Bill would change school funding

School districts could lose their levy authority in favor of a new funding mechanism.

Sponsored by Rep. Frank Moe (DFL-Bemidji), HF3107 would eliminate referendum revenue authority for fiscal year 2010 and later, and require the governor’s next budget to include recommendations for a different source of school funding to go into effect at that point. It has no Senate companion.

The bill was laid over March 18 by the House K-12 Finance Division for possible inclusion in its omnibus bill.

State law caps the amount of money a district can raise through local property taxes, and school boards are prohibited from raising taxes without explicit statutory authority. However, a district can exceed its levy limit via a successful election for additional operating revenue through the referendum revenue program.

According to the nonpartisan House Research Department, the average amount of referendum revenue is $760 per pupil unit; $977 in the Twin Cities metropolitan area and $538 in Greater Minnesota. Nearly three-dozen districts have no referendum authority.

An amendment to the bill would allow school boards, after a public meeting, to increase district revenue by an amount not to exceed their state revenue allowance limits.

Rep. Paul Marquart (DFL-Dilworth) supports the bill, but doesn’t like the amendment. “I don’t like it going back on the property taxpayers.”

Moe said the Minnesota Constitution requires the Legislature to establish a general and uniform system of public schools and make provisions that will “secure a thorough and efficient system of public schools throughout the state.”

“We are out of compliance with the state constitution,” Moe said.