By By ANDY HAMILTON / Niles Daily Star
NILES – Niles Community Schools inked a deal Thursday to lease a bandwidth communication system to Sprint Nextel, but news of a shortfall in state school funding could mean a large chunk of the more than $600,000 payment to the district will not be spent on education.
The deal puts an upfront payment of $620,000 in the pocket of the school district plus monthly payments of $100 for the next 30 years. Superintendent Doug Law said a majority of the money might not even be used for education purposes considering the news coming out of Lansing Thursday of a shortage in the School Aid Fund (SAF).
"Of the $620,000 that we will receive this spring, the board has already committed $180,000 to build an extra computer lab at each of the elementary buildings, and this spring we have to fingerprint all our employees" at a cost of $40,000 to $50,000, Law said.
A letter from the Middle Cities Education Association (MCEA), an association of urban school districts, to MCEA superintendents and business managers stated "there is a significant shortfall in the current School Aid Fund (SAF)." The shortfall, the letter continued, was about $377 million, and Law said Niles could potentially miss out on $900,000.
The district in the summer originally predicted for their budget $233 per student funding, and last month the rumors in Lansing indicated funding could come in as low as $160 per pupil. The MCEA letter stated Thursday's numbers from the state indicated the $377 million, if passed to school districts as is, would mean a loss per pupil of $210.
According to the MCEA letter, the treasury department is required by the School Aid Act to notify the budget director, who passes to legislators the news of the shortfall. From there, lawmakers have 30 days or six session days – whichever is more – to address the shortfall or the budget is implemented as is.
The MCEA letter also stated there is no time frame by which the budget director must notify the legislature, so it is unclear when the budget would go into effect.
"The board [of education] is going to wait to decide what to do with the remaining $400,000 to see what the state's going to do," Law said, adding the new elementary computer labs were completed last summer in anticipation of the bandwidth lease deal.
The Federal Communications Commission gave Niles schools the bandwidth – which provided the district with the ability to broadcast TV shows – more than 20 years ago, but the district never used it, Law said. The FCC also made the donation to the school districts of Benton Harbor, Lakeshore, St. Joseph and Coloma, all of which also signed the same deal with Sprint Nextel.
Law said last month the $620,000 agreement was with SourceIT, who earlier bid $230,000, but added Thursday Sprint Nextel had a 30-day window to match the offer.
"This has been a month and a half long process. We were able to negotiate a very favorable lease agreement because we formed a consortium with the other districts in Berrien County," Law said.
The bandwidth, owned by Niles and the other surrounding school districts, is important in wireless communications because the districts are at the entrance to Michigan for people traveling from Chicago, Law said.