Thursday, June 06, 2019

Adequacy Lawsuit Filed.  The St. Cloud NAACP and the St. Cloud Educational Rights Advocacy Council filed suit in February in the Stearns County District court in an effort to combat the chronic underfunding of special education that has plagued St. Cloud (and districts throughout the state) and the court will be hearing oral arguments tomorrow.  Former St. Cloud School Board Member Jerry Von Korff has been a long-time proponent of investigating the possibility of litigation of this type and the continued failure to make significant headway in reducing the special education cross-subsidy triggered this action.  I have attached a link from The St. Cloud Times regarding the upcoming hearing.

Is special education underfunding a constitutional violation? Court to hear arguments Friday

Compensatory Education Funding Discussed.  The Minneapolis StarTribune had a front-page story in last Sunday's paper outlining the issue of compensatory education funding and how the achievement gap persists even with this funding.  The issue of Minnesota's racial academic achievement gap has been an item of intense discussion over the past two decades and the increase in compensatory education funding during this time is aimed at remedying that situation.  Along with increased compensatory revenue, many have promoted charter schools, more parent choice, and other reforms to address this gap.  Unfortunately, nothing has seemed to make a dent in differences in achievement.

The article spoke with a number of school officials and educators about the challenge and how the current level of compensatory revenue falls short of what is spent on services to address the racial achievement gap.   Often times, the revenue is used to pay for revenue shortfalls resulting from the underfunding of other formulas--particularly the English Language Learner formula--to make those services whole.  Superintendent Anne-Marie Foucault from SEE member district St. Michael-Albertville outlined her concerns over funding in the article.  St. Michael-Albertville is not a district that one would ordinarily think would run a shortfall when addressing student achievement issues, but the compensatory formula is so inadequate for that district that it spent four times the amount of basic skills revenue it received on programs to narrow achievement differences.  Districts that receive higher levels of basic skills revenue have problems of similar magnitude.

The article points out some of the disparities in the distribution of the formula and it's not my place to comment on how the formula works.  Concentration of poverty is certainly an adequate basis for having greater funding in the urban core and regional centers where diversity--especially language diversity--is growing rapidly.  I believe the question boils down to how much of a discrepancy should there be and points are made on both sides of that issue in the article.

Transparency of expenditures is also an issue and that was at the heart of Representative Sondra Erickson's request that the Legislative Auditor look into the issue further and try to get a better handle on the tracking of basic skills revenue.  As a former legislative staffer (lo, though many years ago) who was part of discussions on what should be the allowable uses of compensatory revenue, I can attest it's not that straightforward of a question.

There was talk during the session that the Governor may convene a working group during the interim to look at possible reforms to the education funding system.  Basic Skills/Compensatory Revenue would likely be a big part of that discussion in terms of amount, distribution, and allowable expenditures.  Stay tuned.

Here is a link to the article (nice job Anne-Marie):  $600M A YEAR, YET ACHIEVEMENT GAP PERSISTS  (I'm not shouting!  I copied the headline and it was all caps.  They are shouting.  Not me.)

Thursday, May 30, 2019

Equalization Part of Final Tax Agreement.  With all of the talk about the funding increases in the E-12 bill, not much was said about the just under $10 million that was contained in the tax bill for referendum equalization.  It's below what we were hoping for and less than what was either in the House or Senate initiatives passed by the respective bodies (House $25 million in their E-12 omnibus bill and Senate $15 million in their tax bill), but it clearly is a step in the right direction and it is greatly appreciated.  The tax relief is accomplished through an increase in the now first-tier equalizing factor from $510,000 in referendum market value per pupil unit to $567,000 in referendum market value per pupil unit.

As measured annually by the Minnesota Department of Education, the gap between districts at the 5th and 95th percentile of funding in the categories of the operating referendum, local option revenue, equity revenue, and transition revenue is widening again after being narrowed dramatically by changes made during the 2013 and 2014 legislative sessions when the $300/PU board-approved operating referendum was established and the $424/PU local option revenue was made uniform for all districts.  Narrowing that gap will likely fall to individual districts passed voter-approved levies.  The increased equalizing factor will not deliver relief to districts that will now be at zero in referendum authority (the $300 per pupil unit board-approved referendum and the $424 per pupil unit local option revenue has now been combined into a single category of local option revenue equalized at the current rates for each of the previous categories), but as those districts seek to pass new referendum authority, those districts below $567,000 in referendum market value per pupil unit will receive some measure of state aid.

The challenge for low property wealth districts going forward will be to further increase the equalizing factors across-the-board and then have those factors indexed to averages in statewide property wealth growth.

Here is a data run for the increase in referendum equalization.  The increased aid is found in the column labeled "Q".

District-by-District Referendum Equalization Aid Increase Run

Wednesday, May 22, 2019

For Your Reading Pleasure.  Here is a link to the E-12 bill on which agreement was reached yesterday.  Only 140 pages as there is very little in terms of new policy.  As I reported yesterday, the major parts of the agreement are:

  • 2% increase in the general education basic formula in each year of the biennium.  This costs $388 million.
  • $90 million to prevent the special education cross-subsidy from increasing further.
  • $47 million to maintain the 4,000 pre-kindergarten spots that were part of the School Readiness Plus program.
  • $30 million in school safety grants.  This program is contingent on there being an additional surplus at the end of the current fiscal year.
All told, those appropriations end up being above the $540 million target, but the school safety grants hang in the balance due to the forecast surplus requirement.

Tuesday, May 21, 2019

Education Deal Struck.  It went an extra day, but the final education conference committee deal for E-12 has been agreed to by leadership.  The last time the conference committee met during the regular session was at 4:30 on Monday, but with floor responsibilities for the members and the difficulties associated with dividing up the remaining revenue in the budget target, there was simply too much ground to cover in a short period of time to finish on time.  Here is the final agreement:

  • 2% on the formula in each year.
  • $3.4 million for Tribal Contract School Funding.  Funding is permanent.
  • $46 million to preserve the existing voluntary pre-K seats.
  • $90 million to freeze the special education cross-subsidy.
  • $30 million in school safety grants contingent on positive balance at the end of the current fiscal year.
  • $1.5 million for each body for grants contained in their bills.
  • No additional policy other than the same/similar provisions already adopted in the conference committee.

There will undoubtedly be more details on the individual grants and I will provide them when they become available.

Monday, May 20, 2019

Conference Committee Begins on Last Day.  The conference committee has just convened and the House has put forward its first offer.  The 2% increase in the basic formula is agreed upon in the global pact and the House has put forward the Governor's recommendations of $90 million for special education and $46 million to preserve the existing pre-kindergarten slots.  Other items deal largely with grants.

Sunday, May 19, 2019

Budget Deal Reached.  A global budget agreement has been reached with individual budget targets set for each area of the budget.  The E-12 budget target is set at $540 million, which is approximately $160 million below the Governor's budget proposal and $360 million below the House's.  If it approximately $250 million above the Senate's last budget proposal.  The budget agreement calls for a basic formula increase of 2% in each year of the biennium, which would absorb around $390 million of the $540 million target.  That would leave revenue for special education, early childhood education (school readiness plus or early learning scholarships), and school safety.  We'll have to see where things go from here.  Speaker Hortman indicated she would prefer a special session to be held on Thursday, May 23.  Lots of work to be done between now and then, but things could get done quite easily.

Thursday, May 16, 2019

Where We Are At.  In today's Morning Take, Blois Olson described the current debate at the Capitol attempting to reach a budget/policy compromise as taking place in the Cone of Silence.  As a baby boomer, I immediately caught the cultural reference and can't agree more with Olson's apt illustration.  For those of you too young to remember Get Smart, here's the Cone of Silence.

Even with the close-to-the-vest nature of the negotiations, it's pretty obvious where the major points of contention lie.  The Governor laid out a very ambitious platform in January that called for an increase in the gas tax and an extension of the medical provider tax.  The House went further proposing greater investments in education and health and human services and suggesting these investments could be paid for with adjustments to the Minnesota tax code.  The Senate went a totally different direction, coming forward with smaller budget targets and a no-new-taxes approach.  It was always easy to imagine that the initial approaches by each of the branches would be what they were and anticipating that, the Legislature put forward deadlines that aimed to speed up the decision-making process and ensure a more organized, if not amicable, end to the session.  The overall and individual conference committee budget targets were to be set by May 6 and conference committee reports were to be finished by May 13 under that framework.

So much for good intentions.  It's May 16 and the overall budget situation remains unresolved.  At this point, it's difficult to see the session ending smoothly or on time, but given the power of technology to put together substantial bills in a short period of time, it's certainly not out of the question that business can conclude by the 11:59.999999........... on Monday, May 20.  I am not a betting man (I lost fifty cents to an Augsburg College classmate on the 1972 Purdue/Notre Dame football game and have relegated myself to $2 show bets on the favorite at Canterbury Downs ever since), so I'm not going to post any odds regarding how this turns out.  I can only say that no one wins in a special session; one side simply loses more.  Given the uneven electoral swings in Minnesota over the past decade, I'm not going to venture reading the tea leaves as to what any of this means for the 2020 election cycle.

In the meantime, how about some of this with a slow theme (and oh, so mellow)?

I hope to provide some answers in my next post.