How school funding stacks up

Effect of the 2013 legislative session on northwest metro districts


The education bill approved by the State Legislature this year designates an additional $485 million to early childhood through high school education in the next two years.

True to the form of Minnesota’s education finance landscape, the bill is complex, and its myriad of changes are difficult to understand. It took weeks for the Minnesota Department of Education and consultants to sort through interpretations and consequences of various pieces of the law.

Perhaps the most significant component of the law is that it authorizes full funding for optional all-day kindergarten starting in the 2014-15 school year.

It also increases special education funding, as well as compensatory aid, which goes to districts with students in poverty.

In addition, the law reinstates and rewrites the formula for integration aid and integration levies, which are related to the number of students of color in a district. The adjustments to integration revenue have a major impact on districts in the northwest suburbs, which tend to be racially diverse.

Overall, area superintendents seem to agree the bill is a step in the right direction, but feel there is still room for improvement.

Anoka-Hennepin District 11

Anoka-Hennepin School District Supt. Dennis Carlson believes the legislature and governor did “the best they could” for education under the circumstances, but he says the funding system is still broken.

“We’re grateful for what we did get, but we’re still a struggling district for the next two years to make budget,” he said.

According to calculations by the Minnesota Department of Education, the district is in line to receive approximately $7.5 million in new revenue for the 2013-14 school year compared to the old law.

Carlson said the money significantly reduces cuts the district expected to make.

“Instead of $27 million short, we’ll be about $13 million short through the next biennium,” he said.

He said that means there will be some cuts, but not as deep. For example, the district is hiring back many of the student learning advocates it laid off earlier this year.

As with other districts across the state, the biggest change for Anoka-Hennepin is in the area of all-day kindergarten. The district is doing construction at six schools in order to make room for universal all-day kindergarten starting in the 2014-15 school year.

Carlson said the district had already been adding all-day kindergarten to schools gradually as funds became available but was pleased to offer the service district-wide.

But Carlson pointed out the new kindergarten revenue is specifically meant to cover the added expenses of that program, so it doesn’t improve the overall financial picture.

The change in the formula for integration revenue actually hurt the district.

Integration revenue had been scheduled to expire. The new legislation reinstates the revenue with a different formula that greatly benefits nearby districts, such as Brooklyn Center and Osseo. But Anoka-Hennepin will lose about $600,000 from that source over the next two years.

Carlson understands why the district’s racially diverse neighbors need the money, but he says his district does, too. In each of the past three decades, he said, the number of students of color and number of students in poverty in the Anoka-Hennepin district has doubled.

“You need to make sure in those districts where you have rapidly increasing kids of color and poverty that you have programs ready to deal with that,” he said.

On the positive side, Carlson said the district is very pleased with the continuation of the compensatory pilot program, because the district had $6.5 million on the line. The program provides money to districts based on the number of students living in poverty, not just the concentration of those students.

In a large district with large buildings, Carlson said, a formula based on the concentration of poverty didn’t work well.

“We were spending more money on our kids (in poverty) than we were getting,” he said.

Carlson was also grateful for about $8 million in local school property tax relief for the district.

Despite what he sees as positive changes, Carlson said the state needs to do more.

He said districts need to know what they’re getting earlier so they can make informed decisions about personnel and services.

He also said the 1.5 percent increase in the amount of money the district receives per pupil is only about half of what the district needs to cover the cost of inflation.

“The bottom line is this will now make about 12 years of funding at about half of what we need,” he said. “We need to figure out a sustainable method to pay school districts an inflationary amount each year. Cities get that. Counties get that. School districts don’t, and they should.”

Brooklyn Center District 286

In District 286, Supt. Mark Bonine said the Minnesota Legislature’s approved education funding is critical to the state and Brooklyn Center Community Schools.

According to the Minnesota Department of Education, the total revenue increase for the 2013-14 school year is approximately $867,000 compared to the prior law.

“It’s all an estimate because it’s all based on the enrollment,” Bonine said. The revenue increase includes more funding through integration aid and all-day kindergarten, among other programs.

The Legislature’s approval of funding all-day kindergarten in school districts will allow for some of Brooklyn Center’s budget dollars to be used for other purposes, Bonine said.

Brooklyn Center’s all-day kindergarten program began with grant funding, and the Board of Education decided it should be included in the budget after those dollars ran out.

Funding from the state education budget for all-day kindergarten is effective starting in 2015, Bonine said.

“It will free up money to fund other areas … but it’s a double-edge sword,” he said.

Some students living in school districts without all-day kindergarten are currently enrolled in Brooklyn Center’s program, he said.

When all the districts offer the program in 2015, Bonine said one concern is Brooklyn Center’s kindergarten enrollment will decline,  which will affect the amount of funding from the state.

However, the district’s established reputation with the kindergarten program, as well as the availability of a resource center with mental health, dental, vision and physical health services in Brooklyn Center, could convince parents to keep their children enrolled, Bonine said.

“We just have to make sure we have the best customer service (and) the best academic programming,” he said.

Integration aid will also benefit Brooklyn Center’s budget revenue.

The district staff is reviewing an integration plan written in 2012 to determine how the revenue can be used, Bonine said.

Overall, he said, the aid will help provide resources and instructional support for students and professional development for staff.

Compensatory pilot program funds approved by the Legislature are slated to fund hiring new staff.

Former Brooklyn Center Supt. Keith Lester, who retired in June, testified at legislative hearings about the funding. Lester made sure the funding could support a licensed media specialist position, according to Bonine.

It does, and the district is also hiring a reading teacher and education assistants to work in kindergarten classrooms, Bonine said.

District 286 could also benefit from a combination of state aid and property tax dollars, approximately $1 million, if the Board of Education approves the funding at its Aug. 12 meeting.

The Minnesota Legislature finalized a law on May 22 to allow school districts that have struggled to obtain public approval on referendums in the past to vote on a property-tax increase without going to the polls.

The other component to the law is state aid that compensates urban and suburban districts in the seven-county metro area with higher operating costs. Those costs include fuel and bus repairs, utilities, employee health insurance, food for student breakfast and lunch as well as employee recruitment and retention.

The revenue would be available in the 2014-2015 school year if approved by the Board of Education.

“I am very pleased with what the Legislature did,” Bonine said.

Osseo District 279

Osseo Area Schools Supt. Kate Maguire said she was pleased legislators kept public education “at the forefront” during the legislative session, but the final legislation fell short of her initial hopes.

“It wasn’t the full-scale reform that everyone was talking about prior to the legislative session,” Maguire said. “Our goal is to continue working toward that end.”

Maguire said that although the 1.5 percent increase in per-pupil funding the district receives doesn’t cover the costs of inflation, it will reduce the size of potential cuts the district expects to make if an operating levy on the November ballot fails.

“It doesn’t keep covering the same programs and people each year, and that’s the need for the local levy,” she said.

Nevertheless, the district is receiving a revenue boost above the state average. According to calculations by the Minnesota Department of Education, Osseo Area Schools will get about $4.4 million in total new revenue for the 2013-14 school year compared to the old law.

Because of its high number of students of color, the reinstatement of integration aid and the new formula to calculate it play a significant role in the increased funding for Osseo Area Schools. The district – which has the third-highest number of students of color in the state – will receive an increase of $1.3 million for this school year.

“The integration revenue, as we had hoped, has been redesigned to focus on closing the racial achievement gap,” Maguire said. “We’ve long … advocated for shifts in the formula … to recognize the greater number of students of color in our school district and the progress we’re making in closing the racial achievement gap.”

Integration dollars pay for a variety of expenses, such as professional development and state-mandated membership in the Northwest Suburban Integration School District, as well as classroom teachers working toward equity, student learning advocates and more.

Another big boost in funding will come in the 2014-15 school year, when the district begins receiving money to offer universal all-day kindergarten at all its elementary sites.

“We’ve been waiting for this for a long time,” Maguire said. “Educators across the spectrum of education in Minnesota have been talking to the legislature for years about the importance of early learning.”

The district currently offers free all-day kindergarten at six schools and has fee-based full-day options at all but two schools. Consequently, the transition to offering universal full-day kindergarten at all its locations should be fairly seamless.

The district is also receiving about $5 million in local school property tax relief from the state.

Maguire sees the changes as a step in the right direction but says there are still major problems.

“We believe that there are still elements of the state funding formulas that create inequities among school districts and do not recognize enough needs of students of color in particular,” she said.

But even more important in Maguire’s opinion is the need for more clarity and consistency in funding.

“If we’re going to maintain … a thriving system of education in the state of Minnesota, we’ve got to have predictable and sustainable funding,” she said.

Robbinsdale District 281

Robbinsdale School District Supt. Aldo Sicoli said changes set forth by the Minnesota Legislature appear to indicate an improved allocation of funds – an improvement Sicoli called “encouraging.”

District 281 is in line to receive about $2.6 million more in total revenue under the new law compared to the old law, according to calculations by the Minnesota Department of Education.

“We’re thinking we can do some really good things for students and staff that’ll make a difference in learning,” Sicoli said. “I’m not sure (the increase) is enough to cover inflation, but it’s better than not getting an increase at all.”

A major aspect of the new law made funding available for school districts to provide all day kindergarten at no additional cost to participants. Robbinsdale previously offered all-day kindergarten based on a fee system, as well as offering a number of sessions free of charge for some students.

Sicoli said the new money is fairly revenue-neutral for the district, though he was pleased with the broader educational reach made possible through those funds.

“Educationally, not much will be different (in our kindergarten program),” he noted. “We think we have a pretty strong program and we’re excited to make it available to a larger pool of students.”

New money made available through the compensatory pilot program will also mean improved options for the diversity-rich district. Compensatory money can be used to fund additional intervention teachers for students who are falling behind and bolster other programs that strengthen the academic abilities of low-income students.

“Our student’s have a lot of needs, and that’s what we will use this money for,” Sicoli said.

District 281 also plans to use new funds to hire additional cultural liaison positions and to augment professional development for teachers in an effort to enhance culturally-relevant teaching.

Robbinsdale also retained the ability to levy property taxes for integration aid – an ability that was threatened by a mid-session budget proposal. In addition, state-provided integration aid that was set to disappear was reestablished under new law. More than $2 million of integration aid per year would have been lost.

Sicoli said the new law indicates, overall, that the legislature understands where money should go to better the state’s educational system.

“It’s a step in the right direction, compared to what we’ve had in recent years – definitely an improvement,” he said. “(The new law) does a better job of addressing the issues that need to be addressed in this state, the achievement gap and trying to put resources where they are needed. We’re fortunate that we get a little more, and they put it in the right areas.”

However, extra funds don’t necessarily mean school districts’ accounting woes are completely remedied. Sicoli said he hoped for an automatic inflation factor in funding, but didn’t find it to be realistic. He continued to note the difficulty in balancing a budget with regularly inconsistent revenue streams and an ever-changing political climate.

“It seems like the legislature used fewer accounting gimmicks to balance this budget,” he said. “I think, moving forward, it does provide a little more encouraging level of certainty, but it’s still very hard to count on anything long term.”