Governor’s Response to Revenue Projections

INFORMATIONAL LETTER: 64
POLICY CODE: DB

TO: Superintendents of Schools
FROM: Susan A. Gendron
DATE: December 18, 2007
SUBJECT: Governor’s Response to Revenue Projections

Please forward to Assistant Superintendents and Business Administrators

As a result of recent adjustments to State revenue projections for the current year FY 2007-08 and the constitutional requirement that the Governor maintain a balanced budget, the following actions were announced by the Governor today in an Executive Order directing State agencies to reduce the rate of spending in the current the fiscal year by $38 million.

The Department of Education has been charged with reducing General Purpose Aid for Local Schools by $20,174,517. We have identified $3.5 million in carry forward funds as the first step in meeting this charge. Secondly, the Department of Education will curb spending in those programs within General Purpose Aid for Local Schools over which it has discretion. However, if the full amount of $16.7 million cannot be achieved in discretionary programs, a reduction in payments to school administrative units in June 2008 may be required, in which case those funds would be restored in the first payment for fiscal year 2008-09 that is paid in July 2008.

Legislative action on an emergency FY 2007-08 budget could mitigate the need for some or all of these adjustments. The FY 2007-08 budget must be balanced, but unlike what has happened in prior curtailments General Purpose Aid for Local Schools cannot be reduced. The full amount of any June reduction would be provided in the first FY 2008-09 payment to local school administrative units.