Mpls. schools weighing all options to counter $33M deficit

The Minneapolis school board on Tuesday discussed potentially painful cuts to address its $33 million budget shortfall.

Since the deficit for the next school year was revealed this fall, Minneapolis schools Superintendent Ed Graff has said he's considering all options to find savings in the state's third-largest school district. That includes potentially changing start times and asking voters for more money in a 2018 referendum.

"These are difficult conversations and hard decisions that we're going to have to make," Graff said.

For the past seven years, the school district has dipped into its emergency reserves to plug budget gaps.

Pulling from the dwindling reserves is no longer an option, district officials say, and it's forcing them to consider large-scale overhauls.

The district has to make tough choices to stem the cycle of "balancing a budget with such significant numbers," Graff said.

Minneapolis Public Schools estimates that about $25 million will be left in its rainy-day reserve fund by the start of the 2018-19 school year. This pot of money, called the fund balance, is "used for unanticipated or emergency situations, or to make important one-time investments in district initiatives," according to the district's website.

For the past several years, reserves were "healthy enough to access to overcome deficits, and because we knew we had this money available, significant funding changes were not made at that time," the district's website said. For a couple of years, the board spent reserves money on capital projects because those funds were too high, board Chairwoman Rebecca Gagnon said at the meeting.

Enrollment is slated to drop slightly in the next decade, district officials said, and the schools already are paying millions of dollars for services for special education and English language learners that aren't covered by the state.

Options to curb the budget shortfall could be as drastic as reworking start times or reducing the number of school days. Graff mentioned both those possibilities and estimated cost savings Tuesday.

He ran through a list of hypotheticals: Adding one student to the district's class size ratio could save the district $4 million. Moving from a seven-period to six-period day could save $6.4 million. Changing start times could net a couple million dollars in savings. The district is in session 11 more days than the state requires, and cutting school days could save $1 million per day.

After the 2016 referendum renewal, Graff said he thinks the district could ask for $18 million next fall. The district doesn't have a capital projects levy, as other surrounding metro districts do, and Graff said it is exploring that.

As part of its financial plan, the board will vote in December to certify an increase to its property tax levy payable in 2018 by 6.02 percent.

Beena Raghavendran • 612-673-4569