Pennsylvania schools scramble to cut costs as legislative impasse withholds $4 billion in state funding

Public-school districts across Pennsylvania are dipping into financial reserves to meet expenses after the state failed to pass a budget July 1 for the coming fiscal year. 

“Each passing day, more school leaders are forced to make difficult decisions to postpone purchases, delay hiring staff and shutting down programs,” Sherri Smith, executive director of the Pennsylvania Association of School Administrators, told Trib Total Media. “They are also making tough decisions to borrow money, delay payments to vendors and others – all unnecessary if we could pass a state budget.”

As a result of the legislative impasse, nearly $4 billion and counting in state funding has been withheld from the state’s 500 public schools, Smith said. 

Some districts such as Monessen City School District have depended on state funds to supply more than half of their spending capacity.

“Just our payroll alone is probably about $750,000 a month,” said Superintendent Robert Motte, noting the district has used about half of its $5.5 million fund balance to cover costs so far this year. 

Meanwhile, the district has delayed “replacing its auditorium sound and light system” and may postpone field trips and other extracurricular activities requiring transportation if the impasse continues, according to the news outlet.

‘Our preparation for the next year becomes that much more difficult’ 

The Keystone State must pass a budget before federal education funding can flow into its public schools – adding to their financial plight, Trib Total Media reported. 

“The impasse puts districts in a logistical bind, as business managers and school administrators prepare to launch into 2026-27 budget talks this winter.”

Pennsylvania law requires districts to present a preliminary budget or resolution not to increase taxes beyond allowable limits to their boards in January, said Christopher Dormer, president of the state’s Association of School Administrators. 

“Every day, every week, every month that the state budget delays, our preparation for the next year becomes that much more difficult,” he told journalists. 

An increasing number of schools are taking out loans during the impasse to continue providing services – a practice criticized by teachers such as Mike Rawlins. 

“The commonwealth should not be expecting school districts to take out loans to pay for funding basic education,” the Hollidaysburg Area High School teacher said. 

“Basic education is our commonwealth’s responsibility to our current students and future students, and districts should not be having to take out loans and pay interest.” 

Pennsylvania has passed a bill waiving interest on loans created because of the budget impasse, Trib Total Media noted. 

Other states undergoing similar budget impasses include Michigan, where Gov. Gretchen Whitmer and other officials failed to meet the Sept. 30 deadline for funding free school meals.

As a result, districts have needed to make case-by-case decisions on whether to continue the programs using alternative options.