Last year, we wrote about the coming budget tsunami that we thought would lead to $215 billion in shortfalls in state budgets and squeeze school districts and local governments across the nation. Because about one-third of all state and local spending is consumed by education, the impact on schools was estimated to lead to the loss of about 300,000 teachers and related personnel across the states. Unfortunately, this tsunami may be worse that predicted.

Driven by the geniuses we have elected and sent to Washington over the last generation or two and fueled by the currently unfunded Federal budget liability of about $76 trillion they have produced, our economic malaise is a long way from ending. Don’t expect any help from above. Unlike those who live in the financial dreamscape of our nation’s capitol, states, local governments and schools at all levels have to actually pay as they go and have been left to figure it out on their own.

So how do our locally elected public officials make the tough decisions necessary to live within their taxpayer funded means in the face of less money trickling down from above and a tapped-out citizenry unable to take on any more tax burden? In particular, how are we going to maintain or improve our schools, especially in the face of increasingly sophisticated, challenging and fast-paced global competition?

Schools must decide on exactly what is mission essential for their students’ futures and fully or increasingly fund those things first, then move on to fund other areas until money runs out. (The list will always exceed the available money). This thorough examination will deepen and improve the core function of the most important aspects of education and weed out those that may be nice to do, but not essential. This should also include greater utilization of Career and Technical Education, accelerating students through the curriculum (as required by law in many states), and greater utilization of post-secondary education options while simultaneously raising educational standards. Keep in mind that greater spending has not always led to higher student achievement and performance. .

Here are a few thoughts on cutting costs and improving student learning that we can all keep in mind during the budget tightening process. Though not an exhaustive list, it is a start.

Begin by reducing non-instructional costs first. Many states have been doing shared services on a regional basis for forty years or more and have stretched the educational dollar to allow a stronger focus on improved student instruction and to deliver a competitive curriculum to all students across the state, no matter where they live. Some of the notable long standing successes include Minnesota, Iowa, North Dakota and Colorado, where small schools have been able to remain intact, but educational services can be purchased on a regional or state “super market” level and districts buy only what and whom they need in the quantities they require and at the lowest possible price.

Another cost-saving action involves consolidating school districts. For instance, Maine reformed 260 districts into 80 and saved $36.5 million, while Mississippi found that the state could save $13 million a year by consolidating 18 of its districts. West Virginia enacted a county system more than 40 years ago and has never looked back. States like Ohio, with 612 districts and 300+ charters, and Pennsylvania with more than 500 districts plus charters are mulling those prospects. Individual districts are certainly free to explore local marriages on their own.

An alternative to school consolidation involves shared services among districts. As we have discussed before, increased sharing of services across districts, including personnel, is a major opportunity for savings.

This non-instructional costs typically represent a third to half of school spending and includes such things as administration and supervision, transportation, food services, purchasing, maintenance, safety and security, accounting and finance, and information technology to name some.

Information technologies and computing expenditures may actually save money and move us rapidly away from traditional textbooks. Options such as netbooks and broadband, can allow schools to switch to eTextbooks and tablet programs such as iPad, Nook and Kindle. From there, it is a short step to increased options for virtual learning on a year round basis.

Given the huge financial commitment we have made to education in the United States, we can and will find ways to live within our means while improving quality through good choices.

We can have anything we want. We just can’t have everything we want..

Terry Wallace is a senior fellow in the Government Policy Research Center at West Liberty University and a senior fellow at the Public Policy Foundation in Morgantown, West Virginia.