South St. Paul superintendent warns district faces about $1.5 million compensatory funding loss, urges residents to contact legislators

Dr. Zambrino, superintendent of South St. Paul Public Schools, told the school board on Feb. 24 that a change in the state’s counting method for compensatory (poverty) students could reduce the district’s compensatory revenue by about $1.5 million.

That funding, he said, would drop the district’s compensatory revenue “from 4,500,000 to 3,000,000, and we’re gonna lose 1,500,000,” and would leave the district facing both smaller per‑pupil revenues and the need to “right‑size” staffing for lower enrollment. He asked community members to “reach out to our legislators, please,” and described a governor‑proposed temporary ‘‘hold harmless’’ as one possible remedy that would preserve district counts for a year while a long‑term fix is worked out.

Why it matters: compensatory funding supports programs for students in poverty, and Dr. Zambrino said the district uses that revenue for mental‑health staff, academic interventions, college‑and‑career advising and other programs added after earlier one‑time federal COVID relief funds phased out. He told the board that those programs cost more than the funds provided by the district’s second referendum question and that losing compensatory revenue would require choices about preserving current services.

Details from the board presentation: Dr. Zambrino traced the district’s recent fiscal history, noting declining student enrollment (about 100 fewer students per year in recent years), the sunset of federal COVID relief and the board’s 2022 referendum questions intended to replace expiring one‑time funds and expand supports. He reported current averages for class sizes (elementary homerooms about 23; middle school core classes about 24; high school core classes about 26) and itemized major revenue buckets (local levy roughly $12.5 million; federal funding roughly $1.25 million; total district budget near $50 million). He said the state now counts compensatory students primarily by “direct certification” with county benefit data (SNAP/MN‑Care/Medical Assistance), whereas the district’s full eligibility—direct certification plus families who file applications for educational benefits—would put its compensatory rate at about 58% rather than the 42% the state count currently shows.

Dr. Zambrino said he has raised the issue with the Minnesota Department of Education and the governor’s office, that he has been asked to serve on a work group to design a long‑term solution and that he and board members will contact legislators. He named Sen. Matt Klein and Rep. Rick Hansen as local legislators he has spoken with and asked residents to focus their outreach to members of house and senate education finance committees.

Board reaction and next steps: Board members expressed agreement with the need to press the Legislature and to plan for a range of outcomes. Dr. Zambrino said the governor has proposed a hold‑harmless fix and that, if enacted, the district would keep the higher compensatory count for at least one year. He also reminded the board that the district must adopt a FY26 budget by June.

The board did not take a formal vote on the funding issue at the meeting; it was presented as part of the superintendent’s budget update and as context for later action directing administration to prepare recommendations for program and position reductions if necessary.