Commentary; Posted: 1/4/06
State keeping promise to students, schools
Joe Nathan
Education Columnist
Minnesota is keeping its promise to students and schools. Itís a darn good way to start 2006.
The promise Iím referring to involves paying back millions of dollars that the Minnesota legislature ìborrowedî from public schools. Faced with the constitutional requirement to have a balanced budget, and unable to agree on enough budget cuts or tax increases to accomplish this, the legislature borrowed ìa lot: from public schools,î district and charter.
Imagine your boss promises to pay you $40,000 for the coming year. Then, as the year unfolds, management tells you and other workers that because times are tough, you will get only 80 percent of that $40,000, or $32,000. You will get the last $8000 the following year.
If you are planning on a yearly salary of $40,000, and then suddenly you are told that you will receive only $32,000 over the next year, you have to make significant cuts. Thatís in part, what happened to school districts throughout the state.
School districts also were told that they had to recognize local property taxes earlier than they traditionally had done so, and state aids were reduced.
According to Tom Melcher, director of the Program Finance Division, Minnesota Department of Education, the state has withheld 10 percent from school districts for many years. Thatís to insure that schools are paid accurately for the number of students they serve through the year.
The 10 percent hold back makes sense. Families do move during the year. Many schools start out with fewer, or more students in October than they work with over much of the year.
But over the last few years, the Legislature and Governor could not reach agreement on ways to balance the budget. So the 10 percent hold back increased steadily to a full 20 percent in the last few years, and 16 percent last year. On a K-12 budget of several billion dollars, 20 percent amounts to hundreds of millions of dollars.
Melcher explained to me that in the next six months, Minnesota school districts will receive $625 million to help repay what had been borrowed, through the combination of the property tax shift, and the actual state aid payment that was being delayed.
Minnesotaís economy is improving, tax revenues are up, and so the state is keeping its promise.
Is this a big deal?
Itís easy to find examples of broken contracts and broken promises these days. Whether from corporations or governments, people do not always do carry out commitments. Itís easy to get cynical.
The $625 million sounds like a lot ó but remember that this year the state will provide $6.2 billion in k-12 education (not including the $625 million). Even so, public schools welcome the money.
And this is an example of our elected representatives keeping a promise.
Happy New Year!
Joe Nathan, a former public school teacher, now directs the Center for School Change, Humphrey Institute, University of Minnesota.
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