The money
MPS's financial problems are real. So are its accounting errors. Both matter when the district says closures are needed to balance the books.
Roughly 13,000 empty seats districtwide.
About 6,500 fewer students in ten years.
The yearly gap is smaller than it was, but reserves are already below the board's own 8% policy.
How the gap opened
- Fewer students. K-12 enrollment fell from 36,404 in 2015 to 29,928 in 2025 while charter enrollment in the city rose. State aid follows students. [Star Tribune]
- Federal pandemic money ran out. MPS received $259 million in federal COVID relief. The district's own 2024 budget said that "despite decreases in student enrollment over the past ten years, proportionate changes in the operational structure of our district have not been made." [FY25 budget presentation]
- Big recent gaps. A 2024-25 gap of $110-115 million was partly covered with $55 million in reserves. The 2025-26 shortfall was about $75 million. [Sahan Journal] [Star Tribune]
- Rising costs. The district cites salaries, benefits, utilities, transportation, food and contracted services. [FY25 budget presentation] State and federal funding also cover only part of special education and English learner costs. [Minnesota Reformer]
The accounting errors
The district's finances have also been hurt by its own mistakes, which matters when families are asked to trust its numbers on closures.
- May 2026: an auditor found miscategorized special education expenses. Fixing them brought in more than $20 million over two years. [KSTP]
- May 2026: an assessment commissioned by MPS described the finance department as "in a downward spiral at a crisis point." [KSTP]
- August 2026: MPS lost $4.1 million in special education aid by under-reporting expenses, roughly the cost of 35 teachers. The same reporting describes $5.3 million in federal tax penalties, a late audit with adverse findings, and more than $1 million spent on outside consultants and investigators. [Minnesota Reformer]
- September 2026: the board pre-certified the maximum property tax levy for 2027. [KSTP]
What would closures save?
At the Sept 15, 2026 work session, Chair Beachy asked how much of the structural deficit the three options solve. Deputy Superintendent Ty Thompson's answer, 3 hours 13 minutes into the recording: "what we know about school consolidations and closings across our nation is that it's not something that's like a huge cost savings... that hasn't been the intent."
The same night, Director Callahan asked for "the exact dollar amount you anticipate saving from closing each specific school." No answer was given. In October 2025 the board had required a "cost/benefit analysis for any physical changes." None of the district documents we reviewed, through Sept 15, 2026, estimates the savings from closing or consolidating any particular school. What the board heard
Utility savings are 1.4% to 1.8% of the shortfall. Holding cost uses the operations chief's $50,000 to $80,000 per vacant elementary per year, times 16. Slide 116 adds that the options "do not significantly change the efficiency of overall transportation routes"; the bus savings come from consolidating start times, which does not require closing anything. The ballot amendment figure is about $33 more per student, times roughly 29,000 to 30,000 MPS students; see below.
Other money on the table, and how big it is
On Nov 3, Minnesota voters decide a constitutional amendment that raises the annual payout from the state's Permanent School Fund from about 2.5% of the fund's value to 4.5% of a three-year average. It passed the House 134-0 and adds no tax. Per student, the distribution goes from about $68 to about $101, a gain of roughly $33. For MPS's 29,000 to 30,000 students that is about $1 million a year, or about 2.5% of the 2026-27 shortfall, roughly the size of the utility savings from closing 16 buildings. Director Callahan cited the amendment at the Sept 15 meeting as one reason the district is "not standing in the ashes." It is real, it helps, and it is small. A superintendent quoted in the same article called her district's share "a drop in the bucket when it comes to rising costs." [Sahan Journal, Sept 1, 2026]
The closure-savings estimates that exist are broad and dated:
- About $40-45 million a year from "right-sizing" buildings, cited around the November 2024 space study. [Mpls Schools Voices]
- An empty elementary building costs $50,000-$80,000 a year just to maintain, and selling one takes two years or more. [Star Tribune]
- The district's own April 2026 slide says sale revenue "largely goes into paying down existing debt." [Apr 7, 2026]
What other cities learned
- Pew studied closures in six big-city districts and found savings were relatively small against their budgets, and closed buildings were hard to sell. [Pew, 2011]
- Washington, D.C. reported its 2008 closures cost $9.7 million. The city's auditor later put the real cost near $40 million. [Washington Post]
- A 2024 research review found districts often overestimate savings and underestimate transition and transportation costs. [Research for Action]
None of this means MPS can avoid hard choices. It means the board should see real, school-by-school net savings, including busing, transition and empty-building costs, before it votes to close anything.