PERS: There’s a hole in daddy’s arm where all the money goes

by Dan Lucas

John Prine has a classic lyric in his 1971 song Sam Stone that “There’s a hole in daddy’s arm where all the money goes,” a reference to an addicted veteran spending all his money on heroin.

On Tuesday The Oregonian reported “Despite a nearly $1 billion bump in state education funding, the story hasn’t changed much for schools as they welcomed students on the first day of school Tuesday. Few districts in Washington, Clackamas and Multnomah counties were able to add back anything, unless voters passed a local option levy or bond measure. The additional state money, instead, lessened the severity of cuts, superintendents said.”

So adding $1 billion more to the state school fund – bringing it to $6.55 billion – apparently was only enough to “lessen the severity of cuts.”

How is that possible? Why would there need to be cuts at all if we’ve just added nearly $1 billion more to a state K-12 budget that was around $5.5 billion?

The Oregonian article doesn’t give an explanation for that.

Fortunately, others like the group Stand for Children (Oregon) do have an explanation: PERS.

In their explanation of how PERS affects school funding, Stand for Children writes “The amount of money that school districts must pay to PERS each year is increasing dramatically.  Less than 10% of a district’s budget used to cover PERS costs. For most districts, that number will nearly double from to 2009-2015.”

Stand for Children also notes that “Continuing to pay at that increased level of benefit has now become very costly, which means we don’t have enough money to pay for the services we need now—like education. Currently, the state cannot afford to give districts all the money they need to cover their increased PERS costs.”