By Sam Walseth, MREA Director of Legislative Affairs
The state Task Force has identified issues of concern surrounding facility funding. One that’s been highlighted is the inequity that has grown between the 25 districts qualifying for the alternative facilities bonding program and the more than 300 that don’t. The inequities have grown so large that these 25 spend $2.79 per square foot and all the other districts only $0.58. Districts with fewer than 1,000 students spend $0.45.
Alternative Facilities Bonding was initially a carve-out for Minneapolis, St. Paul, and Duluth because of their size and the age of their schools. Because they had over 1,850,000 square feet, they would alternately bond rather than participate in the Health and Safety program. With every succeeding session, more and more districts have clamored to get into the program and now 25 districts can update their buildings without voter approval.
How bold will the task force go?
One of the key players at the table is Senator LeRoy Stumpf, the former chair of E-12 who now heads the Capital Investment Committee. Stumpf thinks too many districts postpone routine maintenance because they are required to get voter approval while cities and counties aren’t.
Another member of the task force is Windom Superintendent Wayne Wormstadt. Having come from South Dakota, he is a strong voice urging the task force not to tweak, but to think bigger and redesign facilities funding entirely. So far the task force has taken him up on this.
The task force is looking at giving all districts more authority to take care of deferred maintenance without going to the voters. They’re considering a new “Facilities and Equipment Revenue Program” that would consist of rolling the Alternative Facilities, Deferred Maintenance, Health & Safety, Operating Capital and Building Lease Levy into a new aid/levy revenue stream with a significant allowance attached to it.
Any proposal would include a phase in of new funding for the lowest funded districts and grandfather clauses to hold districts harmless through the transition period. A two tier system of equalization to soften the transition is also a likely part of this proposal.
A New Program?
A new “Facilities Grants Program” is under consideration. Districts suffering from a natural disaster would qualify for assistance. The program would otherwise be aimed at property poor districts in order to keep their debt service rate lower than 30% of their ANTC after debt service equalization is factored in. Voter approval for the local share of the project would still be required. The legislature would have to approve funding on a project for project basis.
Administrative reforms are also a part of the discussion. The task force is looking at raising the bar for Review and Comment to projects over $2 million. They’re also looking at a simpler R&C process for remodeling and technology plans compared to new facility construction.
Another option on the table is have the state commit to a fixed portion of the bond for a new facility instead of having debt service equalization float with enrollment changes and property valuations. Kansas adopted this model after several districts sued the state over funding inequities.