"At the Capitol....K-12 Bill Finalized

A report to the members of the Minnesota Association of School Administrators (MASA) on the status of the MN Legislative session, by Charlie Kyte, Executive Director.

The audio podcast is 7 1/2 minutes long.

FLASH UPDATE:  THE E-12 BILL PASSED THE SENATE, AND THEN THE HOUSE, AT ABOUT 9:00 THIS EVENING.  THE LANGUAGE OF THE PASSED BILL DID NOT CHANGE FROM WHAT IS SUMMARIZED BELOW EXCEPT FOR THE 'ONE-TIME' MONEY WHICH WAS REDUCED BY ABOUT ONE HALF.

K-12 AGREEMENT REACHED AT 4:00 AM:

The K-12 Education Bill must still pass through the House and Senate today and be signed by the Governor.  However, we understand that the legislative leadership and the Governor’s office are in agreement about the Bill.  The staff are still working on final language.

There were two major tensions at play as the legislative session neared an end.  One was the issue of raising more revenues vs living within the present tax structure.  The later of these pretty much carried the day although there will be some enhanced enforcement to eliminate foreign operating credits (FOC’s).

The second tension was between meeting the needs of children (ie: education funding) vs the needs of senior citizens (ie: nursing home funding).  The tension here is only beginning and will only intensify in coming years.  As the Boomers age, education may well come out on the losing end of this battle.

DETAILS ARE STILL TO COME, BUT HERE ARE THE MAJOR ELEMENTS:

Please forgive me if a few of these details prove to be inaccurate in the end.  The provisions below are based on what our ‘agents’ know and some of it is pieced together from different sources.

Formulas:  2% in 2007-08, and 1% in 2008-09.

Special Ed Pro-ration:  Approximately $330 million which fills the majority of the pro-rations of the Sp Ed and SP Ed Excess formulas.  Fully funding this shortfall would have cost about $385 million.  By my rough calculations the new pro-rations will be in the 93-96% range.  We believe that the growth factors for these formulas are in the Bill, meaning that the pro-ration shortfall shouldn’t grow again in the succeeding years.

All Day Kindergarten:  The funding has been reduced from an additional $43 million to about $33 million.  This would put the Kindergarten formula in the .58-.59 FTE range.

Q-Comp:  Funding will continue to increase

Early Education:  The 2003 levels of funding for ECFE are restored.  There will also be some funding for the Early Education Scholarships for low income families.

One time funding:  Previously this amount was set at about $150 million which produced about $80/ PU in each year for a range of Capitol purposes.  We haven’t been able to pin this number down exactly, but suspect that it was reduced somewhat in the final negotiations.

STATE WIDE HEALTH INSURANCE POOL:

This Bill passed the House and Senate.  Its future would then lie in the hands of the Governor who can (a) sign it, (b) veto it, or (c) let it become law without his signature.

Please e-mail Governor Pawlenty ([email protected]) and urge a veot.  He needs to hear from you by noon on Tuesday.

If this Bill becomes law, it should always be called the “Education Minnesota Statewide Health Insurance Pool” as Ed MN pulled out all the stops to get it passed.  If it works they deserve the credit, and if it doesn’t, all school employees need to remember whose idea it was.

OBSERVATIONS:

Within the available money, this Bill is about as well crafted as possible.  However, the amount of money for on-going operation of school districts is very slim.  You need to factor out any one time money or dedicated money when calculating what is available to settle contracts and meet other operational costs.

One pundit here at the Capitol said that the 2%/ 1% formula changes will do more to end ‘lanes and steps’ than any Q-Comp program.  Most districts won’t even be able to cover those costs without more lay-offs and class size increases.

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