Governor Walz’s FY 2020-21 budget proposals in E-12 education and higher ed invest more in Minnesota’s students

Governor Tim Walz’s FY 2020-21 budget proposal includes provisions that support students across the state, as well as more targeted funding intended to narrow the opportunity gaps that students of color face in particular. Overall, Walz’s budget proposes $718 million in additional general fund resources for E-12 education and $165 million for higher education.

An educated Minnesota is critical for the state’s economic success. The state plays an important role in the funding of Minnesota’s schools, and local property taxes often factor heavily into whether the schools have the resources that they need to support children’s learning. Districts with less property wealth often aren’t able to raise the additional funds needed to support their students. A long history of discriminatory housing policies in the United States has limited the ability of people of color to build wealth through homeownership. And for those who do own homes – their homes are often assessed at lower values than homes of their white peers, affecting the district’s tax base.

Minnesota has taken some important steps to help equalize the funding that districts receive, but it is still the case that districts with a high concentration of students of color living in poverty receive less money per pupil than districts with a high concentration of white students living in poverty.

E-12 Education

The governor proposes $718 million in additional funding for E-12 education. He proposes increasing funding for school districts through the basic student formula by 3.0 percent in FY 2020 and another 2.0 percent in FY 2021. That’s an increase of $189 per student the first year and another $130 the second year.

The governor stresses the importance of early learning programs to address gaps in educational achievement and opportunity so that all children can thrive in school. Walz also recommends $47 million in FY 2020-21 to restore the number of slots available for voluntary pre-kindergarten. Without action, a cap currently in place would cut the number of pre-schoolers who can participate in FY 2020 and beyond by more than half. Walz’s funding would lift this cap and make it possible for 7,160 students, or about one-eighth of eligible 4-year-olds, to participate in pre-kindergarten and school readiness programs.

The governor also proposes to increase funding for special education by $91 million. Walz’s proposal would increase student subsidies through the special education formula to create more stable funding for schools to provide services and help reduce the portion of unfunded costs that schools have to address.

Walz proposes $18 million in FY 2020-21 for school districts and charter schools to be used for school safety, including security improvements and counselors. For this funding increase, the governor cites the increase in school shootings and violence in the U.S., and the need to protect students in Minnesota.

The E-12 budget proposal also includes a number of targeted initiatives to make sure that all students, including students of color and students in rural areas, have a high quality education:

  • Levy equalization to better fund schools serving communities with low tax bases to meet the needs of their students;
  • Full service community schools that provide wraparound services that serve primarily low-income and rural communities;
  • A multi-pronged approach to support and recruit teachers of color and American Indian teachers in the classroom; and
  • Funding for tribal contract schools. Currently state per pupil aid for tribal schools is set to decrease by about 50 percent; the governor’s budget would prevent this decline and instead maintain the current formula funding.

Higher Education

In higher education, Walz proposes to make college more affordable through an additional $43 million in FY 2020-21 for financial aid through the State Grant Program. His financial aid proposal contains several components, including:

  • Increasing the annual living allowance for students, equal to about $300 per year for full-time students.
  • Reducing the family contribution in order to make college more affordable for lower-income families. This would effectively increase state grants by about $100 per student.
  • Better integrating child care so that students who have children can receive the supports they need while they complete their education.
  • Adjusting the State Grant amount for students who aren’t eligible for federal aid. Minnesota Dreamers – young people who came to the country as children and do not have legal status – are ineligible to receive federal Pell Grants. However, the State Grant formula currently calculates financial aid assuming that students receive this federal grant, meaning that Dreamers receive much less aid than they need to afford college. The proposal would increase the grant award for these students, making college education more in reach for all of Minnesota’s young people.

The governor also proposes investments that go directly to colleges and universities to improve higher education for students. Over the FY 2020-21 biennium, the University of Minnesota and Minnesota State would receive $51 million and $65 million respectively. These funding increases are expected to help these institutions keep up with the costs involved with educating their students. In return, the University of Minnesota and Minnesota State are expected to maintain the quality of education they provide while minimizing any increases in tuition.

Stay tuned for more analysis as the final FY 2020-21 budget comes together.

-Clark Goldenrod

About Clark Goldenrod

Clark Goldenrod is the Minnesota Budget Project's senior policy analyst.
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