Thursday, March 24, 2011

Testifying and Speechifying. I've seen my fair share of both the past few days as the omnibus education funding bills made their way through their respective committees. As I reported on Tuesday, the House proceedings on Monday night were a bit anticlimactic, as the DFLers chose not to offer any amendments (don't worry, they'll be offering more than a few next week when the bill hits the House floor). On Tuesday morning, however, the House Education Funding Committee slowed things down with each member of the committee giving their opinion on the bill. A lot of ground was covered more than once, but it was a very effective way for members to provide some very insightful testimony as to why they were supporting or not supporting the bill.

Not surprisingly--moving speeches or not--the bill passed on a straight party line vote of 12-8 and moved onto the Tax Committee, where it was heard last evening. The biggest tax issue in the House omnibus bill is the elimination of aid from the alternative facilities program, which affects a handful of the approximately 20 districts that are currently eligible for the alternative facilities program. Both Minneapolis and St. Paul see huge property tax increases due to the program becoming one entirely reliant on levy. It's an approximately $10 million annual property tax increase for Minneapolis and approximately a $4 million annual property tax increase for St. Paul. Big ouch and just another reason why urban legislators and their affected school districts think the House bill goes a little bit out of its way to inflict hardship on their districts.

The House bill moved onto the House Ways & Means Committee today, where the rhetoric heated up a bit, but the bill passed once again on a straight party-line vote.

Here is a link for the House district-by-district runs for the next two years:

Scroll down to the 2011 Education Finance Appropriations. There you will find district-by-district data for each of the next two years, along with a district "look-up" spread sheet where you can get even deeper into the data and how your school district is affected.

Meanwhile in the Senate. The Senate bill was handled a bit differently than the House bill, as the Senate did not spend nearly as much time as the House did in re-shaping individual bills before the committee unveiled its version of the omnibus education funding bill. The House commiittees--policy and funding--really scoured through the legislation and put a lot of time into honing the various proposals before they were presented as part of the omnibus bill. Thus, when it came time to discuss the omnibus bill as a whole, the House committee members were very familiar with most aspects of the legislation before them.

What was different in the Senate is that the committee did not spend nearly as much time coming up with alternative language to a number of the bills and thus, took a lot more time discussing the bill and taking amendments Tuesday and Wednesday. As was the case, the final vote was pretty much along party lines, although at least one Democrat voted for SF 1030, the Senate omnibus education funding bill. The bill now moves to the Senate Tax Committee for a hearing tomorrow with a time certain of 11 AM.

Here are the links to the Senate tracking documents in respect to SF 1030. I cannot find any on-line district-by-district runs at this time.

Scroll down until you come to the Education Committee and access those links.

What to Look For When Looking at the District-by-District Runs. There is a ton of "big furniture" moving around in both the House and Senate bills and because of that, there are wide swings in revenue causing some surprising distributional effects that often seem counter-intuitive.

The removal of the growth factors for special education funding, as many of you know, causes a tremendous amount of revenue re-distribution. Generally--and it's hard to say "generally" about anything concerning our current array of funding streams--the growth factors favor the metropolitan area and regional centers, as the special education formula is a cost-reimbursement formula and salaries are higher in the metropolitan area and the regional centers. There are some other outliers located throughout the state, which may equate to the fact that some of the high special education formula recipients among these outliers may be working under a "host district" model, with one district holding a majority of the contracts of the special education providers for a group of districts. Needless to say, whatever the reason, capping the special education appropriation moves a ton of money around.

The other issue in both the House and Senate is the significant changes that both bills propose for the integration program. The House bill pretty much leaves the revenue distribution as is save for the fact that Minneapolis, St. Paul, and Duluth take hefty cuts to their revenue. The Senate totally eliminates the program beginning in the 2012-2013 school year and spreads the revenue statewide in a literacy promotion program. As in the case of the special education program, this generally moves revenue away from the metropolitan area with the caveat that there are a number of integration cooperatives located in greater Minnesota with the districts involved in these programs taking a similar hit to suburban districts that receive integration revenue.

The additional issue in the House is the proposed small school categorical funding stream that moves approximately $17 million into districts and charter schools with less than 1,000 pupil units, providing them with significant funding increases, in some instances over $500 per pupil.

So as you analyze the data, realize that if your special education costs are above the state average, the movement of revenue away from the special education formula and toward the basic formula amount probably does not work for you. Further, if you receive a lot of compensatory or integration revenue, the same effect is present and the move to put more funding into the general education formula likewise doesn't work as well for you as current law.

Most SEE districts do better when money is siphoned away from the general education categorical formulas (sparsity, compensatory, ELL, etc.) and put toward the basic formula, but that gets muddled a bit when the integration and special education programs are tossed into the equation.

Feel free to contact me with your questions and don't miss the regional meetings where we'll be discussing these bills in greater detail. I can be reached at 612-220-7459.

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