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Stabilizing state funding for E-12 education is the district’s top priority for the 2017 session of the Minnesota Legislature. If the state does not provide at least inflationary increases to the general education formula allowance over the next two years, Superintendent Jane K. Berenz said District 196 will be faced with the need for budget cuts and a local levy referendum in the very near future. All three of the district’s legislative priorities focus on funding issues in what is a budget-setting session for the legislature.

The priorities were developed by citizen and staff members of the district’s Legislative Advisory Council (LAC), with input from members of the Budget Advisory Council (BAC) and were approved by the School Board in December. On Feb. 7, approximately 20 citizen and staff members of the LAC, BAC and School Board visited the Capitol to share the district’s priorities with local legislators who represent residents of District 196 and with the chairs of the education committees in the Senate and House of Representatives.

Superintendent Berenz encourages residents to review the district’s priorities and to contact their legislators to share their views on education funding and other issues that are important to them.

1. Stabilize state funding for education by increasing the general education formula allowance and reducing the special education cross-subsidy

The general education formula allowance is the single largest source of funding for all school districts in the state. All districts receive the same amount of general education funding per pupil. Increases to the general education formula have lagged inflation for more than a decade, resulting in program cuts, property tax increases and a growing disparity in the educational opportunities available to students from one district to the next. If the general education formula had just kept pace with inflation since 2003, it would be $550 per pupil more than it is today ($6,067 actual compared to $6,617 adjusted for inflation using the Consumer Price Index, see graph).

The state and federal governments mandate special education services but fund just 59 percent of what it actually cost District 196 to deliver those services in the 2015-16 school year. The other 41 percent or $25.8 million in unfunded special education costs, known as the cross-subsidy, were paid for out of the district’s general fund. All Minnesota school districts would benefit from a reduction in their special education cross-subsidy.

2. Increase equalization aid to reduce taxpayer and funding disparities

Equalization aid helps balance the impact of school taxes for residents in districts with differing levels of property wealth. Those with less commercial/industrial property, like District 196, have lower property wealth and receive equalization aid. Unfortunately, the factors used to calculate equalization aid have not kept pace with the growth in overall property values over time and no longer provide the intended level of equalization or taxpayer fairness.

3. Make supplemental compensatory funding permanent for more districts

School districts receive compensatory funding to help meet the educational needs of students living in poverty. Regular compensatory funding is based on a school’s concentration of students living in poverty; higher concentration equals more funding. The Compensatory Revenue Pilot Project was enacted by the legislature in 2005 to provide supplemental compensatory funding to districts with a high number of students living in poverty spread evenly across the district. Only seven districts are included in the pilot project and District 196 is not among them, despite having a higher number of students living in poverty than four of the seven districts currently receiving this funding. Establishing a formula to make supplemental compensatory funding permanent would better serve students in districts like District 196 with high numbers (but not a high concentration) of students living in poverty.

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