Schools see delayed payments and little else from legislative session

The budget deal the Legislature passed Monday relies heavily on delayed payments to schools to balance the state's books. But aside from that payment shift, lawmakers adjourned without passing any other significant education-related legislation.

The payment shift means $1 billion that schools once expected to get this fiscal year won't come until next year. It's an accounting maneuver that allows the state to balance its books, but pushes cash flow challenges to school districts.

It's the same shift Gov. Tim Pawlenty ordered last year as part of budget-cutting moves that were thrown into question by a court ruling earlier this month.

Scott Croonquist, who lobbies at the Capitol for metro-area schools, says many of his districts had already adjusted for this year's loss of money. But he expects more cash flow problems next year.

"It's just going to mean that much more borrowing, or spending down their fund balance," said Croonquist. "We're getting to the point now where not many districts have fund balances left. They've drained those, and many of those are engaged in short-term borrowing."

Croonquist and other school advocates pushed to have the funding shifts written into law, to ensure a guarantee that the money would be paid back later. While the law was written that way, there's no dedicated source of funding for paying the money back. That means it could be eight to 10 years, by some estimates, before the state brings in enough new money to fully pay everyone back.

Funding wasn't the only education issue at the Capitol this year, which is why some lawmakers say the bigger surprise had to do with what didn't pass.

In past years, lawmakers have typically pooled several different education-related proposals into one big education omnibus bill.

But no such bill passed this year. That lack of any new education laws means Minnesota will probably not re-apply for federal funding under a program called "Race to the Top."

After Minnesota failed to win that money in the first round, Gov. Tim Pawlenty demanded lawmakers pass his education agenda before the state would even consider applying again. That agenda included changes to how teachers are licensed and evaluated.

"Based on the Legislature's absolute failure -- and I mean absolute failure -- to meaningfully address education reforms that are a growing matter of consensus in the nation, it is highly unlikely that we'll proceed with that application," said Pawlenty.

Pawlenty again criticized the state's teachers union, Education Minnesota, saying it is standing in the way of the changes he proposed. Union president Tom Dooher says his group's opposition was based on the standards that must be met to become a teacher.

"There were some other proposals that would weaken the standards, and put less-qualified people into classrooms where the kids need the attention most," said Dooher. "We will always stand strong on high standards for teachers because that's going to put the best and most trained people in front of our kids, which we believe is the right thing to do."

The Race to the Top award would have brought as much as $175 million new education dollars to Minnesota over the next four years, if the state had applied and won.

It's the first time in veteran Rep. Mindy Greiling's memory that there'll be no significant changes in education policy.

"I am just actually shocked at how education was treated this session," said Greiling, DFL-St. Paul, who chairs the House education committee. "We had our bill done before Easter, and still it was kept on the back burner and kept as a bargaining chip until the last two days of session."

Greiling tried to pass a pared-down version of an education bill during Monday morning's special session, but Republicans blocked it.

Republican leader Rep. Kurt Zellers said the plan all along was to just vote on the new budget deal.

"You are breaking the deal that we had when it came to our side of the aisle, the Senate, the governor's office," said Zellers. "We would come in, we would have one vote on one bill."

Other education proposals that died at the Capitol included ones to give school districts the ability to renew tax levies without needing voter approval, and one to change how charter schools lease property.

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