ST. PAUL — The special education cross-subsidy — which has been rapidly increasing in recent years — is causing school districts across the state to dip into their general funds to cover mandated special education costs.
The statewide cross-subsidy has grown from $175 million in 2003 to $672 million in 2017, and is projected to grow to more than $800 million by 2021.
Both Gov. Mark Dayton and Rep. Jim Knoblach, R-St. Cloud, are proposing money to cover part of the cross-subsidy this session.
READ MORE: ‘It’s a crisis situation:’ Underfunded special education mandates cost district $11.7M
“Our Minnesota school districts have had to find ways to cover the unfunded costs of special education for decades, and it places a huge burden on their already stressed budgets,” said Brenda Cassellius, Minnesota Department of Education commissioner. “Our school districts tell us this is a priority, and we are listening to them.”
Minnesota Department of Education Commissioner Brenda Cassellius (Photo: Courtesy of Minnesota Department of Education)
Dayton’s plan would increase special education funding by $19 million for fiscal year 2019 — the 2018-19 school year — and $22 million for fiscal year 2020 to help districts cover the rising costs of special education services.
If Dayton’s proposal is included in the Republican’s final proposal, the St. Cloud school district would get about $305,000 to address the cross-subsidy. Sartell-St. Stephen would get about $41,000, Rocori about $32,000 and Sauk Rapids-Rice about $22,000.
Dayton’s proposal would divide the money more equally among school districts in the state than Knoblach’s bill, which would focus the aid on school districts with the highest cross-subsidies, according to Bruce Hentges, a member of the St. Cloud school board and the board’s legislative committee.
Knoblach’s bill, introduced March 28 and updated April 9, would appropriate $20 million to school districts for fiscal year 2019. If included in the final proposal, Knoblach estimates St. Cloud could see about $1.1 million from that bill.
This year, St. Cloud school district has a special education cross-subsidy of at least $11.6 million, according to the district. But the cross-subsidy might be greater. Legislative analyse Tim Strom estimates St. Cloud’s cross-subsidy could be as much as $14.5 million, according to Hentges.
Hentges said Fred Nolan, a retired superintendent and executive director of Minnesota Rural Education Association, helped Knoblach draft the bill in a way that is fair for rural and metropolitan schools.
“Usually the large schools and the small schools fight each other for funding,” Hentges said. “I thought this was a really neat accomplishment on his part.”
Bruce Hentges (Photo: Courtesy photo)
Other area school districts also have cross-subsidies due to underfunded special education programs. Last year, Sauk Rapids had a cross-subsidy of about $2.5 million, Sartell about $2.4 million and Rocori about $1.2 million, according to information compiled by the board legislative committee.
According to the department of education, special education costs are increasing due to the increase in the number of students receiving services.
There are 141,237 children from birth to age 21 who receive special education services in Minnesota, and the department projects more than 150,000 students will receive education services by 2021.
Costs are also rising due of the increased numbers of special education staff required to address the needs of students, as well as inflationary increases in staff salaries and benefits.
Other legislative proposals call for a committee to study cross-subsidies this year, as well as a possible pilot program that would show the educational impact of the cross-subsidy. The session is expected to wrap up in May.
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