Municipalities may negotiate school cost-sharing agreements

Estonia’s Ministry of Education and Research wants to end municipalities’ automatic obligation to cover the operating costs of schools in other municipalities attended by their residents’ children, ERR reported.

Under the current system, the municipality where a student lives must contribute to the operating costs of another municipality’s municipal school if the child attends it. These costs are not covered by state education support and include school building maintenance, utilities and other day-to-day expenses.

The home municipality must currently make the contribution even if it has already provided the child with a place at its own school.

The ministry has sent a draft bill for consultation that would abolish the automatic payment obligation. In future, municipalities would agree among themselves on how operating costs are shared.

Municipalities face unequal situations

Veikko Luhalaid, director general of the Estonian Association of Cities and Municipalities, said local governments have discussed the draft with the ministry several times.

He said the current system can place municipalities in unequal positions. For example, one municipality may have a smaller school that children do not prefer for geographical or other reasons, leading them to attend a larger school in a neighbouring municipality.

At the same time, the home municipality cannot close its own school because some children continue to attend it. “That is a double burden,” Luhalaid said.

He said it would be more reasonable for municipalities to agree by contract on the conditions for accepting students and covering costs. This would prevent an automatic payment obligation from arising when children attend a school in another municipality.

Municipalities, however, do not agree on the issue. Some support keeping automatic payments, Luhalaid said.

He noted that some municipalities have schools near the borders of other municipalities and receive many students from neighbouring areas. For them, automatic payments are beneficial because their schools receive funding for those students. “Teachers’ salaries are paid from the funding received for these students,” Luhalaid explained.

At the same time, when students move to a larger neighbouring school, the smaller school they leave behind retains its costs but has fewer students. The proposed change would therefore affect municipalities differently.