Getting Cash Back 

School board effectively rejects council school-funding proposal.

At this point, it looks like the only thing that would solve the current school-funding crisis is a time machine. And I'm not even sure that would do it.

Last week, City Council members continued to grapple with where to find $50 million for the Memphis City Schools, voting to take $28 million from the city's reserve fund, make $10 million in budget cuts, and forgive $12 million owed by the school district from a 1998 energy modification loan.

The proposal, suggested by Councilman Reid Hedgepeth, would net the school district $38 million but was contingent on school board approval.

"If they don't agree, this doesn't apply," Hedgepeth said. "If they do, we'll hand them $38 million."

But the Memphis City Schools board effectively rejected that proposal at a special board meeting Monday night, approving instead a resolution asking the council to fully fund the $50 million it promised city schools last summer.

In exchange for the $50 million, the school board said they were willing to pay back a 1998 energy modification loan, either in a lump sum or on the original payment schedule, once the city hands them an additional $57 million currently tied up in litigation.

"I recommend we go back to square one," said school board member Jeff Warren. "Since we already budgeted for the entire [$50 million], it's really important to get all that money this year. If we're right, and the city owes us $57 million, they shouldn't have to forgive us the $12 million."

A little history: Roughly two years ago, the City Council voted to cut school funding, asserting — I think correctly, though the state court of appeals disagrees with me — that education is a county responsibility and that taxing city residents twice for education wasn't fair (or economically good for the city). That led to a lawsuit over $57 million and the "maintenance of effort" clause, which essentially mandates that school funding can never be reduced.

Now back to the present: Both bodies are concerned about making budget cuts this late in the year. Memphis mayor A C Wharton argues that the city's $10 million in cuts halfway through the year comes to a $20 million reduction. Not to be outdone, school superintendent Kriner Cash says $12 million in cuts two-thirds of the way through the school year also means finding $20 million in cuts.

So a time machine could bring us back to the point last summer when the council approved the school district's budget, including $78 million from the city, but perhaps hoping for the court to say they didn't have to fund the schools, decided to wait to figure out where $50 million of it was coming from.

Or we could go back to the point when the council voted to cut its portion of school funding.

Or, better yet, we could go back to when the city gave its first dollar to the city schools and eliminate its maintenance of effort responsibility altogether.

But without a DeLorean and Michael J. Fox in a ski vest, it seems we're stuck here.

The money has to come from somewhere, and with the school board rejecting the 28/10/12 plan, we now go back to the future ... and the council when it revisits the issue Tuesday, February 9th.

It seems unlikely that the council will raise taxes to fund the schools. At its last meeting, member Barbara Swearengen Ware proposed taking $32 million from the reserve fund and reinstating 18 cents on the property tax in an effort to stave off city service cuts.

"To ask the city to cut $15 million in addition to what has already been cut is asking them to commit suicide," she said.

The proposal would have meant an additional $45 in taxes each year on a $100,000 house — or $3.75 a month — but the council voted not to suspend the rules for the proposal, disallowing a vote altogether.

"We said we weren't going to raise taxes," said Councilman Kemp Conrad. "If there is another mix that is going to get us to $50 million, I'm all ears."

Councilman Joe Brown suggested taking the entire amount from the city's reserve fund, but that would leave the fund $13 million short of 10 percent of the budget and the city vulnerable to a lower bond rating.

It's easy to understand why the council is balking. School funding is a huge portion of the budget.

"The citizens need to know this $78 million we give the schools is almost 60 percent of what we spend for fire protection for the whole city," Conrad said. "It's almost 13 percent of our whole budget, and we have absolutely no accountability for that money."

And right now, it's also money that the city doesn't have.

Council chair Harold Collins was at the school board meeting and said afterward that the council had an obligation to fund education. But who knows what the future will bring?

"If the court comes back with a different ruling," he said, "we'll be over here asking Dr. Cash for our money back."

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