Minnesota School Finance: a Guide for Legislators About This Publication This Guidebook Explains How Public Elementary and Secondary Schools Are Funded in Minnesota

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Minnesota School Finance: a Guide for Legislators About This Publication This Guidebook Explains How Public Elementary and Secondary Schools Are Funded in Minnesota Minnesota School Finance: A Guide for Legislators About this Publication This guidebook explains how public elementary and secondary schools are funded in Minnesota. By Tim Strom, Legislative Analyst November 2019 Contents Executive Summary ................................................................................................. 1 Introduction ............................................................................................................ 2 School Finance Terminology ................................................................................. 11 Property Tax System Terminology ........................................................................ 18 Counting Students ................................................................................................. 20 General Education Revenue.................................................................................. 22 School Transportation ........................................................................................... 43 Capital Finance ...................................................................................................... 44 Special Education .................................................................................................. 57 American Indian Programs.................................................................................... 61 Community, Early Childhood, and Adult Education ............................................. 64 Cooperative Programs .......................................................................................... 76 Dual Enrollment Programs .................................................................................... 79 Charter Schools ..................................................................................................... 82 School Desegregation and Integration ................................................................. 85 Career and Technical Education ........................................................................... 90 State Academies.................................................................................................... 93 Miscellaneous Funds for Education ...................................................................... 96 Income Tax Deductions and Credits ................................................................... 106 Taconite Revenue for School Districts ................................................................ 108 Tax Relief Aids and Aids in Lieu of Taxes ............................................................ 114 Teacher Retirement ............................................................................................ 117 Postemployment Benefits .................................................................................. 121 School District Accounting .................................................................................. 123 Appendix ............................................................................................................. 132 This publication was prepared by Tim Strom, a legislative analyst specializing in the area of K-12 education finance. Questions can be addressed to Tim at 651-296-1886. Minnesota House Research Department provides nonpartisan legislative, legal, and information services to the Minnesota House of Representatives. This document can be made available in alternative formats. www.house.mn/hrd | 651-296-6753 | 600 State Office Building | St. Paul, MN 55155 List of Tables Table 1: Characteristics of Minnesota Independent School Districts, 2017- 2018 .................................................................................................................... 5 Table 2: Characteristics of Minnesota Charter Schools, 2017-2018....................... 6 Table 3: School Enrollment 1959-60 to 2022-23 by School Type ........................... 6 Table 4: Minnesota School Enrollment ................................................................. 10 Table 5: General Education Equalizing Factor* .................................................... 12 Table 6: General Education Formula Increases 1989 to 2021 .............................. 13 Table 7: General Education Levy ........................................................................... 14 Table 8: Education Acronyms ............................................................................... 16 Table 9: Enrollment Weights by Grade ................................................................. 21 Table 10: General Education Revenue Components Excluding Referendum Revenue ............................................................................................................ 22 Table 11: Basic Education Formula Allowances .................................................... 23 Table 12: Compensatory Revenue Characteristics for Selected School Buildings for the 2019-20 School Year ............................................................. 27 Table 13: English Learner Revenue Characteristics for Selected School Districts 2019-20 School Year .......................................................................... 28 Table 14: Equity Revenue Percentiles................................................................... 32 Table 15: Pension Adjustment Aid Entitlement .................................................... 34 Table 16: Characteristics of Largest and Smallest School Districts....................... 35 Table 17: Revenue Reserved for Class Size Reduction ......................................... 36 Table 18: General Education Program Aid Entitlement and Levy ........................ 38 Table 19: Referendum Revenue Allowances and Equalizing Factors ................... 41 Table 20: Referendum Revenue Amounts ............................................................ 41 Table 21: Permanent School Fund Endowment and Income ............................... 42 Table 22: Debt Service Equalizing Factors ............................................................ 45 Table 23: Debt Service Equalization Aid Calculation for a Hypothetical District .............................................................................................................. 46 Table 24: Total Statewide Debt Service Amounts; Regular and Enhanced Equalization Aid ................................................................................................ 47 Table 25: School Building Bond Agricultural Credit .............................................. 48 Table 26: Capital Project Levy ............................................................................... 49 Table 27: Maximum Effort Bond Sales .................................................................. 51 Table 28: Long-Term Facilities Maintenance Revenue; Appropriation and Levy .................................................................................................................. 53 Table 29: Building Lease Levy Amounts ................................................................ 54 Table 30: Building Lease Levy Restrictions ........................................................... 55 Table 31: Telecommunications/Internet Access Aid ............................................ 56 Table 32: Special Education Unduplicated Child Count by Disability Category (All Ages) as of December 1, 2018 ................................................................... 57 Table 33: Special Education Appropriations ......................................................... 60 Table 34: Tribal Contract School Estimated Enrollment and Initial Estimated Aid Entitlement for FY 20 ................................................................................. 62 Table 35: Appropriations for American Indian Programs ..................................... 63 Table 36: Community Education Revenue ............................................................ 65 Table 37: Programs for Adults with Disabilities .................................................... 65 Table 38: Early Childhood Family Education Revenue.......................................... 67 Table 39: Early Childhood Home-visiting Program ............................................... 67 Table 40: School Readiness Aid ............................................................................ 69 Table 41: Early Learning Scholarship Appropriations ........................................... 71 Table 42: Developmental Screening Aid ............................................................... 72 Table 43: Head Start Revenue .............................................................................. 72 Table 44: School-age Care Program ...................................................................... 73 Table 45: Adult Basic Education Programs ........................................................... 75 Table 46: Consolidation Transition Revenue ........................................................ 77 Table 47: Concurrent Enrollment Aid ................................................................... 81 Table 48: Charter School General Education, Special Education, and Building Lease Aid .......................................................................................................... 83 Table 49: Achievement and Integration Maximum Revenue for Fiscal Year 2020 .................................................................................................................. 86 Table 50: Integration Revenue Allowances Per Pupil Fiscal Years 2001 to 2013 .................................................................................................................
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