Minneapolis schools face $28 million shortfall
The Minneapolis public school district is facing a $28 million budget shortfall in the next school year, officials announced today.
They say the shortfall for the 2009-2010 school year is based on declining enrollment projections, anticipated state revenue cuts and rising personnel costs.
This is the eighth straight year the district will need to cut its budget.
Voters in the district approved an eight-year, $60 million operating levy just last month. But Peggy Ingison, the school district's chief financial officer, says that wasn't enough.
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"We are deeply grateful to Minneapolis voters for their approval of the November referendum, but those funds are only a small part of our overall budget," she said.
Even with the referendum approved, the district was expecting a budget shortfall next year.
"The harsh economic situation is only making things worse," said Ingison.
The projected $28 million shortfall is based on the following assumptions:
--Enrollment will decline 2.8 percent next year.
--State revenue will not increase next year. Earlier projections had anticipated a 2 percent increase from the state, but that assumption has been changed to a 0 percent, given the recent state economic forecast.
--Personnel costs, which account for 80 percent of the budget, do not include any increases beyond what is currently identified in existing contracts.
--Investment earnings losses of $4 million.
The Minneapolis school board will begin discussions on how to meet the shortfall later this month.
