January in each biennial budget session (the odd-numbered years) is usually dedicated to acclimating new legislators and staff to the workings of the legislative process and informational hearings from the various state agencies about their roles. This January has seen the passage of major legislation in the first two weeks with more significant measures likely to be passed before February rolls around.

The action has been as fast and furious in the education realm as well, but no bill has reached the floor as of yet. One of the issues that has been in the spotlight the most is that of free school meals for all students and not just students who qualify for free lunch. That bill has been heard in both the House and Senate Education Policy Committees and will make its way to the Education Finance Committees in their respective bodies shortly. It is also expected that this measure will show up in the Governor’s budget that will be released on Tuesday, January 24.

All of this interest indicates that it will likely be part of the final education package passed by the Legislature later this session. The question is whether the costs associated with the measure will radically impinge on the Legislature’s and Governor’s ability to fully realize other funding goals they have.

The Senate Education Finance Committee had two very interesting meetings this week. Wednesday’s hearing concentrated on SF 8, Senator Kunesh’s bill to use approximately $270 million in one-time money to address shortfalls in school transportation, special education, and English Learner funding categories. The difference between this bill and other bills that deal with the same subjects is that the revenue is to be applied to the current school year. One of the interesting angles to this session will revolve around the use of one-time money, which comprises about two-thirds of the projected state budget surplus. As anyone who deals with school finance knows, building an on-going budget on one-time money only leads to trouble down the road, but that doesn’t mean that an infusion of one-time money wouldn’t be helpful to filling some budgetary holes.

Thursday’s Senate hearing dealt with on-going revenue dedicated to eliminating both the special education (SF28) and EL (SF21) cross-subsidies. Currently, the revenue generated by the special education and EL formulas is not sufficient to cover the costs that districts are incurring by providing services to students who require instruction in these areas. Addressing the special education cross-subsidy has long been a high priority of the education community and the cost is quite high at over $1.6 billion for the upcoming biennium and $1.9 in the biennium after that. The current EL cross-subsidy is $151 million and SF 21 would eliminate it over the next four years and not all in one big formula upgrade. I was happy to be able to get Albert Lea superintendent Dr. Ron Wagner in front of the committee to testify virtually on the importance of addressing the EL cross-subsidy for his district and many other districts throughout the state. The outline of the Governor’s budget that was released this past week shows a commitment to reducing both of these cross-subsidies although not to the extent in either of these bills.

The House Early Childhood and Families Finance and Policy Committee heard Representative Maria Isa Perez-Vega’s HF456 that would protect current recipients of the voluntary pre-kindergarten program and expand it to new participants. East Central Superintendent Stefanie Youngberg outlined how valuable the program has been for her district and urged the committee to maintain the program.

The big news in the week ahead is the release of the Governor’s biennial budget for the next two years. He has provided an early look at a number of initiatives including:

• A 4% increase in the general education basic formula for the 2023-24 school year and a 2% increase for the 2024-25 school year with future increases tied to the rate of inflation.
• A 50% reduction in the special education cross-subsidy.
• Increasing the EL formula by 25%.

Dedicated funding for student support personnel.

Those are just a few of the many initiatives contained in the bill and more details will be available on Tuesday, January 24, and I am going to get those details you out as soon as I get them.

Thanks to all of you. It was good to see so many members at today’s General Meeting, both in-person and virtual. A special thanks to new MDE Commissioner Dr. Willie Jett and MDE Government Affairs Director Adosh Unni for sharing their insights on the Governor’s budget and how SEE can be active in the on-going process of developing the 2023 omnibus education funding and policy bill.

Make sure to follow Brad’s Blog as he will be giving daily updates from the Capitol.