When he released it last week, Dr. Milton R. Liverman said there was a strong chance that his proposed 2010-2011 budget for Suffolk Public Schools would not survive intact.

On Monday, that budget — already suffering from expected cuts in state funding — took another big hit, as Gov. Bob McDonnell announced a change to the formula that calculates the ratio of state to local money in school budgets across the commonwealth.

In making the announcement, McDonnell’s office noted a desire to save school systems in Northern Virginia $128.3 million in local funds by adjusting the local composite index, which determines a community’s ability to pay for schools.

Updating that index — which has a strong connection to property values — would result in the state taking more of the responsibility for school funding and the localities taking a smaller role in Northern Virginia, where the recession has brought plunging property values. In Suffolk, where property values actually rose slightly during the past couple of years, the effect will be to require an extra $4 million in local funding to meet reduced state responsibilities.

“We always knew that the composite index formula change for 2010-11 was one of the possibilities we might have to deal with,” Liverman stated in an email late Friday afternoon. “We had hoped against hope that it wouldn’t happen, but now we’ll start finding ways to deal with this $4-million decrease.”

It had been unclear until Monday what McDonnell would do about the index, which his predecessor had suggested be held static through 2012. Early reports from Richmond after McDonnell took office last month had indicated he would stand by former Gov. Tim Kaine’s proposal to freeze the LCI. But last week, McDonnell’s said the change was still under consideration.

On Monday, he announced his decision had been made.

“For nearly 40 years, the local composite index has been an impartial means by which to determine state and local responsibility for education funding in Virginia,” McDonnell said in a press release announcing the change. “The local composite index must be applied to all localities, at all times, in the same objective and fair manner by which it has always been utilized. Ensuring that we have a fair formula that is implemented without regard to temporary or political considerations is the best means by which to appropriate education funding in the commonwealth.”

The resulting cuts in Suffolk’s budget will require Suffolk school administrators and School Board members to take a closer look at their budget even earlier than usual, according to Liverman.

“The board has typically met to adopt the revised budget in late March after the General Assembly closes, but this year the board will need to discuss much earlier some of the cuts that will be necessary,” he stated.