Editorial: Funding schools/State action added to tax hike

09/28/2005

Star Tribune
September 28, 2005

In coming weeks Minnesota homeowners will receive their 2006 property tax statements—complete with hefty increases to fund public education. In fact, state education officials estimate that the school portion of the property tax burden will rise about 18 to 20 percent from last year.

What happened to the $800 million the state sent to school coffers during the prolonged 2005 legislative session? Shouldn’t that “historic” state investment go further to help keep local taxes down and comply with a state commitment to fund the lion’s share of school costs?

If that $800 million was all newly generated, state-raised money; and if education expenses were not rising, and if schools were not starting from behind and struggling to make up for recent cuts, that additional sum might have helped hold down local tax hikes. But as the Legislature adopted it, nearly $140 million of the increase must come from local property taxpayers. Another $95 million was generated by accounting shifts that do not provide additional funds.

And changes in what the state pays for in school operating budgets also dilute the pool of new school dollars. For example, the state used to cover expenses such as computers and other equipment and building repair. Now districts have to raise local taxes to support those costs.

During the last session, lawmakers gave districts more authority to raise local taxes—both with and without voter approval. According to the Minnesota School Boards Association, about 78 of the state’s 300-plus school systems will ask voters for more funds in November. However, nearly all of them will impose some tax increases that do not require voter support.

As recent Star Tribune news stories document, the Minneapolis school board will soon consider a proposal that could increase its property tax income by nearly 10 percent. And last week, St. Paul schools adopted a budget that will boost their property-tax-generated income by 22 percent.

Though Gov. Tim Pawlenty wants voters to believe that he stuck to his “no new taxes” mantra—setting aside his health-impact “fee” on tobacco—the claim is misleading. By not seeking additional state revenue for education, the governor and the Legislature allowed, and in some cases forced, school leaders to get more from their local residents. John and Johanna Q. Taxpayer may not see extra money coming out of their paychecks in the income tax category. But the higher burden surely will show up on their property tax bills.

That would be fine if Minnesotans wanted to return to the time when school funding depended more on individual districts and property taxes. And we’re well on the way; school officials say that, with the 2006 increases, much of the 2001 property tax relief (when the state took on more school funding) will have disappeared.

But for those who want to live up to that earlier state commitment to provide a healthy majority of school funding, lawmakers must do a better job of supporting K-12. During upcoming truth in taxation hearings around the state, taxpayers should make that plain. Elected officials need to know that Minnesotans want their K-12 bills paid.