Special Session Pending
Last week legislative leaders pressed their budget work groups hard to wrap up their work. Work groups had blown past one deadline after another since the close of regular session and leadership had to step in several times to push them along toward closure. Thursday afternoon the Education work group posted a spreadsheet containing budgetary change items and it included the signatures of the various Education chairs. Today at 1pm a public walk through of the spreadsheet and hopefully the final bill language will take place. Education, Transportation, Environment, and Health & Human Services are the major pieces of the budget that need to get passed by the legislature and signed into law ahead of the July 1 start of the new state fiscal year.
A heavily scaled back Tax bill, 12 pages total, was released Sunday afternoon. With the very limited Tax bill, our Seasonal Recreational Tax Base Replacement Aid proposal has been dropped from consideration. Assuming caucus leaders have secured the votes to pass these bills, we should expect Governor Walz to call a special session this week, with rumors suggesting Wednesday as the day to begin work. The special session could take a full three days if there isn’t a super majority of members in both bodies willing to suspend the rules and expedite passage of the budget bills.
E-12 Finance
For the next two years the total state investment in E-12 education will remain at the same level as projected in the February budget forecast. However, the new legislation will cut $420 million from E-12 in the tails budget or fiscal years 28-29. Furthermore, there are many change items to E-12 programs for FY 26-27 meaning cuts will be made in order to make room for new spending. The spreadsheet shows the details of the change items.
View the spreadsheet here.
The highlights of the new bill include:
Preserving the formula inflator that is in current law. This means the basic allowance for all students will grow from the current $7,281 in FY25 to $8,095 by FY29. The projected state budget deficit created a challenge to the formula inflator and the original Senate DFL E-12 bill would have repealed it. The House co-chairs and Governor fought hard to retain this provision.
A one-time infusion of $55 million in the Compensatory Aid formula is in the bill and will be distributed according to the Governor’s plan released early this year (see MREA map for distribution impact). A highlight for MREA is the inclusion of “above the line” school board levy authority for major roof repair and replacement projects as part of the LTFM program.
With the good news comes tough news as the E-12 bill made its $420 million contribution towards the state’s emerging $6 billion budget deficit. Special Education transportation reimbursements will be reduced starting next fiscal year. In the tails, the regular special education program will be cut by $250 million if savings to special education services aren’t identified. The growth in Student Support Personnel Aid is capped and School Library Aid is immediately cut in half.
The policy front is pretty quiet for a nice change of pace. Divided Government can have that effect. We were fortunate to see our proposal to make the short call substitute teacher pilot program a permanent fixture without a state mandated daily rate of pay make it into the final bill. This means districts can expand their short call sub candidate pools to include people with AA degrees and paraprofessionals who have worked in the district for the previous year. A battle over allowing parents to authorize seclusion as behavioral management technique is still up in the air as we venture into this week.
