Schools Hit by Budget Shortfalls Should Expect More to Come

(Aug. 18) -- As kids nationwide march grudgingly back to school this fall, public school administrators are preparing for continued budget shortages by refusing to hire additional teachers, holding on to federal dollars instead of spending them and asking parents to send their kids to school with toilet paper in addition to No. 2 pencils. And by some accounts, the worst is yet to come.

The news might come as something of a surprise, given that earlier this month, Congress passed an emergency $26 billion aid package, of which $10 billion was slated to help schools keep or hire teachers and staff. The government predicted the additional money could save 160,000 jobs. But instead of rehiring the teachers who got pink slips last spring, many school districts are holding on to the money in expectation of more budget shortfalls next year, The New York Times reports.

And many schools are passing the buck to parents this year by asking them to send their children to school with cleaning supplies -- tissues, toilet paper, cleaning spray -- in addition to paper and pencils, the Times says.

Though times are dire in the nation's school systems now, more hardship is on the way: The economic collapse of the past two years has not entirely caught up with schools, which get about half of their funding from property taxes, according to Frederick Hess, director of Education Policy Studies at the American Enterprise Institute.

"The whole collapse of the last few years probably won't filter though until 2013," Hess told AOL News in March. "I think it's much more likely that you're gonna be looking at tight budgets into 2014 and beyond."

While the residential real estate market seems to have bottomed out, the commercial real estate market won't hit rock bottom until 2011 or 2012, Hess said. In places where commercial real estate accounts for a large portion of property taxes, more economic hardship is on the way.