Superintendent: Rochester Public Schools faces $10M in cuts after failed referendum

[MUSIC PLAYING] CATHERINE RICHERT: This is Minnesota Now. I'm Catherine Richert filling in for Cathy Wurzer. Teachers around Minnesota are negotiating their contracts, and many are holding walkouts to raise awareness for issues like pay and class sizes. Educators with Anoka-Hennepin plan to walk out at the end of their scheduled day each Wednesday starting today until they reach an agreement. The district is the largest in the state.

Now, in Rochester, the Post-Bulletin reported that more than 300 people marched before last night's school board meeting in support of limiting class sizes. Their contract negotiations could be tricky this year. Voters last week narrowly rejected a levy that would have provided $10 million in funding for technology and freed up money for other spending. During the school board meeting, Superintendent Kent Pekel read from a letter to parents and staff

KENT PEKEL: Unfortunately, given the defeat of the technology referendum last week, making the case to our community for increased investment in education is not our most immediate task. Instead, we must now focus on finding ways to cut and balance the district's budget for the 2024/2025 school year and the years that immediately follow.

CATHERINE RICHERT: He said the school district will now have to cut at least $10 million from its budget for the next school year. In the last two years, the district has already cut more than $20 million. Superintendent Kent Pekel joins me now. Thanks for taking the time.

KENT PEKEL: Yeah. Thanks for reaching out. I was glad to glad to share what's going on in Rochester.

CATHERINE RICHERT: So we've been seeing budget cuts to the school budget already. Finding another $10 million I can't imagine is easy. Where will those cuts come from?

KENT PEKEL: Well, we don't know yet because we're going to have a very, as we have the last two years, rigorous and inclusive and transparent budget development process. But you're right. We cut $14 million last year and we cut $7 million the previous year, so $21 million in total over the two years that I've been in Rochester.

And once you've cut at that level, as the saying goes, you've cut through muscle and you're getting to bone. We're going to find ways to make that happen while still maintaining the core of our academic agenda. But it is going to be tough.

CATHERINE RICHERT: So this budget situation predates your time at the district. What is your best understanding of how RPS got into this situation?

KENT PEKEL: It's a combination of factors. First of all, most of our funding, like every school district, comes from the state of Minnesota. And state funding has not kept up with inflation for a very long time, but school districts just, like individual families, live in the real world. And we have inflation.

Now, the legislature and the governor took a significant step forward in the last legislative session, but that really was making up for lost ground. And it still didn't come all the way to paying for the costs of meeting state standards and actually some of the new mandates that we have. So there's the state piece.

There also is a piece that Rochester Public Schools has decided to grapple with. Here in Rochester, we had the number of staff that grew in excess of our growth and enrollment. And that is my job to make sure it doesn't happen. And that's a significant reason why we've made the cuts. We are bending the curve to more directly align our number of amazing staff that we have with the number of kids we have.

But then there's the third reason, and that really is local support for education. And one of the things as I was all over Rochester the last three months talking about the referendum that narrowly was defeated was that when you combine the two main flexible local funding sources that voters can approve for their school districts, which is an operating, referendum, and a capital projects referendum, Rochester doesn't stack up too well.

We generate $916 per kid from those sources. Bloomington Public Schools up there in the cities where I started my teaching career generates more than $3,000. And we think Rochester, especially as we are a global home of science and medicine, should have educational offerings and resources that are certainly comparable to the other school districts in Minnesota in terms of support from their local communities.

But we're going to have to make the case to people that we are good stewards of those resources and that they will show up in improved academic offerings and outcomes in the years ahead.

CATHERINE RICHERT: So what does the failure of this referendum mean for contract negotiations with teachers and staff?

KENT PEKEL: Well, I'm just going to be really honest. I actually had the goal of not talking about our contract negotiations in the media or otherwise. But our friends in the Rochester Education Association, with whom I have had a great working relationship-- and I'm not just saying this. We have unbelievable teachers in Rochester. We have a great union-- they made the strategic decision to talk about our negotiations in the press and issue some statements.

And there's a point at which just candidly, I got concerned that those negotiations were being perceived as somehow not fully supportive of teachers. And that's why in the statement I made last night, I shared the fact that our latest offer is a 14.88% increase in the contract. That would be the largest increase in 30 years in Rochester, maybe earlier, but the records were sketchy beyond that.

And it's larger than any settlement that has been reached in the state between a teachers' union and a school district thus far. Now, the many negotiations are ongoing. But that increase is indicative of the incredible value that we place on teachers. I also, obviously, have to make what happens not just with that group but with the two other unions we're negotiating with fit into the district's larger financial picture. And that's going to be a challenge.

The referendum would have funded technology, but we said again and again-- and I think in retrospect, this is one of the reasons why it may not have passed because it was a complex message-- we said $10.1 million for technology frees up $7 million we're currently spending from our general fund on technology to keep class sizes at their current levels.

And I think that somewhat more complex message, given that we lost by less than 300 votes, may have just been one step too complex for some folks to really see this as a vote about the classroom. I think the images of kids staring at screens came into the minds of some of our folks. That's not necessarily what even the technology part of our proposal would have covered. But the class size piece of it I worry may have gotten lost in the fact that the proposal technically was to support technology.

CATHERINE RICHERT: Right. So the teachers' union who spoke last night at the school board meeting really emphasized this issue of limiting class sizes, especially for preschool and elementary school students to between 15 and 28 students. What is your position as someone who has made this their entire career on class size caps for elementary classes?

KENT PEKEL: Well, I'm saying this outside the context of negotiations, which again, we look forward to continuing that discussion at the negotiating table. Look, I get it. And i was a high school teacher, but I remember vividly actually in Bloomington Public Schools, Jefferson High School I had 189 students one semester. And we know that that's a challenge at the secondary. And we know in the early grades, it's a huge challenge.

The question of putting something in the contract which is binding and long term is somewhat different from just discussing the issue outside the contract because having discussions about the optimal class size with a union partner is absolutely, I think, appropriate. We do it now. We welcome it. When you put it in a contract that is going to be in place, even though the contract is technically for two years, it's very, very difficult to move something like that out.

And I think we are moving into an era where more flexibility is going to be needed, not less. Flexibility in terms of small group structures for kids who are struggling academically. And then, frankly, we are on the cusp of an extraordinary transformation in the application of artificial intelligence to teaching and learning. I don't think AI is going to do much to change whole class instruction, but it's going to revolutionize tutoring.

And we piloted an AI system this year in our summer of discovery our summer school program in mathematics. And what a large language model AI tutor can do with a kid, it's like you are having a direct conversation, but that tutor is taking the most effective teaching technique that has worked across thousands or 100 of thousands of kids and applying it to that kid sitting there.

And so when we think about class configurations, could you have a somewhat larger class of kids using a tool like that than one where the teacher is providing the direct instruction is something we need to be in dialogue about.

And so one of the questions that we'll be grappling with is the is the is a contract the right place to grapple with that issue. But no question that class size is a big issue. I will just say, the research on class size is not a slam dunk. And so I say that hesitantly because I know every teacher out there is like, well, it's a slam dunk in my experience. So I get that.

CATHERINE RICHERT: So we only have about a minute and a half left here, but I want to go back to the referendum. You've said you plan to ask the school board to renew a $17 million dollars Levy to avoid making additional cuts in '25, '26 school year. And you've also said you'd recommend another referendum for next year. What are the lessons you're going to be taking away from this year's vote as you look ahead to next year?

KENT PEKEL: We got to make sure that we are structuring the referendum in a way that is both going to move our school district forward academically and organizationally but that is going to resonate with where people are. And we need to do some hard thinking about the focus on technology, number one.

But I did make the recommendation that the board take advantage of the opportunity that the state has given all school districts to renew an operating referendum. If we did not do that, in 2025, Rochester public schools would be cutting $17 million in 2025 after cutting $10 million in 2024, after cutting $14 million in 2023, after cutting $7 million in 2022.

And that is just not sustainable. So I'm glad the state has given school boards that opportunity, but it's necessary but not sufficient. And so we will be going back to our community, but we're going to do a lot of hard thinking and listening over the next year before we put something on the ballot in the '24 or '25 school year.

CATHERINE RICHERT: OK. That was Rochester Public School Superintendent Kent Pekel. Thanks so much.

KENT PEKEL: Thank you.