School Decisions On Hold Because of Shutdown

Major policy decisions at local schools are on hold because of uncertain state funding.

Recent proposals by Gov. Mark Dayton and Republican legislative leaders have, at different times, suggested using a much-maligned accounting trick to balance the state budget. The practice, called a “funding shift,” would essentially give schools I-owe-yous on their percentages of state revenues.

Fundings shifts have been used twice in recent years to help balance the state budget, with percentages held back until the following year each time. Some education leaders have likened it to a funding cut, because of the lack of state revenues to pay each “shift” back on time.

“If your salary is $50,000 and your employer says ‘We’re only giving you $25,000 this year and an I-owe-you for the other 25 (thousand) next year, that doesn't help you pay the rent, because you don't have the cash on hand,” said Sarah Snapp, budget director for Minneapolis Public Schools.

Because of its large cash reserves, the district is safe from this cash flow problem for now, Snapp said, but drawing down these emergency funds is “not an ideal situation.”

The big problem, said school board member Rebecca Gagnon, is that budgetary uncertainty hamstrings long-range planning. The district is facing several million dollars in deferred maintenance and must find funds to solve at many district schools, starting with Lake Nokomis Community School.

“We have to know we’re going to be stable enough to do some of those bigger projects,” she said. “Our enrollment’s increasing, our test scores are better, moving in the right direction, but what are we going to be doing without stability?”

The funding shifts could also have strong impacts on districts less fortunate that Minneapolis.

“We continue going to the same well, believing that it makes no difference” to schools, said Mary Cecconi, a long-time Minnesota education watchdog and head of the public school booster group Parents United for Public Schools.

As districts spend down their reserves or reach borrowing limits, she said, they may consider raising local property taxes. A number of districts will be renewing their property tax levies in the coming years. The funding disparities between rich and poor towns this would create, she said, might be a violation of the state’s constitutional obligation to fund a quality public education system.

“Kicking the can down the road doesn’t solve anything,” Cecconi said.