ELY—ISD 696 Board President Rochelle Sjoberg has sat across the negotiating table from teachers, support staff, and other school employees a lot this year.
“I cannot tell you how much I respect the staff of this district that have sat at these tables and tried to be very understanding,” Sjoberg told District 3 Sen. Grant Hauschild and District 3A Rep. Roger Skraba during a recent working session. “They know our appreciation for them but also where we are financially.”
Where Ely is financially is in an increasingly precarious position, one that school leaders say is being made worse by a cascade of state mandates that arrive without the funding to implement them.
With enrollment dropping below 500 students for the first time, the district is caught in a painful squeeze: State requirements keep adding costs, but the school can’t afford to cut programs because every student who leaves for homeschool, online classes, or community college takes funding with them.
The two legislators had come to hear directly from the school board about the challenges facing rural education, and they got an earful.
Superintendent Anne Oelke detailed the mounting burden of unfunded state mandates. 
Perhaps no example better illustrated the gap between state ambition and state funding than the push for Science of Reading” instruction, a research-based approach to teaching literacy that requires retraining teachers and often replacing curriculum.
The state provided funding. Sort of.
“They gave you like $30, $31 per student or something,” Oelke said. “You got this weird amount, and now you need to negotiate that and split it with however many teachers are going to get trained.”
Oelke said the money the district received “did not touch all of our teachers equitably to do that extra training.” And it certainly didn’t cover the ongoing costs: training new teachers hired in future years, or replacing curriculum materials that don’t align with the Science of Reading approach.
“That was just for the training,” Oelke said. “That doesn’t even go on to any new curriculum materials that maybe we should replace because they don’t align with Science of Reading. There was nothing for that.”
The mandate also created another administrative position — district literacy lead — without funding it, meaning the responsibility simply lands on already-stretched administrators. In a small district like Ely, there’s no one else to absorb it.
“It just feels like another unfunded mandate,” Oelke said. 
Hauschild conceded the point. “I think the Capitol probably looks at it like, well, we did give some funding, but not nearly enough to something that expansive.”
The competition for every student
The urgency behind these funding conversations stems from the fact that Ely can’t afford to lose any more students, but it also can’t afford to keep them.
School leaders described the multiple ways students slip away from the district’s enrollment count, as well as its budget. Homeschooling is growing. Open enrollment allows students to attend other districts. Post-Secondary Enrollment Options lets juniors and seniors take community college courses, and the community college gets the funding rather than the district.
“If we can’t offer stuff that the kids want because we just don’t have the funding for it, what happens?” asked board member Tom Omerza. “You end up with more kids in homeschool, more kids in PSEO, online school. And then you lose the funding.”
But maintaining programs requires money. Transportation costs alone are staggering for a rural district covering vast distances for travel to sporting events and other extracurricular activities.
“We have to have those programs to entice enrollment so our enrollment doesn’t continue to decline,” Oelke explained. “But at the same time, we’re looking at different ways on how to even fund those transportation costs.”
Even students who leave for PSEO remain the district’s responsibility for technology, counseling, extracurricular activities, and other support services.
“They still are students and that still is our responsibility,” Oelke said. “We still have to provide everything for them... and that’s not even compensated for.”
Two decades of falling behind
Oelke identified what she sees as the root cause. For many years, the state’s education funding formula wasn’t tied to inflation. Although that finally changed recently, the damage has been done.
“That has now got all of our schools in a really bad spot,” she said. “And the only way I feel like that is going to be able to be fixed is we need to front-load them, because I don’t know how else we’re going to catch up.”
The timing couldn’t have been worse. The gap between funding and costs became obvious when federal COVID relief money dried up just as inflation surged.
“We are like a couple on a fixed income,” Oelke explained. “We get so many dollars for revenue based on pretty much student headcount enrollment. But yet every single cost to manage the staffing, the lights, the utilities, the property, the liability insurance — everything has gone up exponentially, and that inflation money has not kept up with that.”
Hauschild agreed it was “the biggest problem in all of the education funding in the entire state.”
Something has got to give
As the discussion drew to a close, Sjoberg returned to her central concern about the state’s one-size-fits-all approach to policy.
“At some point, something has got to kind of give with this one-size-fits-all process that happens down at the Capitol with these mandates,” she said. “It is getting out of control.”
Board member Tom Omerza offered a more philosophical observation that captured the bipartisan frustration in the room. Looking at the two legislators — one Democrat, one Republican — he said, “I don’t see you as a D or an R. I think you guys are just trying to help us the best you know how. And there’s not enough of you.”
The legislators took copious notes and promised to explore potential reforms, from adjusting PSEO rules to fixing transportation funding formulas to reconsidering teacher certification requirements that prevent experienced educators from teaching college-level courses.
But as the elections and a new legislative session approach with the House and Senate evenly split between parties, the question remains whether state leaders will find the political will and the money to address the crisis facing rural schools like Ely.