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					         April 2004
 Parent Leadership Summit

 Education Funding in
     Minnesota –
How Did We get Here?
   Minnesota State Constitution
  SCHOOLS. The stability of a republican
  form of government depending mainly upon
  the intelligence of the people, it is the
  duty of the legislature to establish a
  general and uniform system of public
  schools. The legislature shall make
  such provisions by taxation or
  otherwise as will secure a thorough
  and efficient system of public schools
  throughout the state.‖
How Public Schools are Funded

The legislature taxes, funds
 and regulates;
School boards dispense
      The Legislative Process

 The Minnesota State Legislature
  works on a biennium basis.
 One year for policy and the next for
 In its funding session, the Legislature
  sets the per pupil formula for the next
  two years.
 Major Sources of Revenue for a
 School District’s Operating Fund

 86% State
 7.3% Local Levies
 3.6% other sources
      fund raising
 3.1% Federal
The Funding Process

 Per pupil formula
 x AMCPU (adjusted marginal cost pupil units)
 District Operating fund (General Fund)
        Basic Skills revenue
   ELL ($700/pu capped @ 5 years)
   Compensatory (capped @ $2512/pu)
   Transportation sparsity funding
   Special Education funds
       State $9,800 average/pu
       Federal $1,100 average/pu
Average General Fund Dollars in
  Minnesota’s public schools

   According to the state’s 2003
Education Finance Task Force report
  Minnesota school districts receive
           $7,615 per pupil
      How Did We Get Here?
1. A per pupil formula that has
   averaged 1.14% increase
2. State policies reforming property tax
3. The 2001 General Education Buy
4. ―No New Tax Pledge‖
     Per Pupil Formula Analysis
 Year        Formula     General        Actual      Actual
            Allowance    Increase     "NEW" $$     % Change
1992-93     $   3,050   $      -      $      -       0.00%
1993-94     $   3,050   $      -      $      -       0.00%
1994-95     $   3,150   $     100     $      -       0.00%
1995-96     $   3,205   $       55    $       55     1.75%
1996-97     $   3,505   $     300     $      -       0.00%
1997-98     $   3,581   $       76    $       76     2.17%
1998-99     $   3,530   $      (51)   $     (49)    -1.37%
1999-00     $   3,740   $     210     $     150      4.25%
2000-01     $   3,964   $     224     $       95     2.54%
2001-02     $   4,068   $     104     $     104      2.62%
2002-03     $   4,601   $     533     $     118      2.90%
2003-04     $   4,601   $      -      $      -       0.00%
2004-05     $   4,601   $      -      $      -       0.00%
    Total               $   1,551     $     549      14.9%
      Flat per pupil formula

 The true per pupil formula grew an
  average of 1.14% annually
 Expenses in districts grew an average
  of 5% annually
     How Did We Get Here?
1. A per pupil formula that has averaged
   1.14% increase annually
2. State policies reforming property
3. The 2001 General Education Buy
4. ―No New Tax Pledge‖
 State policies to reform property
 Class rates for taxing businesses were
  reduced to more closely resemble
  residential property tax rates
 Agricultural and recreational land
  removed from the equation for school
 General Education Fund Buy Down
Annual School Taxes 1997-2002 on
        a $250,000 Home

  3000 $2,643
  2000                $1,760 $1,772


  1000                            $793


         1997 1998 1999 2000 2001 2002
     How Did We Get Here?
1. A per pupil formula that has averaged
   1.14% increase annually
2. State policies reforming property tax
3. The 2001 General Education Fund
   Buy Down
4. ―No New Tax Pledge‖
General Fund Buy Down
   In 2001, the state accepted the
        liability of funding 85% of
           public schools cost
 Passed half of the legislation—the
  liability was accepted, without a
  revenue stream to support it.
 Destabilized the funding source for
  schools and now makes them reliant
  on the state’s economy
Change in percent of school
revenue from the state

    1997    1999     2001     2003
     How Did We Get Here?
1. A per pupil formula that has averaged
   1.14% increase annually
2. State policies reforming property tax
3. The 2001 General Education Fund
   Buy Down
4. “No New Tax Pledge”
  The Decade’s Mantra

        PAY LESS
        ―No New Tax Pledge‖
                 Developed by
the Minnesota Taxpayers League whose website
  ―Everybody knows we pay too much in taxes.”
                       -David Strom

 ―The Taxpayers League has been successful
   because we take our case to the people of
  Minnesota. It is our goal to reach out to and
  persuade as many Minnesotans as possible‖
 -David Strom, Legislative Director of the Taxpayers League.
      Price of Government

The Price of           17%

Government is the
State of
Minnesota’s official          16%

measure and is
factored as total
revenue as a                         15%

percentage of
personal income.       1992   2002   2006
    Requirements for public schools
      grew while funding did not

   Testing
   Standards
   Special education mandates
   Transportation
   English Language Learning
   Days added to the school year
   Health and safety mandates
   Physical Education
   HIV/AIDS Sex Education
   Drug/Alcohol Abuse Education
   Bus Safety
   Title 1 programs
 No Child Left Behind is possibly the largest
  unfunded/under-funded mandate the federal
  government has ever imposed on public schools.
 The Office of The Legislative Auditor, State of
  Minnesota has said: ‖Even if student’s math and
  reading scores improve significantly in coming
  years…more than 80% of Minnesota elementary
  schools would not make AYP by 2014...and this could
  trigger expensive sanctions‖—OLA Evaluation Report 2/26/04
 The US Department of Education contends that ―NCLB
  is appropriately funded‖. Yet in 2004-05, because of
  formulaic restructuring at the federal level, Minnesota
  will receive substantially less federal funding. –Eugene
   Hickock, Undersecretary of USDOE 4/14/04
What the cumulative effects of this
      decade have meant to
          public schools
   Less administration—R&D
   Greater reliance on local levies
   Fewer Art/Music programs
   Fewer Gifted/Talented programs
   Books older than the kids
   Cutting or charging for transportation
   Higher fees
   Larger class sizes
   Fewer enrichment programs
   Fewer intervention programs
   Deferring maintenance to facilities
   Greater reliance on parent fund raising
   Greater reliance on the classroom teacher
   Fewer fund balances; higher cost for districts to borrow money
    What was happening with the

 Between 1995 and 2001 the state of Minnesota
  and the federal government experienced the
  largest surpluses ever recorded
 Minnesota rose to rank 8th in per capita income
  of the fifty states
 Residents received tax rebate checks in
  multiple years
 Property tax reductions were enacted over
  multiple years
 Business tax rates were reformed
What Do We Need to Do to
  Change Where We are
       Know your Facts
 Schools have had greater expectations
  placed on them with flat or decreased
 Policies that aided property tax reform have
  destabilized funding for schools
 The state took on the liability of providing
  85% of the funding for schools without
  identifying a revenue stream
 The ―No New Tax Pledge‖ has created a
  greater dependence on fees and increased
  local taxes.
                    Make the case
 Taxes are not ―out of control‖.
 The State crises wasn’t inherited, it was self–inflicted
 State funding for K-12 was ―protected‖ only for this year.
 State funding for K-12 education actually declines for the
  next three years, for the first time in the history of the
 85% of school funding is regulated by the state. You
  can’t use fees to support these basic services.
 Few local reserves are ―surplus‖. School districts often
  have to borrow throughout the year.
    John Gunyou, Commissioner of Finance for Gov. Carlson and
    Jay Kiedrowski, Commissioner of Finance for Gov. Perpich
      Work for What you believe in
 Organize Candidate Forums
 Work for Representatives that support your
 Elect representatives whose judgment and
  integrity you trust
 Help elected officials understand your views
 Take your candidates and representatives on
  tours of your schools
 Keep public schools in the forefront
      start a letter to the editor campaign
      help parents be a presence at the Capitol
    Concentrate on expanding the
   Local Chambers of Commerce
   Early Childhood parents
   League of Women Voters
   Seniors
   Realtors
   Local Business people
   Legislators
The Power of the Network
Together we can:
 provide information
 provide a speaker or help you be a speaker
 provide a state view to your local and a
  local view to our state
 network local advocacy groups
 connect with state-wide advocacy
 present a state-wide parent voice for our
  public schools
―What the best parents
want for their children the
 public must want for all
               --- Dewey

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