The cuts are so deep, they're catching districts off guard.
"Shocking would be an appropriate word," said Dave Chapin, Superintendent of the East Lansing School District.
"It was hard to believe that it actually happened," said Thomas Pillar, Superintendent of the Waverly School District.
That's because districts like East Lansing and Waverly were promised more than the minimum per pupil amount , because they were spending more before Proposal A.
"East Lansing would be one of about 40 districts in the state that received what's called a 20-J that's a line item on the budget," Chapin said.
But Gov. Granholm has now vetoed that item.
"I did not want to veto any money, out of the School Aid Fund, but as you know, as Governor I cannot veto money into the School Aid Fund," said Gov. Granholm.
Now Waverly Schools stand to get $275 less per student, and East Lansing Schools $314 less.
"It's really a catastrophic episode for us in East Lansing," Chapin said.
"That has the potential to impact whatever opportunities that we have that are available for our students," Pillar said.
The cuts come on top of the $165 per pupil cut facing all districts in the state, equaling and even greater loss.
"Over a $600 per student reduction, in dollars and cents that means about $2.2 million in reduced expense," Chapin said.
And because of the devastating reductions, administrators now say everything is on the table in their budgets, and the cuts will effect the classroom more than ever.
"We have to consider larger class sizes, we have to consider employee contracts, consolidation of our facilities," Chapin said.
"Whatever adjustments we have to make could be reflected in staffing," Pillar said.