Negotiations

Eastern Carver County Schools: You Belong Here

Eastern Carver County Schools employs 1,500 employees representing 12 unions/bargaining units. These are our teachers, our paraprofessionals, our custodians, and our bus drivers to name just a few. Contracts are negotiated on a cycle, and this year ECCS is negotiating two contracts, including our teachers contract. All of the remaining contracts will expire next June which means negotiations for all of those contracts will also take place this year. During the negotiations process, the district and bargaining group each present proposals asking for what they want included in the contract but neither the bargaining unit or the district is not obligated to agree to those requests. These processes can take many months, and even when relationships are good and good progress is being made, negotiations can be challenging.

District Priorities and Guiding Principles

Our priorities during negotiations are the following, with the ultimate goal of supporting student success

Bargaining Groups

School Funding

It’s important to understand that despite breathless news coverage this past legislative session of a financial windfall for school districts, the end result for ECCS and other districts across the state was a mixed bag. Yes, there were historic increases in school funding, for which we are very grateful. But with that increase in funding came a historic number of mandates, many of which are either funded for one or two years or not at all. As a result, much of that increased funding is already tied to programming and not available for other district needs. Even with the historic increase in funding, funding formulas for public schools in Minnesota lag behind inflation and have since the early 2000s.

Among the key wins were a general education formula increase of four percent in Fiscal Year (FY) 2023-2024, the fiscal year that began on July 1, 2023, and two percent in fiscal 2024-2025, with the formula being linked to inflation beginning in fiscal 2025-26.

The special education cross-subsidy was also reduced by 44 percent for each of the next three years, and then goes to 50 percent in FY 2027. The cross-subsidy measures the difference between what the district spends on special education and the corresponding revenue received from the state.

On the expense side, however, legislative changes will impact the district’s costs and some of those impacts are still unknown.

These include changes to unemployment law, paid family medical leave, teacher retirement, and shifts to mandatory bargaining of traditional management rights that will significantly impact that new funding.

These are all welcome and much needed increases in funding, but those increases alone don’t keep up with current or past inflationary pressures and other costs districts face on an annual basis.

For this fiscal year with the 4% formula increase, the per pupil allowance is $7,138. While 4% is a welcomed boost to revenue, April’s Consumer Price Index for the last 12 months was 5.2%.

While grateful for the increase in funding from the state in the 2023 session, the funding formula still does not adequately meet the needs of districts given inflation and other pressures.

As the district enters into the 2024-25 budget process, the focus will continue to be on developing a fiscally responsible budget focused on supporting our students and classrooms while maintaining a healthy fund balance.

The categories in the box above are aligned with how the Minnesota Department of Education requires districts to report expenditures.

Fund Explanations

School district funding often comes with specific restrictions. As a result, districts have different funds to support their work. Per district policy 714, there are four types of fund balances:

Unassigned Fund Balance - technically available for any expenditure purpose
Nonspendable Fund Balance - the value of inventory on hand
Reserved (Restricted) Fund Balance - funds with legal constraints on use
Assigned Fund Balance - reflect the intended use of other unrestricted funds

Fund balances are simply what’s left after all expenses have been paid, and are updated annually as part of the financial audit.

Fund categories

Let’s break that down.

General Fund

Instructional and Student Support Activities
Pupil Transportation
Facilities and Equipment
Operations and Maintenance
Administration

Within the General Fund, there are restricted fund balance categories for

Operating capital
Long Term Facility Maintenance
Basic Skills
Staff Development

Food Service (Restricted Fund)

School breakfast and lunch

Community Services (Restricted Fund)

Early Childhood Family Ed
Preschool programming
School aged child care
Adult Basic Education
Adults with Disabilities
Youth Enrichment
Recreational programs

Fund Balance

The fund balance is like the district’s savings account. While board policy dictates a minimum fund balance of 5% of general fund operating expenses, our strategic plan aims for a minimum fund balance of 8% and our practice is to keep it above 10%. The COVID-19 pandemic showed us how critical a healthy fund balance is, and it allowed the district to weather changes to enrollment and unanticipated costs. For additional context, 5% of our annual general fund revenue would cover approximately three weeks of payroll and other expenses. If we look at our five-year projections, the importance of carefully managing that fund balance becomes even more clear. Maintaining a healthy fund balance is an important part of our responsibility as stewards of taxpayer dollars.

The most referenced fund balance is the unassigned fund balance, which is tied to our strategic plan. There are three main reasons why a healthy unassigned fund balance is important:

Maintain a sufficient cash flow to meet monthly expenses
Indicates a district's financial well-being which is important both to rating agencies when assuming debt and the community
Long term fiscal management that provides a cushion when there are unanticipated expenses or enrollment changes

As a district, we value every single one of our employees and their work. They do an extraordinary job serving our students and the broader community every day. Contract negotiations take time and patience. The district is committed to fair contracts for all our employees that align our resources to support their work and our students’ success.

Elementary Schools

Middle Schools

High Schools

District Services

Bargaining Groups

School Funding

Fund Explanations

Fund Balance