School paybacks from state under way

MARSHALL – Area schools won’t have to wait much longer to fully cash in on their IOUs from the state.

Sen. Gary Dahms said Friday school districts across the state will immediately begin to receive bi-monthly school aid paybacks.

For the last four years, the state has used money that would’ve otherwise went to schools to help erase deficits. The state owed $1.3 billion to states because of those previous funding shifts and cut its first checks to schools on Dec. 15, which was triggered by the November forecast. Schools are scheduled to receive payments twice a month – on the 15th and 30th – until the full $1.3 billion is paid back.

“I’m glad we’re able to do that,” Dahms, R-Redwood Falls, said. “I feel we’re going to have a pretty decent forecast come February, and I think if we keep our nose to the grindstone we’ll be able to get this shift paid back. Unless we start doing some adverse things, I think we can do that; we need to try to do that and get out of this school shift program and stay out of it.”

The latest budget forecast showed an additional $1.3 billion surplus on top of $1.2 billion reported previously, Dahms said. With the total surplus of $2.5 billion in the current biennium, the state filled the budget reserve, replenished the cash flow account and paid back the entire school shift negotiated as a part of the 2011 budget agreement.

According to the Minnesota Department of Education, Marshall Public Schools will receive a total payback of roughly $3.6 million; Tracy Area Public Schools will get just over $1.1 million; and Yellow Medicine East will get back a little more than $1.2 million.

“It’s not new money to them because it’s shifted money that we’re paying them back,” said Dahms. “It’s new cash in the account, but that cash has already been accounted for in their budgets.”

The last payments have to be made to schools by June 30, which is the end of this fiscal year.

With a projected $1.1 billion shortfall this year, Dahms can’t say for sure if future funding shifts involving schools won’t happen again.