Grand Forks' public schools stand to lose almost $500,000 in state aid next month, and a piece of proposed legislation can't do anything to stop it, a state school official says.

The payments, called supplemental aid, are intended to pad the budgets of school districts that don't get enough money from local property taxes.

A recently revised formula for distributing the money means that Grand Forks and six other districts will be getting less aid than they expected, said Jerry Coleman, the Department of Public Instruction's assistant school finance director.

"We're just finally, after a long haul, getting all the pieces in place to make the calculations appropriately," he said Wednesday.

The development annoyed Grand Forks Superintendent Mark Sanford, who said the state has not notified his district about the impending reduction.

"It does make it difficult to deal with because there has been no communication relative to this issue from DPI," Sanford said.

The supplemental aid issue was raised last year in a legal opinion from Attorney General Wayne Stenehjem. In that ruling, Stenehjem said federal "impact aid" payments couldn't be considered when deciding which schools qualify for the supplemental aid.

The impact aid goes to school districts that can't levy property taxes on military property, or American Indian reservations. Grand Forks' district, for example, gets impact aid because it educates children who live at the Air Force base west of town.

The Senate Education Committee on Wednesday examined legislation that would eliminate the federal impact aid from the DPI's formula for calculating supplemental payments. The panel did not act immediately on the bill, which has been approved by the House and will get a Senate vote later.

Coleman, however, said the legislation will not affect the way the DPI calculates supplemental aid for schools with military bases. That's because a more recent attorney general's opinion concluded the federal payments are the same as tuition, which can be included in the funding formula, Coleman said.

As a result, Grand Forks' public schools will get about $460,000 less than they expected this year, Coleman said.

"I imagine they're not going to take it well. We haven't formally notified the districts yet," he said Wednesday. "With 20/20 hindsight, we would have done this the right way."

The changed formula also will cost the West Fargo district about $30,000, because the district is now closer to the state average of property taxes available for each student. That determines how much supplemental aid is given.

Five other schools also will collect less state money, but the difference only will be a few thousand dollars each, Coleman said.

In Grand Forks, the reduced funding is just a fraction of the district's budget, which sits at about $62.5 million. Nevertheless, schools were counting on that money to help them achieve their goals, Sanford said.

"Any additional funds don't permit you to do a lot of extra things. They just permit you to try to do what you're supposed to do," he said.

The bill is HB1032.