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.

Tuesday, May 14, 2019

So, What is Happening?  It's been a couple of months and there has been a lot of action, but it's all boiled down to an impasse that few hoped, but many predicted, would happen as the 2019 legislative session rolled along.  All of the major conference committees have been meeting, but there has been very little headway on items that will have major impact in terms of policy or finances.

It's been no different in the education conference committee.  The first few days consisted of:

In which the two sides outlined their vision and the provisions of each bill were presented and discussed.  After that was finished, the conference committee launched into:

And provisions that were either the same in both bills or similar were discussed, sometimes amended, and adopted.  Since then, action has slowed and much of that is due to the overarching effect that the unresolved budget situation is having on the proceedings.  Everyone across the board in both bodies are waiting for a decision on the fiscal parameters that the various conference committees will be accorded as their final bills are put together.  Unfortunately, it seems this song is an apt description of the loggerheads that leadership has found itself in:

As expected, the tax issue is the cloud through which the sun cannot pierce at this point.  Much of the Governor's and House's plans rely on extension of the medical provider tax and an increase in the gas tax to both bolster the state general fund by removing road repair/construction costs from it and provide funding increases in a number of budget areas, including E-12 education.  This approach resembles a loose thread on a sweater (I called the Tortured Analogy Department for this one).  Currently, the revenue leakage from the general fund is like a loose thread and the Governor's tax policy is trying to snip that thread with his proposed tax policies.  The Republicans, while not yanking on the thread, don't seem willing to snip it by increasing taxes, which leaves us in a limbo from which a rapid escape seems unlikely and the fate of the sweater lies in the balance.

I do want to report that there are referendum equalization provisions in both the House and Senate, with $25 million in the House E-12 bill and just below $15 million in the Senate Tax Bill.  I have informed decision-makers that SEE prefers the higher amount (thanks Captain Obvious) and would like it in the Tax Bill as opposed to the E-12 bill.  Like everything else, the ultimate fate of the proposal will depend on how much revenue will be on the table for this and other purposes.  I want to thank all the authors of our equalization bills (Representative John Huot, Representative Brad Tabke, Senator Roger Chamberlain, and Senator Carla Nelson) for their support and the chairs of the committees (Representative Jim Davnie and Senator Roger Chamberlain) who are carrying the provisions in their omnibus bills.

I haven't been using the blog with regularity this session (as you have likely noticed), but as the regular session comes to a close over the next week, I hope to keep you informed of the action (or inaction).  Let me know if you have any questions or comments regarding the status of particular pieces of legislation.  Catch me at 612-220-7459 or

Monday, March 11, 2019

House Omnibus Education Policy Bill Released.  The House Education Policy Committee released its bill today and it comes in at 101 pages, which is relatively slim considering that a number of provisions in the bill are resurrected measures from last year's vetoed omnibus supplemental appropriations and policy bill.

The major provisions of the bill include:

  • Significant changes to the tiered-licensure program adopted by the Legislature in 2017.  Under the bill, a tier one license could only be renewed once among other changes.  The pertinent sections of the bill are found in Article 3, Sections 10 through 29, starting on page 30 of the bill.
  • Nonexclusionary disciplinary policies similar to those in last year's vetoed bill found beginning on page 15.
  • Lowering of the age for compulsory attendance from seven to six.
  • Several of the special education paperwork reduction initiatives that have been discussed this session dealing with conciliation conference requirements and short-term objectives on individual education plans.  The bill also calls for a working group on the prior written notice.

The committee will spend a lot of time over the next few days with the goal of finishing the bill on Thursday, one day before the deadline for policy bills to be heard in committee in the house of origin.

Here is a link to the bill:  HF 1711 Delete-all Amendment (Omnibus Bill Framework)

Great Hearing on Equalization in Senate Education Funding Last Week.  Two different equalization bills were heard in the Senate Education Policy and Funding Committee last week and SEE was well represented at the hearing.  In addition to my usual ramblings on the subject of equalization, expert testimony was provided by Stewartville Superintendent Belinda Selfors and South St. Paul Superintendent Dave Webb.  Both superintendents did a very good job of explaining how low property wealth school districts are at a great disadvantage when going before their voters for operating or debt service levy approval.  

SF 670 is Senator Roger Chamberlain's referendum equalization bill and it takes a different tack than the usual course of equalization bills by looking at tax effort in each tier of the referendum as opposed to using equalizing factors.  It accomplishes much the same purpose as current law and there's certainly no crime in thinking outside the box.

SF 1237 is Senator Nelson's bill that tackles both referendum and debt service equalization.  It stays within the current framework of the law and in the case of the operating referendum it hikes the second tier equalizing factor.  On debt service, it lowers the first tier eligibility threshold and the second tier eligibility threshold.  This makes more debt service revenue eligible to receive equalization aid and increases the rate of equalization for a number of districts.

Here's a picture of Senator Nelson and Superintendents Webb and Selfors taken after the hearing.  Thanks to all:  the Senators for introducing the bills and the superintendents for testifying.

Monday, March 04, 2019

Monday Wrap Up.  There will likely be progress on the MNLARS issue today as the Senate is taking up the bill on the floor this evening.  The big education news of the day took place in the House Education Policy Committee and the release of the Legislative Auditor's report on Debt Service Equalization.  The House Education Policy Committee took up a number of bills related to teachers, including HF 1329, which would dramatically change a number of provisions in the recently-established tiered licensure system.  HF 1559 was also heard.  This bill would raise the training requirements for special education paraprofessionals and fund sixteen hours of training.  It is going to be a very hectic week for the House Education Policy Committee as they wade through a colossal number of bills as the work to meet the March 15 policy committee deadline.

The more exciting news for SEE districts is the release of the evaluation of the Debt Service Equalization Program by the Program Evaluation Division of the Office of the Legislative Auditor.  The report gives an excellent and thorough description of the program and its shortcomings in meeting the current building needs of school districts throughout Minnesota.  Foremost among its recommendations is the suggestion that the current thresholds and equalizing factors for the program be updated to create greater property tax fairness.  Another recommendation looked to explore the differences between the needs of growing districts in need of new construction and districts that need to replace, rather than continue to repair, older buildings.  There are also suggested revisions to the Minnesota Department of Education's Review and Comment process.

Here is a link to the page where the Executive Summary and the complete report can be downloaded:  Debt Service Equalization for School Facilities

Kudos to Jody Hauer as Project Manager and Will Harrison from the Office of the Legislative Auditor on a job well done.  And just in time for the hearing on Senator Carla Nelson's SF 1237 on Wednesday.

Sunday, March 03, 2019

I Haven't been Asleep for Quite Twenty Years.  But I guess one could say I have been asleep for twenty blogging years.  February has been an extremely busy month at the Legislature and it will be a while before things calm down.  The deadlines have been set and the first policy committee deadline is set for Friday, March 15.  That means that the next two weeks will feature extended night meetings in a lot of committees.  Things will likely transpire differently between the two houses of the Legislature as it appears that the committees that combine policy and funding in the Senate may only observe the funding bill deadline of April 12.  All this remains to be seen.

One of the things that has contributed to the hubbub is that most of the policy measures that were part of the vetoed omnibus supplemental appropriations and policy bill for 2018 have been re-introduced again in 2019.  When folks talk about the vast number of bills that have been introduced this year when compared to other years, the effect of last year's veto are rarely mentioned.

In the Meantime.  The Equal(ization) has landed!  A number of equalization bills have been introduced.  In the House, Representative John Huot is carrying HF 1143, a bill that would increase the equalizing factors in the first and second tiers of referendum revenue and deliver about $50 million per year in property tax relief to low property wealth school districts.  Representative Brad Tabke is carrying HF 1142, a bill that would simplify the debt service equalization program by creating a single tier of equalization and then setting the equalization rate at the highest level in current law.  As in the case of the referendum equalization, the total cost of the bill is approximately $50 million per year.  Both bills were heard at an House Education Finance Division meeting in Windom on Friday, March 22, and after the hearing were referred back to the House Ways and Means Committee.  From there, they will be referred to the House Tax Committee.  Representative Paul Marquart who chairs the House Tax Committee has pledged to carry any property tax relief related to education in the tax bill.  That's not to say that there will be an increase in any of the equalization programs or the Ag Bond Credit, but if there is, it will not be pitted against increases in education funding programs.

The Senate also has two equalization bills that it will consider.  They are not companions to the House measures, but do deliver considerable levels of property tax relief.  SF 670 was introduced by Senator Roger Chamberlain and delivers around $30 million of property tax relief by providing relief in each of the three tiers of the referendum levy.  Senator Chamberlain is taking a different approach than what has generally been advocated in the past and the distribution of the relief is a bit different than if the bill were to simply adjust the equalizing factors upward, it is still substantial relief.  Senator Carla Nelson has introduced SF 1237, a bill that would deliver approximately $30 million in referendum equalization and $30 million in debt service equalization.  The approach in Senator Nelson's bill is similar to that found in HF 1142 and 1143, although scaled back somewhat.  Both SF 679 and SF 1237 will be heard in the Senate Education Finance and Policy Committee this coming Wednesday (March 6), at 3 PM, in Room 1100 of the Minnesota Senate Building.