February 2010 (Revised May 2010) - Special Education Cross-Subsidies Fiscal Year 2009 - As a result of the 2007 legislation, the cross-subsidy decreased to $507 million in FY 2008 but began to grow again in FY 2009 to $544 million. Due to federal stimulus funds in FY 2010 with anticipated carry-over in FY 2011, the cross-subsidy is projected to drop below the FY 2008 level in FY 2010 to $497 million and rise slightly in FY 2011 to $513 million. It is projected to exceed the FY 2007 level by FY 2012 and to reach $647 million by FY 2013, Minnesota Department of Education.
March 2009 - Special Education: Modest Changes, Better Education, Major Savings - Recommends reducing special education costs by improving identification, reducing conflict between districts and parents, and lowering the costs of compliance. From a collection of budget-savings strategies shared by five Minnesota foundations: Northwest Area Foundation, Minneapolis Foundation, Saint Paul Foundation, Minnesota Community Foundation and Bush Foundation, Public Strategies Group (Full Report; Executive Summary).
March 2009 - Special Education Cross-Subsidies Fiscal Year 2008 - Special education cross subsidy to increase by 17% from $615 million in FY 2010 to $724 million FY 2013, Minnesota Department of Education (Projected District Impacts).
February 2009 - Policy Issues in Special Education Finance - An in-depth look at special education finance; includes policy recommendations, University of Minnesota Children, Youth & Family Consortium Family Impact Policy Initiative.
November 2008 - Many factors contribute to stormy weather for education - Changing student demographics, increasing expectations, rising energy costs, and inadequate and inconsistent funding have made for rough sailing, Association of Metropolitan School Districts (page 2).
Source: November 2008 AMSD Connections
February 2008 - Special Education Task Force Report - Review of state and federal special education mandates and recommendations for change, Bureau of Mediation Services.
February 2008 - Special Education Cross-Subsidies Fiscal Year 2007 - MDE Report to the Legislature.
This year's Special Education Cross-Subsidies report changed the calculation methodology to provide a more refined picture of the impact of special education services on school funding by taking into account the general education dollars that follow special education students.
Since special education students earn general education revenue in the same manner as other students, a portion of the general education revenue earned by these students is available to cover costs of the special education programs, without creating a shortfall in the general education program of the district.
Definitions
- Gross Cross-Subsidy - The difference between total special education expenditures and categorical special education revenues.
- Adjusted Net Cross-Subsidy - Equals the gross cross-subsidy minus the amount of general education revenue attributable to special education students for time spent receiving special education services outside of the regular classroom for 60% or more of the school day.
For purposes of this report, the adjusted net cross-subsidy includes the portion of general education revenue that reasonably follows the student to the special education program as a revenue for special education, thereby reducing the amount of the cross-subsidy.
Highlights
- Special Education expenditures increased steadily over this period, from $939 million in FY 1999 to $1.504 billion in FY 2007, and are projected to continue to increase up to $1.840 billion by FY 2011.
- Special education revenues increased at a slower rate than expenditures between FY 2002 and FY 2007, increasing the gap between expenditures and revenues.
- As a result of the 2007 legislation, the cross-subsidy is projected to decrease to $516 million in FY 2008, but is projected to exceed the FY 2007 level of $603 million by FY 2010 and to reach $675 million by FY 2011.
Additional Resources
March 3, 2008 - Special Education Budgets Shortchanged - Once again, schools are forced to spend hundreds of millions of dollars to make up the difference between special education revenue and actual costs, Minnesota 2020.
March 28, 2007 - Senate E-12 Financial Bill Special Education Impacts - District by district comparison of cross subsidy costs with/without Senate Finance Bill 2095, AMSD.
February 2007 - Special Education Program Growth Factors FY 2007 - District by district comparison of cross subsidy costs, Minnesota Senate Counsel, Research and Fiscal Analysis.
The Minnesota Department of Education provides information on how much general education revenue is being used by school districts to provide legally mandated Special Education services.
September 2006 - Who Pays? Taking the MAZE Out of Funding (CAUTION: Very large, 4.5MB file) - Perhaps misnamed, this document contains a wealth of information about federal and state program guidelines for children with special needs - Minnesota Children with Special Health Needs (MCSHN), Minnesota Department of Health.
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