Mpls. school board weighs op­tions on bud­get gap

Among the ideas are chang­ing start times, fewer in­struc­tion days and a ref­er­en­dum.

Star Tribune - - 2000 FT. - By BEENA RAGHAVENDRAN beenar@star­tri­ Beena Raghavendran • 612-673-4569

The Min­neapo­lis school board on Tues­day dis­cussed po­ten­tially painful cuts to ad­dress its $33 mil­lion bud­get short­fall.

Since the deficit for the next school year was re­vealed this fall, Min­neapo­lis schools Su­per­in­ten­dent Ed Graff has said he’s con­sid­er­ing all op­tions to find sav­ings in the state’s third-largest school district. That in­cludes po­ten­tially chang­ing start times and ask­ing vot­ers for more money in a 2018 ref­er­en­dum.

“These are dif­fi­cult con­ver­sa­tions and hard de­ci­sions that we’re go­ing to have to make,” Graff said.

For the past seven years, the school district has dipped into its emer­gency re­serves to plug bud­get gaps.

Pulling from the dwin­dling re­serves is no longer an op­tion, district of­fi­cials say, and it’s forc­ing them to con­sider large-scale over­hauls.

The district has to make tough choices to stem the cy­cle of “bal­anc­ing a bud­get with such sig­nif­i­cant num­bers,” Graff said. Min­neapo­lis Pub­lic Schools es­ti­mates that about $25 mil­lion will be left in its rainy-day re­serve fund by the start of the 2018-19 school year. This pot of money, called the fund bal­ance, is Min­neapo­lis schools used re­serves to cover deficits for the past seven years. Re­serves have dropped from more than $122 mil­lion to about $42 mil­lion now.

Gen­eral fund unas­signed fund bal­ance (or re­serves)

Dol­lars in mil­lions $150 100 “used for unan­tic­i­pated or emer­gency sit­u­a­tions, or to make im­por­tant one-time in­vest­ments in district ini­tia­tives,” ac­cord­ing to the district’s web­site.

For the past sev­eral years, re­serves were “healthy enough to ac­cess to over­come deficits, and be­cause we knew we had this money avail­able, sig­nif­i­cant fund­ing changes were not made at that time,” the district’s web­site said. For a cou­ple of years, the board spent re­serves money on cap­i­tal projects be­cause those funds were too high, board Chair­woman Re­becca Gagnon said at the meet­ing.

En­roll­ment is slated to drop slightly in the next decade, district of­fi­cials said, and the schools al­ready are pay­ing mil­lions of dol­lars for ser­vices for special ed­u­ca­tion and English lan­guage learn­ers that aren’t cov­ered by the state.

Hy­po­thet­i­cals dis­cussed

Op­tions to curb the bud­get short­fall could be as dras­tic as re­work­ing start times or re­duc­ing the num­ber of school days. Graff men­tioned both those pos­si­bil­i­ties and es­ti­mated cost sav­ings Tues­day.

He ran through a list of hy­po­thet­i­cals: Adding one stu­dent to the district’s class size ra­tio could save the district $4 mil­lion. Mov­ing from a seven-pe­riod to six-pe­riod day could save $6.4 mil­lion. Chang­ing start times could net a cou­ple mil­lion dol­lars in sav­ings. The district is in ses­sion 11 more days than the state re­quires, and cut­ting school days could save $1 mil­lion per day.

Af­ter the 2016 ref­er­en­dum re­newal, Graff said he thinks the district could ask for $18 mil­lion next fall. The district doesn’t have a cap­i­tal projects levy, as other sur­round­ing metro dis­tricts do, and Graff said it is ex­plor­ing that.

As part of its fi­nan­cial plan, the board will vote in De­cem­ber to cer­tify an in­crease to its prop­erty tax levy payable in 2018 by 6.02 per­cent.

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