This article originally appeared in the December 20th issue of The Villager.
A crowd of about 100 demonstrators representing the St. Paul Federation of Teachers marched through downtown St. Paul on December 7 past the corporate offices of U.S. Bank, Securian Financial, Wells Fargo and Ecolab. The federation’s goal was to open negotiations in hopes of convincing these corporations to make a greater financial contribution to the St. Paul Public Schools.
“Students in St. Paul, especially students of color, are not getting the education they deserve,” read a flyer distributed at the demonstration. “Classes are too big, textbooks are out of date, and there are not enough support staff.”
“We organized this demonstration because we wanted to reach out to our corporate partners in St. Paul and let them know that we expect more from them,” said Nick Faber, president of the St. Paul Federation of Teachers. “For the last 20 years, we’ve been losing funding left and right. We’re down $1,000 per student. As our funding has been going down, these corporations have been paying less and less in taxes. With the handout of tax relief to corporations, there’s a certain amount of responsibility, so we think they should really turn around and help out the students of the St. Paul Public Schools.”
Many of the contributions from private corporations to public education come with strings attached, Faber added, and the schools have little say in how the money is spent. He cited Maxfield Elementary School in St. Paul’s Summit-University neighborhood as an example: “You walk in and they have a beautiful library put together by Target Corporation,” Faber said. “And sure, the staff are appreciative of that library, but nobody asked them if they wanted a library. Target didn’t ask, ‘Do you want a library, or do you want a full-time nurse?”
“We want to create more equitable schools for kids,” said Kirinda Anderson, the parent of a 5th Grader at Wellstone Elementary School in St. Paul’s North End, “to spread the wealth around, rather than the corporations saying, ‘This is what we’re giving you the money for, and this is what you should use it for.’”
“We’re asking these corporations to pay their fair share,” said Todd Mader, a teacher at St. Paul Music Academy in the North End. “Our students deserve it. Our school systems deserve it. Our school systems are underfunded. It’s at a point where I’ve had to ask family and friends to pay for equipment in the classes I teach.”
Jon Schumacher, Chairman of the St. Paul Board of Public Schools, issued the following statement via e-mail in response to the demonstration:
“SPPS shares our teachers’ commitment to finding new revenue sources for the important work of providing a premiere education for our students. SPPS has also made it clear to our teachers’ bargaining unit (SPFT) that any conversation on new longer-term funding solutions has to include meaningful consideration of current funding options such as Q-Comp. As part of our ongoing contract negotiations with SPFT, the importance of corporate support has been discussed. The district values its strong relationships with our corporate partners and has confidence in their ongoing willingness to explore new opportunities that ensure success for our students.”
(According to the MN Department of Education website, Q-Comp, or Quality Compensation, is a voluntary program that makes certain funds available on a per-student basis)
The St. Paul Public School’s annual budget has increased by 32.7 percent over the past 15 years—from $551 million in 2002-03 to $731.2 million in 2017-18. During that same period, school district enrollment has decreased from 43,900 to 37,000. Patrick Burke, communications organizer for the St. Paul Federation of Teachers, responded to whether the decrease in enrollment and increase in budget would make more funds available for students.
“The needs that are actually greater than they were in the past,” said Burke. “We’ve had a number of students coming to our schools who have limited or interrupted formal education, students who have never been in a classroom before. In addition, we have increasing numbers of special education students enrolled in our schools.”
Burke singled out St. Paul’s tax-increment financing (TIF) as a primary concern. Tax-increment financing is a program that uses property taxes to subsidize private development costs. According to a 2016 report from the St. Paul Office of Planning and Economic Development, the corporate offices of Securian Financial and U.S. Bank will be TIF-certified until 2026 and 2028, respectively.
The St. Paul Federation of Teachers also alleges that Ecolab is sheltering $2.1 billion in offshore tax havens. However, Mesa Denny, senior communications manager for Ecolab, disputed that.
“We’re puzzled by the St. Paul Federation of Teachers’ approach,” said Denny. “The St. Paul Federation of Teachers is claiming that we’re using [tax] loopholes, which is untrue. We’re not receiving tax breaks. We’re in compliance with all tax laws, and we’re one of the largest taxpayers in St. Paul.”
According to Ramsey County tax officials, in 2017 Ecolab paid $1,753,454 in property taxes for its location at 1 Ecolab Place and $117,098 in property taxes for its location at 360 N. Wabasha Street. Property Taxes paid in 2017 for the Securian Center/Minnesota Mutual property at 400 and 401 N. Robert Street were $1,385,914 and $3,184,862, respectively, according to Ramsey County Tax Records.
“We’re definitely not dodging our duties,” said John Hobot, a spokesperson for Wells Fargo. “In 2016 we paid $8.3 billion in worldwide income taxes and we’re one of the largest corporate taxpayers in Minnesota. Wells Fargo isn’t hiding from taxes and we’re very active when it comes to outreach and support for schools.”
Hobot said Wells Fargo’s effective tax rate in 2016 was 31.5%. He also cited the Junior Achievement Upper Midwest program sponsored by Wells Fargo, a program that aims to help students in the areas of workforce development and financial literacy, as well as $247,000 in educational grants contributed since 2015.
“There’s plenty of dialogue with local schools,” said Hobot. “The claim of ‘no dialogue’ is inaccurate.”