2009 Session Summary
Minnesota Budget Project.
A healthy early childhood, elementary and secondary school system (E-12 education) is critically important to the state’s economic vitality and quality of life. Minnesota, however, has become an average state in terms of its investments in education. The state has significant work to do to ensure that all children have the opportunity to succeed: low-income children are twice as likely to not be ready for kindergarten as children from families with the highest incomes.
The Governor, House and Senate had to reconcile vastly different approaches to balancing the E-12 education budget. Both the Governor and the House avoided cuts by delaying more than $1 billion in payments to school districts and utilizing one-time federal stimulus money. The Senate did not use the payment shift budget gimmick and followed its formula, applied across all budget areas, of cutting spending by seven percent. The Senate then reduced this to a three percent cut through the use of one-time federal stimulus money.
The final compromise signed by the Governor keeps E-12 spending roughly flat for the FY 2010-11 biennium, using $500 million in federal stimulus money to backfill cuts in state spending. The compromise does not implement the delay in payments to school districts and the Governor did not line-item veto any bill provisions.
In June, however, the Governor announced his intent to use his unallotment power to implement a $1.8 billion delay in payments to school districts. There is some question, however, as to whether the Governor has the authority to pay school districts back in the future. So, unless the legislature acts, this could be a $1.8 billion cut in funding to schools.
| |
Governor’s Proposal |
House Proposal |
Senate Proposal |
Final Legislation (including line-item vetoes and unallotments) |
| Overall funding |
The Governor would have slightly increased state spending for K-12 education in FY 2010-11 (after factoring in federal money). |
The House held state spending for K-12 education at FY 2008-09 levels through the FY 2010-11 biennium (after factoring in federal money). |
The Senate proposed a three percent reduction in state E-12 spending in FY 2010-11 (after factoring in federal money). |
The final legislation holds state spending for K-12 education at FY 2008-09 levels through the FY 2010-11 biennium (after factoring in federal money). |
| Federal stimulus dollars |
The Governor proposed using $424 million in one-time federal stimulus dollars in FY 2010-11 for E-12 education. Of that, $320 million would have been used to backfill spending cuts in K-12 education and $64 million would have been used to backfill spending cuts in special education. The result would have been a $40 million net increase in funding for K-12 education. |
The House proposed cutting state funding for K-12 education by $265 million in FY 2010-11, backfilling the reduction with $276 in federal stimulus dollars. The result would have been an $11 million net increase in funding. |
The Senate proposed cutting state funding by $973 million in FY 2010-11, partially backfilling the reduction with $520 million in federal stimulus dollars. |
The final legislation cuts state funding by $500 million in FY 2010-11, backfilling the reduction with $500 million in federal stimulus dollars. The result is no net change in funding. |
| Aid payments to schools |
The Governor proposed delaying education aid payments to school districts, saving the state $1.3 billion in FY 2010-11. Normally, schools get 90 percent of state aid in one year and a 10 percent settle-up payment in the following year. The Governor would have changed this to 80/20 percent split. |
The House delayed $1.8 billion in state aid to school districts, which would have changed it to a 73/23 percent split. |
No proposal. |
Not adopted. However, the Governor’s unallotment plan simulates a $1.8 billion shift in payments to school districts. |
| Q-Comp |
The Governor proposed expanding the Q-Comp program to all school districts in Minnesota. The state would have contributed $42 million in FY 2011 and $111 million in FY 2012-13 towards the cost of this expansion. Funding would also have come from higher local property taxes. The Q-Comp program is a 2005 initiative from the Governor that restructures teacher pay and professional development. |
No proposal. |
No proposal. |
Not adopted. |
| Summer of Success |
The Governor proposed $10 million in one-time funding for FY 2010-11 for a new pilot program to set up an intensive summer school for 8th graders that are not yet proficient in math or reading. This pilot program would have reached 2,000 students in FY 2010 and 4,000 students in FY 2011. |
No proposal. |
The Senate adopted the Governor’s proposal, although with smaller level of funding: $4.5 million in one-time funding for FY 2010-11. |
Not adopted. |
| Maintenance of effort requirements |
No proposal. |
The House proposed reducing various maintenance of effort requirements, allowing school districts to have greater flexibility in where they spend money. The House also extended the ability of school districts to transfer money from their operating capital account to the general fund for another two years. |
The Senate eliminated maintenance of effort requirements for certain aspects of the safe schools levy. |
The final legislation lessens the maintenance of effort requirements, or required spending levels, for libraries and for the safe schools levy. The bill also extends the ability of school districts to transfer up to $51 per pupil from their reserved operating capital account to their unreserved general fund for another two years. |
| The Senate also lessened the required spending levels for libraries and would have allowed school districts to use learning and development revenue for general education purposes for FY 2010 and 2011 only. |
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