BUDGET Q&A

Class sizes are often the most discussed topic in schools. It is fair to say that everyone wants smaller class sizes. However, in a district of our size, with limited funding, when 80 percent of our budget is people, it is not possible to reduce a large portion of our budget without impacting class sizes. While classes are at the heart of all we do, there are many things school districts must do (mandatory) and others that communities expect districts to provide that are important to staff and students. We will have to find the balance between the two.

How many teachers (FTEs) are being proposed for reductions and when will staff learn about reductions?

Originally the proposal included 10.5 teaching positions (FTEs or Full-Time Equivalents of a position). This is on top of 90 positions that were previously cut. The total number may change in the coming weeks as we work through some creative solutions with School For All Seasons. April 22 is the final decision. Any staff impacted by cuts will be notified before it becomes public.

What administrative cuts are being made, couldn’t there be more?

Currently, we have identified about $166,000 for administrative cuts. We are not yet ready to name positions impacted, because we want to honor our guiding principle to talk to individuals impacted before it goes public. This number will represent approximately 3% of the administrative budget. As mentioned before, we will continue to look for additional efficiencies in all parts of our proposal as we gather feedback and evaluate further.

Would cutting the School For All Seasons (SFAS) program negatively impact revenue in the future if families who value that program chose to enroll elsewhere?

Yes. We are concerned that SFAS is in a highly competitive area in Isanti where parents have many options for school choice. We do not want to lose a single student. We believe we offer the best educational experience for children in our schools. We want to work with families to provide the education families want for their children.

Can the District hold another referendum this spring? I’ve heard some school districts are holding a referendum in May. Could we do that to avoid the cuts?

Some districts may hold facilities or bond referendums in May. We need an operating referendum. Operating referendums, by law, can only be held in November.

Is the district saving money by withdrawing from Rum River Special Education Cooperative?

We have been watching this closely this year because we have been asked this question often. However, we don’t have good data on this due to the pandemic. The school opened during the pandemic, and there are many variables that make it very difficult to evaluate. We will continue to monitor and report on the cost-savings during the coming year, which should be more representative of future trends.

Can enrollment at the Woodland Campus (Brookside and Riverside) be opened to neighboring schools with tuition agreements to bring in more revenue?

Yes, it is open to other districts and open enrollment.

Will the cuts affect the special education department?

We are looking at all areas of our organization. One of the challenges we face is Special Education laws that set a federal standard for maintenance of effort. We are required to meet "maintenance of effort" standard. So if a student’s IEP requires an instructional assistant, we can’t unilaterally remove that service.

With the pandemic, we have been distributing free meals to children (0-18). Why are we doing that and how can we afford it?

As part of the Minnesota Pandemic Response Plan and Governor’s Executive Orders, all school districts are required to provide free breakfast and lunch to all children in their communities. The cost of the meals is fully reimbursed to districts by the Federal Student Nutrition Program. This provides nutritious meals to students and keeps our nutrition services employees working during the school closure period.

What about savings from the shutdown?

There are many unknowns about the impact of the pandemic on the current year budget. The district has accounted for anticipated savings from cancellations of sports, field trips, consumable materials for some supply budgets, and a reduced need for substitutes.

There are other areas where the shutdown also resulted in lost revenue. For example, because meals were free, fewer families completed the Free-Reduced Price Lunch (or Educational Benefits Form). Some of the District's funding is based on the number of students whose families qualify for those educational benefits. So, the district anticipates lower revenue in some categorical aids next year because of the drop in students who qualify for Free- Reduced meal services.

Why are our property taxes high if we have so little going to education?

Local property taxes support three primary entities: The County, the City or Township you live in, and the School District. Three different governing bodies set the tax rates for their portions. For school districts, the amount we can set for taxes is strictly regulated by the Department of Education. State formulas set our local levy rates - our local officials have little input in the amount we set—unless voters give school districts more authority through an operating referendum, which we don’t have. In Cambridge-Isanti, for most of our community, the school district is the lowest entity of the three entities. The school portion of your property taxes is LOWER today than it was 20 years ago, even as total property taxes have increased.

Why does such a low portion of our property taxes go to education in comparison to the rest of the state?

Most school districts have a voter-approved operating referendum. We don’t. Our school district voters have not approved an operating referendum. District voters last approved a local operating referendum in 2004, the same year voters approved a $47.7 million bond referendum for two new schools—Isanti Intermediate School and Cambridge Middle School. The local operating referendum was for five years and expired in 2010. So we haven’t had that additional local funding since 2010. Most school districts in Minnesota have a local operating referendum and the average amount is $1,600 per student.

I really don’t understand school finance. Can you help me understand where the money comes from and where it goes?

In Minnesota, school funding is a shared responsibility among local, state and federal funding sources. Here is a short explainer video: https://www.youtube.com/watch?v=ASSxa9Hn0m8

Another resource which details how public schools are funded is the Legislator’s Guide to School Finance.

Cambridge-Isanti Schools receives less local, state and total revenue per student than the average Minnesota school district. While most districts receive about 20% of their operating budget from local property taxes, only 10% of the Cambridge-Isanti operating budget is funded by local property taxes. Cambridge-Isanti is more reliant on state funding as its primary source of revenue, which totals 84% of the operating budget.

The largest portion of a school district’s budget is the operating budget, which is funded by the state’s General Education Fund Formula. This is the fund that provides for teachers, classroom supplies, co-curricular, and utilities—all the day-to-day operations of a school. When we discuss budget reductions, the District is focusing on the operating budget.

The District has other funds (or buckets) that are strictly regulated or restricted. For example, there is the food service fund, which is largely funded by the Federal Student Nutrition Program and families who pay for lunches. This fund must be self-sustaining and break-even every year. Student Nutrition Services staff and some lunch-time supervisory staff are paid through the food service fund.

Long-Term Facilities Maintenance Funds (LTFM), or building funds, are another fund that is tightly regulated and those funds can typically only be used for buildings.

Community Education (Fund 04) is outside the District’s general operating budget. Like the food service fund, it must be self-sustaining and receives a small local levy and fees from programs and services.

The Minnesota Department of Education sets formulas and guidelines for school district revenue. The only portions of revenue for which there is local control are local operating referendum funds and local fees. As a general rule, school districts can’t use funds from other designated areas (like food service or LTMF) to fund day-to-day school expenses.

Reductions over the last two have totaled more than $7.5 Million or 12% of the annual operating budget. The full FY21 Budget Recommendations are available here.