. The hearings gave the public the opportunity to gather information and give input regarding the state of their districts finances.

Many districts were able to avoid even more major cuts due to voluntary severance agreements or "buyouts" of educators at the top of the pay scale. However, Chesaning Union School District Finance Director Scott Sawyer cautions that this "quick fix" solution is only a short-term savings to get a district out of a bind with a district seeing significant savings mostly in the first year.

"You save a lot in the first year with the reduction of salaries, but the cost of the buyout, plus salaries of new teachers hired, end up costing a district in the long run."

Facing a nearly $1.5 million deficit, the Chesaning Union School District found it necessary to make major cuts to pare its proposed 2007-08 budget down to a $290,476 deficit.

Board members approved a close to $15 million dollar budget with cuts that included one maintenance position, two Para-pros, one hourly school-year-only custodian, athletic coaches, and the contract with the Saginaw County Sheriff's Department Liaison Officer.

Eleven teachers who accepted a voluntary severance agreement helped the district recall eight teachers who had previously been laid off. The "buyout" brought an approximately $400,000 first year savings to the district after new teachers were hired to replace the retiring educators.

Chesaning based its projected budget on an enrollment reduction of 51 students with no increase in State Aide funding using the same $7,085 per-pupil amount as last year.

Chesaning will use fund equity and also take advantage of State Aide borrowing to help cover expenses.

"Naturally we tried to keep cuts as far away form the students as possible. It is painful to cut people, they are all valuable, but our first responsibility is the kids and to not cut programs," Sawyer noted.

The New Lothrop School District adopted a just under $6 million budget for the 2007-08 school year that includes a slight deficit of $21,000.

While basing its projected budget on a reduction in enrollment of 15 students, and no increase in State Aide funding, with the per-pupil grant amount remaining at $7,085, the district made minimal cuts to offset projected shortfalls.

Cuts include the district librarian, a part-time curriculum director, a special education aide, supplies at both the high school and elementary school, and athletics.

"All of these were tough calls. There is nothing pleasant about reduction," noted Superintendent John Strycker.

The state of the budget was aided by five educators who accepted a severance agreement that helped save the district approximately $120,000.

Strycker and the rest of the district's administrators also helped out by taking a voluntary pay freeze.

"While New Lothrop maintains one of the highest fund balances in the area, the board finance goal is based on the month the district receives no State Aide payment," noted Strycker. "We need to maintain a15% fund balance in order to not have to borrow money during the month we don't receive funding form the state."

The districts current fund equity is between $850,000 and $920,000.

"I certainly believe that we will have more students than projected, however, until I see the whites of their eyes I need to remain conservative with our budget projections."

New Lothrop will draw from its fund equity to cover the deficit without borrowing from the State.

School officials in St. Charles approved the districts approximately $10 million budget for the 2007-08 school year that includes a deficit of $161,588.

The district budgeted for a drop in enrollment of 19 students and projected State Aide funding also the same as last year, $7,085.

"We budgeted for the bare minimum of per-pupil funding. You just don't know what the state will do, you have to be conservative," noted Superintendent Mike Wallace.

Due to cautious planning St. Charles was able to balance its budget without making cuts.

"We are fortunate to be able to continue to put money away while other districts are making major reductions," Wallace noted. "A year ago we budgeted for a pro-ration anticipating shortfalls caused by State funding. That planning left us with approximately $150,000 additional dollars when the State decided not to cut our funding this year."

The district made no cuts, hired three new teachers to replace three retiring educators, and also added all-day Kindergarten hiring one additional teacher for the program.

St. Charles maintains a current fund equity of $1.3 million and anticipates a return of $271,000 for the 06-07 budget year, bringing that figure to $1.6 million.

The district will draw from its fund equity to cover the shortfall but will take advantage of the Sate Aide borrowing to the tune of $565,000.

The Montrose School District approved a 2007-08 budget just under $15 million that includes a deficit of $249,578.

The proposed budgets are just one step in the budget process as all will undergo several revisions during the upcoming school year as enrollment numbers and state financing are finalized.