Record number of state school districts ask voters for money

ST. PAUL -- Never have so many Minnesota school districts asked voters for so much.

Come Tuesday, more than half of the districts in Minnesota -- 181 in all -- hope to win approval for property tax levies that would mean as much as $230 million more in state and local funds.

"We've come to a moment of truth for a lot of school districts, and they're forced to go to their voters," said Brad Lundell, executive director of a 68-district coalition called Schools for Equity in Education.

Some see the so-called excess levies, which supplement the general state operating allowance, as their last hope to fight off program cuts and teacher layoffs.

It's a record as school levies go, easily surpassing the 1997 mark of 83 referendum attempts. In terms of dollars, it's far above the amount lawmakers thought schools would request.

It's also a big test to the substantial property tax relief sought by Gov. Jesse Ventura and approved by the Legislature in June. Before the 2001 overhaul, the state set the floor for per-pupil spending but let about 30 percent of the tab fall to local property taxes. Now, the base K-12 allowance comes entirely from the state.

Ventura touted the change as restoring control of the property tax to citizens, and it was supposed to mean double-digit cuts for all classes of property. Now, how much of a reduction taxpayers in each district get depends on the outcome of the separate elections. Increases in county and city budgets also will eat into the relief.

And depending on how many and which districts are successful, the state could have to fork over more money than lawmakers budgeted because it absorbs more school costs in poorer areas, including part of some levies.

The avalanche of requests comes amid widespread claims of financial hardship in schools and a sense that the deep tax cuts this year will make the pleas more palatable. In addition, schools are more successful in odd-numbered years, when ballots generally are devoid of big races and turnout is lower.

For years, school officials have argued that state aid hasn't kept pace with rising costs. An education budget approved this summer -- $8.7 billion over two years, including more than $380 million in new funding -- did little to quiet those concerns.

Districts will see an average 2.6 percent increase in the bedrock per-pupil formula for each year, but they say their heating, health care and other expenses will grow faster.

In Pine City, voters will decide on a 10-year levy that could provide an additional $823 per student annually. Superintendent Darwin Bostic said only $300 per student would be collected next year, which, according to the district, would cost the owner of a $125,000 home an extra $4.22 on his tax bill.

The money is needed to stave off cuts, Bostic said. Last year, he said, the district trimmed $520,000 from its budget -- driving class sizes up, reducing elective offerings and prompting increases in athletic fees.

"It's survival basically for us," Bostic said. "I've told people that if this was a business, we'd file for bankruptcy."

Pine City, a district along Interstate 35 about 80 miles south of Duluth, is a good example of how a referendum could hit the state treasury as well.

If the referendum passes and the district eventually imposes the full amount, it would be in line for $661,000 more in state aid, according to Department of Children, Families and Learning figures.

That's because the state tries to even out funding disparities between districts by paying a share of levies for those with a smaller property tax base and by giving extra dollars to those that have less money to spend per student.

Equity revenue, as it's known, is linked somewhat to levies. A few districts are asking voters to approve $1 per student levies, which can get them up to $55 more in equity revenue from the state.

When assembling the 2002-03 budget, lawmakers figured they would need $30 million to make the equity payments, according to House researchers. If all of the levies are approved and imposed in full, the state would need $53 million to meet its obligations. The extra money would be taken from reserves built up to handle an economic downturn.

"I'm sure we will blow that quite easily," said House K-12 Education Finance Chairwoman Alice Seagren, R-Bloomington.

Not all of the requests are for new money. Some districts are trying to renew expiring levies.

Others had levies wiped out or reduced by another tax-law change that converted up to $415 per student of their excess levies into direct state aid, allowing districts to go out for more money while telling voters they'll be held harmless.

The Minnesota Education League, a mostly one-man operation run through the conservative Taxpayers League, contends many districts aren't being frank with voters about their requests or what they truly need.

The league's executive director, Morgan Brown, has been churning out district-specific "accountability kits" for skeptical residents. The kits include fact sheets on what districts receive now and where that money is going, as well as a list of questions voters can put to leaders about the use of new levy dollars.

One kit, for the Osseo district, provided fodder for Ventura, who last week accused his home district and others he didn't name of running misleading campaigns. He told voters to stay alert if they want to hang onto tax relief.

Brown is doing likewise.

"They know they can tell residents, at least at this point, that they'll still get a net tax cut even with this levy," Brown said. "It makes it sound like the school districts are doing the taxpayers a favor.

"School districts decided this was the year to rake in the money because it's going to be harder in the future when it actually shows up as a net tax increase rather than a net tax cut."