2019-2020 Budget FAQ

  • The struggle is no secret. By now, most have heard that ISD 728 is facing a financial situation it hasn’t seen in years, joining many other school districts across Minnesota.

    In order to develop a balanced 2019-2020 budget with expenses not exceeding revenue, the district and its school board will need to make $10.2 million dollars in reductions for the 2019-2020 school year. That’s on the heels of trimming more than $10 million over the last six years.

    Here are some answers to common questions presented to the Superintendent and additional school district leadership.

    Why do public schools always need more money?

    Public schools, just like families, homes, and businesses have increasing costs every year.  Historically, our State hasn’t kept up with the costs of inflation over the past 15 years. If State funding had kept up with inflation since 2003, ISD728 would receive nearly $620 more per student, or a total of nearly $9 million more this year.  In addition, ISD 728, like other school districts, is required to pay for unfunded mandates related to special education each and every year. Written differently, ISD 728 pays $10.5 million dollars annually out of the General Budget to covers costs that are not reimbursed from state or federal sources.  If current state and federal mandates were funded, there would be no need to reduce budgets at this time.

    General Funding Per Student

     

    Why is the 2019-2020 budget reduction estimated at $10.2 million?

    Historically, ISD 728 has made consistent cuts annually in order to balance the budget because state and federal funding has not kept up with inflation or increased costs.  Increased expenses in transportation, personnel, and insurance premiums, as well as our ongoing unfunded mandates in the areas of Special Education, require general education funding to be used and thus require budget reductions be made each year, including 2019-2020.

     

    Aren’t we growing as a District?

    Yes! And we’re proud of our Community and District success! Our enrollment has grown 8% in the past 10 years, and it is projected to grow even more rapidly in the next 10 years.  Projections estimate an additional 2,000 students in the next ten years or an average of about 200 students per year. In addition, a demographer recently reported that more than 2,300 new single-family homes are expected to be built within our district in the next three years.  Our growth is exciting, but something that requires additional resources too. Unfortunately, revenue from the state and federal governments has not kept pace with inflation or actual cost increases, thus requiring reductions.

     

    If we’re growing, why have we had to make budget cuts?

    School funding has not been keeping pace with the changing needs and expenses of education.

    Due to this disparity, ISD 728 has cut more than $10 million from its budget over the past six years, impacting staffing, programming and classroom resources. If state funding had kept up with inflation since 2003, ISD728 would receive nearly $620 more per student, or a total of nearly $9 million more this year alone.

     

    What is a school district cross-subsidy?

    Special education funds allocated to school districts by the state and federal government do not cover the actual costs to provide special education support to students within each school district or to meet state requirements.  Cross-Subsidy refers to the amount of money school districts must spend annually from their General Education Budget to pay for costs not reimbursed by the state and federal government. ISD 728 pays approximately $10.5 million annually to meet the unfunded mandates and to cover the special education costs not reimbursed, yet required by the state and federal government.  

     

    Doesn’t ISD 728 have a fund balance reserve?  Can’t those dollars be used to reduce the budget deficit?

    Yes, ISD 728 maintains a fund balance of 8%.  The state recommends public schools maintain a 12 - 15% fund balance.  Fund balance can be used to reduce the budget deficit but would be against the recommendation of the state.  However, the Superintendent will recommend the Board utilize 1% of the current fund balance (8% to 7%) to minimize the impact.  By using 1%, the District would reduce necessary reductions by approximately $1.3 million dollars.

     

    If the Legislature approves an increase in public school funding will that reduce the amount of reduction?

    No.  In recent history, the Minnesota Legislature has approved a 1-3% increase in public school funding.  For every 1% increase, ISD728 would receive approximately $890,000. Current personnel-related costs increase between $3-4 million dollars annually.  As a result, ISD728 would need more than a 12% increase this year just to balance the budget for 2019-2020. However, any increase above 1% from the Legislature would lessen reductions for the 2020-2021 school year.  

     

    Are class sizes going to increase?

    The recent budget adjustments are expected to have an effect on the average class size throughout the district. More specifically, the average elementary class size is expected to be 25.7 compared to 24.3 this year (1.4 increase); The average class size at Middle School is expected to be 32.1 compared to 29.4 (2.7 increase), and 34.4 at the High School compared to 32.2 (2.1 increase).  Class sizes in core academic areas will be consistent at each site throughout ISD 728. Factors such as, but not limited to student needs, grade level enrollment, and demand for elective courses impact decisions related to class size.

    Class sizes increase between Kindergarten and Grade 12, thus acknowledge different student needs for a child at age 5 compared to a child at age 18.  

     

    Who do I talk to with my concerns?

    ISD 728 values the opinions of others, and thus provides avenues for students, families, and staff to share their ideas and concerns about the 2019-2020 Budget.  Our ISD 728 School Board is responsible for policy and budget approval, and the Superintendent and Cabinet are responsible for making budget recommendations to balance the budget.  In that role, our ISD728 Superintendent Dr. Dan Bittman is happy to hear those ideas and concerns. ISD 728 advocates are encouraged to use the Contact Usform on our website.  On that form, there is a link to the ‘2019-2020 Budget.’  This form will ensure timely response by directing questions, comments, and ideas to the appropriate District administrator to answer questions quickly and accurately.  Furthermore, this FAQ document will continue to be updated regularly in order to ensure accurate information and transparency.

     

    I heard about the sale of the previous District Office. Can those funds be used to help with the budget reductions?

    No.  Minnesota Statute requires that revenue from the sale of district properties be used for specific expenses.  Unfortunately, these dollars will not be applicable for budget reduction solutions.

     

    Has the District considered early retirement incentives for teachers?

    Yes.  The District has considered and will continue to explore possible early retirement incentives if it makes sense fiscally and is in compliance with the law. Current statute and negotiated agreements do not allow the District to offer early incentives as it once did. As a result, the District has no immediate plans to offer an incentive but will continue to explore the possibilities in the future.


Resources

  • general fund revenue chart


      

    total general fund expenditures chart


      

    Total per student operating levy chart

     

Equity in Education Video