MINNEAPOLIS (FOX 9) - Minneapolis Public Schools (MPS) adopted the district’s budget for the 2023-2024 school and fiscal year Tuesday, setting the stage for a looming deficit throughout district schools.
According to the resolution unanimously passed by its school board, MPS will have a Fiscal Year 2024 operating budget deficit of $1,427,835 with $753,149,726 in district revenues and $754,577,561 in expenditures.
However, its Capital Projects Fund faces a deficit of $48,093,403 with a planned use of $132,002,128 in bond proceeds and only $83,908,725 in revenues.
Combining the current operating budget deficit, and its Capital Projects Fund deficit, in total, the district faces a $49,521,238 budget shortfall for the upcoming year.
"We know that we have many needs, we just don’t have the money to meet all those needs," said MPS board member Kim Ellison prior to the vote.
The current budget incorporates funding changes resulting from the Minnesota Legislature increasing the per pupil funding in coming years.
The state’s education funding formula is the main funding that K-12 schools use to operate. The new formula calls for $23.2 billion in state spending through the next biennium, or two budgets years - an increase of $2.26 billion, or 10.2% over its current base throughout the timeframe.
The spending formula will also be tied to inflation, beginning in Fiscal Year 2026, with parameters that would limit the annual increase to between 2% and 3%.
Despite the additional legislative funding, the MPS budget deficit remains, while also incorporating an assumption that the district will, on average, have 5% of positions unfilled.
In March 2022, Minneapolis Federation of Teachers and Education Support Professionals voted to ratify the union's tentative agreement with MPS, increasing the wages of most educators and receiving one-time bonuses in the process.
How the district intends to balance its budget in the coming school years, while facing declining enrollment, will be a top task for MPS officials going forward.