Proration to Start February 15
We currently have a proration rate of 95% for SFY 25 IDEAS reports across the state. This adjustment will affect the State IDEAS Reports issued on February 15, 2025.
To give you an example, if your Special Education program has a $2 million budget, here's how the proration would impact it:
Revenue:Â $2 million
Proration adjustment:Â 5%, equating to a $100,000 reduction
Annual effect:Â $100,000 reduction, less the 10% holdback, spread across 24 payments = $3,750 per payment
Cumulative impact by February 15 (15 payments):Â 15 payments x $3,750 = $56,250 reduction in your total IDEAS payment
Unfortunately, this is disappointing news, and the proration is expected to continue through the rest of the fiscal year.
Why Is There a Proration?
The proration occurred because total statewide spending in state funding year 2024 exceeded the projections made back in February 2024. These earlier projections determined the appropriations for funding year 2025.
According to Paul Ferrin at the MN Department of Education, it was shared that this month's forecast will propose an appropriation increase for the current year. If approved, this could reduce the impact of the proration. However Paul noted, "This will need to be passed by the legislature to become available. The last time this happened where we needed an increase to the appropriation was in SFY 18. It was not passed during the 2018 legislative session (which was a bonding year) due to governor Dayton vetoing everything."
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Budget Considerations
For most EdFin schools, the budget impact should be relatively modest. Planning for 90-93% reimbursement and roughly 55% reimbursement for many ADSIS budgets provides some flexibility to absorb this proration. Overall, the budget impact for FY25 is expected to be minimal, ranging from 1-3% of special education revenue if the legislature does not resolve the issue.
As always, feel free to reach out if you have any questions.
