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Morris, Cyrus school districts continue with discussions of consolidation

MORRIS - For the last four months, representatives from the Morris Area and Cyrus school districts have been working on a potential plan to consolidate the districts.

In a series of three stories this month, we'll look at what consolidation is and why the Morris Area and Cyrus school districts are considering it, what are the major considerations in consolidation discussions, and what the next steps will be in the consolidation process.

What is consolidation?

At an informational meeting in January, John Bulger, a representative from the Minnesota Department of Education School Finance Division, explained the different processes for school district reorganization to administrators and school board members from the Cyrus, Morris, Minnewaska, Hancock and West Central Area school districts.

There are two main ways for districts to reorganize: dissolution and consolidation. Dissolution is a less-common method - since 1980, only two districts have been dissolved, while 83 districts have been involved with consolidations.

In the dissolution process, the school board turns over control of the district to their county board, which then chooses which district to attach the defunct district to. Both districts involved with the dissolution lose all authorization for any operating referendums that voters have already approved, which is the major reason this process is not often used, said Bulger.

It's more likely - and more beneficial to all parties involved - to go through the consolidation process. With a consolidation, a new school district is created by combining two or more old school districts.

The consolidation process typically takes between 6 and 18 months to complete.

In the case of the potential consolidation between Morris and Cyrus, the process formally began in May when the Morris Area School Board voted to hire consultant Mike Hoheisel of Northland Securities to help facilitate the consolidation process. At the same time, both Morris and Cyrus passed resolutions stating their intent to move forward discussing the process, while other area districts formally stepped out of the discussions.

Once the process begins, the school boards of affected districts need to pass resolutions that address bonded and operational debt, capital and energy local obligations, excess and down payment levy referendums and how the new, consolidated school board will be handled. All of these considerations will be laid out in a plat, a plan that will eventually be submitted to the Department of Education.

Why consider consolidation?

The impetus for beginning a reorganization discussion came from Cyrus, which has struggled to staff and maintain their elementary school due to declining enrollment.

"You have to look and see if the K-6 educational process is viable for kids," Cyrus Superintendent Tom Knoll said at the meeting in January. "We have to do what's best for the children so they get a good learning opportunity."

"Collaboration just makes sense for us," said Morris Area Superintendent Scott Monson. Cyrus' high school students already have a tuition agreement in place to attend MAHS, the two districts do some shared bussing, and are geographically close together.

There are also some financial benefits to moving forward with a consolidation. If the two districts consolidate, the new Morris-Cyrus district will be allowed to extend all of their current operating levies out to the ending date of the longest-running levy. As a result, the district will be able to add about $2 million in operating revenue over the next eight years without needing to renew the levies.

If the districts cannot come to an agreement and Cyrus is forced to go though the disillusion process, both districts risk losing all of their operating levies.

Additionally, the new district will receive some transitional aid revenue from the state of Minnesota - about $180,000 in 2014 and $90,000 in 2015.

There are also some challenges to the consolidation process. Morris Area Elementary School is already close to capacity. Monson said the consolidated district may have to look into moving sixth grade students to the high school to make space, but noted that the Morris Area School Board has already discussed that possibility.

If the districts consolidate, the new Morris-Cyrus school district will be more property wealthy than either district is now. This shift will likely lower the amount of state aid the new district will receive in the future to offset local property taxes.

The Morris and Cyrus school board formally met for the first time last week to discuss the consolidation together. We will recap that meeting and explore some of the major considerations in the consolidation discussions - staffing, facilities, school board reorganization, and debt repayment - in a story next Saturday.