US public schools are going broke, yet some spend like a kid in a candy store

Faced with the need to make drastic cuts to avoid looming budget holes as federal stimulus money runs out, school districts across the country are resorting to once-unthinkable solutions. Officials are turning to desperate measures to save the jobs of teachers, whose livelihoods were long considered secure.

In Boston, the superintendent has chosen to close nine schools and merge eight others into four buildings in light of a potential $63 million shortfall next year. School officials in Camp Hill, Pa., are so eager to raise funds that they've offered to sell naming rights to their gyms ($250,000 each), the library ($150,000), and even the counseling office ($15,000).

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New studies indicate that thousands of other school districts will be forced to follow suit unless there is another federal infusion of cash. This is troubling because it sends a clear message to children that everything is for sale.

Didn't save for a rainy day

Yet states have to assume their share of responsibility for the way they've used the $100 billion in federal stimulus funds they received soon after President Obama took office. Most of the money – $40 billion – was directed at shoring up the balance sheets of state education systems. The rest supported Title I funding for poor students, programs for disabled students, and smaller programs like the Obama administration's Race to the Top contest.

But according to a 50-state survey conducted by the National Conference of State Legislatures and reported in The New York Times, 20 states said they intended from the very outset to spend all of their stabilization funds in the 2008-09 and 2009-10 school years. On average, all 50 states spent 86 percent of the federal stimulus money in the past two years, leaving just 14 percent for this year. Such short-sighted budgeting in the midst of the Great Recession is hard to defend.

Whatever sympathy might be felt for schools in these hard times was further dampened by jaw-dropping examples of profligacy in other districts. The Los Angeles Unified School District (LAUSD), the nation's second largest, serves as a case study of how to undermine taxpayer confidence when it is desperately needed.

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