Budget hit and miss with school officials
WILLMAR -- Wednesday was a good news/bad news sort of day for public education in Minnesota.
There's disappointment in the state's decision to delay paying state aid to the public schools that are dependent on it. But school officials are pleased, maybe even relieved, to have a signed state budget agreement following this week's special session of the Legislature.
School districts had to file their 2011-12 budgets in late June, even though no state budget or state aid levels had been set.
"We can focus on doing our jobs as well as we can under the new parameters," said Dan Tait, business manager at Atwater-Cosmos-Grove City Schools. "I dislike uncertainty, even if the news is bad."
Many school districts around the state plan to borrow money so that they can maintain a positive cash flow while waiting for state aid and property tax payments to arrive.
The delay in aid payments could be particularly hard on school districts this year. In recent history, the state has paid school districts a percentage of their state aid in one fiscal year and shifted the remaining payments into the following fiscal year.
The shift has varied from a 90-10 split all the way to the 70-30 split in the past fiscal year. In the new legislation, the split will be 60-40.
That means that in the current fiscal year, schools will receive 30 percent of last year's aid payments and 60 percent of this year's payments. That is likely to have a significant impact on cash flow, as schools depend on the state for about three-quarters of their annual revenue.
Schools will also pay fees and interest to borrow money to get through the year. To help offset that cost, the Legislature increased the general education aid by $50 this year and another $50 next year.
That will increase the base aid from $5,124 per pupil to $5,174 for this school year and to $5,224 for the following year.
Willmar Superintendent Jerry Kjergaard didn't mince words in his assessment of the new, larger shift.
"They used education to balance the budget again," he said. "I would hope there are no legislators out there who are bragging about the K-12 bill."
Paul Carlson, superintendent at New London-Spicer Schools, said he was disappointed that the state was using the "same old tactics" that have been used in the past. "It's time our leaders talk about making investments in education."
The shifts have been used to varying degrees for eight years in a row, Carlson said, and the practice serves to delay dealing with state financial problems.
Carlson said he is pleased to see the increases in state aid, after years of no increases at all.
School leaders did see some things in the legislation to like. A requirement that teacher contracts be settled by Jan. 15 was repealed, as was a law requiring schools to maintain levels of school counselors and social workers.
There had been a fear that integration funding would be eliminated, and that would have affected a number of districts in west central Minnesota. However, the money was kept in place for the next two years, and a task force will study ways to revamp the program for the future.
The education legislation is long and must be interpreted by the Minnesota Department of Education before all the impacts will be known. "There's going to be unexpected consequences in the fine print," Tait said.