A phased-in levy is when the levy revenue is phased in over time, rather than all at once. The advantage of this approach is that it also phases in the tax impact, making it a more conservative and financially responsible approach during a time of economic uncertainty. Specifically, the school funding - and estimated monthly tax increase for the average district homeowner ($280,000) would be as follows:

• +$400 per student in 2021; no tax increase (in fact, homeowners would see a decrease of $6.25 per month due to school debt being paid off)
• +$300 per student in 2022, $11.58 per month tax increase
• +$200 per student in 2023, $7.50 per month tax increase
• +$100 per student in 2024, $3.67 per month tax increase

The combination of inadequate state funding, unfunded mandates and increasing educational costs are resulting in expenses exceeding revenue. The only way school districts can guarantee more revenue is by asking voters to approve a local levy, which the vast majority of Minnesota school districts have. Shakopee is one of the only comparable districts without this type of local financial support. The funds would be used to: maintain quality programming and learning opportunities for students; attract, retain, and fairly compensate high-quality teachers; and to build a path to long-term financial stability.

State law requires that bonds can only be used to build, maintain and repair buildings. Operating levies are a legally separate funding source that is used to cover operating costs such as classroom supplies, school staff and bus transportation. 

It would help the school district maintain quality programming and learning opportunities for students; attract, retain, and fairly compensate high-quality teachers; and build a path to long-term financial stability.

If an operating levy request is not approved by voters, the district would need to cut an additional $5.4 million for the 2021-22 school year, on top of the $2 million in cuts during the 2021-22 school year. These are deep cuts that would impact all levels of the organization. These cuts include classroom teachers and nearly every type of employee across the district.

Based on the current student enrollment, the approximate annual revenue to the district will be $3,600,000 in 2021, $2,700,000 in 2022, $1,800,000 in 2023 and $900,000 in 2024. The fully phased-in levy amount will be $1,000 per student in 2024, which is below the metro average and also of comparable districts.

In 2015, voters approved a building bond to build Shakopee High School. Bonds are different from levies - bonds can only be used to build, maintain and repair buildings. Levies are for learning expenses and the costs of operating schools, such as classroom supplies, staff and bus transportation.

The district has tried to manage its budget without asking for additional support until absolutely necessary. Our financial situation can no longer be managed with cuts alone, so the School Board unanimously decided to ask for a voter-approved operating levy, along with making budget cuts. Because Shakopee Public Schools has no voter-approved operating levy, we receive about $1,250 per student below the metro average each year. The last time local voters approved an operating levy increase was more than a decade ago.

The primary reason we receive less is that we don’t have a voter-approved levy, which the majority of districts do. These levies are one part of the school funding puzzle that supports district efforts to provide a quality education to their students. Districts that receive local funding through a voter-approved operating levy have additional funds to spend on classroom instruction and other operating expenses. In addition, other districts with higher percentages of students with financial needs receive more funding.

Shakopee ranks 11th out of 12 comparable school districts in beginning teacher salaries, and Shakopee ranks in the bottom quarter of those districts in terms of teacher salaries across a teacher’s career. Shakopee teachers received a raise in 2019-20 and 2020-21 as a step to start putting them in alignment with their peers in other districts. Our goal is to attract and retain quality teachers for our Shakopee students, which requires providing competitive salaries.

Due to construction debt being paid off, we have an opportunity to increase revenue through an operating levy without increasing net school taxes until 2022. If voters approve the levy, the average homeowner ($280,000 value home) would see tax increases averaging $4 per month over the first four years of the phased-in levy, with no tax increase for the last six years of the levy. View a tax impact chart and learn more about the tax impact here.

The district has worked hard to address past budget issues. We are working hard to live within our means, and have made a number of budget cuts over the past four years. However, state funding that has not kept up with inflation and unfunded mandates have put tremendous pressure on our budget. Using money from the fund balance - which is used for financial stability, cash flow and unanticipated expenses - is no longer sustainable. More revenue is needed to present a balanced budget and maintain the level of programs and services our students deserve and our community expects. This levy request is not about correcting past financial errors, it’s about looking to the future and building a sustainable path forward for our students and families.

Recognizing that education funding is a shared partnership between the government, the school district and local communities, the School Board voted unanimously to couple the levy request with district budget cuts as a balanced approach to the financial challenges. The approved budget cuts fall into three groups:

• 2020-21 school year-- $450,000 in permanent budget cuts.
• 2021-22 school year-- $1,600,000 in permanent budget cuts. These cuts do not include any classroom teaching positions.
• 2021-22 school year-- If the levy is not approved by voters, $5,400,000 in additional cuts. These are deep cuts that would impact all levels and areas of the organization, including classroom teachers. 

Click here to view the budget cuts.

The school district spent more on student learning and related services than the revenue being received. School districts maintain fund balances for financial stability, cash flow and unanticipated expenses. We have worked hard to rebuild the fund balance in recent years. However, the fund balance for the 2020-21 school year is expected to be drawn down by $2.5 million to cover expenses. Additional effort is required to rebuild the fund balance to a healthier level while maintaining our programs and services. This unanimously approved option by the School Board to combine budget cuts with an operating levy will help rebuild the fund balance, if voters approve the levy request.

We have worked hard to live within our means. We have made a number of budget cuts over the past four years to present balanced budgets. We have worked hard to rebuild the fund balance in recent years, which helps support financial stability, cash flow and unanticipated expenses. Additionally, we formed a Citizens Financial Advisory Committee (CFAC) in 2017. We also received the International Designation for Excellence in Financial Reporting for four consecutive years.