Governor Bill Richardson Saves Schools From Budget Cuts

Press Release

Governor Bill Richardson announced today that he will direct the Department of
Finance & Administration to spare public schools from general fund budget cuts until federal funding approved Wednesday by Congress starts to flow to school districts.

"In light of this unexpected federal funding for teachers, it makes no sense to force school districts to cut budgets now and disrupt the upcoming school year," Governor Bill Richardson said. "I am sparing schools from premature budget cuts."

The Legislature earlier this year passed a budget that requires across-the-board budget cuts -- in the amount of 3.2 percent -- as a result of lower general fund revenue projections. The State Board of Finance will meet Thursday to verify that the budget cuts will balance the budget and keep adequate cash reserves.

However, following the Board of Finance action, Governor Richardson will direct the Department of Finance to delay general fund cuts to the state's primary public school funding formula while school districts wait for the new federal funding. That means school districts will continue to receive the same amount of funding through the state equalization guarantee distribution until they get the additional federal money.

Governor Richardson's action will help school districts avoid teacher lay-offs during the 2010-2011 school year.

All other state agencies, including the Legislature, Judiciary and other state-elected offices, will be required to implement the 3.2-percent budget reductions beginning in September. The only exceptions will be Medicaid programs, services for Developmentally Disabled people, and a few legislative programs, which the Legislature exempted from state budget cuts.

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