Facing large budget shortfall, St. Paul superintendent explains possible cuts

[MUSIC PLAYING] CATHY WURZER: Two of the largest school districts in the state, St. Paul and Minneapolis Public Schools, are facing large budget shortfalls. Minneapolis school board members met last night, where they shared the district might eliminate more than 200 full-time positions, including some teachers, in an attempt to ease a $110 million deficit.

Teachers and other staff are currently in contract negotiations with the district. They're asking for better pay. At a news conference earlier this morning, teacher Marcia Howard said pay increases are necessary to keep staff in the district.

MARCIA HOWARD: We implore the school board and our new superintendent to intervene and make changes to improve our school. And that means not cutting the classes that we need and paying competitive salary to keep our members here.

CATHY WURZER: It's a similar story across the river. St. Paul Public Schools face a $107 million deficit, though the district averted a strike earlier this month. At last night's school board meeting, board members approved a teacher contract that includes pay raises, class size caps, and increased health insurance contributions from the district.

Last night's school board meeting also included a budget update presentation, where district leaders shared their funding challenges. Joining us right now to explain the district's financial situation is St. Paul Public Schools Superintendent Joe Gothard, who is leaving soon for a new position in Madison, Wisconsin. Nice to talk with you. Thanks for taking the time.

JOE GOTHARD: Hi. Good afternoon, Cathy. Great to talk with you, too.

CATHY WURZER: So the teacher contract approved will increase wages for teachers and other union staff by about $37.5 million, if I read that right. As teachers get paid more and more each cycle, each contract cycle, how are you factoring those increases into the overall budget?

JOE GOTHARD: Right, so that is the two-year total of the agreement for three different groups, and it's important that people know that SPFE represents teachers, educational assistants, and school community service personnel. So, three different subunits under SPFE.

And yes, you're right. I mean, we have to factor that into our overall budget projections. When we're projecting the amount of expenditures we'll have, we have to add inflation. And if it's a year that the contract is being renewed, we factor that into it. So, the agreement that we came to a couple of weeks ago was factored into our overall budget planning. It doesn't make that number better or worse. It keeps it the same.

CATHY WURZER: Although you're facing this fairly significant budget shortfall, right? So, I'm sure listeners would say, well, wait a minute. Why would they have approved the contract if they're facing a budget shortfall and they're increasing teacher pay?

JOE GOTHARD: Well, and I think we have to look at it this way. I mean, I think a pay freeze right now would be reprehensible to many. And we would hear that loud and clear. Our local union has been very active-- I don't have to tell you or listeners that-- in terms of what I've experienced in four cycles bargaining with them. And we do want to retain a great workforce. We do want to attract a workforce.

The rhetoric and narrative around public education right now, whether we're talking about here in St. Paul, or my friend, Kevin Glover, up in International Falls, or superintendents around the country will tell you that it's getting harder and harder to find and keep good staff. And the churn and the workforce dynamics are making it very difficult to do this.

So, we have to have a solid pay structure. We have to address insurance increases. We have to address overall inflation, as it factors into our budget. But you're right. It leaves us with very little room to make modifications.

CATHY WURZER: I understand you've identified about $71 million in possible cuts. Where might those cuts be coming from? Can you tell us?

JOE GOTHARD: Well, a lot of that was our American Rescue Plan dollars. And again, we're a little bit different than even Minneapolis. Back in spring of 2021, we received $207 million just in the SR3 or ARP allotment from the federal government. So, a lot of that money, we have to spend by September of '24. So, of course, we wanted to use that to its fullest abilities. And a lot of that will go away.

Now, the difficult part of that is that we absolutely supplanted and subsidized many of our positions with that money for two reasons. One, we really wanted to do some great work that our community valued. And two, we wanted to make sure we spent the money. The worst thing I could do right now is to spend back or send back unspent dollars to the federal government. So, we're getting that number down to a balanced budget as close as we can. We've identified maybe about 35 million more that remains for us to look for reductions.

CATHY WURZER: How helpful is it with the historic investments in K-12 education last year from the state of Minnesota, more money put on that per pupil education formula? Has that been helpful?

JOE GOTHARD: Well, I think-- and you and I talked about this before, but since 2003, there has hasn't been a relative way to keep up with inflation. And the historic investment in one biennium is not going to make up for 19 previous years or 20 previous years. So it is going to take a sustained effort to have that kind of investment over time to give districts the ability to both rightsize, adjust for rising costs, but most importantly, design their school districts around the student experience.

And to me, that's what gets lost in all these conversations. We talk about the adults and whether it's contract settlements or this position being cut or that position being cut. We don't talk about students in the student experience enough. And we wanted to find out this budget cycle, where should we invest? What does the community, what do our students, staff, and families value? And we did want to hold on to some of the great initiatives that we learned through that process.

CATHY WURZER: What do you think might be something that you might want to jettison, then? If you're going to be protecting the student experience, sometimes times that means the arts, music, sports. We keep all of that? I mean, what might you be looking for when it comes to maybe axing some things out in the budget?

JOE GOTHARD: Well, there will certainly be an across the board reduction in ways that I might not be able to quantify individually right now, but I'll give you one great example. We targeted $11 million for job embedded professional development. And by doing that, we added specialists to our elementary schools so that there could be a rotation of music, science, art and physical education that was equitable around the district, but it also gave teachers the time to plan together and work together towards the achievement goals and social emotional learning goals that they have in their schools.

And again, it's a nice to have, right? I mean, we're not funded to do that kind of work because it does add extra work for us in order to accommodate that schedule. But we certainly can't afford to continue that. That was funded through our ARP dollars. So that is one large one that we identified last night-- and shared last night, I should say.

CATHY WURZER: As you know, Minneapolis is having trouble with student enrollment numbers. For the first time in six years, your enrollment has stabilized. And folks say a big factor is your language and cultural schools. In fact, you and I talked about the East African Elementary Magnet School that opened up this year. Any cuts coming to these language magnet schools?

JOE GOTHARD: No, in fact, we're adding additional strands. As you might remember, we're two years into our Txuj Ci dual-language and culture school, adding the middle school. So we had sixth grade last year, seventh grade this year. Next year, we'll have sixth, seventh, and eighth.

And we just announced at our committee, the board meeting last week, that we're beginning a Karen language and culture school that will be housed at Wellstone Elementary School, near the North End. So we're excited about that.

We have thousands of Karen families who opt for charter schools and live right in our community, right near that school, in fact, when we did our study. So it's very much a goal of ours and a community group that has come around that's similar to East African Elementary Magnet School, that they are very much going to welcome back families who have chosen other options in St. Paul Public Schools.

CATHY WURZER: Say, before you go, with this budget deficit that you are dealing with, as I mentioned, you're going to be going to a new job. How will you ensure there's going to be a smooth transition between yourself and the future superintendent?

JOE GOTHARD: Well, I think smooth in St. Paul Public Schools can certainly depend on the day, but I've got a great team around me, a really engaged community. And I think that we'll work as hard as we can for the days that I'm here to make sure that we get this budget balanced, and really look forward to transitioning in interim likely for the next year before a permanent superintendent is hired in the future.

I'm always easy to find. If that individual, once they're identified, would like anything from a year on out or however many months that's out, I'll certainly always be there. And appreciate my time here in St. Paul Public Schools with folks like you and certainly our students, staff, and community.

CATHY WURZER: We wish you well. Thank you, superintendent.

JOE GOTHARD: Thank you, Cathy. Have a great day.

CATHY WURZER: You, too. Joe Gothard is the superintendent of St. Paul Public Schools.