A Forum on Education Funding

About 75 people gathered in the big room at ARTech charter school on Tuesday, January 5, for an evening of conversation with State Senator Kevin Dahle and State Representative David Bly.  The main topic of the evening was education funding, and the impact on Minnesota public schools, and charter schools in particular, of the state budget crisis and the 27.5% holdback of state general education funds. 
What is the 27% Holdback?

By statute, 10% of state per pupil education funding is held back from public schools in the state of Minnesota until after final enrollment figures are available for the school year.  The money is generally paid to the schools in the first half of the following school year.  This year, in an effort to address the state budget shortfall without raising taxes, Gov. Pawlenty increased the holdback to 27%.  This means that 27% of the amount that schools have budgeted, and to which they are entitled according to the per pupil funding formula, is held back—payment to the schools is deferred. 

This has put charter schools into a bind.  Because 27% of their general education funding is being held back, schools are finding it necessary to secure loans in order to meet their expenses—to pay teachers.  The interest payments then have to be included the school’s general education budget.  In effect, funds that should have gone into the classroom are going into interest payments to banks—if, that is, the schools can secure loans at a time when banks are tightening credit. 

The Impact of Charter Schools

The evening at ARTech was moderated by ARTech school board chair Joe Pahr, who also teaches at the school, and began with testimonials from parents and students about the importance of charter schools.  All of those who spoke stressed the importance of the sense of community that charter schools create. 

Bo Aylin, a parent of two children at Prairie Creek, spoke of the “nurturing community” that charter schools create, in which fostering a love of learning is a priority.  Jan Rowher, an ARTech parent, stressed the importance of a small school community that provides students with options and that recognizes individual learning styles.  Amelia Schmelzer, an extremely poised and articulate ninth-grader from ARTech, described her school as being “like a big family gathering every day.”  ARTech, she said, is a diverse and dynamic school community that prepares its students to live in a diverse and dynamic world. 

The Fiscal Realities

Both legislators expressed their strong support for charter schools.  The hard reality is that the state budget is facing a projected $5 billion shortfall in the next biennium. To this point, the stategy of Gov. Pawlenty has been to make cuts and accounting shifts, rather than to raise additional revenue. 

Rep. Bly pointed out that this crisis has been brewing for some time.  A decade ago, under Gov. Ventura, the primary responsibility for funding public education was shifted from local taxpayers to the state, but no permanent mechanism for funding the shift was enacted, creating a $1 billion “hole” in education funding.  This was easier to fill at a time of state budget surpluses, as there were at the time.  It has become impossible to fill in a recession.

Both Dahle and Bly stressed that the budget crisis cannot be addressed with spending cuts alone. 

“We need more revenue,” Sen. Dahle said. 

He argued that it has begun to reach the point at which the cuts will be more painful than the effects of raising taxes.  He said that even with additional revenue, more cuts will be necessary.  Without additional revenue, more jobs will be lost—especially teaching jobs. 

Rep. Bly said that a bonding bill to stimulate job creation would be part of the coming legislative session.  But with no end to the fiscal crisis in sight, and with Gov. Pawlenty holding firm in his refusal to raise taxes, Bly predicted that “this is probably going to be one of the most difficult sessions” in recent memory. 

A Call to Action

Both Sen. Dahle and Rep. Bly stressed the importance of contacting legislators and mobilizing grassroots support for action on the issue of education funding.  Concerned citizens need to “speak up,” Bly said, and let the legislature and the governor know that there’s support for raising taxes to fund services, like public education, that benefit the entire community.  

Representative David Bly's contact information.

Senator Kevin Dahle's contact information.  


Top photograph: Sen. Kevin Dahle and Rep. David Bly

Bottom photograph: Prairie Creek director Caroline Jones, ARTech student Amelia Schmelzer, ARTech parent Jan Rowher, and ARTech director Simon Tyler.