Good news for school budgets?

As local school districts grapple with a sour economy, ever-increasing costs and reductions in state aid, there was some good news on Tuesday, when the U.S. House of Representatives joined the Senate in passing legislation that will provide more Medicaid funding to the states.

"It's really good news, but it's too early to tell what, exactly, it means," said Gary Schall, the Lawrence School District's deputy superintendent. "We have to verify with the state ... exactly what the implications are."

Medicaid, the health program for the poor, is financed jointly by the federal and state governments. Until now, school district officials were worried that Congress would provide less money for the program than New York state was expecting, which would force the state to make up the difference -- and most likely reduce the amount it had allocated for school aid. But the House action may give districts some budgetary breathing room.

Just how much breathing room has yet to be determined. That the state finally passed a budget -- on Aug. 3, 125 days late -- did not appear to be a consolation to either the Lawrence or Hewlett-Woodmere school districts, as both continue to fight constraints on spending.

Schall noted that Lawrence had already calculated a 7.8 percent reduction in its state aid for 2010-11, or just under $7.7 million. Long Island districts are expected to see an overall decline of financial help from Albany of 7.2 percent.

The Lawrence district has created more than $1.2 million in savings since July, he said, which includes laying off staff and consolidating positions. "We are looking through our expenses every day, looking to cut expenditures that do not impact student programs," Schall said. "We are shopping, pressing our vendors for added discounts."

The district eliminated 14 staff positions, including 11 special-education teachers, last month, while hiring non-contract instructors who will be paid by the day, at a cost savings of around $500,000. The cuts were necessitated by an increase of $400,000 in the district's special-education costs and an additional $300,000 in legal fees from a number of lawsuits, which together created a $700,000 budget hole.