Education advocates celebrated a bit of a breakthrough this week after state lawmakers acknowledged much of the state’s new education spending should go to day-to-day school operations.

Gov. Mark Dayton and Senate Majority Leader Tom Bakk, DFL-Cook, signaled this week they believed schools should receive up to a 2 percent annual increase on the general per pupil funding formula, though Bakk added that Dayton would have to find room in his budget priorities for the increase.

After days of talks, top legislative negotiators said they planned to spend at least $400 million of the state’s $1.9 billion budget surplus on new school spending. At roughly $16 billion every two years, public schools make up about 40 percent of Minnesota’s general fund spending.

Dayton and the DFL Senate had proposed a 1 percent annual increase at a cost of $172 million over the next two-year budget. The GOP-led House passed a bill with a 0.6 percent increase per year.

A 2 percent annual increase to the funding formula would cost about $350 million in the next two-year budget. At the start of the legislative session, school lobbyists believed 2 percent was a starting point for negotiations.

Kirk Schneidawind, executive director of the Minnesota School Boards Association, said his members still hope for 3 percent per year. Districts need more than an inflationary increase if they are going to keep up with the growing demands of students and state mandates, he said.

“We don’t just want to maintain,” Schneidawind said. “The formula is the fuel that drives the engine for everyone.”

Earlier this month, Mary Cecconi, executive director of Parents United for Public Schools, rallied parents at the Capitol to push lawmakers to make general school funding a top priority. Cecconi said talks of 2 percent per year for a general funding increase were an improvement.

“The per pupil funding formula is where districts get the lion’s share of the dollars they can spend,” Cecconi said. “It is not targeted, so it doesn’t have to be used for X, Y or Z.”

An increase in general funding allows locally elected school boards to make decisions that are best for their districts, she said.

Just how much new general funding school districts get will be up to top budget negotiators and how members of the education conference committee divide up the new funding they are allocated.

In general, Democratic-Farmer-Labor Party members like to target new dollars at programs they believe will be most successful. Republicans want reforms so districts can spend the money they have more efficiently, and they don’t like to dictate how districts spend new funding.

Here are the basics of Minnesota’s per pupil funding formula.

What is the per pupil funding formula?

School districts receive a base amount of funding for each student they educate. For the 2014-15 school year the formula provided $5,831 per student. State lawmaker must approve formula increases.

Does every district get the same per student?

No, the funding formula is modified for a number of reasons. Districts get additional money if they have large numbers of students who face certain challenges, such as learning English. Districts also get additional revenue to offset things like declining enrollment and transportation costs.

How can schools use the money?

Money from the general funding formula is somewhat flexible, so districts can decide how much goes to certain programs and staff positions. Other state funding is prescribed for certain reasons, such as tutoring students in reading.

How else do schools get money?

Besides state funding, districts can raise local property taxes. Local school boards have some say over how much their local property tax levy can bring in. Voter approval is required for larger increases to operating levies and most funding for school improvements.

Has the formula ever gone down?

Yes, since 1989, the formula declined one time, in 1999, but that loss was offset by another state revenue increase. There have been six times in the past 26 years schools received no increase to the formula.

Are there other ways to fund schools?

School funding systems are controversial nationwide.¬†Minnesota’s system is criticized because some schools, those with large populations of students who face certain challenges, often get more state funding than others. In general, states use a combination of property taxes and state aid to pay for public schools. In Minnesota, about 65 percent of school funding comes from the state, 29 percent from local property taxes and 6 percent from the U.S. government.

Christopher Magan can be reached at 651-228-5557.

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