MONROE - Gov. Jennifer Granholm yesterday outlined to area school officials possible options that could spare Michigan public schools from deep funding cuts.

A day after the Michigan House voted to tap federal stimulus money to soften funding cuts in the new school budget, Governor Granholm met behind closed doors with educators and superintendents at the Monroe County Intermediate School District.

While supporting the short-term fix approved in the House to funnel extra federal money to schools this year, the governor said she prefers a mix of tax and fees increases and freezing the personal exemption on the state's personal income tax to generate extra revenue as the long-term solution for education funding.

"The way we fund schools now is broken. There has to be a bigger solution," she told The Blade after the meeting. "I would like to see some revenues put in to allow the stimulus money to be used to soften the cuts."

Public schools were dealt cuts of nearly $300 per pupil in the 2009-10 budget signed into law a week ago. The schools are scheduled to be hit with the cuts on Nov. 20.

Using the $184 million in stimulus money that was set aside for next year would restore all but $10 of the per-student cuts.

Governor Granholm has said she would support and sign the House bill if it reaches her desk.

Among the long-term solutions noted by the governor are closing loopholes on taxes that certain businesses pay to free up $150 million and suspending 2010's scheduled personal exemption increase in the income tax to yield $55 million.

She also said she is advocat-ing raising the tax on loose tobacco to make it equal to the tax on other tobacco products, an increase that could bring $40 million into public education funding.

"We have to do something different in this state to fund education for these kids," she said.

Without the influx of stimulus money, the $292 per student funding cuts will "devastate us," said Bedford Public Schools Superintendent Ted Magrum.

The cuts in the school aid budget represent about $1.5 million of Bedford's $48 million annual budget for K-12.

"To use the federal stimulus to buy time, I understand that. If all they do is use the stimulus money and do nothing else, it will just compound the problems we will see in 2010-11," he said.

David Drewyor, superintendent of Mason Consolidated Schools in Erie, said he liked the idea of immediately using federal stimulus money and finding other revenue sources for the long term.

"Admittedly they are short-term fixes but they are short-term fixes that will keep us from having the $127 proration thrown at us," he said.

Contact Mark Reiter at:

markreiter@theblade.com

or 419-724-6199.

First Published November 7, 2009, 3:22 p.m.