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Legislation seeks solution to special education funding shortfall

School districts are statutorily required to provide special education to children with disabilities from birth to age 21. In the 2020-21 school year, approximately 17% of students qualified for some type of service.

However, full funding for that is not a given.

According to an overview from the nonpartisan House Research Department, “School districts, charter schools, and cooperative units receive state aid and a relatively modest amount of federal aid to provide special education services to their students. The state and federal aid do not cover the full costs of special education services. The difference between a school district’s special education spending and its special education revenue is called the special education cross subsidy.”

Sponsored by Rep. Dan Wolgamott (DFL-St. Cloud), HF2657 would require the state to ensure cross subsidy costs are covered beginning in fiscal year 2023. It was held over Wednesday by the House Education Finance Committee. There is no Senate companion.

“Special education needs are rising rapidly, yet the funding shortfall keeps on growing,” said Wolgamott. “… It’s been projected by [the Department of Education] that our shortfall for fiscal year 2023 will be $744 million. In my school district in St. Cloud that shortfall is going to be $11 million.”

[MORE: Department of Education special education funding overview; projected district shortfalls]

Wolgamott knows the price tag is hefty, but so is inaction.

“Just ask the schools who are being forced to take on the costs that we’re mandating on them. Just ask the teachers and students who are missing out on opportunities because we are not funding these expensive mandates,” he said.

Districts must use their General Fund dollars to cover the gap.

Cherie Johnson, executive director of the Goodhue County Education District, echoed that fully funding special education needs could be a boon for all students.

“If the General Fund wasn’t subsidizing special education costs, General Fund dollars could be used to lower class sizes, bridge the way for innovative programs and add support for needed mental health services and technology,” she said.

Also held over by the committee was HF2751. It, too, lacks a Senate companion.

Sponsored by Rep. Cheryl Youakim (DFL-Hopkins), it would establish a legislative working group on special education tuition billing. A report would be due the Legislature and governor by Jan. 31, 2023.


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