Superintendents and board members often publicly decry lack of money as one of the biggest problems facing schools. Yet unreasonably large fund balance accumulations will send the message to taxpayers that schools don't need more money. Having lots of money left over at the end of the district's fiscal year is just not good school budgeting. But it happens. One possible explanation has to do with the management of grant money.
Federal grants require that federal dollars supplement local dollars.
Numerous grants are available, especially to districts with high concentrations of low-income students. But there are only so many programs you can run to help the same at-risk children. Perhaps the district has reached the point where it cannot efficiently use all its grant funds to meet the needs of the targeted student population. Because these districts' local revenues were low in comparison to others in Michigan, they were receiving twice the per-pupil increase in their state allowance each year. Obviously, an accumulation of 45 percent did not occur overnight, which leads me to believe there was a tradition of spending little on education in some of these places.