Pandemic could trigger financial meltdown for schools

"With the nation's attention still fixed on the covid-19 health crisis, school leaders are warning of a financial meltdown that could devastate many districts and set back an entire generation of students," Cory Turner reports for NPR. "Schools receive nearly half of their funding from state coffers. But with businesses shuttered in response to the pandemic and the unemployment rate already nearing 15 percent — well above its 10% peak during the Great Recession — state income and sales tax revenues are crashing."

Some states reported April revenue 25% below last April, and 49 states are required to balance their budgets, so many are cutting school funding. "Ohio Gov. Mike DeWine unveiled $300 million in K-12 budget cuts — and that's just through June 30, when the current fiscal year ends," Turner reports. The $2 trillion CARES Act "provided K-12 schools with more than $13 billion in emergency funding, an average boost of about $270 per student. But spending the money has been complicated by controversial guidance from the U.S. Department of Education."

Many rural schools are already strapped for tax revenue, and a recent survey by the School Nutrition Association revealed that rural schools were the less likely than those in cities and suburbs to have a reserve fund to operate a summer meal program.