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School bond referendum requests fare better in 2018, but rural-urban divide persists

Taxpayer support for perks that help districts stay competitive tends to fall along an urban-rural divide. More urban, high-property-wealth districts consistently have an easier time passing these sorts of bonding requests.

This Thursday, Fosston Public Schools will canvass election results at its monthly school board meeting. The initial counts show that voters narrowly approved an $11,195,000 bonding request, earmarked for roof replacements and general maintenance, along with security and technology improvements.

On the heels of two prior failed referendum requests in 2015 and 2016, this victory — which passed by eight votes — marks a significant turning point for this rural northwestern district, located in Polk County.

Superintendent Kevin Ricke says three key factors came into play this time around: The district had paid off prior debts; the board broke the ask down into three questions; and the new state agricultural land credit helped swing the district’s farmer base.

It’s a blessing for us that it passed,” he said. “With almost 49 percent of our property base being ag owners, I think that moved the needle for us.”

Passed by state lawmakers in 2017, the 40 percent ag tax credit is part of a multipronged effort to help offset the greater burden taxpayers in Greater Minnesota are asked to shoulder when it comes to financially supporting their local schools. This particular school funding equalization measure is tied to bonding dollars, which schools use to fund school building maintenance projects and upgrades.

While the Fosston district succeeded in passing one bonding request this fall, taxpayers still shot down two other bonding asks: $1 million to preserve the school’s 1937 gym and nearly $8 million for classroom additions and science upgrades. And the year prior, they shot down a funding request for a fine arts and performance center.

Taxpayer support for these sorts of perks that help districts stay competitive tends to fall along an urban-rural divide. More urban, high-property-wealth districts consistently have an easier time passing these sorts of bonding requests.

Meanwhile, low-property-wealth rural districts — knowing that their taxpayers have to shoulder a higher proportion of any referendum ask — are being forced to triage their bonding asks. Often they end up prioritizing the basics to fill in gaps between the rising costs of running a school and shortfalls in state and federal funding.

State education dollars have not kept pace with the rising costs of inflation. Additionally, school budgets are stretched thin by mandated services for special education students services that the federal government has chronically underfunded.

Minnesota’s newly elected governor, Tim Walz, singled out this school funding issue at a gubernatorial candidate forum in Willmar earlier this year. We have a situation where we have rural schools holding bonding referendums to fix leaky roofs. And we have suburban schools holding bonding referendums to build a third domed turf stadium, and add Chinese and French classes,” he said.

Results breakdown

Regarding bonding requests on the Nov. 6 ballot, results show that 19 of 25 districts passed at least one question, for a 79 percent approval rate. When results of bonding asks earlier in the year are figured in, the overall passage rate for 2018 is 69 percent, with 31 out of 45 districts passing at least one question.

This is a pretty good passing rate for bonds, even when you look at the calendar year overall,” said Greg Abbott, communications director for the Minnesota School Boards Association.

Last year, this passage rate sat at 56 percent; and at 45 percent in 2016.

On the bonding front, two districts came out as “big winners,” he said, noting the public school districts in Detroit Lakes and Northfield both passed requests by a wide margin —  a $49 million request and a nearly $41 million request, respectively.

All of the districts that failed to pass at least one bonding question this year were located in Greater Minnesota. And among smaller, rural districts that were successful, the total ask typically fell below $11 million.

And when it comes to asks tied to things like athletic facilities or band rooms or performing arts spaces, Abbott says metro districts continue to have an easier time garnering voter support.

For instance, Columbia Heights Public Schools voters approved nearly $4.5 million for performing arts space improvements and a band room addition at the high school. These two asks came in addition to a nearly $12.5 million request for elementary school improvements that voters also passed by a wide margin.

On the operating levy front — dollars used to cover teacher salaries, expand offerings and help cover basic expenses like utilities and transportation — 24 out of 35 districts passed at least one question. This 69 percent passage rate is pretty average, says Abbott.

He notes that not many districts attempted to pass an increase that would have significantly impacted individual taxpayers. Also, all eight districts that were simply looking to renew an existing operating levy amount, he adds, passed their requests by a wide margin.

“That continues a trend that’s been going on for about a dozen or so years,” he said.

Inequities persist

Perhaps the greatest takeaway from this year’s referendum results is that inequities persist, placing a smaller, rural districts at a distinct disadvantage.

The ag credit that passed in 2017 “helped a little,” Abbott says. But it wasn’t the solution.

In more rural communities, the land is where the tax base is, “so the cost of keeping the schools running is disproportionately falling on farmers,” says Gary Wertish, president of the Minnesota Farmers Union.

“The problem is the farmer is paying approximately six times more … in any of these bonding referendums, than metro or urban people are paying,” he said. “That’s what makes it a struggle as the rural districts try and do the upgrades.”

He says the 40 percent tax credit helped alleviate some of this pressure on farmers. But other reforms are needed in order for rural districts to sway farmers who are being forced to decide between supporting their local schools and sustaining their livelihood.

A tax bill is on there for a long time before the various projects get paid for,” he said. “Farmers are dealing with a lot of unknowns — with the weather and the market — that impact what type of income they’ll have.”

Comments (5)

  1. Submitted by Frank Phelan on 11/14/2018 - 10:05 am.

    Maybe the solution to funding rural schools is to elect legislators who don’t create and exploit divisions among Minnesotans, but look for ways to create a more level playing field for all.

    Electing legislators who are more concerned about local plastic bag ordinances the local school funding hasn’t worked well for rural schools.

  2. Submitted by Richard Callahan on 11/14/2018 - 11:04 am.

    “The problem is the farmer is paying approximately six times more … in any of these bonding referendums, than metro or urban people are paying,” he said. “That’s what makes it a struggle as the rural districts try and do the upgrades.”

    The portion of my property taxes for 2019 in St. Paul for the school district will be about $2,500. Farmers are paying six times that?

    Just what is the typical property tax for an acre of Minnesota farmland?

  3. Submitted by Jim Smola on 11/14/2018 - 01:27 pm.

    The answer is to develop a fair, equitable system of funding to erase the disparities that exist in the current system. In my opinion the state has to become the main funding vehicle for schools which would lessen the burden on property taxes.

  4. Submitted by Ray Schoch on 11/15/2018 - 08:26 am.

    I believe Mr. Smola is correct.

    From the Minnesota Constitution: “Section 1. The stability of a republican form of government depending mainly upon the intelligence of the people, it shall be the duty of the Legislature to establish a general and uniform system of public schools.”

    The “general” part seems to have been accomplished, but the “Minnesota Miracle” of decades ago not withstanding, it’s the “uniform” (i.e. equal or equivalent) part that the state’s various school districts have trouble with. A 2nd-grader in a rural district anywhere in the state should have the same number of dollars available for her education each year as a 2nd-grader in the most affluent Twin Cities suburb, whatever suburb that might happen to be.

    I doubt that genuine equality of funding can ever be achieved, since the wealthy will always have more resources (money) to spend on their children than most, but many of those parents will be sending their children to private and/or parochial schools they deem “superior” to public schools anyway. The 2nd grader in rural Cook County or Roseau or Pipestone Counties should have the same – and sufficient – fiscal support from the state as does a 2nd grader in Maple Grove or Wayzata or any other affluent suburban district.

    This is an issue that **ought** to be nonpartisan. Instead of the near-constant complaints about taxes, the state’s Republican legislators, particularly those representing outstate Minnesota, ought to be pressing their legislative colleagues (DFL and Republican alike) and the Governor for a solution that’s equitable and ethical – and mandated, I’d argue, by the state Constitution. The fiscal inequities between and among the state’s school districts noted in Erin’s column ought to be addressed and corrected on a permanent basis.

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