Albert Lea Area Schools Levy Renewal

1. Albert Lea Area Schools Levy Renewal

2. November Referendum • The Albert Lea Area School District is seeking to renew its current levy for 7 more years on Tuesday November 5th. The current levy is set to expire in 2014.

3. Legislative Changes • Legislature has impacted our local finances in multiple ways. For the purposes of this renewal levy, two factors are most significant: • Legislature has increased the tax equalization formula for Albert Lea, so local taxes will go down on the tax statements property owners receive this fall, • Legislature has funded all day every-day kindergarten starting in 2014-15, but reduced student weights in the future.

4. Equalization • The legislature has increased the equalization aid paid by the state on a significant portion of our taxes. It increases from 23% to 38% for a large part of our levy. Savings will be seen on the school district portion of property owners statements this fall. • See handout for tax impact.

5. Legislative actions impact on levy • Since the district is seeking a renewal that will go into effect for tax purposes in 2015, taxes are expected to remain flat if the renewal is approved.

6. What About All Day K? • Funding all day kindergarten was a significant factor in seeking approval of the levy approved in 2007. If the legislature is funding all day K- why do we need to continue to support the levy at its current levy?

7. Student Weights • Districts receive funding from the legislature based upon a weighted factor determined by the grade levels of the student population. The general aid that the district receives is multiplied by this factor to come up with a weighted adjustment. • In 2015 most student weights will be reduced to compensate for the increase in all day kindergarten funding- See handout

8. New Student Weights for 2015 • Prekindergarten Disabled: from 1.25 to 1.0 • • Part-time Kindergarten: from .612 to .55 • • All-Day Kindergarten: from .612 to 1.0 • • Grades 1-3: from 1.115 to 1.0 • • Grades 4-6: from 1.06 to 1.0 • • Grades 7-12: from 1.3 to 1.2 The impact of this reduction across every grade level has a significant financial impact on Albert Lea Area Schools in the future.

9. Referendum Trends Average referendum authority per pupil is increasing • In 1993, average referendum authority was $332 per pupil • For 2014, the average authority is projected to be $920 per pupil • 17.6% of general education formula allowance- statewide • Albert Lea is at $1096 and 13% for 13-14.

10. Ehlers provides public finance materials for convenience and information only. Additionally, this material is provided for educational purposes only and should not be construed as investment advice or an offer or solicitation to buy Ehlers’ products or services.

11. How has the district managed its resources compared to other area districts? • Owatonna- seeking third levy in past four years. Looking for an increase of $5,700,000 • Faribault- seeking third levy in past four years. Looking for an increase of $2,500,000 • Austin- seeking third levy in past four years. Previously passed a building levy. Seeking a renewal. • Mankato- seeking second levy in past four years. Previously passed a technology levy. Seeking $70,000,000 building levy.

12. Final Thoughts • We have not gone out for a referendum since 2007, and we are only seeking a renewal. • The legislature is funding all day k, but has shifted weights from elsewhere in the funding formula to do it. This potentially will impact future funding for Albert Lea Area Schools. • The district has made significant improvements, and have done so without seeking additional taxpayer support.