School Districts Hoarding Millions Claim the State is “Bleeding” Them

As the Pennsylvania budget stalemate approaches its fourth month, the Pittsburgh Post-Gazette reports that the state’s failure to release education funding is “bleeding” school districts in lost interest income.

The article notes that the state has earned $40 million in interest since July 1st on money budgeted to school districts.

To be clear, districts are not bemoaning the lack of funds. Instead, they are complaining that they aren’t earning interest on the funds.

The article named seven school districts, with reserve fund balances between $5.7 million (Hopewell Area School District) and $223.9 million (Pittsburgh Public Schools). These numbers are from the 2022–23 school year, which is the latest data available.

According to the Pennsylvania Auditor General, districts’ reserve balances should not exceed 20 percent of their annual budget. Of the districts highlighted in the article, four of the seven exceed that recommended limit.

Loath to let a good crisis go to waste, the article notes, “Lost interest income in a public school district, officials say, can be thought of as lost opportunity.” Yet, the real lost opportunity here isn’t the missed interest. Instead, it’s the opportunity for school districts, flush with cash reserves, to be forthright and honest about their financial situation.

Curious about your school district’s reserve funds? Click here to search.

Related reading:

• School Districts Claim to be “Underfunded” During Budget Impasse, Despite Massive Reserve Funds
• Rethinking School District Reserve Funds as Students Return to Class
• Public Schools Increased Spending to $23,000 Per Student, Ballooned Reserves While Enrollment Declined