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Though the comprehensive formula will not be completely overhauled until 2005, rural areas may see small positive changes in the state budget formula for next year. The projected $160 million state deficit limits the amount of help legislators can offer struggling schools, said Senate Majority Leader Dean Johnson (DFL-Willmar).

"Schools across Minnesota have never had tighter budgets," he said.

Johnson's constituents are calling out to him, but being this is the second year of a biennial session, the education budget is already set so schools will have to wait until next year to see major funding changes, he said.

The state awards a certain amount of financial aid per pupil, and for many rural districts that continue to experience declining enrollment, the financial situation is especially grim. For a state known for its great education system, the situation in Minnesota is not as rosy as Republicans would like people to believe, Johnson said.

The House and Senate have looked within the state budget to find more money for schools. Each came up with a different solution to afford some funding increases to rural schools.

"When you are $160 million in deficit, it's hard to find money anywhere," said Rep. Bud Heidgerken (R-Freeport), a former teacher who represents western Stearns County. He is pleased with the change that the House made in March to its final K-12 finance bill.

The house voted 74-56 to shift $54.7 million from metro area integration aid funds and distribute it among districts across the state. If adopted, Paynesville could see a $29 per pupil increase to its current rate of $3,720 per pupil, Heidgerken said.

"At least, for once, it's more money than less," he said.

The integration aid money was set aside to help schools desegregate following a school desegregation lawsuit in the early 1990s.

But Heidgerken's amendment has little support in the Senate. In general, the Senate does not support taking money from the integration aid and giving it to other districts, said Scott Sandy, the Senate K-12 Education Finance Committee Administrator. "It's stealing money from one district and giving it to another," Sandy said.

The Senate has tried to find more money for districts within its narrow budget constraints, Sandy said. The Senate K-12 Education Budget Omnibus bill (SF2353) was approved by the Senate Education Finance and tax committees in early April. It does not include the same money allocations as the House bill (HF1793), but it does create a way for local districts to increase their revenues by authorizing them to pass local levies.

"This is new money, but it is raised on a local level," Sandy said. The levies do not require voter approval, but they are restricted to certain areas of spending. Districts that qualify could see an additional $12 per pupil. Spending areas include deferred building maintenance or capital projects, costs of school facilities shared with the community, retired employee health benefits, and other outstanding costs associated with operating facilities.

"School districts in general will like this if they have those needs," Sandy said.

Expanding local authority to levy without voter approval helped the Senate to devote reserve monies to programs that took deep cuts last year, such as school nutrition.

The state school nutrition program - including free and reduced meals and breakfast and milk programs - took deep cuts last year. At the time, lawmakers predicted a minimal impact, but the Department of Education reported that milk drinking in schools is down 24 percent, or 200,000 less cartons every month.

The Senate heard SF2353 last week, along with seven other omnibus finance bills. If it passes, the Senate and House bills will be assigned to a conference committee that will work out the differences between them and draft one final bill.

The House K-12 education finance bill also includes increases in funding to nutrition, online learning and school readiness programs, and it allows for an increase in local levies. Floor amendments added to HF1793 say the state should also adopt health physical education standards and allow districts to develop the proposed standards rather than the state.

One of the most positive parts of the House bill is the increased funding to school Internet and telecommunications usage, Heidgerken said. House File 2195 was included in the House's final package and would provide $4.5 million in state aid to reimburse schools for a portion of their telecommunications and Internet costs.

Internet service can cost up to $300 per pupil in some rural areas, compared to 75 cents per pupil in St. Paul. The state average is $15 per pupil, said Vernae Hasbargen, director of legislative action for the Minnesota Rural Education Association. By subsidizing part of the costs, this bill intends to lower the disparity in costs and available opportunities between rural and urban education, Lindgren said.

Gov. Tim Pawlenty included the $4.5 million in his budget, his first investment in school telecommunications. Schools would still have to come up with about $10 million to cover the total costs. Suggestions to make up the difference include an 11-cent tax on every phone line in Minnesota, Hasbargen said.

Rural districts lack the resources to offer students a wide variety of in-house classes. Students can broaden their academic experiences via online courses or classes shared with other districts and taught over the telecommunications systems, Hasbargen said.

(Editor's Note: Arnquist is a senior journalism major at the University of St. Thomas in St. Paul. She is covering the 2004 legislative session for the Paynesville Press. Next she plans to cover educational policy issues.)