Minnesota Democrats float $1,200 annual bonuses for teachers

Public and charter school teachers could receive a boost in pay in the form of a $1,200 refundable tax credit under a bill pitched by Minnesota Democrats.

The bill (SF186) could help Minnesota schools struggling to attract and retain teachers, but the proposal must compete with a slew of other spending priorities as lawmakers craft a two-year budget — with a gloomy budget forecast on the horizon.

More than 70,000 licensed public and charter school teachers would be eligible for the $1,200 tax credit at a cost of about $100 million per year to the state, according to an estimate by the Department of Revenue.

“I know that this is a hefty price tag,” said bill author Sen. Heather Gustafson, DFL-Vadnais Heights. “But if we want to actually do something for public school teachers, then it’s going to cost us something and it’s got to come from somewhere.”

Gustafson, who taught high school history before entering the Legislature in 2023, said the tax credit would be particularly meaningful for early-career teachers, who are often managing student debt while earning a starting salary that averages about $43,000, according to the National Education Association.

School principals would also be eligible for the credit, though private and homeschool teachers would not.

Senate Taxes Committee Chair Ann Rest, DFL-New Hope, proposed during a Tuesday committee hearing that the bonuses be restricted to full-time instructors, which would whittle down the cost of what she called a “very expensive” bill. It was laid over for possible inclusion in a larger tax bill that will be negotiated in the next month before the Legislature adjourns for the year.

The bill would offset potential losses teachers will face if state lawmakers go along with Gov. Tim Walz’s proposal to phase out the alternative teacher pay system known as Q Comp, which provides additional funding to participating school districts that adopt performance pay and invest in teacher development and evaluation.

Walz’s administration noted the 20-year-old program provides additional funding to districts serving just half the state’s population and argue it has become duplicative of newer teacher development and evaluation requirements. Eliminating the program would save the state more than $80 million a year.

Some Democrats and the teachers union want the state to think even bigger about increasing teacher pay by creating wage floors for licensed teachers and support staff.

A separate DFL bill in the House (HF3119) would set the minimum salary for licensed full-time teachers at $60,000. Full-time teachers with master’s degrees would be entitled to at least $80,000 a year and those with 10-years of experience on top of an advanced degree would earn at least $100,000. The bill also sets a minimum wage floor for hourly school workers like paraprofessionals, cafeteria workers and bus drivers at $25 an hour.

The bill, which could cost upwards of $250 million a year, is not expected to be considered this year after missing a key legislative deadline.

Still, Rep. Samantha Sencer-Mura, DFL-Minneapolis, said the bill lays the groundwork for future negotiations at the Capitol about raising teacher pay to help address the staffing shortages afflicting an estimated 8 out of 10 schools in the state.

“I want people who, to me, are doing the hardest work of educating our children eight hours a day to be well-compensated,” said Sencer-Mura, the bill’s chief author.

The bill would raise wages for a significant portion of the state’s teachers, about half of whom earn less than $65,000, according to the Department of Employment and Economic Development.

She pointed out that the starting salary of a Minneapolis police officer is now $90,000, which proponents justified because of the job’s difficulty, responsibility and accountability.

“I think we ask the same thing for teachers, right?” Sencer-Mura said.