A very popular question, yet many don’t have the answer and unfortunately it’s not easy to find.
Public Education is funded from three primary sources: state funds, federal funds, and county funds. When the General Assembly debates the budget, the figure they are debating is at the state funding level only. Many will argue that it isn’t enough for our students, or that we aren’t making education a priority in the state, but the whole picture is not being assessed.
If we look at public education, from an expenditure breakdown, it looks like this:
When comparing year-to-year or making an argument to spend more or less – the entire picture must be part of the debate. Unfortunately, lawmakers don’t get the full picture until after-the-fact.
North Carolina’s fiscal year operates on a different schedule then the federal fiscal year. So it is impossible for state lawmakers to know what the federal funding will be when they pass the state budget. Case-in-point, from FY 2011-12 to FY 2012-13 federal funding for public education was reduced by more than $205 million. With county data, it is much harder to collect and also falls after the deadline of when the state budget is passed. The only solution is to change the way North Carolina budgets.
Since changing our fiscal year would prove difficult, the easiest solution is to use actual spending figures from the prior year. Currently the state uses a complicated formula along with forecasting to estimate spending. If we used actual numbers, the budget process would be based more on sound and realistic expectations instead of guesswork from economists.Note: all data came from the Fiscal Research Division