The housing slump and Education

Housing slump affects sales tax collections | ajc.com:

Georgia's tax collections fell slightly last month, following a trend across the country where the housing slump has begun to affect state budgets and sparked talk of spending cuts for education and health care.

As houses depreciate, property taxes will inevitable be reduced. Not only will their be less property taxes collected, but spenders will also cut back on a lot of discretionary spending, causing a reduction in sales tax collections.

Education will be a primary target for local and state governments, when they look to make spending cuts.

The hardest hit areas are going to be large cities with a significant portion of poor and minority students. Reduced funding won't make all that much difference to well funded middle class suburban school districts.