Duluth Public Schools has a serious financial problem, an equally serious credibility problem and an old, tired referendum narrative that does little to resolve either one. The administration wants more money. It warns of larger classrooms, eliminated positions, reduced educational opportunities and financial consequences if taxpayers reject two operating levy questions Nov. 3.
The message is familiar. The schools are in trouble. The children could suffer. The community must step forward.
For the kids.
It is a familiar appeal to emotion, one that has been part of school referendum campaigns for generations. And it raises a question that deserves considerably more attention than another presentation about the consequences of voting no.
Where is the accountability for the money Duluth Public Schools has already spent? The district's financial record gives taxpayers legitimate reasons to demand answers.
In fiscal 2025, General Fund expenditures exceeded the final revised budget by approximately $15.27 million. The district's fund balance declined about $11.53 million, roughly $8.75 million more than projected. Those are extraordinary differences between financial expectations and actual results.
They do not establish fraud, missing money or misconduct. They do establish the need for a detailed public explanation of the district's budgeting assumptions, expenditure controls and financial oversight.
Yet the referendum campaign has devoted considerably more attention to the district's future financial needs than to providing a comprehensive, accessible accounting of how its past financial projections went so badly wrong.
That imbalance is at the heart of the trust problem.
District administrators have disclosed budgets, financial statements and information about their fiscal difficulties. But making documents available is not the same as explaining them thoroughly or accepting responsibility for the decisions they reveal.
Transparency requires more than publishing numbers. It requires explaining what happened, why it happened, when leadership recognized the problem and what has changed to prevent its recurrence. Those explanations should be central to the referendum campaign.
Instead, the emphasis remains on what students could lose. That is where the old referendum playbook becomes particularly troubling.
A school district facing serious financial difficulties has every reason to explain the educational consequences of further spending reductions. Parents deserve that information. So do teachers, students and taxpayers. But the threat of reduced services cannot become a substitute for financial accountability. Nor should support for public education be confused with unquestioning confidence in the people managing its finances.
Duluth residents can believe deeply in public schools while questioning the administration's spending decisions. They can admire teachers, support classroom instruction and want the best educational opportunities for children while demanding better explanations from the superintendent and school board.
Those positions are entirely consistent.
What makes this referendum especially difficult is the economic climate in which it arrives. Property owners are already contending with rising housing costs, insurance premiums, utilities, groceries and other household expenses. Retirees on fixed incomes cannot simply manufacture additional revenue whenever another institution announces that its budget is under pressure.
Neither can working families.
Superintendent John Magas and the school board estimate that approval of both referendum questions would cost the owner of a $300,000 home approximately $15 a month, or $180 annually.
That amount will be manageable for some residents and burdensome for others. But reducing a decade-long financial commitment to a monthly payment does not answer the more important questions about how public money is managed.
The proposed levies would provide approximately $112.6 million over 10 years, based on the district's financial projections. That is a substantial commitment.
Taxpayers deserve more than reassurance that the money is needed. They deserve a convincing explanation of how the district will use the additional revenue, what financial safeguards will accompany it and how the public can determine whether the plan is working.
The administration has emphasized its record of spending reductions. District officials say they have cut approximately $12 million over three years, reduced administrative costs by 16% and eliminated 48 positions. Those reductions are significant and should not be dismissed. They demonstrate that the district has already made difficult choices.
The district also faces genuine external pressures. While state funding has consistently kept pace with inflation, special education, transportation, health insurance and other operating expenses continue to strain school budgets across Minnesota.
Those problems are real. They deserve serious legislative attention. But they do not erase the district's responsibility to manage its finances accurately and communicate clearly with the people paying the bills. A district can be underfunded and still have weaknesses in its financial management.
Both possibilities deserve examination.
The most disturbing warning came in August, when Moody's Ratings lowered the district's issuer and general obligation debt ratings from A3 to Baa2. That was a three-notch downgrade.
Baa2 remains investment grade, but the reduction reflected a significantly weaker financial assessment of the district.
A credit rating downgrade is not an accusation of dishonesty. It is an independent evaluation of financial risk, and one that should command the full attention of taxpayers and school board members.
The downgrade also raises legitimate questions about how the district's financial condition deteriorated and whether its current recovery strategy is adequate. The financial problems did not materialize on the morning the school board decided to seek another operating levy. They developed over time.
District officials prepared annual budgets. Administrators monitored expenses. The school board reviewed financial reports and approved spending plans. The public deserves to know how effectively those oversight responsibilities were carried out.
Was the district receiving sufficiently accurate financial forecasts? Were significant variances identified early? Did the school board receive timely warnings? What changes have been made to reporting and expenditure controls?
These are basic questions of financial governance. They should not require a referendum campaign to bring them into focus. The district's own financial projections make the situation more complicated.
Even if voters approve both levy questions, officials have indicated that approximately $5 million in additional reductions could still be necessary for the 2027-28 school year because of the timing of property tax collections.
If both questions fail, the district anticipates approximately $12 million in additional cuts over two years, with potentially severe consequences for staffing and educational programs. They underscore why voters need to examine the financial plan behind the referendum rather than simply respond to its emotional appeal.
An operating levy can provide additional revenue. It cannot, by itself, correct weaknesses in financial forecasting, improve expenditure oversight or establish lasting public confidence. Those improvements require management decisions. And management decisions require leadership.
The administration's public explanations deserve scrutiny not because school leaders are necessarily indifferent to the district's problems, but because a campaign centered on familiar warnings is an insufficient response to a crisis of this magnitude.
It is possible to spend considerable effort conducting public meetings, distributing information and answering questions while still leaving the most difficult matters inadequately explained. That is a distinction Duluth voters are entitled to recognize.
The district held its final referendum town hall Wednesday at Denfeld High School, giving residents another opportunity to question officials about the proposed levies. Such meetings are worthwhile. Public engagement matters, particularly when an institution is seeking additional taxpayer support.
But town halls are not a substitute for a detailed, independently understandable financial recovery plan.
The administration should publicly reconcile the $15.27 million spending variance, identify the largest contributing expense categories and explain how those differences affected the district's operating position. It should demonstrate what changes have been made to budget forecasting and monthly financial monitoring.
It should provide year-by-year projections showing how the additional levy revenue would be used, what reductions would remain necessary and how depleted reserves would be rebuilt.
And the school board should commit to regular public reporting against those projections, with meaningful explanations when actual results differ substantially from expectations. None of these expectations is unreasonable. They are ordinary standards of financial accountability for an institution responsible for spending public money.
Duluth's school leaders have repeatedly discussed the sacrifices that could follow if additional funding is rejected. They should apply the same urgency to explaining their own financial decisions.
The school board is not a ceremonial body. It is the institution charged with supervising the superintendent, reviewing financial information and protecting the district's long-term interests. If budgets are repeatedly inaccurate or reserves deteriorate unexpectedly, board members have an obligation to demand explanations and corrective action.
The public has an equally legitimate interest in knowing whether those obligations have been fulfilled.
Duluth has a long history of contentious school funding and facilities decisions. Residents remember expensive commitments, difficult closures, political arguments and the financial consequences that followed. That history does not mean the current referendum is unjustified. But it helps explain why public trust cannot simply be assumed.
Trust grows when institutions demonstrate competence, admit shortcomings and disclose enough information for residents to independently evaluate their performance. It weakens when legitimate questions seem secondary to a campaign's preferred message.
The district's current referendum theme, "Lift Up Learning," emphasizes an admirable objective. Every community should want its children to receive a strong education. But a slogan is not a financial strategy. Neither is an appeal to guilt.
The children of Duluth deserve excellent teachers, strong academic expectations, safe facilities and a school system capable of meeting their educational needs. They also deserve a district whose financial management is stable enough to sustain those opportunities.
Taxpayers deserve the same level of responsibility.
A family evaluating its household budget does not have the luxury of ignoring rising expenses or explaining every shortfall by pointing to its good intentions. When expenses exceed income, difficult questions must be answered. Priorities must be examined. Spending must be scrutinized.
Public institutions operate under more complicated financial rules than households, but the underlying obligation to explain how money is used remains.
Duluth Public Schools is asking residents to accept another long-term financial commitment at a time when the district's recent financial performance has made accountability especially important.
That request warrants serious consideration, not automatic rejection or unquestioning approval.
The central issue is whether district leadership can provide enough evidence to restore confidence in its financial stewardship.
The superintendent and school board have an opportunity to do that before Election Day. They can present a complete financial explanation, identify improvements in oversight, establish measurable recovery targets and demonstrate that lessons have been learned from the district's recent difficulties.
Or they can continue relying principally on a familiar referendum message built around financial necessity and the potential consequences for children. The first approach would give voters stronger evidence on which to base their decisions.
The second leaves fundamental questions unresolved.
Duluth taxpayers have heard the warnings. They understand that children could be affected by further spending reductions. They understand that public education requires substantial financial support. What they still deserve is a convincing accounting of the past and a credible financial plan for the future.
"For the kids" expresses a worthy purpose.
It does not explain a $15.27 million budget variance, restore a depleted fund balance or reverse a credit rating downgrade. And it cannot take the place of competent financial oversight.
Duluth's children deserve strong public schools. Duluth's taxpayers deserve transparent, accountable leadership. The district must demonstrate that it can deliver both.
Howie Hanson is editor and publisher of HowieHanson.com and a former Duluth City Council member.