The financial discussion was dominated by the impact of losing federal Esser grants, which had previously bolstered the district’s budget. The board highlighted the strategic decision to manage these grants cautiously. However, the expiration of these funds has left a substantial gap, with special education costs further exacerbating the situation. Over the past decade, the student count for special education has soared from 668 to over 1,000, necessitating increased services that are federally and state-mandated.

This rise in special education needs has led to an increase in expenditures, with costs escalating from $9.9 million to $17.4 million in ten years. The board expressed concern over the inadequate state reimbursement for special education services, which continues to fall short of covering these expenses. The financial burden on the district’s general fund is considerable, and the conversation underscored the need for reevaluating funding strategies.

Staffing changes over the past decade were also reviewed, revealing an increase of 47 positions primarily in direct student contact roles without adding administrative roles. This expansion is partly due to the district’s successful online program, which has generated approximately $1 million in net income through open enrollments. The program’s growth reflects positively on the district’s efforts, yet it also demands additional resources to meet the needs of enrolled students.

The board also discussed student enrollment trends, noting stability over the past ten years despite challenges in kindergarten enrollment. Recent declines in kindergarten numbers pose a financial challenge, as funding is closely tied to student enrollment counts. The board noted that a reduction of 100 students could lead to substantial revenue losses, further straining the district’s financial standing.

Amid these financial discussions, the board addressed policy concerns brought forth by community members. A public forum revealed frustrations from parents, particularly Sarah and Jeff Chandler, who voiced concerns about access to their daughter’s special education classroom. The Chandlers highlighted their daughter’s distress and the school’s policy preventing classroom visits, urging the board to adhere to its policies. Another community member, April St. Martin, supported the Chandlers’ request, emphasizing the need for timely responses from the board to prevent further disruptions in the student’s education.

In addition to financial and policy discussions, the board reviewed other issues, including inflation’s impact on vendor contracts and the widening gap between revenue and rising costs. The potential need for a levy was briefly mentioned, but no specific strategies were defined at this stage. The board acknowledged that financial challenges are not unique to Owatonna, with many districts in Minnesota facing similar issues, partly due to declining birth rates affecting kindergarten enrollments.

The board’s meeting also covered various administrative matters, including updates on the sale of the Bridge Street school and preparation for an upcoming district audit and truth in taxation hearing. The board expressed appreciation for community support through gifts contributing to extracurricular activities and essential items for students.