Population Loss, Economy Drive Midwest School Closings

Story first reported from USA Today

The Midwest has lost more than 2,100 public schools in recent years as school districts hammered by population loss scrambled to shift students and save money.

From 2006-07 through 2010-11, the region saw a net loss of 2,110 K-12 schools, according to a USA TODAY analysis of U.S. Department of Education data. The rest of the nation had a net gain of 965, largely from growth in the West.

The closings — which often see students moved to other buildings in a district — can affect home prices and businesses and often take an emotional toll on residents.

"It's like losing the soul of the community," said Terry Ryan, vice president for Ohio Programs & Policy at the Thomas B. Fordham Institute, a public policy center focused on education. "It's a painful experience."

The Midwest has been losing schools for some time, but the trend has accelerated in the past decade, largely because of economic issues, Ryan said.

The analysis examined the operational status of more than 100,000 schools each year to identify those flagged as closed. It found:

•Much of the Midwest's school loss came in three states: Michigan, Minnesota and Ohio. There, the number of schools fell by 1,694.

•The schools that closed during the five years studied had served nearly 1.5 million students. Buildings marked as closed in 2010-11 alone served 351,600 students.

•The faster-growing regions of the West and South saw gains. California, Texas and Arizona had a total net gain of 1,133 schools.

School enrollment — and the pressure to open or close schools — follows larger demographic shifts.

In the Midwest, the number of people younger than 18 fell by more than 519,000, or 3%, from 2000 to 2010, according to the U.S. Census.

In Ohio, the Warren City School District shrank its 14 schools to five in two years, closing all elementary and middle schools and consolidating into four K-8 schools and a high school.

"We lost a lot of jobs here," said Larry Simpson, president of the Warren Community PTA. "The steel industry was one of the main employers in Warren. Not anymore."

In Jewell County, Kan., two districts merged in 2006 and later took in students from a third district that closed in 2009. The moves left five buildings empty. One school had gone from an enrollment of 195 a decade ago to 95 in 2008.

"The reality is we didn't have enough students to fill the buildings," said Darrell Bohnert, president of the Jewell City Council.

People used to come into the city for school events, but with less traffic, the lone gas station in town has suffered and a coffee shop closed.

"Our patrons are loyal, so we still do pretty good business, but we don't see the fuel sales we did from when the schools were here," said Jeff Williams, a Randall Coop gas station employee.

Major cities aren't exempt. In Detroit, the district has closed more than 100 schools in recent years.

When it closed in 2007, Mackenzie High School was nearly 80 years old and housed more than 1,000 students, down from nearly 5,000 in the 1950s. One of its best-known alums is NFL halfback Jerome Bettis, who retired after winning a Super Bowl in his hometown and serves the community with his non-profit group, The Bus Stops Here Foundation. "You didn't understand why a school with so much history was closing," Bettis said.

Bettis attended the ribbon-cutting of a new pre-K-8 school that will open in the fall on the old campus of his high school. "It's obviously not the same as it was, but it was great to see that some of the legacy will still be there," Bettis said.

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Unemployment Checks Running Out

Story first reported from USA Today

Since abruptly losing her $312 weekly unemployment check in June, Laurie Cullinan has depleted her savings, sought food from the Salvation Army and lit candles to save electricity.

If she can't find a job this month, the Royal Oak, Mich., resident worries she'll be evicted from her apartment, an unthinkable prospect for the 52-year-old, who enjoyed a solidly middle-class lifestyle until she lost her office-manager job two years ago.

"What am I going to do if I'm homeless?" says Cullinan, who collected unemployment for 1½ years. "My mind won't let me comprehend that."

Cullinan is among about 1 million long-term unemployed Americans whose jobless benefits are phasing out this year as the federal government reels in Great Recession lifelines that provided unemployment checks for as long as 99 weeks in many states. By year's end, another 2 million will see their checks cut off sooner than Cullinan's were, because extended unemployment benefits will end beyond the standard 26 weeks that states pay for. Congress could renew the program, but many economists say that's unlikely.

The cutbacks, required by a federal law passed in February, are already taking a toll. They are nudging some Americans into poverty, straining social services just as states and localities face their own budget woes and further crimping weak economic growth as those who lose benefits spend less.

The number of jobless workers has fallen from over 15 million in early 2010 to about 13 million now, but the share of unemployed workers collecting jobless benefits has dropped more sharply. It was about two out of three in 2010, but it's less than one in two now. Next year only about one in four will receive payments, according to the National Employment Law Project (NELP).

"There's going to be lots of people without any income still unable to find a job," says George Wentworth, a senior staff attorney for NELP. "You're going to see these people not be able to feed their families and not able to pay their mortgages. It will have a devastating impact on a lot of local economies."

Wentworth, like other advocates for the unemployed, does not accuse Congress of acting rashly, and he believes some scaling back of benefits was warranted. The federal government spent $59 billion on extended unemployment benefits last year and the up-to-99-week periods of subsidies are unprecedented in any economic downturn.

The February legislation was seen as a compromise that kept payments flowing but phases them out as state unemployment rates fall from near-record levels. Yet the cutoffs are coming as job growth has slowed to an average monthly pace of 75,000 in the second quarter from 225,000 in the first quarter. Unemployment rates rose in 27 states in June. The government is expected to report today that the U.S. gained 100,000 jobs in July and the unemployment rate stayed at 8.2%, according to a consensus forecast of economists.

States eye ways to save

Some states, including Illinois, Michigan and South Carolina, have trimmed even initial benefits to less than 26 weeks, and some have cut the size of payments and restricted eligibility. Florida residents must apply online and take a lengthy skills test, keeping some from receiving unemployment insurance.

Under the federal compromise, states are truncating the second phase of benefits, which helps people unemployed from 27 to 79 weeks, when their jobless rate falls below certain levels. The reduction in so-called emergency unemployment compensation will affect about 600,000 recipients through December and 2 million more at year's end, NELP says.

The biggest impact so far has been on the final phase, known as extended benefits, which provides an additional 13 to 20 weeks to those who have been jobless as long as 79 weeks. Benefits in that phase depend on a formula that requires state jobless rates to be higher than the past three years — a tough standard to meet with unemployment falling from recent peaks. So far this year, more than 500,000 Americans in 32 states and Washington, D.C., have lost extended benefits. This month, Idaho will end the program, effectively eliminating it nationwide.

Economists worry most about the likely suspension of all benefits past 26 weeks at year's end. The average unemployed American has been out of work 40 weeks, according to the Labor Department, and there are still about three jobless people for every job opening.

"We're still in a world where you can't expect anybody to find a job within a specific period of time because there aren't enough jobs out there," says Jesse Rothstein, economist at University of California-Berkeley. "I think it still calls for pretty long extensions."

Workers who lost jobs in the recession and exhausted their benefits by January 2010 had a poverty rate of nearly one in five, and about 40% had incomes below 200% of the poverty threshold, according to a Government Accountability Office study this year.

Since jobless people tend to spend virtually all of their income, the phase-out of benefits may cut up to two-tenths of a percentage point off economic growth over the next year, says Mark Zandi, chief economist of Moody's Analytics. Unemployment checks average about $300 a week and typically pay about half of a recipient's former salary.

Is job-hunting delayed?

The development also has renewed a debate about whether such payments encourage job seekers to stay unemployed longer while hunting for a position most to their liking. Some studies have found that extended benefits increase unemployment by a half to one percentage point or even more.

"If we start reducing unemployment benefits, I think workers will make tough decisions they have to make to either reduce their wage demands or move to states like North Dakota where the economy is doing better," says Chris Edwards, an economist at the conservative Cato Institute.

Hank Finke, 54, of Westborough, Mass., concedes that after he lost his job as a sales vice president, he was unwilling to accept anything less than a national sales manager position and 75% of his former pay. But after his unemployment benefits ran out last year, he started considering regional sales head jobs and a 50% pay cut. He still hasn't found work.

Cullinan says her job search grew more desperate after she received a notice in April that her benefits would end in June, 20 weeks earlier than she had anticipated. Michigan cut maximum benefits from 99 to 79 weeks earlier this year because the state's unemployment rate was no longer rising. When Cullinan lost her $32,500-a-year office-manager job, she first sought similar positions but quickly decided she'd settle for being a part-time cashier at McDonald's or a Starbucks barista.
"I can't even get a job doing that," she says.

Cullinan supports a partner who hasn't worked since a job-related injury four years ago. Faced with losing her benefits, "I went into pure panic mode," she says, seeking jobs as a warehouse worker, gas-station cashier, hospital janitor or food server. "I would take any job that's offered to me. You want me to dig a ditch, and pay me, I would do that."

But Cullinan rejects the idea that losing benefits makes her more likely to land a job, observing that if she can't pay her $635 monthly rent and is evicted from her apartment, she'll have no Internet service. "All the ways I have of looking for work — if I lose my home, I no longer have that," she says. "I feel like my safety net was dropped out from under me."

Till Von Wachter, a labor economist at the University of California-Los Angeles, says unemployment compensation's negative economic effects matter less in tough times when there are fewer jobs. They are likely outweighed by the financial hardships people suffer after losing their benefits, he says.

 "The debate has gone a little bit too far," he says. "It's very hard to pretend that all these people just didn't want to work."

A study by Rothstein last fall, one of the few to examine the effects of expanded benefits in the recent downturn, found they boosted joblessness in early 2011 by only about 0.3 percentage points. Just over half the increase was due to older workers who kept seeking jobs, as they must to be eligible for benefits, staying in the labor force longer rather than retiring.

Indeed, many older workers who lose benefits do drop out of the labor force and retire. That lowers unemployment but also could hurt consumer spending and the economy.

Patricia Kirby, 62, is considering retiring early and tapping Social Security benefits after her $450-a-week unemployment payment was cut off after 79 weeks in May. Kirby, who lives in Studio City, Calif., lost her job as managing director of an opera training company in 2010, and has had no luck finding similar jobs or even part-time retail sales positions. When her benefits ended, Kirby largely stopped looking. "I took a break because it gets so depressing," she says.

Kirby and her husband, Terry, who does sporadic work to help film studios with location shoots, are hurting but not in dire shape. They've stopped donating to charities and dismissed the housekeeper. They're also drawing thousands of dollars from savings monthly.

Many others who exhaust benefits apply for Social Security disability benefits, which are for people who can no longer work for health reasons. In a 2011 study, economist Matthew Rutledge of the Center for Retirement Research found that the jobless are significantly more likely to apply for disability when their unemployment checks stop. That further strains disability fund reserves, which are projected to be inadequate to provide full benefits to all beneficiaries by 2016.

Joe Sangataldo, 54, of Vineland, N.J., is healthy and eager to work, making his grinding two-year job hunt even more frustrating. Sangataldo says he was more selective when he first lost his job — as an unemployment office worker who monitored benefit recipients' job searches — in October 2010.

"You try to avoid taking the worst job in the world while you have the time to shop for maybe a new career," says Sangataldo, who recently got an associate degree in accounting to go along with a bachelor's in human resources.

But his search for civil-service jobs proved fruitless. He lived off jobless benefits for about 21 months until the $407 weekly check stopped July 7. Sangataldo has sought jobs as a front-desk clerk in Atlantic City, a server at a cookie stand, and a bathroom janitor. With Vineland area unemployment at 13%, he still has come up empty.

Sangataldo, who is single and lives in his deceased mother's house with no mortgage, has applied for food stamps and will seek Medicaid. He plans to sell many of his and his mother's clothes at a yard sale.

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FOURTH OF JULY FIREWORKS CANCELED ACROSS THE COUNTRY

Wildfire concerns caused by droughts are combining with budget problems to increase the number of Fourth of July fireworks displays called off or in jeopardy of being canceled.
States including Texas, New Mexico, Colorado, Louisiana, California, Arizona and Alabama have banned all outdoor burning in certain areas, as well as the sale and use of fireworks.
The governor's office in Texas has granted 14 requested countywide bans. That has led to the cancellation of traditional fireworks shows in multiple Texas cities, including Austin and the Lake Travis area.
In Florida, officials in cities including Jacksonville and St. Augustine are watching weather conditions and may cancel professional shows as the date approaches.
Jacksonville doesn't expect to have to cancel because their fireworks are shot from two barges in the water, but they will not know until closer to July 4th if any kind of cancellation would take place.
The bad economy also is continuing to fizzle fireworks shows in areas not affected by drought.
A group of University of Florida’s media outlets, including the school's radio stations, canceled the fireworks display they have hosted in Gainesville for the past 20 years after more than a half-million dollars was cut from their budget. The cost of the celebration was $30,000 to $40,000.
Chicago has cut funding for fireworks this year.
Elsewhere:
•Cincinnati's annual $30,000 All-American Birthday Party and fireworks display have been canceled because of budget concerns.
•A $50,000 celebration in New Britain, Conn., has been canceled for budget reasons.
•Jersey City’s fireworks display is off for the second consecutive year.
Some people are not letting traditions go without a fight. On citizen of Bloomingdale, N.J., has collected more than 600 signatures he will present to the borough council today in an effort to reinstate canceled fireworks, which cost $7,000 last year. He said it is important to have the fireworks and events like that because it brings the community together. A Council member said she believes the council will consider the petition.

Interview: Paul Volcker

Charlie Rose talks financial reform with former Federal Reserve Chairman Paul Volcker

Business Week

There has been chatter in recent months about Paul Volcker, the chairman of President Barack Obama's Economic Advisory Board, being muffled by the Administration—especially when it comes to his views on bank regulation. But that hasn't stopped Volcker from taking his argument for separating commercial and investment banking on the road, scolding bankers in Britain in early December and telling politicians in Germany that "this is no time for a return to business as usual." The former Fed chairman has also been hard at work leading a panel that will report back to the President early next year with proposals for tax reform. And at 82, he recently got engaged. We talked at Volcker's Manhattan apartment on Dec. 29.

CHARLIE ROSE

What will economic growth look like in 2010?

PAUL VOLCKER

Economists are terrible at forecasting, but it's going to be a slog. The most recent figures are a little bit better than we would have expected, but that doesn't mean they're very strong.

And jobs?
Jobs are going to be slow to recover.

A permanent loss of jobs?
No, we shouldn't have a permanent loss of jobs, but we have a considerable adjustment process to go through here. We've got to restore investment, we've got to restore our manufacturing industry, not the old-fashioned manufacturing industry, but we have to do a better job at the new industries that are coming along—the so-called green economy. Other countries are ahead of us in production that's related to change.

How did that happen?
What happened is our best and brightest got attracted to Wall Street. You've read about those big bonuses. These are generalizations, but I do think that the pull of Wall Street on bright young people, ambitious young people, has been tremendous.

Will it change?
I think we're in the process of change now. Wall Street hasn't got quite the glamor that it had a few years ago.

Yes, but I hear bonuses are coming back.
Well, I hope you'll get more competition on Wall Street and get some reforms, and profitability won't seem quite so great. At one point, Wall Street had almost 40% of all the profits in the country. And, you know, its contribution to the welfare of the country does not approach 40%. Something's out of line here.

Let's talk about the financial system. You have said it failed the test of the marketplace.
Yes. It collapsed on us. And I think that's the test of a financial system—is it facilitating reasonable stability and growth? No, it's had a breakdown at great risk to the economy. It became dysfunctional, and it is still largely dependent upon government assistance.

How should we create a well-oiled financial system?
The kind of reform I've been advocating is acceptance of the fact that the core of the system remains commercial banking. If that breaks down then you have an enormous crisis. And commercial banks have expanded into areas I don't think are so central. I would cut back their so-called capital market activities—hedge funds, equity funds, commodities trading, trading in derivatives. They're all legitimate functions, but they're not so central. And I don't want to protect all those functions. I don't want to protect everybody because when people act like they're protected, you get in trouble. So let's leave the capital markets to their own devices without any expectation of government protection and keep the existing safety net for the commercial banking system.

In my judgment we don't need to regulate the capital markets so heavily. You have some extreme cases where individual institutions are so big and so vulnerable, yes, you might want some regulation of capital and leverage, but that would be the exception. But if they fail, let 'em fail. We will have some kind of a new resolution process. Some agency will go in there and say, "You're going to fail, but we're going to provide a more orderly exit."

But if you're a commercial bank, no matter how big you are, you should not be allowed to fail?
I wouldn't go so far as to say you're not going to be allowed to fail, but you're going to have a lot more protection available so that it would take pretty extreme circumstances to fail to the point that the institution disappears. The quid pro quo for that is more regulation and a limitation on your activities. I don't want [commercial banks] out doing a lot of speculative trading.

So does this mean we should restore Glass-Steagall?
No. That's a false statement people make about my position. Glass-Steagall basically said banks cannot underwrite corporate securities or deal with corporate securities. But I would let commercial banks do underwriting of corporate customers. So you could argue that what I propose is somewhat in the spirit of Glass-Steagall in making a distinction between capital-market activities and trading activities and banking activities. But it is not specifically going back to Glass-Steagall.

Do you think that Congress will see it your way?
Eventually, yes. They need a little more persuasion.

So why haven't your views prevailed with the Administration?
I wasn't persuasive enough.

How many meetings have you had with the President about this?
Not very many but...the President has heard my arguments a number of times.

Has he heard them one on one, where you've had an opportunity to say "This, Mr. President, is why you need to make sure that commercial banks..."
That's not the way the process works.

But do you feel like you have had sufficient opportunity with the President to make your case?
Well, what's sufficient? He's the President. He decides.

You have one of the most powerful and persuasive voices in the global financial conversation.
You flatter everybody. I am one voice in the conversation, and there are others.

Does Ben Bernanke agree with you?
I don't want to speak for him. He can speak for himself.

Britain now has a system in which they tax 50% of financial bonuses.What would you do as far as compensation goes?
I've thought about this, and I don't know the answer. I think the whole system is broken, frankly. The best article I've seen about this was in The Wall Street Journal a week or two ago. Some professor said: "Let's get rid of all the stock compensation business. It all gives bad incentives. It's the wrong way to go about it. You ought to pay a guy cash, pay him a salary, pay him a bonus if you decide that he's done a good job. But don't attach a lot of criteria that he's going to manipulate to his advantage."

Isn't that exactly what they do on Wall Street? They basically say, if you've brought in $50 billion worth of business, then we're prepared to give you a huge income?
Sometimes they do it on the basis of stock and sometimes not. That isn't going to solve all the problems, I agree. But you take the trading guy who says: "I brought in $100 million worth of profits, therefore I want $25 million." Have they really taken into account that this trading guy is going on [the firm's] reputation, capital, and risk when he went out there and made the $100 million? If he's so good, let him go out and do it himself.

Wall Street has a history of creating financial instruments that will meet any new challenge. Any reason to believe that's going to stop?
No. They will continue to try to get around all these restrictions. You have to have a much stronger supervisory and regulatory apparatus to have any chance of keeping up with that.

You feel strongly that the financial system has gotten out of whack. Do you think the American political process is capable of fixing it?
The American political process is about as broken as the financial system. Therefore, one has to be a bit skeptical. Just to give you one little example, one unrelated to the financial crisis. Here we are on Dec. 29, almost a year after the Inauguration, and there is no Under Secretary of the Treasury. That should be an important position. How can we run a government in the middle of a financial crisis without doing the ordinary, garden-variety administrative work of filling the relevant agencies? The Treasury is an outstanding example of a broken system, but it's not the only one.

Is part of the problem that Congress is slow in the process of approving?
Slow is too fast a word to describe what's going on. The Administration is one quarter over, and it hasn't manned the ramparts of government yet.

So it's the Administration's problem? They haven't gotten their Executive Branch in place?
It's partly a reflection of the discord in government and extreme views on either side and fighting each other for every scrap of advantage.

In interviews in the past you said that's why we needed to change the political process; that's why you thought that candidate Obama was the best choice for President.
True. But has he been able to do that at this point? It doesn't look that way. I think that's unfortunate. I wish the Administration would pay more attention to what's needed to improve the ordinary functioning of government. We can't even fight a war with our own people any more. We've got to hire Blackwater. I think people have lost confidence in government, they've lost trust in government, and it shows. This isn't a question just of this Administration. It's been kind of a steady, downhill path.

Yes, but this Administration came in and said it would change. That was the mantra of the campaign. So what happened?
It shows you it's not that easy to change.

A Tough Economy Makes Cooking At Home More Popular Than Ever
Originally Posted at Winston-Salem Journal

The tough economic times are having an effect no one predicted: Cooking. At home. By you.

Cooking classes are packed. Sales of such cooking magazines as Gourmet and Bon Appetit have been up since last summer. Sales of quality ingredients and cookware are doing fine, too, even as high-end restaurants go out of business.

We may be watching our wallets by skipping the high cost of dining out, but some of us are apparently rewarding ourselves by trying to cook better meals at home.

"As the economy is going down, we're going up," said Vic Giroux, the owner of What's Your Beef?, a butcher shop that specializes in high-quality meat and poultry. "Perfect example -- Valentine's Day. We had a line out the door." Practical gifts are in - flowers that die and chocolates are out. With prices being slashed, this is a great time to buy new kitchen appliances.

That's the key to the whole thing, say many retailers who watch the food economy from the inside: quality. We're not buying much, but what we're buying is choice.

"They're not going out and just buying rice and beans, like we did in the early '70s and '80s, when the economy was just as bad," Giroux said.

Nationally, it's part of a bigger trend that has been pushing us back home for dinner for a while, says Harry Balzer, the vice president of the consumer research company NPD Group.

Since 2001, he says, the percentage of women working full time or part time while their children are young has hit a peak and started declining. When families have only one wage-earner, they make more frugal choices.

"It's being exposed by the economy," he said. "But it's been going on for years."

We spend half of our food dollar in restaurants and half at the supermarket, Balzer says, so the quickest way to save money is to skip restaurants.

Needy Schools Turn to Parents For Funding

As posted by: Wal Street Journal

Public schools across the country, hurt by state- and local-government cutbacks, are tapping an alternative source of cash: Mom and Dad.

Parent groups and local nonprofit organizations have long raised money for activities like class trips, school dances and after-school clubs. But many parents say they now are shelling out for core curricular items that were once publicly funded -- from classroom supplies to teachers' salaries.

This fall, a parent group in Columbia, S.C., bought 100 dictionaries for a middle-school teacher who had requested them. In Kentucky, the Middletown Elementary School parent-teacher association has been discussing helping to pay the salary of a teacher aide whose job might get cut. And in Sunrise, Fla., the Sawgrass Elementary School PTA is kicking in $3,000 for news magazines that the district used to buy for classroom use. The group also is considering eliminating funding for specialized after-school clubs to free up money for classroom study programs.

"There's no question that PTAs are having to reprioritize," says Michael Ryan, president of the Sawgrass Elementary PTA. "It couldn't come at a worse time for us in many respects since fund raising is so difficult because of the broad economic issues."

Sawgrass Elementary is part of the Broward County Public School District, the sixth-largest in the country, which is expecting a $100 million reduction in state funding for the 2009-2010 academic year, according to district superintendent James Notter. That amount would be twice the size of the budget cut of just two years ago, he says.

Many school districts are facing similar cuts as governments run up deficits. Some 41 states are projecting midyear budget shortfalls this fiscal year, compared with just seven states a year ago, according to a survey by the Center on Budget and Policy Priorities, a nonprofit research group. If current trends continue, combined state deficits for next fiscal year will be around $145 billion, compared with the $89 billion shortfall estimated for the current fiscal year, the center calculates. The best way for students to attend school is through Alternative Student Loans.

The Iowa City Community School District, which serves 11,000 students, won't be receiving $783,000 from the state it had already budgeted for this school year, says superintendent Lane Plugge. School officials expect to tap reserves from local property-tax revenues to continue providing programs and services in coming months.

Also digging deeper is the Iowa City Community School District Foundation, a nonprofit that traditionally supports non-core student enrichment programs. Now, the group is seeing a big uptick in requests from teachers for books to supplement library collections and computer gear that the district typically used to fund, says Jacki Brennan, the foundation's executive director. Last year, the foundation was able to come through with half of the funds for $130,000 in requests from teachers for supplies and core programs. This year, "I anticipate lots more requests, way more than we can fund," Ms. Brennan says.
Strapped Parents

As schools lean more on parent groups, those groups, too, are affected by leaner times. In Oregon, the nonprofit Lake Oswego School District Foundation is lowering its fund-raising goal this year to $1.5 million from $2.2 million last year as local residents seek to save more and spend less. Middletown Elementary's PTA in Kentucky says donations are about one-third lower than at this time last year, even after an extra fund-raiser. And in Colorado, the Poudre School District Foundation says it is hearing from donors that they'll likely be giving less this year.

A survey by California PTA, a statewide group, of about 500 PTA presidents in the state showed that nearly two-thirds of the groups have been asked by schools this year to pitch in more money for basic supplies and programs, from pencils and books to arts programs.

"One of the things we've always said to our members is, 'Your purpose is not to be a cash cow'" to cover regular school expenses, says Jan Harp Domene, president of the National Parent Teacher Association, an umbrella organization. "But we know they are playing a critical part in making sure children still have services that were once part of the budget, from music programs to adequate custodial supplies. These are not frills."

As local PTAs play a bigger role in funding school activities, the National PTA is reminding members in organization publications to adhere to fund-raising guidelines that aim to avert potential conflicts of interest and liabilities. Among the guidelines: PTAs should obtain a broad consensus in deciding what activities to sponsor. Local groups also should keep projects at arm's length -- providing schools with earmarked donations, for instance, rather than dealing directly with contractors.

Some groups are concerned that increased reliance on parents for funding can create inequities "because not all parent and community groups can pitch in to backfill services in the same way," says Pam Brady, president of California PTA.

To minimize this, National PTA encourages local groups to avoid making donations to programs such as science clubs or band boosters that wouldn't be shared by everyone at the school. "Donations should provide for all children," Ms. Domene says. Still, she says, some inequity is inevitable since parent participation in low-income communities is generally lower than in wealthier ones.

Other parents worry that increased PTA funding of core school items will in the long run encourage further cuts by school boards "if we're here making up the difference," says Mr. Ryan of the Sawgrass PTA. "Pragmatically, though, none of us are willing to take a stand and say 'We won't provide it this year.'"
Onus on School Boards

But other PTA's are doing just that. The Eldorado Community School PTA in Santa Fe, N.M., this year has put the brakes on funding teacher salaries after it raised $61,000 last year to save a physical-education instructor's job. "After that we decided we're not going to pay district responsibilities like salaries" because of concern that it was setting a precedent that could not be maintained, says PTA president Kathy Ritschel. To the district, "we said, 'You guys figure it out.'"