What is the cause of New London-Spicer's Financial Challenges?

I have talked to several people in the community about the challenges facing our school district. Questions that continue to arise are: Can you simplify the challenges you face as a district? What is causing you to need additional revenue? Why is the New London-Spicer School District in this spot financially? The answers to these questions are related and a bit complicated. To simplify the complexities of our situation, I have organized the need into four general categories.

1. Funding from the state of Minnesota has not kept pace with inflation.

If state aid had increased at the rate of inflation, schools would have received $7,461 per student this year. Instead, schools will receive $6,863 per student, a difference of $598 per student. New London-Spicer has about 1,530 students. If state aid kept pace with inflation, that would result in nearly $1 million in additional state funding in one year, and many millions over previous years, eliminating the need for constant budget reductions.

2. The federal government has not kept their funding promises.

In 1975 the federal government passed the Individual with Disabilities Education Act (IDEA) which provides education and support services for students with disabilities. During that time, the federal government promised to provide 40% of the excess costs of providing these services. The federal government has not kept this promise as they have generally provided only 17% of these costs. This lack of promised support from the federal government has caused the district to spend an average of over $1 million annually from its general fund to supplement the rising costs in special education. These are critical services and the federal government must keep their promise.

3. Our school district falls into the "donut hole" as we are considered property rich but tax poor.

The New London-Spicer School District has a unique tax base. Specifically, our tax base is as follows:

Residential: 56.8%

Commercial/Industrial: 5.2%

Agricultural: 14.5%

Seasonal/Recreation: 23.5%

This means that our homeowners carry the greatest tax responsibility as some seasonal/recreation and agricultural land is not taxed based on different tax mechanisms. The New London-Spicer administration and school board work hard in advocacy efforts with legislators to bring equalization funding to schools in Minnesota. Currently, New London-Spicer ranks 230th out of 327 for public schools in revenue received from the state through their current system of financing education. This is not sustainable!

4. Inequities in funding formulas.

Various funding formulas are tied to free and reduced lunch numbers in school districts. A couple of these programs are Title I and compensatory education. The higher a district's free and reduced population is, the more revenue they receive. New London-Spicer has a lower free and reduced lunch population which means we generate less funding than most of our neighbors. 

ACGC - 36.6% Albany - 17.8% BBE - 30.0% KMS - 33.0% Litchfield - 32.6% MACCRAY - 36.1% New London-Spicer - 20.5% Willmar - 56.3%

In summary, New London-Spicer faces unique challenges due to its complex situation that have a major impact on the students, families, and communities within our school district. All of these factors have contributed to our current situation and we are working diligently to turn this ship around and get our financial house in order to be able to continue to provide excellent educational opportunities for our students.