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Advocates Say Use ‘Rainy Day’ Fund for Schools During COVID

Person with sign
Teacher Deanna Fierro took part in a virtual rally on Tuesday to ask state lawmakers to tap into the state's 'rainy day' funds in order to help fund schools. Fierro is running for Richmond's School Board in the 4th District. (Photo courtesy Deanna Fierro)

Two nonprofits are calling on Gov. Ralph Northam to dip into the state’s reserve, or rainy day, fund to support public education. Rainy day fundsare generally surpluses set aside from past years to help with unforeseen emergencies. The groups seek to restore spending paused or eliminated from the budget due to the ongoing coronavirus pandemic. 

According to Chris Duncombe of The Commonwealth Institute for Fiscal Analysis, now is the time to make sure schools are funded.

 “We are in the midst of a health crisis, an economic crisis. You’ve seen state revenues are down dramatically. Now is the appropriate time to draw upon these reserves--it’s raining,” Duncombe said.

Duncombe and the group Fund our Schools are asking Northam to tap into some of the $1 billion in reserve funds to restore a funding increase passed by the General Assembly in March, which brought school funding back up to pre-recession levels.

Specifically, the coalition is asking lawmakers to: 

1. Tap into the more than $1 billion in the state's rainy day funds, in addition to the $490 million left unspent in the budget, to fund education.

2. Restore the approximately $500 million in unallotted education funding for pre-K, K-12, and school counselors that was initially passed by the General Assembly in March.

3. Provide at least $600 million in flexible emergency response funding for the upcoming school year.

The coalition said the dollars would go to hiring additional counselors and provide better access to school meals, among other things.

The General Assembly is currently in special session to, in part, approve an updated budget that addresses shortfalls created by the coronavirus pandemic. 

One lawmaker, Del. Jennifer Carol Foy (D-Prince William County), has a budget amendment to fully restore the K-12 funds that were taken out. That amendment has already been heard in front of the appropriations committee. Foy is also running for governor next year..

Duncombe said the removal of new investments in public education, along with a projected decline in sales tax revenue caused by the ongoing health crisis, amount to a huge loss of school funding. 

“Combining all those resources together, that comes to a total of $722 million less for early education and K-12 than was initially anticipated,” Duncombe said.

However, Duncombe says there’s a constitutional limit to how much of the rainy day funds the governor can tap into. 

“They can only use half of the funds up to a year--it wouldn’t be the entirety,” Duncombe said.

But either way, he said “the state has the ability to use these resources to protect the students and schools.”

Duncombe also said The Commonwealth Institute hoping Northam looks into using other revenue streams as a way to get money to schools. 

“Virginia is in the minority of states that does not applya tax to digital downloads,” Duncombe said. “There’s a sales tax that applies to in-store purchases and online purchases--but not to downloads.”

The General Assembly’s special session is still ongoing with no end in sight. But when it comes time for Northam to sign the revised budget, Duncombe hopes that schools won’t be left out.

 

Ian M. Stewart previously was the transportation reporter and fill-in anchor for VPM News.
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