Staff: Parkers Prairie Public Schools Operating Levy Fact Sheet
September, 2008 By: Supt. Kent Baldry
The main goal for the Operating Levy is to provide a quality education for all students. November 4, 2008 is an important day for the students, families and community members in ISD 547. Staff cuts, program reductions, freezes on technology and curriculum spending, are the result of inadequate state funding that is limiting the district’s ability to continue to provide quality education for students. The district has sought on two previous occasions to gain local support but both referendums failed with the last a narrow defeat. Additional cuts to staff and programs will follow another election defeat.
This fall, on November 4, the Board of Education has placed one levy question on the ballot for voters to consider. The choice is simply; to approve the increase of local financial support for the school district or to make reductions to staff and programs.
Some facts to consider:
Fact 1 Students began school this fall with 16 less teachers than taught in 1978. There are six less than in 1998 and five less than when school opened five years ago. (School records)
Fact 2 There are 196 fewer students in school today than enrolled in 1978 with the majority of the decline in the last ten years at 102 less students. (School records)
Fact 3 Our State legislature has not provided adequate funding increases over the last 16 years. Adjusted for inflation, state aids for schools have dropped 13.4% since 2003. (MPLS Tribune)
Fact 4 Legislative action in 2002 reduced local property owner’s financial responsibility to fund the school district by 53%. But in the past years local property taxes have risen by approximately 37% due to needed local financial support. (MREA)
Fact 5 Without a successful levy, fees will increase again, staff and programs will be severely cut and the Board of Education will have to consider more serious steps to balance the budget.
Fact 6 The Parkers Prairie School system provides teachers, paras, special education, extra-curricular, transportation, textbooks, computers and a whole lot more for educating our students at a cost of $7.12 per hour per student. (MDE Fall Report card)
Fact 7 District administrative salaries are 73% of the state average and the superintendent’s salary is 42% of the state average. When compared to sixteen districts of similar size (500-600) ISD has 2.5 administrators to 14 districts having 3 full time administrators. (MDE fall report card)
Fact 8 ISD 547 average teacher salary is $40,357 compared to a state average of $50,345. (MDE)
Fact 9 In fiscal school year 2007 the district’s general fund expenditures per pupil were $8,260 compared to the state average of $8,913. (MDE 2007 Report card)
Fact 10 In fiscal school year 2007, the district generated $8,622 per pupil while the state average was $9,457 per pupil. (MDE 2007 Report Card)
Fact 11 The district receives approximately 11% of its total revenues from local taxes while the federal and state government picks up the balance of 89%. (District Audit)
Fact 12 The school district employs 80 people in a variety of capabilities. The employees account for 79.3% of the operational expenses. The maintenance and operating of the district facilities is 12.4% of the budget and transportation is 8.4 % of the budget. (District Audit)
Fact 13 Extra-curricular activities costs are 4.8% of the general fund budget. It supports 24 activities for grades 7-12 where 74% of the students participate. Revenues generated by tickets and fees reduce the cost to the district so the net cost is 2.5%. (Region One)
Fact 14 The transportation of 455 students for 171 days, field trips, extra-curricular events and emergencies takes 8.4 % of the general education budget. A regular bus trip to and from school cost $1.94 per rider per ride. (Region One)
Fact 15 Open enrollment has been a financial plus for the district. Last year opening enrollees generated a net gain of $476,354 in state aid that stays in our district. This offset our loss in transfer students out and declining enrollment. (School records)
Fact 16 When compared to other school district of similar size on total school taxes paid annually for a home valued at $100,000; Parkers Prairie is ranked seventh from the bottom out of 24 school districts.
Fact 17 In Minnesota, 311 out of 335 school districts have referendums in place. Currently, 47 school districts are going for an operating levy this year. That could change as the deadline for deciding is September 15.
Road to Statutory Operating Debt (S.O.D.) School districts across the state see these signs.
Sign 1. The fund balance dwindles as district uses reserves to balance the budget
Sign 2. School boards deficit spend to save programs and staff. Deficit spending then prompts using more reserves.
Sign 3. Declining enrollment across the state has districts looking for ways make ends meet when funds become sparse because the funding formula uses enrollment to calculate state aid. As long as state aid is based on enrollment, districts will find themselves looking for funding to replace lost pupil units. The cycle of declining enrollment tied to the formulas in addition to poor legislative financial support continues to impact public education programs.
Sign 4 Operating levies are called by local school boards to reverse the negative budget trends. Districts cannot withstand the growing cost of inflation to the budget without receiving some help in the form of state generated school aid. Often the solution comes from local tax support because state legislative fail to support and take action to adequately fund public education. The lack of such state support causes school district to cut budgets and seek voter approval for needed funds to keep their doors open.
Sign 5 Local referendums often are deciding the quality of a local school system and what the community will have in the future. Taxpayers are asked to pick up the slack by passing operating levies to counter the lack of state level support for our local public school system. This type of local support helps fill the funding gap left by state and federal legislators. Depending on the outcome of the referendum election, the Board of Education will have to address budget issues again which may mean further spending of the reserves, deficit spending, cutting programs and staff.
All these steps lead to a negative annual budget situation that will move the district into a Statutory Operating Debt status when it reaches a negative 2.5 % of the general fund. When that happens the Minnesota Department of Education steps in to manage the school district by mandating a recovery plan and then working to implement the plan. SOD to a school district is like going into bankruptcy and the MDE is the bank working with the district to recover out of bankruptcy. Not a positive situation for anyone.
If the funding formula changes down the road what happens to the levy?
It is realistic for school districts to hope and work toward a funding change that would have a positive impact and relieve taxpayers. If this were to be the case, the Board of Education has the ability to under levy in any given year. A successful levy referendum gives the Board authorization to levy up to the maximum allowed by the voters but the board can levy less. This would only be prudent if the funding formulas changed to the district’s advantage.
Quote:
Minneapolis Tribune, August 18, 2008, John Fitzgerald wrote “Some may pooh-pooh these dire predictions but numbers do not lie. Adjusted for inflation, state aid for schools has dropped 13.4% since 2003. Schools had to lean on levies to keep their doors open”.
What are the consequences to a failed referendum?
What will the district use the additional levy revenue for if the referendum passes this fall?
The district would be in a stronger financial position to continue providing the quality education the people of the Parkers Prairie community have become accustomed to receiving. The Board of Education would carefully study the budget and plan accordingly to balance the budget, sustain staff and programs. It is unlikely that they would add back staff or programs but rather enhance what we have in place. The Board would continue to be prudent in spending but they could relax the tight reins that limited what administrators and teachers were able to do in school. In the business of public education we deal with a basically personnel driven industry. Without teachers, administrators and support staff there would be no one to teach our children, keep the buildings opening, feed or transport our students. Our goal is to continue to provide a quality education for our children without short changing or hindering that process financially; to provide our students with the best materials and the best educators we can recruit and retain.
How do we get more information?
What do our transportation dollars buy?
The district currently contracts with Parkers Bus Company and has a long standing relationship with the owner. Bussing contracts are bid every four years and within that time frame the owner and board bargain fees for at least two years at a time. The contract provides for transportation services that include regular to and from school every day, preschool , field trips for classes, special education , emergency evacuations if needed and all the sports and fine arts activities. The transportation portion of the budget is 8.4% of the overall budget.
The district determined years ago to contract out bus service rather than run a district owned service. The Parkers Board of Education carefully studied the options presented along with the costs back then and made an informed decision regarding contracting out transportation. For the district to consider operating their own fleet the district would have to purchase busses for each route and a couple of spares, hire and train drivers, hire a manager and mechanic, and build a facility to house the fleet. It is difficult to match the quality of a contracted bus service.
What part of the overall budget is our extra-curricular program?
The extra-curricular program consists of 24 different activities for students in 7-12. The sports and fine arts programs serve our students in their development and growth. Students who participate in extra-curricular activities stay in school and tend to do better academically. Local statistics show that in grades 9-12 at least 298 students participate in at least one program. That is a 74% participation rate. There is an overall average of students participating in 3.6 activities in the school year. The sports and fine arts make up 4.8 % of the total budget. After collecting entry fees, ticket sale and participation fees the net cost is closer to 2.5% of the general budget.
How can I reduce my taxes? There are three possible refunds available on your state and federal taxes.
If you qualify for this program, you may receive an additional refund of up to 80% of the amount of the property tax increase caused by the proposed referendum. For example, if the referendum increases your property taxes by $300 per year, your refund may cover up to $240 of this increase.