Strategies for Dealing with Shrinking Budgets

January 22, 2011

It’s the weekend after Thanksgiving. The state legislature has been called back for a special session tomorrow to deal with a spiraling budget deficit. Andrew Cuomo is governor-elect and facing a daunting challenge. And I have a strong sense of déjà-vu.


Twenty years ago, almost to the day, the New York State Legislature, at the request of then Governor Mario Cuomo, took the unprecedented action of cutting aid to schools in the middle of a fiscal year. Districts, having organized and staffed based on aid totals in the state budget enacted the previous spring, suddenly found themselves seriously overextended. And superintendents and boards of education had little time to deal with the initial confusion and to react effectively as the development of the 1991-92 budget loomed immediately ahead. State school aid would be cut again that spring and wouldn’t rebound again until 1994-95.


This was a difficult period for New York schools but through those years important lessons were learned that can assist the leaders of this generation in addressing the current crisis. Here are a few:


It’s a multi-year problem and requires a multi-year solution. When faced with declining revenues, the typical district at that time sought to preserve the status quo, either by using its fund balance to cover losses or by maintaining all programs but reducing each in an incremental way. These strategies would have worked had the downturn been limited to a single year, but it wasn’t. Districts following this path experienced significant conflict in the years that followed. Everyone expected continued insulation from pain, with employees demanding no cuts and residents opposed to tax increases. They were to be disappointed—and angry. In contrast, districts which moved quickly to explain the nature of the multi-year problem to their stakeholders and then make structural reductions fared much better, subsequent research found.


When the water hole dries up, all the animals begin to look at one another differently. In 1990, there were no New York Learning Standards, high stakes assessments or school report cards. Without the imperative to continually improve student achievement, district decisions were often made in a political rather than in an educational manner. With no accountability system in place, districts were free to value the football team above the math program. Pet projects and sacred cows were protected while programs with demonstrated effectiveness were sacrificed. Fortunately, no one has absolved today’s leaders of the need to improve student achievement because funding is tighter. As a result, districts have a “North Star” to guide their decision-making during the coming budget season. Though districts owe fairness to adults, a primary focus on children’s needs will guide them through turbulent waters.


People are the solution. In the later years of a multi-year downturn, schools no longer can apply additional funds to problems they face. Things that aren’t mandated such as field trips, after school activities and high school electives have largely disappeared. Yet, students keep showing up each morning. In such an environment, how can schools meet their challenges? The answer is in people. Districts which successfully navigated the troubled waters of 1990-94 recognized intuitively that their strength lay in their people—faculty, staff, administrators, students and community. Without the ability to add new programs to address student needs, such districts invested in their human resources. They preserved professional development programs. They found more time for adults to work with one another and created processes for stakeholders to reach consensus about district mission and objectives. Horizontal teaming and vertical alignment efforts were begun. In a serious downturn, the only thing left are the people. As the schools’ greatest resource, they are more than sufficient.


Warren Bennis has said that leaders are made in the “crucible”, tested through crisis. Kenneth Leithwood has found that leaders matter most when and where they are needed most. Twenty years ago was one of those times; so is today. Given the resolution of today’s leaders, and armed with lessons from the past, I have no doubt that we will again meet our challenges, seen and unforeseen. Schoolchildren, whose futures hinge on the quality of their childhoods, are depending on us to do so.

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