Most school system expenses, such as teacher positions, textbooks and transportation, are outlined in the operating budget. Each winter, the school board develops a proposed operating budget for the next fiscal year that will begin on July 1 and presents this information to the mayor. The mayor then recommends a total amount of funding for Metro Schools to the Metropolitan Council, along with proposed budgets for other city agencies as part of the overall city operating budget. The Metro Council must approve a city budget on or before June 30, or the mayor’s proposed budget goes into effect. The mayor and council set the overall funding amount for Metro Schools, but cannot determine how those funds are spent. It is the responsibility of the school board to make those decisions by approving a detailed operating budget.
The operating budget is funded by state and local tax revenues, with around a third coming from state direct funds, and more than 60% from the Metro General Fund, such as local property taxes, local option sales taxes, and licenses, permits and other fees. State education funds are largely provided through the BEP formula, which is determined by the governor and state legislature. Capital expenditures are accounted for separately and are generally not a part of the operating budget recommendations. Additionally, federal and state grants and other special-purpose funds are accounted for separately. For example, the School Lunch Fund Program and the MNPS print shop are special-purpose funds that are funded by fees.