Education finance law appropriates 10% funding increase for public schools

Public education funding will total $23.2 billion during the 2024-25 biennium. This is an increase of $2.26 billion, or 10.8% over base appropriations. The education finance law will also make dozens of policy adjustments to the state’s educational landscape.

Rep. Cheryl Youakim (DFL-Hopkins) and Sen. Mary Kunesh (DFL-New Brighton) sponsor the law that takes effect July 1, 2023, unless noted.

HF2497*/SF2684/CH55

Significant changes to public education

The basic funding formula — the main mechanism through which the state funds local school districts — will increase 4% in fiscal year 2024 and 2% in fiscal year 2025. This translates to a formula allowance of $7,138 and $7,281 per pupil, respectively.

Starting in fiscal year 2026, the formula will be indexed to inflation, though the law includes language that will limit this annual increase to between 2% and 3%.

The state will cover 44% of the special education cross-subsidy — up from 6.43% — in fiscal years 2024-26, with this rising to 50% beginning in fiscal years 2027.

Appropriations in fiscal years 2024-25 include:

• $705 million for the basic funding formula increase;

• $663 million in increased funding for reducing the special education cross-subsidy;

• $135 million in unemployment aid to reimburse school districts for this new expense;

• $87 million in additional funding for English Learning;

• $86.7 million for the Department of Education;

• $84.8 million for pre-K education;

• $75 million to carry out the READ Act, which will overhaul literacy education in an attempt to halt the declining literacy rates seen in recent years;

• $74.4 million for student support personnel aid and workforce development, to attend to students’ mental, behavioral, and physical health needs;

• $60.4 million for American Indian education;

• $50 million for Grow Your Own teacher grants, designed to increase the size and diversity of the teaching workforce;

• $45.2 million in school library aid;

• $30 million to establish a special education teacher pipeline;

• $30 million for afterschool programming;

• $24.3 million for building safety and cybersecurity grants;

• $15 million for full-service community school grants;

• $10 million for the Rural CTE Consortium;

• $9.9 million to cover 35% of the transportation sparsity aid cross-subsidy, up from the current rate of 18.2%;

• $7.2 million for paraprofessional paid orientation;

• $3.5 million for non-exclusionary discipline training;

• $3.5 million to provide menstrual products and opiate antagonists at no costs to students;

• $2 million for the construction of gender-neutral bathrooms; and

• $416,000 to cultivate heritage language and culture teachers.

Monetary-related and other policy

Hourly school workers, such as bus drivers and cafeteria staff, will be eligible for unemployment insurance benefits during summer breaks.

Pre-Kindergarten education will be permanently expanded: 4,000 seats due to sunset will be preserved and an additional 5,200 seats will be established in fiscal year 2026, bringing the statewide total to 12,360 seats.

Within the Department of Education, an Office of the Inspector General will be established to detect and prevent fraud, waste, and abuse in departmental programs. The bureaucracy will see additional growth with the creation of an Equity, Diversity, and Inclusion Center; a comprehensive school mental health services lead; a school health services specialist; and an ethnic studies specialist.

Effective May 24, 2023, all school employees must receive full pay and benefits on e-learning days, and departmental oversight of the federal summer food service program will be modified.

Under collective bargaining agreements effective July 1, 2023, and thereafter, the probationary period of new K-12 teachers will be shortened under various circumstances. Also effective from that date, 80% of compensatory revenue must be utilized at the generating school site (up from 50%) and the list of allowable uses will be reconfigured.

Many policy provisions will affect American Indian education:

• effective May 24, 2023, American Indian students will be permitted to wear tribal regalia at graduation ceremonies and carry loose tobacco in medicine pouches while at school;

• effective Aug. 1, 2023, Indigenous Peoples Day will replace Columbus Day on the school calendar;

• starting Sept. 1, 2025, schools will be prohibited from using Native American symbols or names as mascots, unless all 11 of the state’s tribal nations sign off on an exemption request; and

• Indigenous education will be added to the state’s academic standards during the next 10-year review.

The law makes other notable changes to academic standards. Personal finance courses will be required for high school graduation, effective with students beginning ninth grade in the 2024-25 school year. Additionally, civics courses required under current standards must be taken in grade 11 or 12. Holocaust and genocide studies will be embedded in the social studies curriculum beginning with the 2026-27 school year, while a directive for schools to offer ethnic studies courses will be phased in throughout the decade.

Several policy changes take effect Aug. 1, 2023, including:

• substantial modifications will be made to active shooter drills;

• tier 1, 2, and 3 teachers of world languages and culture, performing arts, and visual arts will be exempt from the requirement to hold a bachelor’s degree;

• the Online Instruction Act will replace the Online Learning Act;

• charter schools will have to abide by the Education for English Learners Act in the same manner as local districts and will have to make an enrollment preference for Minnesota residents, with admission for these in-state pupils being free; and

• higher education institutions participating in the postsecondary enrollment option program will no longer be allowed to require a faith statement from applicants for admission.

Mainly effective with the start of the 2023-2024 school year, the use of suspension, expulsion, and recess denial as punishments for elementary school students will be severely curtailed.

Effective Sept. 1, 2024, seclusion-based punishments will be prohibited for special education students through grade 3

HF2497* / SF2684 / CH55