School Finance Working Group Update

School Finance Working Group Update

The School Finance Working Group met remotely Thursday, June 4, from 4-5:30 p.m.

The first order of business was to hear from Commissioner Ricker.  She applauded the work of school districts as they have provided meals to 20 million students, child care to 6,000 students and designed and implemented a distance learning model of education across the state.  With conviction she called on the work group to continue their work, “Our work is magnified; not diminished.”

As a continuation of May agenda, the work group looked at some funding streams that are not equally available to all school districts and local education agencies.  The topics addressed were long-term facilities maintenance revenue, safe schools levy and lease levy.

Long-term facilities maintenance revenue (LTFMR) was the first topic. LTFMR’s is designed to allow all districts the ability to maintain facilities.  It is capped and equalized for all school districts, except alternative facilities school districts. There is an inequity between the state’s largest school districts and the smaller school districts.  In recent years, the gap has grown, and will continue to grow if the inequity is not addressed. 

The second topic addressed was the Safe Schools Levy/Revenue. Like the LTFMR it is capped at $36 per pupil. And unlike LTFMR, it is not equalized.  There are only 14 districts that have not levied to the cap due to low property tax base. In recent years, charter schools and cooperatives (e.g. special education cooperatives, career technical cooperatives, education districts) have been excluded.

The third topic addressed the Lease Levy, which is used to pay rent on leased facilities.  Once again, this revenue stream is capped, and like the Safe Schools levy is not equalized. Since education cooperatives do not have ability to levy yet, an inequity exists between school districts and education districts.

The meeting concluded with small virtual breakout discussions, which then lead to a large group discussion. Break out groups reported back responses to the facilities funding formulas.  MSBA proposed lifting the cap on all three formulas, equalizing the safe schools levy and the lease levy and expanding the allowable use of safe schools levy to include COVID-19 safety equipment and supplies. 

The next meeting will be June 18 and they will focus on the area of the transportation formula.  The next scheduled meeting dates are:  July 16 and July 30.

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