If Julie Critz seems to be following what has been going on - or not going on, depending on your point of view - in St. Paul lately, that is because Alexandria's superintendent of schools has more than a casual interest in the state budget process.

The state's education funding is a big part of the biennium budget. It is also by far the largest funding source for public school districts.

The proposals being bandied about by the Senate, House and governor are quite different in how much money they allot to public schools. Whatever amount they settle on takes on even greater significance for schools such as Alexandria, which is projecting budget shortfalls for the future.

Those financial uncertainties have caused Critz to hold several small-group discussions recently with people who are connected to the school district in some capacity, from individual school advisory councils, partners with the high school academies to parents and others. Last week she gave a boiled-down presentation to Rotary Club members.

"I don't want this to be a surprise to the community," she said. "The goal is really building awareness for what we're projecting in the future and the reasons why."

Projections

At the school board's March meeting, Critz said the district would be solving a $1.1 million projected shortfall for the 2019-20 school year through roughly $600,000 in cuts and $500,000 from their financial reserves.

"We were able to stay away from the classroom," she said. "All of the reductions we made kept the impact away from students."

The projected deficit is the first in nine years, according to Trevor Peterson, the school district's director of business services. In the small-group meetings, Critz has been covering many of the reasons for that. They include:

• Operating revenue: Funding is not keeping up with expenditures, as revenue has increased by about 1 percent a year over the last decade, and spending at 3 percent. This means the projected deficits grow larger with each passing year. "We're not the only ones with financial challenges in place," Critz said. Without knowing what level of funding the state will provide for the next two years, Alexandria's deficit could be as high as $3 million for the 2020-21 school year.

• General education aid: Among 14 districts of comparable size, Alexandria is next-to-last in the amount of general education aid per student it receives. Of the 333 public school districts in Minnesota, Alexandria ranks 298th in that category.

• Local sources: While 89 percent of school revenues comes from state, federal and other sources, 11 percent of Alexandria's general fund budget is derived from local aid. That is less than the average for Minnesota districts, which is 15 percent. "We're low in both areas," Critz said of state and local revenues. "That's why we are where we are."

• No voter-approved levy: In 2004, voters approved an operating levy for the district. In essence, it provides money above what the state allocates, to be used for staff salaries, transportation, co-curricular programs and other expenses. The operating levy expired in 2014.

A majority of Minnesota school districts are funded in part by a levy. Alexandria has been able to operate without such a levy for five years. The increased enrollment has helped delay things, Critz said, as to this point the district has not had to spend at the same ratio by hiring additional staff. Instead, class sizes have risen.

"We have been increasing class size at the time needs are increasing," she said.

That may be changing in the near future, however.

A demographic study done recently for the district shows that enrollment will continue to increase, between 11-17 percent in the next decade. While Critz described that as "slow, steady growth," it does create issues when it comes to class sizes in several grades that are already bumping up against what the district deems as ideal. Current class sizes range from 18-27 students per class in grades K-2, 24-27 in grades 3-5 and 26-28 in grades 6-8.

"We have in some ways been able to kick the can down the road," Critz said, noting that it doesn't come as a surprise to the school board that the district finds itself staring at projected deficits. "We have been watching this."

Reaction

School districts are not funded equally, with property-rich districts such as Alexandria receiving less aid than those with lesser property values. Aid is also based on demographic criteria such as the number of students who receive free or reduced lunch or those who are English as a second language learners.

That last part surprised Rachel Buse, a parent of two children who attend elementary school at Miltona Science Magnet School.

"I am floored, and think a lot of people would be surprised to learn the demographics affects our funding that much," she said. "If we had more diversity, we would be (getting more aid)."

Buse believes the district's biggest challenge will come from a very small number of people who will be vocal in blaming it for the situation.

"I think that's going to be the biggest hurdle," she said.

However, that can be solved by breaking things down as was done in the session she attended at Grand Arbor last week.

"I'm happy to see they're trying to get information out for discussion before instead of after the fact. I commend the district in how they're approaching this and trying to problem-solve," Buse said. "The more people are informed, the more they are involved."

Her reaction has been characteristic of others in the 20-plus discussion groups Critz has led.

"If there's been a person that's been negative, they haven't spoken out. Once people understand the funding structure and the disparities and that we don't currently have a voter-approved operating levy," Critz said they have been really supportive.

She pledges to hold more public sessions in the future, with the goal of sharing information as well as getting feedback.

Another way for the district to get that input will be through another community survey to be conducted later this month. It will be demographically representative. For example, since 23 percent of households have children attending school in the Alexandria district, the survey will aim to replicate that figure.

"We need people to participate in the survey," says Critz, noting the telephone surveys will take less than 10 minutes.