Rochester School Board discusses possible operating levy of up to $20 million a year

ROCHESTER — Following its failed referendum in November, Rochester Public Schools is tweaking its message for the next time it asks voters to approve more funding, which could be up to $20 million a year.

The district’s leadership has previously indicated that they would pursue a second referendum, but the School Board discussed the possibility for the first time in depth during a study session on Tuesday, March 26.

“So it begins,” Superintendent Kent Pekel said. “This is the beginning of a really important discussion.”

The School Board is scheduled to speak on the issue again during its April 23 meeting. It is then expected to vote on a decision May 7.

The referendum that failed in November 2023 asked voters to approve $10 million a year for technology needs. In the lead-up to the vote, district leaders frequently said the money approved for technology would free up resources the district was already spending on tech-based needs.

With a 27% turnout, voters rejected the levy proposal by a slim margin of 50.72%.

Following that result, RPS reached out to voters to determine how they perceived the levy request in November, and how they would view one with different parameters in the future.

“It was a very complex message for the public to understand,” Pekel said about the November referendum. “We heard again and again how the emphasis on technology was challenging for even some folks who are connected to our students and our schools.”

So, the district is getting ready to change its approach.

Rather than pursue another capital projects levy as it did in 2023, 68% of survey respondents said the district should pursue an operating levy. Funding from a capital projects levy would be limited to equipment and materials, whereas funding from an operating levy could be used for day-to-day operations.

The dollar amount of the 2023 referendum was limited by the fact that it was a capital projects levy.

Because of that, the next referendum could include a much larger dollar amount than the last one if the district does pursue an operating levy. Even though the specifics of the next referendum are still getting ironed out, Pekel said on Tuesday that the district could ask voters to approve up to $20 million a year in additional revenue.

Board member Justin Cook emphasized the impact a referendum campaign of that nature would have on the community.

“The conversation itself is immensely destabilizing,” Cook said. “Parents make decisions about where their kids are going to go to school based on their perception of the stability of those systems.”

Currently, the district receives the lowest amount of locally-generated per-pupil funding among Minnesota school districts with student populations of 10,000 or more. Pekel said if voters were to grant the district an operating levy of $20 million a year on top of what it already gets, it would put RPS in the middle of the pack when it comes to per-pupil funding among districts with 10,000 or more students.

During Tuesday’s meeting, Pekel gave a forecast of what the district’s future would look like in the case of voters both approving and rejecting a proposed referendum.

“We will have achieved significant financial stability,” Pekel said about voters approving a request of $20 million a year.

On the other hand, the failure of a second referendum would result in a much grimmer situation.

RPS has already cut more than $20 million over the last few years, resulting in the reduction of more than 100 positions.

Pekel said that if voters turn down a referendum again – leaving the district in its current position – RPS would need to cut an additional $20 million from the 2025-26 budget. According to Tuesday’s presentation, that “would be the equivalent of cutting more than 200 staff positions based upon current average salary and benefits in RPS.”

In addition to discussing the nuts and bolts of the actual dollar amount and date of the next referendum, the board also spent time discussing how the district would have to broach the subject with voters.

“We really need to do a better job of helping our community understand that whether or not they’re committed to other people’s education, having Rochester be a world-class educational community is going to be good for every single person who lives here – economically if not in any other way,” board member Jean Marvin said. “It’s the right thing to do. It’s also the smart thing to do.”