Granholm's veto of school funding will cost Ann Arbor $3.7 million

The state now pays each district a varying amount of money per each student it has enrolled. Ann Arbor gets about $9,600.

In Ann Arbor’s case, the money cut was $233 per student. The Legislature could override the veto, but if it stands, it will mean a $3.7 million hit to the district’s $180-million plus budget, Roberts said.

The state school budget also takes away $165 from each district's base per-pupil funding. That’s going to cost the district $2.8 million

Combined, that’s a hit of about $395 per pupil, or more than $6 million.

“It’s a big deal,” Roberts said. “When we got the first cut, we had hoped to make it up with part of our fund equity (more than $20 million). We can’t use the fund equity to cover all of this.”

That’s because the district uses that extra money to cover the bills in the months each year it doesn’t get a state aid payment.

“The problem could get worse,” Roberts said. “We’ve been told to expect another cut in February.” School officials also expect districts will have to take another cut next year of $400-$500.

Combined, the cuts could amount to $1,000 per student. The district has more than 16,000 students.

The cuts come as the district, along with all the other school districts in Washtenaw County, are asking voters for a 2-mill tax increase.

The tax would raise about $11 million a year for Ann Arbor. Even that won't be enough, Roberts said. “If all the cuts come, the millage doesn’t touch the total,” he said.

As for making up the two cuts announced in the last couple of weeks, Roberts said the district is looking at all its options, but making cuts well into the budget year - it starts July 1 - is very hard to do.

“This is ridiculous. To make this cut in late October makes it almost impossible for districts to handle.”

In all, Granholm's cut to the 39 highest-funded districts will cost them $51.6 million. Overall, the Democratic governor vetoed $54 million in spending from the budget. School aid payments are to go out Tuesday.

Losing the extra money would mean $4.9 million less for Livonia Public Schools and a cut of the same amount for the Dearborn City School District. The Walled Lake Consolidated School District would get $4.7 million less and Warren Consolidated Schools would get $3.8 million less. Districts ranging from Saugatuck to Detour and East Lansing also would see decreases.

School officials have said even the $165-per-student cuts will lead to layoffs, crowded classrooms and fewer preschool programs. More districts could face severe financial trouble as they struggle with falling enrollment and a lingering recession.

Districts will have the flexibility to trim spending from programs of their choosing as long as they agree to consolidate services to reduce costs.

Michigan Education Association President Iris Salters said the $54 million Granholm vetoed from the school aid budget and the threat of more cuts to come shows the state needs to change how it pays for education and other services.

"We have a chronic budget problem, and cuts aren't making it go away," Salters said in a release.

In her letter to lawmakers announcing she had signed the K-12 budget, Granholm warned that unless lawmakers raise more money for schools, districts could see even bigger cuts than the ones included in the bill. State law requires school payments be cut if there's a deficit.

She said the shortfall could be as much as $264 million in the $12.9 billion K-12 budget. Some lawmakers have said they plan to raise more money for districts, but they haven't sent any revenue bills to her desk. Lawmakers didn't pass the school aid bill until late Oct. 8, a week after the fiscal year started.

The Associated Press contributed to this story.