6/9/2025 Work Session

School is out, and the OHS graduation ceremony is completed, congrats graduates! We held our June work session per usual at the district office and as a reminder, our next Regular Meeting is next week June 16, 2025 at the chamber board room. This week’s work session was packed with lots of updates, maybe our longest meeting of the year!

HIGHLIGHTS:

Operational Plan – end-of-the-year update from each cabinet member-these are also just a few highlights among much work that has been done. Details can be reviewed on the district website -> school board -> meetings -> agendas.

Achievement Data Update (gr K-8 Fastbridge Assessments) from our Teaching and Learning Director Julie Sullivan

2025-2026 Preliminary Budget review from Mark Stotts, Director of Finance and Operations – very much an estimate as we wait for the legislature to finalize decisions

Levy Referendum review from the finance committee – recommendation for a levy amount and ballot question for the November 2025 election.

OPERATIONAL PLAN UPDATE

Human Resources – Chris Picha: ongoing work with our Grow Your Own Teacher Apprenticeship program for special education teachers, we have 6 teachers that are expected to graduate May 2026 and hopefully will become OPS special education teachers. This program is funded by grants. Chris notes work with AI and finding ways to use this in trainings. Work is being done to prep for implementation of Family Paid Leave Act.

Teaching and Learning – Julie Sullivan: READ Act training going well, phase One will be completed by 6/16/2025 (which is an accomplishment that not all districts can claim). Much work is being done for new math standards, starting with “Illustrative Math” for school year 2027-28. Social studies standards also updated recently with a new ethnic studies component to begin 2026-27 school year. Ongoing work to close the Achievement Gap as noted in MN Dept of Education CACR goals https://education.mn.gov/MDE/dse/wbwf/

Special Services – Mr. Elstad presents this topic in the absence of Sarah Knudsen and Shari Mensink: much work has been done to improve results through “consistent due process.” Work is also being done to expand and improve special education services for our Owatonna Online students. Through staff training using Ukeru and Safety Care programs, there have been less staff injuries, and improved regulation of challenging behaviors that occur with special education students.

Community Education – Deb McDermott Johnson: very challenging year for community education. She reports a 27% reduction in adult student contact hours (many immigrants are no longer participating in classes) which may result in decreased funding for next year. However, we have a full School Age Care (SAC) program which requires at least 18 staff. Deb noted that she’s had to be creative with scheduling and coordinating staff to make this work!

Finance and Operations – Mark Stotts: our new director of finance has only been with OPS for about 3 months and has kept very busy! He noted that he values time visiting the schools and encourages other business staff to do the same as a reminder of why we do the work we do. He notes that school finance has changed dramatically over the last many years, becoming much more complicated. Legislative decisions are still pending which will affect future funding. Our transportation contract with the bus company is changing and there are currently several unknowns that make budgeting difficult (may not know actual numbers until this fall). Mr. Stotts notes that our district uses more bussing services than any district he’s worked with in the past. He notes that our growing Owatonna Online program is financially beneficial, but they are monitoring the success vs cost of summer programing for the future.

Facilities, Infrastructure, and Security – Bob Olson: the pool remodeling project is a work in progress but going well. They are renovating the shower areas also. HVAC updates have begun at McKinley and the Owatonna Education Center as previously planned. There is a possible interested buyer for the Bridge Street district building and there may be a partnership in the community for the Rose Street building.

ACHIEVEMENT DATA UPDATE

Julie Sullivan reviewed slides with data from our K-8 Fastbridge assessments that are done every fall, winter and spring. These slides are not available on the agenda for review. The spring MCA scores are not available yet. While the data indicated improvements in reading and math from 2023 to 2024, the data from 2025 revealed decreased scores. At this time, it is unclear why this occurred. However, there is concern for increased behaviors in the classroom that make teaching and learning more difficult. More to come on this as I anticipate further discussion when the MCA scores are revealed. Mrs. Sullivan reports positively for our increased graduation rate, notably for our Hispanic and black students which have typically had lower graduation rates (closing the achievement gap is one of the goals of CACR as noted above).

2025-2026 PRELIMINARY BUDGET REVIEW

Two main factors that have significant impact on our budget are legislative decisions and upcoming salary negotiations. Neither of these are currently easily predictable. So far, there is an estimated $2 million deficit in the general fund for each of the next 2 years. Projected unassigned fund balance for 2025-26 is 9.83% which has decreased from ~12% this year, with a board-determined goal of 8-10%. So while we are still in the goal range, projections show compounding deficits that will have significant impact over the upcoming several years if nothing is done.

LEVY REFERENDUM UPDATE

The finance committee met on June 2, 2025 to finalize a recommendation to the whole board regarding a levy amount and ballot question for the November 2025 election. Based on the recent community survey results, we determined that we could approach the Owatonna community to ask for additional funding for district operations (which is different from recent bonds used for building the new high school and updating buildings as noted above). As summary:

1. The board previously approved $1.8 million in cuts for the 2025-26 school year which resulted in ~7.3 FTE reduction in staffing/teachers.
2. We have a budget shortfall due to several factors: loss of federal COVID funding, increased special education costs, unfunded mandates set forth by the previous legislative session, and declining birth rates resulting in decreased projected enrollments
3. The last voter approved levy was in 2013 and prior to that was 2002. Owatonna currently sits second from the bottom in levy funding amount within the Big 9 at ~$550/student while Northfield sits at the top of the list with ~$2000/student. Last on the list is Austin, which receives much funding from Hormel.
4. An operating levy will allow the district to maintain its current operations, specifically class sizes, retaining quality teachers/staff, and offering variety of classes/programs/activities. If this levy does not pass at the upcoming November election, we estimate that the district will have to make additional $2-3 million in cuts for the upcoming school years.
5. After review of all the data, the survey results, discussions with Superintendent Elstad and our incoming Superintendent Dr. Champa, and our finance director Mr. Stotts, we believe that we should ask for an operating levy that gives us an additional ~$700/student for a total of ~$3.7 million. This amount is actually less than what the survey suggested we could ask our community for. However, we determined that this amount should be adequate in order to be fiscally responsible yet allow the district the necessary funding to maintain excellent operations. This amount is estimated to cost about $23.25/month for residents with a $275K home value. The additional funding would be collected beginning in 2026 and payable in 2027. After discussion at the meeting, we agreed to present the information for a formal vote at the regular meeting on 6/16/2025.

That’s all for now, much to consider in the coming months! Please reach out with questions and concerns.

Soli Deo Gloria!