By Carmen McCollum and Patrick Guinane, The Times of Northwest Indiana

Indiana's new state budget is going to cost urban school districts some serious money.

Lake Ridge Superintendent Sharon Johnson-Shirley said she is "saddened" by the budget and the impact it will have on urban schools. She said all students should have an opportunity to achieve a quality education despite the color of their skin, the location of their home or their socioeconomic status.

"I am appalled," she said.

MORE: View a database of projected funding changes for region schools for the next two years.

The Gary Community School Corp. is expected to lose $12.4 million over the biennium. Lawmakers projected the district's enrollment will shrink from 11,570 students today to 10,106 by 2011.

The Gary school district already has slashed $23 million out of its budget, cutting teachers and administrators along with closing and consolidating schools. Even the $306 per-student increase -- bringing the per-student rate from $9,932 to $10,196 -- won't make a dent in the declining revenue.

Gary school officials said they have not had a chance to review the budget to determine where to make additional cuts, but Superintendent Myrtle Campbell said it's clear "we'll have to look at cutting personnel." They also said they will look at ways to retain the current number of students and attract others back.

Gov. Mitch Daniels called the budget a victory for taxpayers and a "step forward in education reform."

The budget calls for no caps on charter-school growth, a scholarship tax credit for those people who donate to private-school scholarship programs up to $2.5 million a year and a small pilot program for online virtual charters.

Daniels said he spoke with U.S. Secretary of Education Arne Duncan, formerly of Chicago, who congratulated Indiana for not putting caps on charters and deleting state law that said student performance could not be considered when evaluating teachers.

But Johnson-Shirley said the governor is not meeting the needs of public education. She said Lake Ridge schools will lose $1.2 million over the biennium.

In the 2008-09 school year, Lake Ridge had an enrollment of 2,162 students, down 78 students the year before. The district peaked in the 1988-89 school year with 3,154 students. Enrollment has continued to drop each year.

"It makes me think he's trying to shut us down," Johnson-Shirley said. "We're supporting charter schools at the expense of public schools. Shame on you, governor,"

The budget, signed into law, calls for Lake Ridge to receive $15.9 million in 2010, a decrease of about 2.61 percent, and $15.6 million in 2011.

Meanwhile, the School City of East Chicago stands to lose about $3 million in state funding by June 2011, in part because of declining enrollment.

"We're not getting the guarantee that urban schools like ours need," said Frank Ramirez, East Chicago school treasurer.

"If we're going to stay in business, we need to attract more students. The only way we can do that is by raising our test scores, creating good schools and doing all of the things the school district needs to do to improve."

Merrillville school officials said the district will see a small increase of approximately $830,000 over the two-year budget period. However, Assistant Superintendent Mark Sperling said "it's very hurtful to see that Indianapolis is not paying a lot of attention to the urban school districts."

Statewide, schools would receive an average increase of about 1 percent next year and 0.3 percent in 2011. That's less than Democrats wanted but $54 million more than Senate Republicans included in their final budget.

Daniels said by now being able to connect student performance in evaluating teachers, Indiana is eligible to apply for the federal "Race to the Top" grants.

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