Editorial

Public School Accounting: $100M Cut From Budget In 10 Years = Spending Increase

On the Grand Rapids Public Schools website Superintendent Teresa Weatherall Neal says the district has “cut $100 million from our budget” as part of a "transformation plan."

ForTheRecord says: The Grand Rapids school district's total expenses were $259.64 million in 2003-04. Ten year later, spending had barely budged, rising around $650,000 to $260.29 million in 2013-14, the most recent year audited statements were available.

So where's the $100 million reduction? Given that the district lost 6,502 students during that period, going from 23,447 to 16,945, per-pupil spending actually rose a good deal more than the raw figures suggest.

Many public school districts use accounting methods that give them credit for any savings in one area of the budget without regard to higher spending in other areas. For example, cutting a $1 million program one year but then starting up a different $2 million program the next year is still counted as a $1 million "cut," even though overall spending is $1 million higher. That’s how a district that claims to have cut $100 million over 10 years can actually be spending $650,000 more.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.