How Do We Solve the School Budget Deficit Problem?

School budget deficits, alternative revenue streams, social commerce

The problem appears to be that cycle of the economy is higher taxes to pay for higher costs. Now before you storm the Bastille, higher taxes appear to be off the table for now. However Freeport just was reported to be looking at a 9% increase in taxes.

This could be coming at you very soon. There is only so much magic going around. Think three-card monte… who’s got the revenue, who’s got the revenue?

Well how do we solve this Gordian knot? What has to give and how did this happen? Well it appears that tax bases have been shrinking and salaries keep going up. Now salaries going up is going to be a given and continuous. Revenue bases shrinking aren’t going away either, that is traditional bases. What has to change, in my humble opinion is how we actually generate revenue.

The biggest generator of revenue today is actually technology. Apple, Inc. generated just 1 billion less than ExxonMobil last year. Instagram was purchased for $1 billion USD. Facebook, Google and LinkedIn just IPOed and have valuations higher than most producers of physical products. The question is should school districts be keeping the same model just refocusing on different revenue streams?

Think about possibly tapping into the world of social commerce. How can this be done? Well just think about it. Students and families are on diverse forms of social media and generating those valuations. How about building a social network that actually funds the schools that create such a network. It is called revenue sharing and it is possible. Take a look at a beta prototype site currently running and see what you think. Can this solve the problem?

Full disclosure here – I built it and own it but it shares revenue with school districts at 70% of revenue after production expenses.  There is no cost to schools, it is free - period. I’ll say it again – it is free this is not sold to schools it simply generates revenue that it shares with each school district and can be customized to look like the district – colors and icons.

Would like to hear your opinion. Honorscholar.com

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Patrick Aievoli January 16, 2013 at 10:02 PM
completely agree with shared sacrifice. But again wrong direction with the "cuts" concept. The reason for the diminished budgets is simply that the tax revenues are not there from business sources. Last year alone online sales were up 56% this is where the money is going. Nobody can afford higher taxes, so the revenue streams have to change. Higher Ed is suffering as well with any tuition driven school they also need to tap into alternative revenue streams. The well is going dry. A linear base of simply taking money is over everybody and everything thing has to be a revenue stream, new century, new economy. The linear path is done a new cyclical path has to be structured just like a farmer you feed the field to get the produce.
Tom January 20, 2013 at 05:12 AM
Teachers SALARY are the biggest problem, instead of them "negotiating" a contract and then RAISING the school budget and our taxes to pay for their raises maybe just maybe the the school budget can be passed and then the teachers salaries can be sone within the budget, shouldnt be to hard given the fact they only work 9 months of the year and are off every weekend and holiday.
Peter T January 20, 2013 at 06:16 AM
There are 100's of school districts in NY state almost totally financed by the state (Example Waterloo's budget is $60 million, state aid 53 million). And why is that you ask? For the last 45 years we in NY state have rule and regulated much of upstate out of business when it came to industry. So Long Island has been making up their funding every since. Solution? Start slashing all those poverty creating NY business regulations and consider fracking. ( fracking brings in over a billion in tax revenue in Pa)
Patrick Aievoli January 20, 2013 at 12:45 PM
Albeit both comments have some value but in my opinion here is where both of the opinions fall short. Again we are talking about cutting because of limited supply and in the other we are talking about focusing again on a finite form of revenue. The overall goal is to change the thinking from elimination and finite streams of revenue to streams of revenue that grow and are self-sustaining. Social commerce is growing at leaps and bounds and sustains itself. It is just in its infancy and is a driving economic force that can be implemented at any level, local, state and global. Cutting salaries and tapping into a new source of finite energy for sale has an endpoint. We need to think of solutions that expand over time not contract and ultimately fail. Please see my follow up post on social commerce from a local business person. http://huntington.patch.com/blog_posts/proving-the-power-of-social-commerce
Patrick Aievoli January 20, 2013 at 01:17 PM
For the record my father's job encompassed spraying asbestos. Back in the 70's the dangers were not well known. He came home with it on his clothes I am sure. So we didn't know those dangers as well at first. We did when he passed from lung cancer. Second I have been an academic living on Long Island for 25 years (one income for most of those years) and honestly I do not know what it is to not work summers or vacations or to come home at 3:00 and be finished. My father had a saying "if your hands are cold I will buy you gloves but for God's sake son get them out of your pockets because we have work to do"... I believe words to live by.


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