Balancing the Budget on the Backs of Our Kids

It’s time to consider a radical reboot of the way we fund education

Can you smell the blood in the water?

With the recent announcement that Minneapolis Public Schools faces a $33 million deficit next year – which means even deeper cuts than followed this year’s $28 million shortfall — teeth are bared.

It’s not just Minneapolis. St. Paul Public Schools this year are trying to close a $27.3 million shortfall.

The gnashing is compounded by the impact of the Star Tribune’s recent series on school choice, which was a pretty good where-are-we-now check-in packaged under some unfortunate headlines that contained the word “fleeing.”

The combination, of course, leaves one with a run-for-the-lifeboats feeling.

People who truly care for kids and respect one another are morphing into mama and papa bears, worried about what all the red ink means for their kids. As they should be. To my knowledge, there isn’t a single school in the district that’s able to provide everything its students deserve.

It’s time to start having an honest conversation about school funding. And we might start – even just as conversation starters — with some of the ideas in a recent Center for Reinventing Public Education report on responding collectively to declining district enrollment throughout the country. What follows isn’t a synopsis of the report, but rather some thoughts it triggered for me.

The deficits are structural. We’re not going to cost-cut our way out of them. The cuts on the table at the moment are all going to be borne by children — affluent and fragile alike, but with a disproportionate impact on the second group.

We’ve been at this under one guise or another since Tim Pawlenty was governor. He undid the mechanisms that compensated in part for disparities between rich districts and poor, and began choking the latter to death.

Gov. Mark Dayton has been terrific for Minnesota in many ways, not least for restoring the aforementioned funding equalization, and for having the spine to raise taxes. Huzzah. But there have been major and shortsighted limitations to the fixes he’s been willing to entertain.

Charter supporters have tendency to see most clearly the money they don’t have; indeed the basic stream of state revenue is much lower than the dollars that go to traditional districts. On top of which, charters can’t offset shortfalls by passing levies.

Traditional districts, on the other hand, see “their” students leaving in droves, taking state tuition dollars with them. They can’t just shrink, they complain, they are saddled with costs charters don’t have.

Teachers unions spend a ton of money and energy lobbying for more state and federal education funding, but they are unwilling to discuss changing their role in perpetuating some of those district “legacy” costs. And all of those new dollars lawmakers come up with have a tendency to go straight to their rolls, either as salary increases or membership gains.

It’s not just the institutions that need to engage in some introspection, either. Minneapolis is replete with wealthy white families that purport to want equity for kids of color, but refuse to send their own children to schools with concentrations of poverty.

It’s true that having 45 kids in a classroom and a minimally staffed roster of counselors, literacy coaches and the like is a hideous situation. And it’s also true that there are MPS programs with majorities of color withering for lack of enrollment.

And finally, every year when they go home to face their constituents, lawmakers of both parties need to stop bragging about increasing school funding by whatever paltry percent. Because the general fund, the big, unrestricted pot of money those “new” dollars go into, isn’t the problem.

State and federal governments have never come anywhere close to reimbursing school districts for the cost of educating students with disabilities. They make up the shortfall by diverting general ed funds. By upwards of 20 percent of each Minnesota student’s state aid.

Which is how we have ended up with this maddening political black box where our elected officials get to brag they increased school funding, yet classrooms get more and more overstuffed and extra-curriculars rarer.

If the state assumed responsibility for this financial sleight of hand by reimbursing the actual costs, or even anything close, MPS and possibly all Minnesota districts would be running healthy budget surpluses.


Districts have been asking lawmakers to fix this for, oh, forever? But our senators and representatives – and governor — are, with the exception of a Band-Aid here and there, unmoved. The size of this so-called cross-subsidy is expected to hit $719 million in the next fiscal year.

Here’s something I’ve been puzzling over for a few days. MPS plans to ask the legislature this year to overturn the law that says traditional districts must pay 90 percent of the special education costs of students with disabilities who live within their boundaries but are enrolled in other districts or in public charter schools.

Sounds pretty reasonable on its face, right? Particularly when followed by the argument that MPS has no control over whether those services are appropriate or cost-effective. Maybe the law ought to be changed. We ought to seriously talk about it.

But we need to be honest about that talk. Students with disabilities are leaving traditional districts in larger numbers because those districts too often simply warehouse them – or worse. Every school, regardless of its charter or district status, needs an incentive not to push those kids out.

And we need to be honest with the public that yes, kid A is costing kid B resources – not because we are not wealthy enough as a state to educate our children but because our political culture has indeed made school funding a zero-sum game.

Because I, too, would like more money for education. For the kids and for the adults. But I’m not willing to wait for that hypothetical day. Especially not given the regularity with which our elected officials now deadlock on far less audacious issues.

We also need to be honest that nowhere in this discussion is anyone taking on the legacy costs mentioned above, possibly because the bottom lines they impact are those of adults.

In his letter to district staff, MPS Superintendent Ed Graff said “inflationary salary expenses and benefit costs” are one large driver of the deficit. Yet salary “steps and lanes,” the automatic yearly increases that take place whether employee contracts contain raises or not aren’t up for discussion.

(I don’t know whether you noticed, but in its current teacher contract talks MPS has asked for the ability to shorten the school year a few days and decrease pay commensurately. Which the union is describing as a pay cut, despite having fought the addition of more paid days for years.)

And you know what we’re really, really not willing to talk about? The unfunded shortfall in teacher and other school employee pensions. Makes the special ed deficit look like chump change. Even just MPS’ share.

Oh hey – and servicing districts’ debt?

Education finance is such a morass we can play this blame shell game for years. Maybe it’s time to consider a radical reboot, such as calculating the reasonable cost of providing each Minnesota child with enough money, to be spent at a public school, to meet their needs.

Think about it. What if a student who needed dual-language instruction or services for a disability or any other support costs arrived with enough money, so to speak. What if schools competed to do better by them?

There are ways to ensure we spend our money more equitably. But we’re not going to get there without a totally different conversation.


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