State Budget

State Budget
Posted on 02/26/2015

As previously reported, the Menomonie Board of Education took action this week to reduce the district’s future liability related to early retirement benefits for employees in the school district. While this change should help the school district mitigate a projected “bubble” in the area of budget associated with these future benefits, it does little to impact the district’s budget in the next few years.

Much of the school district’s budget is controlled by the state. Mostly based on enrollment, revenue limits dictate how much money school districts can raise per student through a combination of property taxes and state aid. Over the years, and for various reasons, state officials have also established alternative school funding mechanisms such as the “school property tax levy credit” and “per pupil aid” that might or might not impact the district’s budget.  While per pupil aid is funding that impacts school district budgets through direct payments, any funding increases in general school aid and the school property tax levy credit only impact our schools if there is a corresponding increase to the revenue limit. Some reports make it appear that the state is increasing funding for public schools, but when revenue limits are not increased, dollars designated for general school aid or school property tax levy credits are really intended for a property tax reduction.

Earlier this month, the governor released his budget proposal for the next biennium, which once again included significant changes for education in our state. The governor recommended unprecedented cuts and tuition freezes for the University of Wisconsin system and a freeze on the revenue limits for K-12 public school districts, while at the same time continuing to expand the new private school voucher system. In addition to allowing no increase in the revenue limit for public K-12 students over the next two years, the proposal also reduces per pupil aid by $150 per student in 2015-2016. In Menomonie, that creates a gap of more than $500,000 in next year’s budget.  Per pupil aid is currently slated to return in the second year of the biennium, but that could change based on other factors in the state budget. 

Current estimates project a budget deficit in Menomonie of close to $1 million for the 2015-2016 school year. Nearly half of that deficit is directly related to the proposed elimination of state per pupil aid. The other half of the deficit comes from the revenue limit freeze that would be used for projected inflationary increases such as salaries, benefits, consumables, etc., and other changes in school district needs and priorities. Next year’s budget in Menomonie is also impacted by the need for local funding to pick up costs for student academic interventions in buildings no longer qualifying for federal funding.

Having anticipated a possible reduction in revenue in the next state budget, administrators in Menomonie have been working for months reviewing programs and staffing to determine which adjustments could possibly be made to cut costs while maintaining effective services for our students and community. Over the next several weeks, we will be collaborating with staff members and getting more input from the board and other stakeholders as we develop a budget to be considered in the months ahead. We are hopeful that the legislative process will improve the fiscal landscape for K-12 public education before the final state budget is approved, but it is unclear if legislators (including our local representatives and state senators) are willing to address these concerns on behalf of the public schools in our communities.

Should school stakeholders have any questions about the budget, or anything else in our school district, I invite you to visit the Administrative Service Center on Pine Avenue or contact me at 715-232-1642.  More information about our schools can be found on the school district website (www.sdmaonline.com) and on Twitter (www.twitter.com/sdmaonline).