Budget Cuts Pose Threat to the Recovery School District’s Success

Constituencies across the state are up in arms about the more than $200 million of budget cuts approved by the House last week and up for consideration in the Senate Appropriations Committee this week. In New Orleans, public schools could face additional costs of up to $400 per student next year due to an $11 million reduction in the Recovery School District’s (RSD) operating budget. That funding had been set aside to cover the cost of property insurance on the RSD’s school buildings. Unless full funding is restored to the RSD, individual schools will have to foot the bill.

The RSD currently pays significantly higher rates on property insurance than other school districts in the state and region. This is largely due to the requirement that since the RSD is a state agency, it must purchase its insurance through the Louisiana Office of Risk Management (ORM). The ORM rates are substantially higher than the rates offered on the private market. In fact, the RSD pays about 40 percent more on a per pupil basis for property insurance than it would pay if it were allowed to add its properties to the insurance policy carried by the Orleans Parish School Board. As long as the RSD is required to purchase insurance through the ORM, it cannot be expected to cover these costs strictly out of the per pupil funding it receives through the Minimum Foundation Program.

The $11 million budget cut to the RSD comes at the time when its schools are showing dramatic results. The LEAP and GEE test results released last week show that the percentage of students in RSD schools in New Orleans who met grade-level expectations on these tests increased by 25 percentage points over the past 4 years – more than four times greater than the state average increase over this same time period. Placing such a steep financial burden on the RSD’s schools right now poses a great threat to the incredible progress they are making.

The funds slashed from the RSD’s operating budget are part of $32.5 million in K-12 education spending cuts approved by the House Appropriations Committee. In addition to reducing the operating budgets for the Louisiana Department of Education and its special schools and school districts, the committee’s budget cuts eliminated funding for the New Orleans private school voucher program and a new special education voucher program. However, at Governor Jindal’s urging, the House voted to restore $8 million in funding for the New Orleans voucher program.

The Louisiana Legislature should not risk losing the academic gains seen in the RSD over the past four years by cutting $11 million from the RSD’s budget. As the Senate considers the budget legislation passed by the House, we urge them to restore full funding to the RSD.