GMR continues to review finances and referendum options: No official decision yet

Greenbush School site

The GMR School Board continued to review its financial options, including potentially putting a levy or levies on an upcoming November ballot, during its June 15 meeting— offered in person and via Zoom. Should it revoke and replace it with a new levy? Put two questions on the ballot— one, to renew the current levy and, two, to seek an additional authority? Or increase the authority by the rate of inflation each year? The board didn’t make a decision at this time, but it has until August 21 to adopt a resolution calling for a special election.

The board will hold a special meeting on Thursday, July 9 at 7:30 pm to review referendum options.

At this June 15 meeting, the board may have not made an official decision, but had several discussions following a presentation by Matthew Hammer from the district’s financial advisor, Ehlers & Associates.

One of those discussions revolved around the possibility of putting two questions on a ballot— one of those questions being renewing the current referendum and the second being authorizing an additional referendum (increased levy). The district’s currently running, five-year referendum expires in fiscal year 2022.

“We need to renew it,” Board Chairperson Shane Kilen said. “We have to renew what we have.”

The currently running referendum produces $806.05 per pupil in fiscal years 2018, 2019, and 2020, and will produce $506.05 per pupil in fiscal years 2021 and 2022. What was the reason for decline?

As Guggisberg explained, during the 2019 Minnesota legislative session, the legislature lowered all existing operating referendums by $300, and added this amount to a separate board approved funding formula called Local Optional Revenue. The district is receiving the same amount of revenue over the five years, but through two separate funding streams— $506.05 of voter approved operating referendum and an added $300 in Local Optional Revenue. Guggisberg mentioned at a May meeting how GMR has one of the lowest referendums in northwest Minnesota.

As for the option of renewing the current levy, the Ehlers & Associates Power Point presentation highlighted how referendum renewals between 2014 and 2019 passed 100 percent of the time. In November 2015, the district approved renewing its currently running referendum at the same amount — the same year it voted down a school building bond for a new school building.

“Even at the legislative level, there has been some conversation… it hasn’t gained traction in this cycle,” Hammer said. “But in the past, there’s been some conversation about allowing boards to just renew authorities that are in place because the passing rate has been so high for renewals.”

After renewing that levy in 2015, the district ran a couple revoke and replace questions for increased operating referendums and a capital project levy question on ballots, but all have failed. In 2016, the district voted down revoking the existing referendum and replacing it with a new one that would have provided the district with $632,831 in additional revenue annually for five years. In 2017, the district voted down revoking the existing operating referendum with a new referendum that would have generated approximately $400,000 annually over 10 years. On this same ballot, it also voted down a capital project levy that would have generated $400,000 for 10 years.

Guggisberg mentioned a positive he has witnessed within the district during the COVID-19 pandemic— a potential reason to put a question or two on an upcoming ballot— citing numerous larger area employers that stayed open or closed for just a short time and returned to business.

“You don’t have the issues with a large number of people in northwest Minnesota as compared to the unemployment that you find elsewhere,” Guggisberg said. “So those I think are positives that other places in the state of Minnesota can’t say that have happened.”

Guggisberg added how the neighboring Badger School District is looking at an election with one or two finance-related questions. He also again cited how the Roseau School District passed a pair of bond referendums, together totalling just over $40 million, last month. Each of these referendums passed by 74-26 percent margins, according to the Roseau Times Region.

“There are some positives out there,” Guggisberg said. “But you still have to convince people that K12 education here in Greenbush-Middle River is important… and we need the resources, additional resources to function and operate.”

Guggisberg did provide a cautionary message to the board if were to pass a referendum.

“If you blow through that money in three years, you’re just not being good stewards,” Guggisberg said. “I’ve indicated to you in the past that you have to do a combination of operating referendum as well as some budget reductions.”

As review, thanks to COVID-19 assistance and savings, the Greenbush-Middle River School received a reprieve in terms of its budget— “more on par or not far in deficit”—Guggisberg explained at the May 18 school board meeting. At that time, he recommended making no cuts.

To see the complete story, read the June 24 issue of The Tribune in print or online.