How are Minnesota Schools Funded?

How are Minnesota Schools Funded?

January 14, 2020 0 By Stanley Isaacs


– [Narrator] We have great
schools here in Minnesota, serving our youngest
learners in early childhood family education and preschool programs, to our K-12 programs and
beyond with adult education. Districts have people
working hard to maintain and build programs that
help learners of all ages. This, of course, requires
money to operate. But how exactly are schools
funded in Minnesota? Unfortunately it’s a bit
more complex than some of the principles taught in an
intro to business course. Funding public education
is a complicated business. There are many stakeholders at the table. Students, parents, school
leaders, community members, business leaders, and elected
officials, to name a few. The money to pay for elementary
and secondary education in Minnesota comes through
a combination of state collected taxes, primarily
income and sales tax along with locally
collected property taxes. The majority of revenue
for school districts, up to 70%, comes from the state. The largest share of the
funds provided to schools comes in the form of
general education aid, which is intended to provide the basic financial support
for the education program. This goes to fund things like transportation, teachers,
and curriculum materials. School districts also receive funding for specific categories
through formulas generally used to meet costs that vary
significantly between districts. These funds must be
used for specific areas, like special education or
long-term facility maintenance. Some of these funds are
tied to specific items, like literacy programs
to get students reading by third grade, or school
breakfast and lunch programs. The remaining school district
revenue comes from local tuition and fees, federal
grants, and local property taxes. There are many variables which
impact our budget each year. Enrollment, community
support, the local economy, and decisions by state law makers. The challenge is to take
each of these revenues, which typically don’t
keep pace with inflation, and meet the needs of
all of our stakeholders. For our budget, we take the revenue we expect to receive and
allot the funds in buckets. The largest bucket is for
paying our teachers and staff. Other buckets include special
education, transportation, operations and maintenance,
and administration. The state also mandates
some of our spending for things like special
education and basic skills. Other factors influence
how we spend money. Class-size ration, aging
buildings, emerging technology, and needs specific to the
students in our district. We always need to prepare
for the winds of change which can quickly impact our local budget. New legislation, competitive enrollment, teacher retirements, and
health insurance costs are all things that can
quickly make a big impact. Each year our challenge
is how do we connect all these revenue and expenditure drivers in order to build an effective budget while taking into account
stakeholder voices? It’s important for us
to collectively develop financial priorities to ensure
we use our resources wisely and have the greatest
impact on our learners. (cheerful music)