Student Opportunity Gaps

Melcher Speaks on School Funding Shifts at MREA Conference

By November 12, 2012 No Comments

Tom Melcher, director of school finance at the Minnesota Department of Education, presented on shifts education funding and sought feedback on reform from teachers, school board members and administrators Nov. 12 at the MREA Annual Conference.

Melcher has been working with the Education Finance Working Group and hosting community listening sessions. The Working Group has been reviewing a decade of data and series of options to provide recommendations to the Governor.

Here are five of the facts Melcher shared to show state funding changes since the early 1990’s and challenges facing the state:

  1. General education funding per student (outside of referendums)
    Down $500-$1,000 per student, when adjusted for inflation.
  2. Average referendum in the state
    Increased from $352 to upwards of $1,000. “Even when adjusted for inflation, school levies have more than doubled,” Melcher said.
  3. State general education formulas as percentage
    Decreased from 94 percent to 85 percent
    “To me, that means if you’re a traditional school, you have to rely on referendums,” Melcher said.
  4. Special Education Cross Subsidy
    Held steady from $4,123 to $4,593
  5. Property tax levies
    Skyrocketed to $707 million
    School taxes are still quite a bit lower than city and county taxes and city and county taxes are growing much faster, according to an analysis provided by Melcher. The more the city and county taxes rise, the more challenging it is for schools to pass a referendum, Melcher said.

The total shift in educational funding amounts to a loss of $2.4 bill in state funding as of June 2013, when combining the $1.9 billion aid payment shift and the $563 million property tax shift, Melcher said.