Declining enrollment and rising costs have pushed the Minneapolis school district to the brink of insolvency, which could lead to intervention by the Minnesota Department of Education, Patch.com reported. The district’s financial crisis is particularly striking given the relatively healthy local economy and increase in education funding recently passed by the Minnesota legislature. The district’s low reserves could also hurt the district’s bond rating, increasing the cost to borrow money. Six districts were in this financial predicament at the close of the 2022 fiscal year: two independent school districts and four charter schools. The number of districts in that category has steadily declined from a high of 59 in 1994. The Minneapolis school district has balanced its budget for the past three years with the help of nearly $262 million in federal pandemic funds, but that money runs out late next year, leaving a huge budget hole that must be dealt with by an inexperienced school board.
