Passing the Education Buck

Everybody's behind the Minneapolis schools referendum this year--including local business interests that opposed it last time. Why? Because their taxes will go down, while those of most homeowners will go up.

          Janet Kujak is a born classroom performer. A tall woman with a shock of brown hair and a splash of bright red on her cheeks, she soothes, commands, and entertains her 5-year-old charges. There are about 24 in her class. And that's an improvement from the beginning of the year.

          Like most other city schools of its kind, Northstar Elementary was recently designated a "community school," and a spot was guaranteed for each kid in its attendance area. In a poor neighborhood full of young families, that guaranteed overload. Though Minneapolis kindergarten classes are supposed to have no more than 19 kids on average, Kujak and her colleagues started the year herding 28 5-year-olds each.

          "A lot of them come straight from home," she says. "They've never been in daycare. They've never been in any big group before. So we need to think of every detail ahead of time. What you do with your table, where you put your garbage. How you stand in a line, where your hands go, how you eat, how you handle conflict. And there's always someone walking off somewhere, or someone getting bumped and crying."

          Kujak and her colleagues got a little relief. Some reshuffling reduced class sizes, and the school won a state grant to test an all-day kindergarten program. "That's made a huge difference," says Kujak. "I'm old enough to remember how, before 1990, we had 33 kids in each class, and two classes every day. That's 66 kids a day; 66 families to get to know, 66 individual learning plans to put together. There were just a lot of things you couldn't do. Activities, like cooking, games--a lot of my teaching is done through games. But when you have that many kids, a lot of your time is spent just keeping the lid on. It's hard with 25, but it can be done."

          This is the easy part of the referendum Minneapolis voters will find on their ballots November 5. First approved in 1990, it's given the schools $25 million a year so they could reduce class sizes to a tolerable level. If it's not renewed, close to 10 percent of the district's general-fund revenue will be lost. Sitting in Kujak's classroom, the conclusion seems logical: These kids obviously deserve every penny.

          A look at the politics behind the referendum is educational--not for what it says about this particular levy, but for what it reveals about how public education will be paid for (or not paid for) in the future.

          On the surface, the campaign is a love fest. The school district, obviously, supports the levy. So does the teachers' union, many of whose members are paid directly from referendum funds. The Star Tribune, which editorialized against the measure in 1990, is now in favor. Even the Chamber of Commerce has gotten on board.

          So, you might ask, what's different this time? A few things--a new superintendent, a good PR effort, a decent record spending referendum money. More than anything, though, the change is a matter of who will be paying the tab. Businesses and rich homeowners bore most of the referendum burden over the last six years. Now, as a result of legislative changes and a Faustian pact the district struck with business interests, homeowners will have to shell out. And that's the part referendum proponents don't like to talk about.

          Take what they told Beth Popalisky. A teacher in the Anoka-Hennepin School District, she was an easy sell to start with: She has 33 students in her classroom and appreciated the benefits of Minneapolis's lower numbers. But she just bought a house in the city, and she'd heard that the referendum could cost her as much as $120 a year. So she called the Better Schools/Better Communities referendum hotline. It was a relief to hear that at the most, her school property tax bill would rise by $21 next year if the levy was approved.

          What the hotline people didn't tell Popalisky was that the price won't stay that low. For one, the actual referendum tax increase for an $85,000 home, roughly the Minneapolis average, is $68 in 1997. The bill looks lower only because other school taxes have gone down as a result of rising downtown property values.

          What's more, the referendum's tax bite will go up each year for five years, finally reaching $183 for the same $85,000 house in 2001. That's still a defensible amount--it works out to about 50 cents a day--but it does represent an almost fourfold increase.

          But if you own a business or your house is worth more than $200,000, it's a very different story. Assuming that the referendum passes and current projections hold, people in the most expensive dwellings and owners of business property will get a tax cut. For a $250,000 house, total school taxes are estimated to drop $9 in 1997. For an office building valued at $5 million, education taxes should fall more than $7,000.

          The reason for the imbalance is buried amid some little-noticed recent changes in the way property taxes are figured. Politicians don't like to explain them in detail, claiming the system is so complicated mere mortals won't understand. But the basics are actually quite simple.

          Unlike most places, Minnesota has a moderately progressive property-tax system. Land and buildings are taxed at varying rates depending on what they're used for and what they're worth. Farms generally get the best deal, followed by owner-occupied homes; commercial and industrial properties pay the most. The owner of a brand-new office tower may pay property taxes at as much as five times the rate of a couple in an aging bungalow.

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