The Potluck

DFL-controlled Legislature has agreement on $2.3 billion boost in education spending

By: - May 16, 2023 7:59 am

Rep. Cheryl Youakim, right, and Sen. Mary Kunesh confer during Friday’s meeting of the Education Finance and Policy Bill conference committee. Photo by Andrew VonBank/Minnesota House Info.

A panel of Minnesota lawmakers on Monday agreed to a compromise on education funding and policy provisions that includes a $2.3 billion boost in school spending.

The 331-page agreement will now go to the DFL-controlled House and Senate for an up-or-down vote and then to Gov. Tim Walz, who is likely to sign it.

“We really did take to heart the issues that we heard from our students and our teachers and our administrators,” said Sen. Mary Kunesh, DFL-New Brighton, on Monday. “It’s never going to be enough to do all of the work that we need to do for our students, but this is the first step.”

The extra $2.3 billion in education spending for the state’s 2024-2025 budget — a 10.16% bump from the previous two years — includes an increase for K-12 schools’ general education funding formula, which is the primary source of operating revenue for districts.

The per-pupil formula distribution is based on district enrollment, as well as the district’s student profile. Under the deal agreed to Monday, the formula would increase by 4% in fiscal year 2024 and 2% in fiscal year 2025. Districts would receive $7,138 per student in fiscal year 2024 — up from the current $6,683 per student. That’s a 6.8% increase. 

In the years following, the formula would be indexed to inflation, with a minimum increase of 2% and a maximum increase of 3%. The cost of the funding formula increase would be $704 million in 2024-2025, and $1.3 billion in the following two years.

The agreement also increases special education funding to partially eliminate the so-called special education cross subsidy — a term used around the Capitol referring to school districts paying for special education programs from their general funds because of inadequate state and federal funding.

This often causes districts to ask residents in their local area for property tax levies to help defray the rising cost of special education costs. The agreement would eliminate the cross subsidy by 44% for fiscal years 2024-2026 and 50% for the following years, costing over $300 million annually.

In addition, lawmakers came to a compromise over unemployment insurance eligibility expansion, which earlier this session caused school districts to raise concerns about potential unfunded government mandates.

The Senate and House bills originally expanded unemployment insurance eligibility to district hourly workers during the summer months without providing any funding for it. Now, legislators have created an unemployment district aid account for hourly workers, with a one-time $135 million payment.

In another victory for the education union, school districts must negotiate with teachers about class size during collective bargaining negotiations, according to a provision in different labor legislation also expected to pass.

The education conference committee agreement also includes a number of policy changes. Religious colleges participating in post-secondary enrollment options — when high school students take college courses for credit — can no longer require faith statements from students.

The bill mandates that school employees receive full pay and benefits on remote learning days,  and allows teachers to achieve higher licensing status via experience or other nontraditional pathways.

Schools are also required to teach Holocaust and genocide studies in social studies by the 2026-2027 school year. High schools would also need to offer ethnic studies courses by the same year, while elementary and middle schools have an additional year to develop ethnic study classes.

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Michelle Griffith
Michelle Griffith

Michelle Griffith covers Minnesota politics and policy for the Reformer, with a focus on marginalized communities. Most recently she was a reporter with The Forum of Fargo-Moorhead in North Dakota where she covered state and local government and Indigenous issues.