There’s a lot for local school administrators to like in the budget the Michigan House passed in August. But they don’t seem to want to see it.
The House budget increases education spending in Michigan more than does the budget passed by the state Senate or the budget proposed by Gov. Gretchen Whitmer. At the same time, it eliminates a host of categorical grants (or “special programs”) that fund outside priorities such as special education, infrastructure spending, smaller class sizes, mental health and other areas. By transferring some of this money to the general education grant, the House budget lets school district officials figure out how they want to spend this money.
This needs to be emphasized: School districts will be getting more money overall in the House budget, and they’ll be getting it with no strings attached. They are free to continue providing free lunches or limiting class sizes, and they have even more money to do so. The difference is that now districts have more control over their own budgets.
Naturally, this bonanza for school districts has superintendents all over the state cheer… well, not so much cheering as expressing cautious optimism that… uh, well not that either. Let’s just take a look at a news story from UpNorthLive, ominously subtitled, “A 25% boost, but at what cost to special programs?”
But where is that extra money coming from? “We got rid of a lot of the categoricals,” [Rep. Parker] Fairbairn said.
The state’s 2025 education budget included 128 categorical grants. These targeted funds cover a wide range of purposes like free meals, special education and school safety.
“For us, those are very, very important categoricals,” Traverse City Area Public Schools Superintendent John VanWagoner said.
VanWagoner has a good point. These categories are important — important enough that he can easily continue funding them with the extra money his district is getting.
House Republicans say removing many categoricals, and putting that funding into the per-pupil funding, would give districts the freedom to choose how they spend their money. “Let’s say there’s $100 in this budget for a school. How it used to be done was there’s 10 buckets with $10 each in them and you had to spend those certain dollars in each of those buckets on certain things,” Fairbairn said. “We said, no, we’re just going to give you the whole $100 and you can spend it the way you want.”
But that flexibility has leaders in some northern Michigan districts sounding the alarm. “I do not support that budget proposal because we would lose the opportunity to support our students in Cadillac for those programs that really ensure that our kids are met with supports that lead to success,” Cadillac Area Public Schools Superintendent Jennifer Brown said.
This is phrased with all the grace and poetry for which school superintendents are famous. But does it make any sense? It is true that the funding change would be more visible to school districts that now get generous helpings of categorical grants, including rural districts in northern Michigan. But no school district will be getting less money overall. By “lose the opportunity to support our students in Cadillac,” the superintendent seems to mean that she is going to take the extra money and then not use it for “supports that lead to success.” Why would she make that choice?
VanWagoner said about 85% of TCAPS’ total funding goes toward salaries and benefits, leaving only 15% of funding for everything else. “We really don’t have a lot of discretion with much of that 15% that does have to be used for busing, general maintenance, all of the other things we do across the school district,” VanWagoner said.
So why is VanWagoner objecting to a budget that gives him more discretion?
A big categorical many are worried about losing: free breakfast and lunch for students. “If they want to do free breakfast and lunch, they can still do that. They have the choice,” Fairbairn said.
They have that choice if there’s enough money for it. “You have to pay for buses and you have to pay for salaries and you have to pay more for health insurance or more for retirement to the state, then that really doesn’t balance out,” VanWagoner said. “You don’t have enough to do everything.”
That’s certainly a lot of stuff to pay for — and the school is getting more money than last year to pay for it. What even is the supe’s complaint?
Fairbairn said the plan offers the most flexibility for districts and their students. “For the schools, they can just decide what they want at their local level,” Fairbairn said.
“Although it would provide flexibility, it really is diverting over a billion dollars from K-12 education,” [Cadillac Area Public Schools Superintendent Jennifer] Brown said. “For a rural school district who serves students in high poverty and at risk, we’re looking at really reducing our ability to support kids in special education, safety, mental health, rural transportation.”
Out of the blue, Brown announces that the budget “is diverting over a billion dollars” with no citation or context. Unfortunately, the reporter never follows up on how a story noting districts are getting a billion dollars more turned into a (phantom) billion dollar diversion.
Supporters say it’s about empowering local control. But for many districts, that flexibility could come with tough choices.
You may have thought running a $140 million, taxpayer-funded entity with elected officials as your boss meant you would never have to make any tough choices. But education is complicated stuff — so complicated that sometimes a generous funding hike must be treated as bad news.
