Saint Paul Public School District, Minnesota's second-largest district, has just passed a balanced budget for fiscal year 2027 that includes $14.35 million in cuts and could eliminate about 90 full-time positions, more than a third of them teachers. The budget, approved last Tuesday, totals $1,064,333,209 in proposed expenditures and narrowly avoids shortfalls after years of financial strain. According to a new report from the Center of the American Experiment, the district achieved financial solvency by prioritizing certain programs while making deep cuts to employee salaries.
The district's financial troubles stem from a severe enrollment collapse. Saint Paul has experienced over a 16.4 percent enrollment decline in the last 10 years, with only 60 percent of school-age Saint Paul residents now attending district schools. The district faced a $107.7 million shortfall for fiscal year 2025 and a $51.1 million shortfall for fiscal year 2026, largely covered by reserve funds. A referendum passed with a two-thirds majority, infusing $37 million a year—about $1,073 in new revenue per student—with the median homeowner contributing an extra $309 per year. Even after the referendum, the district still faced the $14.35 million shortfall for fiscal year 2027, representing 1.7 percent of the district's budget. Of the remaining students, about 27 percent are Asian, 24 percent Black, 22 percent white, and 15 percent Hispanic, with almost one in three being English learners.
The report notes that district leaders held three untouchable budget parameters while making cuts: a commitment to full-day pre-K, retaining at least 95 percent of instructional support services, and demonstrating a continued commitment to language and culture programs. The primary slashed line item is employee salaries at $9.4 million, with about 90 full-time district employees potentially losing their jobs. More than a third will be teachers or licensed staff, aligned with diminished enrollment numbers. Additionally, 25 district staff positions will be reduced, representing an extra $3.06 million in cuts. The report states that "the Saint Paul school board is correct to understand that budgets aren't playthings."
The report explains that several factors drove the decision to cut traditional K-12 teacher salaries as the primary budget line item. The rise of school choice options like open enrollment and charter schools has allowed 40 percent of school-age Saint Paul residents to choose schools outside the district. The board's commitment to language and culture programs—including one new Afrocentric program replacing an IB curriculum at a struggling elementary school—is a competitive bid to keep remaining students. Full-day pre-K acts as a feeder program to attract families. But there are structural reasons too: union contracts mandate a strict "step and lane" salary schedule that requires all employees of the same education level and years of teaching to take home identical salaries, with the average St. Paul teacher salary at $87,250 during the 2022-23 school year. The lack of budget flexibility means districts drop teachers completely instead of transitioning them to part-time or lower-paying positions. Next year, the district will also spend $1.4 million on paid family and medical leave, a mandate the report says lacks essential state support or carveouts for school districts.
The report concludes that "the Saint Paul school board should be applauded for successfully passing a balanced budget," contrasting the district with its twin across the river, Minneapolis, which has struggled for years to achieve financial solvency despite new levies and fresh leadership. Financial stability is described as a fundamental part of strong district governance. The bottom line: Saint Paul made painful cuts to achieve what many districts can't—a budget that actually balances.