House Passes Omnibus Education Finance and Policy Bill
Last Thursday, the House debated HF 2497, which is the omnibus education finance and policy bill. The bill contains 4% and 2% increases on the basic formula allowance over the next two years, respectively. The bill would also increase special education cross-subsidy reduction aid to just over 48% of each school district’s particular cross-subsidy amount. The House bill merges both finance and policy into one package.
During debate on the bill the GOP minority offered a competing version of education finance provisions that would put ‘5&5’ on the formula with 50% for special education cross-subsidy reduction aid, and little to no policy, but for investments and policy relating to literacy training.
For the specifics of this bill, be sure to refer to the 4th Engrossment of the bill:
Senate Floor Action on Education Today
The Senate will take up their version of the omnibus education finance bill during their floor session today, SF 2684. The Senate is maintaining a ‘4&5’ increase on the formula and a higher reimbursement for special education cross-subsidy reduction aid, 60%, as their plan is fully phased in over 4-years.
For the specifics of the bill, be sure to refer to the 3rd Engrossment of the bill:
The Senate may take up their version of the omnibus education policy bill today as well. The Senate has kept finance and policy separate, but the House is insisting on conferencing all of education finance and policy together.
Indexing the Formula to CPI
During his state of the state speech last week, Governor Walz reiterated his adamant support for indexing a CPI factor, a range between 0-3%, to the basic formula allowance for future budget cycles, beginning with fiscal years 26-27.
The Governor and House are aligned in their support for indexing the formula. The Senate remains opposed to it. This is the most significant friction point within the DFL trifecta as it relates to education. Conference committee action on the education bill will likely begin on Monday, May 1. We’re hearing that leadership (made up of the Governor, Senate Majority Leader, and Speaker of the House) will call conference committee chairs before them, starting on May 5 to help sort out major hurdles. This is likely to be one such hurdle that the ‘tribunal’ will have to resolve. Legislative leaders have internal timeline goals for final passage of the budget bills. Our understanding is they would like them all passed and presented to the Governor by May 12 or soon thereafter. Session must adjourn by Monday, May 22.
The Senate GOP dug in against the proposed unemployment insurance mandate last week when SF 2684 made its way through the Senate Finance committee review. In fact, this morning the Senate Jobs & Economic Development committee, with jurisdiction over UI, will review the specific proposal to create this mandate (SF 34). The state’s fiscal note for the new UI mandate shows a cost of $158/ADM ($135M divided by the 851,298 pupil units), but district survey results estimate a higher usage rate for the new UI mandate and an associated cost closer to $230/ADM. The state’s fiscal note assumes a 50% usage rate for UI. The cost of the UI mandate would be paid for by district general funds as the legislation prohibits usage of the UI levy for UI costs generated during the summer months.
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