Source: Jimmie Kaska
Oct 29, 2024, 1:18 PM CST
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MADISON, Wis. (Civic Media) – Advocates for Wisconsin’s public schools have been sounding the alarm for years that funding for education was about to hit a fiscal cliff of sorts.
Now that federal pandemic relief funding has expired, many districts in the state have or are about to ask for more money from local taxpayers to continue to pay for teachers and facilities.
On November 5th, 140 referendum questions from over 120 school districts in Wisconsin will be seeking a collective $4.2 billion for facility projects, operations, and in some cases, consolidation efforts. The number of districts and questions on ballots next week are both records.
“The state has a massive budget surplus, and school districts are telling us they need more resources,” Jill Underly, Wisconsin Superintendent, said in September during her State of Education speech. “Most public school districts have gone, are going, or will be forced to go to referendum just to make ends meet.”
Through this year’s Spring Election, since the option to ask to exceed revenue limits was given to districts in the 1990’s, 357, or 85%, of districts have tried for an operational referendum. 20% of the state’s district have used operational referendum questions six times or more. All time, voters have approved 877 of 1,513 operating referenda through 2023, or 58%, according to data from the DPI.
The DPI says that 100 of the state’s 421 districts get at least 10% of their revenue limit from non-recurring operational referendum, with the number expected to grow in the next fiscal year. Last year, there were only 80 districts at that threshold, and 10 years ago, just 36 districts were north of the 10% mark. 14 districts get at least a quarter of their funding from referenda.
All told, between both the spring primary and spring election in 2024, districts sought $1.67 billion in additional local taxes to pay for school services, teachers, and facilities. Added to that is nearly $4.28 billion in the fall primary and election for a 2024 total of $5.95 billion in referendum requests by public school districts in Wisconsin.
“Rebuilding Wisconsin’s strong, high-quality public education system requires that we adequately and equitably fund our public schools,” Underly said in calling for an increase to revenue limits.
Partial veto attempts to raise revenue limit
In 2023, Wisconsin Gov. Tony Evers issued a partial veto that perpetually adds $325 per student per year to the revenue limit. That partial veto is being challenged in court, with the Wisconsin Supreme Court hearing arguments earlier this month.
Evers’ partial veto got national attention, and was criticized by state Republican leaders. The lawsuit challenging the move says the law’s intent was only for a two-year budget cycle and that the governor is prohibited from certain methods of line-item vetoing. The governor’s attorneys argued that Evers acted within the law.
The exact language in the budget as signed by Evers is “121.905 (3) (c) 9. For the limit for the 2023-24 school year and the 2024–25 school year, add $325 to the result under par. (b).”
At this month’s state Supreme Court hearing, lawyers challenging the partial veto argued that Evers acted beyond his scope in creating the new line in the budget. Conservative Justice Rebecca Bradley said that regardless of which party held office, the governor’s partial veto authority was too strong.
“The governor is becoming the most powerful power in the state, arguably, just to make the law whatever he declares,” she said during this month’s hearing.
At issue is the actual wording of the law and established precedents, which are at the heart of the argument over whether a governor can strike out numbers to create new ones. Liberal Justice Ann Walsh Bradley said that previous actions have only addressed letters, and that numbers aren’t letters.
“I don’t care how many fancy words or legal theories you put behind it to make it sound like it’s airtight,” she said during this month’s hearing. “Four is not a letter of the alphabet.”
While the state’s Supreme Court won’t have a decision in time for November’s election, it could have one before work begins on the next biennial budget once the new state Legislature is elected.
Advocates eye funding from massive state surplus
According to the Wisconsin Department of Administration, the state ended the 2024 fiscal year with a $4.6 billion surplus. The state’s so-called “rainy day fund” also increased to a record $1.9 billion.
The state’s surplus funds have been targeted by a wide range of interests over the past several budget cycles, with Republicans pushing for tax relief and Democrats seeking investments in education, infrastructure, and child care.
This year’s announcement came in at over $820 million over estimates, leading to calls from the state Department of Public Instruction to fund several different education-based initiatives.
Last week, Underly called for a $304 million investment in mental health services for children. Over half of Wisconsin high school students reported having at least one mental health challenge in the past year, with numbers higher for women.
“We know what we need to do to act and stop this alarming mental health crisis,” Underly said.
The request seeks an expansion of eligible costs for aid for mental health services, training, and grants for middle schools taking part in suicide prevention programs. It also seeks $168 million in funding over the next two years for an expansion of the school-based mental health services program.
In a separate announcement, Underly also promoted a universal free meals program at a cost of $294 to $311 million. A similar program in Minnesota served over 150 million meals last year.
The plan would make breakfasts and lunches free at Wisconsin schools, with other measures, such as a program to encourage using local farmers and producers for school meals, included in the request.
“Access to food is one of the most basic human needs, and yet many Wisconsin kids are telling us they don’t know when – or if – they will have their next meal,” Underly said, citing data from the 2023 Youth Risk Behavior Survey that showed over a quarter of Wisconsin students reported being hungry due to a lack of food in their home.
Another priority for Underly, as well as groups such as the Wisconsin Association of School Boards, is to increase the reimbursement rate for special education. Currently, public schools receive just over 30% reimbursement for those costs. In the last budget, a modest increase to the rate was added, but advocates are seeking a 60% or higher rate.
Underly also announced a request for $60 million to recruit and keep teachers and staff at Wisconsin schools.
The public school requests are also competing with other big-budget asks, such as increasing child care subsidies and a $855 million call from the Universities of Wisconsin for funding. Gov. Evers supports both of those plans as well.
The end of ESSER
Federal pandemic relief funding brought $2.4 billion to Wisconsin schools the past few years. The program, Elementary and Secondary School Emergency Relief, or ESSER, sought to help making up for educational losses during the COVID-19 pandemic
Schools had wide authority to use the funds in any way they saw fit, whether it meant hiring additional staff or establishing programs to help students. Some districts used the money as a way to backfill budget gaps caused by declining enrollment and the increased cost of services. Others hired staff to help reduce class sizes and offer additional courses or resources.
For districts that were using ESSER funds to patch budget holes, the end of the program meant that those deficits would need to be dealt with again. That’s led to a sharp increase in recurring or non-recurring operational referendums — money used to pay for things like staff and utilities — with 82 such questions on fall election ballots.
For other districts, it marked the end of some of the flexibility in staffing they had enjoyed the past few years, with those workers either being absorbed into open positions or moved into the regular budget. For a few, creative programs that dealt with everything from learning how to read to mental heath care to child care came to an end or were otherwise brought into the operating budget.
School districts were required to spend the rest of their ESSER funds by September, meaning that for most of the 2024-25 school year, budgets are put together with that revenue missing from the bottom line.
Whether or not districts will continue their specific programs largely is up to how they set their budgets, and for many schools, keeping popular pandemic-era programs up and running means seeking additional money through referendum.
Local taxpayers must decide whether to pay more
Wisconsin has 421 school districts, and nearly 200 of them will have gone to referendum in 2024. 93 districts asked 103 questions in February and April, and 1 district had a single question in the August primary. Now, 140 questions are on the fall election ballot, coming from 121 school districts.
Referendums come in three different varieties: recurring operational, non-recurring operational, and issue debt.
Issue debt is the simplest to explain: Districts ask to issue bonds and pay back the debt and interest for the purpose of capital projects. These tend to be the most expensive price tags, but the effects are spread out over 20 years, keeping mill rates reasonable for local property owners.
For many districts this fall, the issue debt, or capital, referendums deal with consolidation of school facilities. A $261 million dollar plan in the Arrowhead School District, for example, seeks to build a new high school in order to bring its 9-12 students onto one campus. In La Crosse, after its last plan for consolidation was overwhelmingly defeated at the polls, the district is attempting to consolidate elementary schools at a price tag of $53.5 million.
The most expensive capital referendum on ballots anywhere in the state is in Madison, where the MMSD is seeking $507 million to provide updates to seven school sites, affecting 10 schools.
Operational referendums are meant to cover expenses such as staff, programming, and other non-capital items. Recurring referendums are a permanent increase in the local tax levy, while non-recurring are fixed over a set number of years. The benefit to the latter is that districts can re-evaluate needs each cycle, but the downside is asking voters each time to approve the measure.
Of the 140 questions on November 5th ballots, 58 are issue debt (capital) and 82 are operational, with 60 of them non-recurring and 22 of them recurring, according to DPI data.
Districts are allowed to ask up to two referendum questions per calendar year, and several districts, including Madison and Arrowhead, have two questions for voters. Wauwatosa has a $60 million capital and $64 million operational set of questions for voters. Sheboygan is asking two capital referendum questions, one for $121 million and another for $78 million.
If approved by district voters, the district then levies the additional amount through property taxes, adding costs to already-rising tax bills due to inflation, assessment increases, and in competition with various municipal or county referendums that are also seeking additional funding for services. Over 90% of districts have gone to referendum at some point and over half have gone in the past 2 years, according to DPI data.
State funding for education a major political issue
In Wisconsin, several factors are at play as to why education funding has been on the decline for several years.
The first is that revenue caps were put in place on districts in the 1990’s as a means of protecting property taxpayers from never-ending increases.
The second is that per-pupil funding increases were de-coupled from inflation metrics as part of the lead-up to Act 10, meaning it was up to the state legislature to decide how much money would be added each cycle.
A third factor is that funding is directly tied to student enrollment, and with the majority of districts reporting declining enrollment, that means less money to pay staff and maintain buildings.
Finally, decisions by the state legislature and Gov. Evers have resulted in taxpayer money going into private school vouchers, to the tune of $225.5 million for the Wisconsin Parental Choice Program (and an additional $40.8 million for the Racine Parental Choice Program) and $32 million for new independent charter schools.
In the meantime, districts that are dealing with issues like declining enrollment still need to afford schools, or for larger districts, facility consolidation, and there are few other levers for districts to pull for revenue. Public schools can’t charge tuition, and while some can receive grants to help with things like STEM facilities or safety projects, there are no other ways for a district to afford the large costs associated with building or renovating facilities.
Republicans in Wisconsin have long advocated for funding private school vouchers, and the latest budget shows the compromise between Gov. Evers and legislative Republicans in increasing revenue caps for public school students while also increasing the amount of taxpayer money going to private schools.
Democrats, who are typically backed by education-affiliated advocacy groups and associations, seek more resources for public schools specifically and have typically voted against funding vouchers for private schools.
What to know before you vote “yes” or “no”
Chances are, if you live in Wisconsin, you will be seeing a school referendum question on your ballot, whether it’s in the past two years or in the coming year or two. Over 90% of districts in Wisconsin have had at least one referendum since the revenue limit system was put in place three decades ago.
Perhaps the most important piece of information that voters seek is the overall change to their tax bill, which is usually reflected in an estimated mill rate for the following year. The mill rate is simply the total tax levy and cost of the referendum, if passed, divided by the total value of property in the school district.
Mill rates typically rise if a referendum is passed, meaning district property tax payers will see a higher bill. Usually, this amounts to a few hundred dollars per year on a typical tax bill, but that greatly varies depending on the size of the district, the value of property in that district, and the size of the referendum.
Rates also go up and down as property values and school district tax levies, which are largely tied to enrollment, change.
Districts are required to provide public information about the tax impact of referendums, and nearly all of them hold informational sessions in person, online, or both. If your district has a referendum, there’s a great chance that your school district website has a page dedicated to it.
If the district does not have a page or any information easily accessible online, administration, such as the school superintendent, can answer questions from the public about the overall impact of any referendum.
Impacts go the other way as well. If a referendum does not pass, schools still need to balance their budget, which can come in the form of staff or programming cuts, or eliminating extra-curricular activities such as athletics or art. At its most extreme, districts would have to consider consolidating with neighboring districts, a multi-year process that historically raises taxes for the people in the district that is dissolving into neighboring ones.
At least two districts in 2023 said that they would pursue district consolidation if their operational referendums did not pass. Both districts saw those measures approved by voters.
Finally, if you still aren’t sure, local school board members have access to resources that explain how referendums work, and since they have to vote to put the ballot measure in place, are informed on the financial impacts of a passed or failed referendum. You can find your local representatives through MyVote Wisconsin, which can also tell you which school district you reside in.
Jimmie Kaska is a member of the Boscobel Area School District school board. None of the information provided here reflects the position of the Boscobel Board of Education, its administration, or district employees. This article is intended for editorial purposes.
