Frequently Asked Questions
What are the district’s financial needs?
For STMA, low state funding and stabilizing enrollment, exacerbated by the pandemic, produced an unforeseeable combination of multiple short-term and long-term impacts to our budget.
Our district started the pandemic in solid financial condition. However, the pandemic has had significant effects on students, families, and school staff, leading to higher expenses for the district across a variety of areas.
These expenses include PPE, cleaning supplies, substitute staff, unemployment costs, technology, and more. STMA received little federal funding, as it was largely based on community poverty levels.
COVID-19 also created unexpected disruptions to school revenues. Loss of reliable revenue streams—such as student activity fees, facility rentals, Community Education class revenue, gate receipts, and food services meals—were temporarily cut off.
More broadly, the state of Minnesota’s education funding formula continues to work against STMA’s students and families. We remain one of the lowest-funded districts in per-pupil revenue due to an unfair funding formula. In fact, we are ranked 325 out of 328 school districts in the state.
STMA projects steady, but minimal, enrollment growth from now through 2026. Because 85% of our funding is from STMA the state and is largely based on student enrollment, we are experiencing significant budget shortfalls.
At the same time that we are seeing a lack of available revenue, expenses have risen dramatically. The needs of our students have increased significantly—especially in the areas of special education and mental health. Costs for things like running our buses and heating our schools continue to increase, as do other expenses that are out of the district’s control.
Why is an operational levy necessary?
In recent years, revenues for Minnesota schools have not kept pace with rising costs. In fact, STMA is one of the few school districts in Minnesota that does not have a voter-approved operating referendum in place.
The high-quality school districts to which we compare ourselves all have passed operating referendums. For example, Hopkins has approved $1,829 per pupil, Wayzata $11,796, Minnetonka $1,829, Eden Prairie $1,603, Elk River $1,246, Buffalo $750, and Monticello $529. STMA has $0 in additional per-pupil funding. STMA has $0 in additional per-pupil funding.
What this means is that STMA does more with less every day. We have one of the strongest statewide track records of minimizing overall taxes and maximizing opportunities and experiences we offer to our students. However, low state funding and stabilizing enrollment, exacerbated by the pandemic, have created the need for a sustainable source of local revenue for teachers, programs, and services for our students.
As we move forward and emerge out of the pandemic, we remain confident that, with the passage of an operational levy referendum and the stabilization of other revenue streams, we will be able to quickly restore our strong tradition of excellence and remain a great investment for taxpayers.
What has the district done to manage its financial challenges?
Over the years, the School Board and district administration have taken a number of steps to address our financial needs. We have made difficult decisions that have adversely impacted students, staff, families, and the community.
In spring 2022, the district cut $1,317,500 for the 2022-23 school year. These cuts are in addition to the $6 million in budget cuts during the last two budget cycles and the 78 staff reduced in the last 18 months.
While we continue to seek efficiencies, more budget cuts would directly impact the high-quality programs and services that make the STMA such a point of pride in our community.
Will district residents get to vote on this?
Yes. The STMA School Board has approved two operating levy referendum questions that will appear on the ballot Tuesday, November 8, 2022.
If the referendum is approved, how would the district use the funds?
If voters approve the two questions, the district’s general education revenue would increase by a total of $858 per student in each of the next four years. STMA would apply funds from the first question to maintaining current programs, restoring the walk zone, and adding eight teachers to decrease class sizes.
Approval of the second question would enable the district to also restore high-potential programs, add seven more teachers and staff to further reduce class sizes, and reduce middle and high school activity fees.
With these two questions, the board is asking taxpayers to consider a modest per-pupil amount significantly reduced from the November 2021 levy question (which did not pass). We listened to taxpayers and heard the per pupil amount was too high, inflation should not be included, and the length of time was too long. The questions on the ballot November 8 reflect this community feedback.
What happens if the referendum is not approved?
If the referendum is not approved on November 8, the district and board would immediately begin work to gather community feedback. It is likely that significant cuts to programs and services would need to be made to balance the district’s budget. These include potentially:
Reducing 30-35 full-time staff positions
Increasing class sizes
Eliminating middle school athletics and activities
Reducing availability of high school athletics and activities
Due to the changing landscape, STMA is at a tipping point. Budget projections for the 2023-24 school year show a $2.7 million deficit. We have already cut $7.3 million and 78 staff. There is nothing left to cut except additional staff and student programming.
Cuts like these would threaten the high-quality educational experience our families and community have come to expect from STMA.
How would approved referendum questions affect property taxes?
If the first question is approved, it would have a property tax impact of $46 per month (or $555 per year) on a home worth $350,000, for taxes payable in 2023. The second question’s property tax impact would be an additional $8 per month on a $350,000 home, for taxes payable in 2023.
The approval of both questions would lead to an estimated property tax increase of $644 per year on a home with an average value of $350,000. See the chart to find the tax impact on properties of varying values in our community.
The district and board aim to keep property taxes as low as possible in our community. We have worked to balance the needs of our students and schools with those of our community members. However, we believe we must act now to protect the future of our STMA schools.
*On an average home value of $350,000, For taxes payable in 2023.
Click here to view additional tax impact information.
Do I use the taxable market value, estimated market value, or my appraised value of my home to determine my tax impact?
The proposed levy amount is based on the estimated market value and NOT the appraised value. The estimated market value can be found on your tax statement. Please see the sample tax statement below.
Why are there two questions on the ballot?
The School Board split the referendum into two questions to give voters a choice in how STMA schools are funded and what level of investment they are willing to make. The first question asks voters to increase the district’s general education revenue by $756 per student, while the second asks for an additional increase of $102 per student.
Has the community been involved in this process?
Yes. Over the course of several months, our Operating Levy Steering Team examined the district’s needs, reviewed feedback from community members, and developed a sound solution for the board’s consideration. The team included parents, finance advisory committee members, a student, local representatives, and district staff.
The Operating Levy Steering Team presented its recommendations to the School Board. The board then approved the team’s recommendation to place two operating levy referendum questions on the ballot this November.
We want to hear your thoughts about how we can best address the challenges ahead of us. Our School Board and district administration will continue to seek the input and feedback of community members throughout the process, leading right up to election day.
If approved by voters, would these referendums expire?
Yes. Both proposed referendums are non-recurring operating levies that would expire at the end of the 2026-27 school year.
Can the district use federal COVID relief funds (ESSER Funds) to address its financial needs?
The district has received one-time federal funds through the Elementary and Secondary School Emergency Relief (ESSER) Fund, which was part of the COVID-19 relief effort. While this money has been helpful, it is temporary in nature and will do little to address our long-term financial needs.
What's the difference between a bond and a levy?
Bond referenda are for “buildings” and operating referenda are for “learning” or paying for operating costs such as staff salaries. The 2017 school election was a bond referendum, as the dollars were used for buildings and not operations.
How can enrollment be stabilizing with so many new developments in our community?
Stabilizing long-term student enrollment results in less revenue than previous years. Per a recent demographic study, the district projects steady, but minimal, enrollment growth through 2026. In fact, demographers predict we will grow just .2% to 1% per year through 2026.
This most recent demographic study was completed in October 2021 by the same demographers who conducted our last demographic study in 2016. For the last demographic study, demographers were off by just eight students, and it spanned five years.
Does the district get additional tax dollars from the new developments in our community?
No, the district receives an amount per pupil (or student) from taxpayers. The total amount the district receives is split between taxpayers. Additional homes mean the cost is actually lower for taxpayers, as the total is split among more homes. For example, if the district has an operating levy of $858 per pupil and the total students in the district is 6,876, the district would receive approximately $5.9 million. This amount is spread among taxpayers. The more taxpayers, the less each has to pay.
I heard other districts have operating levies and their taxpayers do not have to pay as much? Why?
Inadequate state funding has created large disparities for taxpayers. STMA taxpayers pay more than their counterparts in nearby school districts. For example, for a $1,919 per pupil levy, STMA taxpayers would pay $1,130 per year, while taxpayers in nearby Hopkins would pay just $291 for the SAME amount. That's a difference of $839. See below for other examples:
Why do STMA taxpayers have to pay so much more?
The STMA community is “property poor,” which means there’s low commercial and industrial development to expand the tax base, and so the tax burden falls heavily on residential homeowners. That means that, for the same levy amount, STMA taxpayers would pay $1,130 while taxpayers in nearby Hopkins (property wealthy as they have lots of commercial and industrial development) would pay just $291 for the SAME amount (see table above).
Note this an example based on a $250,000 market value home and includes an $1,195 per pupil levy, plus $724 per pupil in board-approved local optional revenue.
The state paid approximately 61% of the STMA bond referendum in 2017. Do we get state aid for an operating levy?
We get some state aid, but it is not as much for an operating levy. For an operating levy, the state breaks the levy into two tiers. The first tier is equalized (subsidized with state aid), up to $460 per pupil. This means for STMA, we get approximately 29.5% of equalization aid for the first $460 of the per-pupil amount.
STMA does not qualify for state aid in the second tier, which is any amount above $460. In simple terms, for the 2022 STMA Operating Levy, we would receive approximately $1 million from the state and taxpayers would contribute the remaining amount. If we do not have a levy, we do not receive the $1 million in state aid.
Do other school districts have voter-approved operating levies?
Yes, about 70% of Minnesota school districts have an operating levy in place . STMA is not one of them.
See the graph below for districts we compare ourselves to, as they all have an additional per-pupil, voter-approved operating referendum:
If STMA does not have an operating levy, why does my tax statement say I pay taxes to the district?
The section on residents' tax statement labeled “voter approved levies” is for any voter approved election. It includes past bond referenda and operating referenda. STMA does not have an operating referendum, but we have had past bond referenda for our buildings. In the tax statement example below, this amount is $296.68. For STMA, that number is just for past bond referenda and does not include operating referendum dollars as STMA does not have one.
The other school line item on the tax statement is labeled “other local levies.” This is for various revenue designated to the school district and is strictly defined in statute. These are designated by the state for things such as deferred maintenance, capital outlay (textbooks, technology), etc. Many of these items are based on a state set formula allowance and student enrollment. When enrollment increases, the amount taxpayers pay increases, as the dollars we receive are largely based on student enrollment. In the sample tax statement below, this amount is $364.60.
When was the last operating referendum at STMA?
In 2011, voters approved an operating referendum. The amount was $695 per pupil for 10 years. However, due to legislation in 2015, the $695 was rolled into Local Optional Revenue, which essentially eliminated the $695 per pupil we were receiving.
Will there be public informational forums for stakeholders?
Absolutely! Please see below for dates, times, and locations. It is important to note that all school board meetings are open to the public and the school board welcomes stakeholder comments.
Tuesday, September 20 at 7:00 p.m., MW Auditorium
Friday, October 7 at 1:00 p.m., MW Auditorium Coffee & Conversation
Wednesday, October 12 at 7:00 a.m., MW Auditorium
Thursday, October 13 at 7:00 p.m., High School PAC
Monday, October 17 at 9:00 a.m., MW Auditorium Coffee & Conversation
What would happen if we close open enrollment? Would that fix anything?
No. In fact, we would lose funding and would need to make additional cuts. Not taking open enrolled students would have a negative impact on our resident students.
Why does STMA accept so many open enrolled students?
Minnesota is a choice state. School districts are obligated to accept non-resident enrollment requests, per guidelines specified by Minnesota Statute 124D.03. While this statute does provide some grounds for limiting non-resident enrollments, the district cannot completely close the doors to families outside the district.
Does accepting open enrolled students negatively impact STMA’s budget?
No, when non-resident students choose to attend STMA, the state funding that would have gone to their home district comes to STMA. STMA open enrollees brought in $6,025,286 to the general fund in Fiscal year 2020. For every $1 million loss, there’s a reduction of approximately 13 teachers; the loss of open enrollment dollars is equivalent to 80.3 teachers.
Further, nonresident enrollments have been used to balance class sizes and maintain programming for resident students that otherwise may not be possible without the funding. In addition, fixed costs (e.g., heat, electricity, snow removal, building maintenance) would be borne exclusively by local taxpayers without this revenue. In the past 10 years, STMA has received $25 million in state aid revenue from open enrolled students.
Would class sizes be smaller with fewer open-enrolled students?
No, the additional revenues generated by open enrollment actually reduce class sizes for resident students. Without the open enrollment revenue, which exceeds the cost of hiring teachers to teach the open enrolled students, class sizes would increase significantly for resident students. Without open enrolled students:
STMA would not be able to offer the current programs and services to students including arts, high potential/advanced, activities, etc.
Staff would be reduced
Class sizes would increase
When will the community vote on the referendum questions?
The operating levy referendum questions will appear on the ballot during the regularly scheduled election of Tuesday, November 8, 2022. For voting and polling location information, please visit https://pollfinder.sos.state.mn.us/.
Can I vote early?
Registered voters in Minnesota may vote early by mail by requesting an absentee ballot or by voting in person before election. Early voting/absentee voting starts September 23, 2022. You can learn more about these options at https://www.sos.state.mn.us/elections-voting/other-ways-to-vote/.