HF3654

Purpose

• The bill aims to change how charter schools are funded by reallocating and increasing certain education revenue. It also renames and increases funding for the local optional revenue program and updates related Minnesota statutes.

Main Provisions

• Treat charter schools like districts for general education revenue (GER) calculations:
  • For each adjusted pupil unit, a charter school’s GER is calculated as if the charter were a school district. This amount starts with the state average GER per pupil unit plus the district of residence’s referendum equalization aid and the first-tier local optional education aid, then makes deductions based on a formula allowance and specific revenue categories.
  • A particular calculation reduces the impact of the formula allowance by 0.0466, using a method that omits certain revenue categories (declining enrollment, local optional revenue, basic skills, extended time, pension adjustment, transition, and transportation sparsity) and then adds back certain revenue categories as if the charter were a district.
• Extended-time programs boost:
  • Charters operating an extended day, extended week, or summer program receive a GER increase equal to 25% of the statewide average extended-time revenue per adjusted pupil unit.
• Special education charter schools:
  • Eligible special education charter schools receive GER equal to the amount calculated above plus unreimbursed costs for educating students not eligible for special education services.
• Overall funding uplift:
  • The GER under these provisions is increased by 132 times the charter’s adjusted pupil units for the fiscal year (a substantial funding increase).
• Related statutory updates:
  • The bill would enact these changes by amending Minnesota Statutes cited in the text (including sections related to GER, local optional revenue, and special education provisions) and would rename the local optional revenue program while increasing its funding.

Significant Changes to Existing Law

• Substantial overhaul of how GER is calculated for charter schools, aligning more with district-based funding and incorporating district-level allowances.
• New funds and a targeted uplift for extended-time programs and for eligible special education charters.
• A large overall funding increment via the “132 times APU” mechanism.
• Revisions to the local optional revenue program, including renaming and increased funding.

Potential Implications

• Charter schools could receive significantly more funding, especially those with extended-time programs or special education needs.
• The funding model moves charter schools closer to district-style funding, which may affect how resources are allocated and how schools plan programs and staffing.
• The cost of funding may increase for the state; districts and charters may see changes in how revenues are distributed.

Relevant Terms - charter school - general education revenue (GER) - adjusted pupil units (APU) - referendum equalization aid - first tier local optional education aid - local optional education revenue - formula allowance (section 126C.10 subdivision 2) - extended day / extended week / extended time / summer program - unreimbursed costs - eligible special education charter school - 124E.21 subdivision 2 - declining enrollment revenue - basic skills revenue - pension adjustment revenue - transition revenue - transportation sparsity revenue - 132 times the adjusted pupil units