Why some schools will win bigger than others under state budget passed by lawmakers

The state budget passed by Wisconsin lawmakers this week offers historic wins for some schools while leaving others to fall further behind as they're depleted by inflation.

With a $7 billion budget surplus for the state, school leaders were optimistic that the Republican-controlled Legislature would offer schools a bump to catch up to inflation. In a budget plan that awaits action from Democratic Gov. Tony Evers, Republicans allotted the bulk of the surplus for income tax cuts favoring the wealthy. Evers has threatened to veto the entire budget but could also veto certain lines.

The Republican plan provides about $534.3 million more in general school aid and allows schools to raise local taxes to spend an additional $325 per student this coming school year and another $325 the following year — amounts that fall below estimated inflation. About half of the state's school districts, which have been locked into the lowest base funding level, will get an additional raise.

The plan also invests about $590 million in school levy tax credits, a funding mechanism discouraged by the bipartisan Blue Ribbon Commission on School Funding in 2019 because it most benefits taxpayers with higher property values, as opposed to other education funding streams that aim for equitable distribution.

Here’s what to know about which schools will be helped the most and why.

Biggest boosts are for private schools and charter schools

Separately from the state budget bill, lawmakers and Evers already approved a bill that will increase state payments for independent charter schools and for voucher payments that cover the cost of tuition for students from lower-income families to attend private schools.

Between that bill and the state budget plan, the Legislative Fiscal Bureau calculated the payment amounts would change as follows by the 2024-25 school year:

• Vouchers for students in kindergarten through eighth grade: a 22% increase to $10,271 per student

• Vouchers for high school students: a 41% increase to $12,765 per student

• Vouchers for special needs scholarships: an 18% increase to $15,443 per student

• Payments for independent charter schools: a 27% increase to $11,763 per student

Private school leaders have said the new amounts could allow them to pay staff higher wages and potentially expand to serve more students.

Lowest-spending school districts get a lift

In the same bill that raised voucher payments for private schools, lawmakers included a boost for about half of the state's public school districts that historically received the least base funding: under $11,000 per student.

Wisconsin school districts have been confined since 1993 by state-imposed revenue limits, which were locked in at different amounts for each district depending on what they spent the prior year. The limits initially rose each year with inflation, but that provision was deleted in 2009, and any increases have since been left to the discretion of lawmakers.

To address some of the gaps in funding between districts, lawmakers previously set a minimum allowance for each school district, allowing them to collect at least $10,000 per student since 2020. As part of the voucher bill, lawmakers hiked the minimum to $11,000.

About 221 of Wisconsin's 421 public school districts would be eligible to increase base funding to $11,000 per student under the bill, according to preliminary calculations shared by the state Department of Public Instruction, while almost all other school districts were already getting more than that. DPI noted its calculations factored in provisions of the state budget yet to be approved by Evers, and didn't factor in other special adjustments districts may be eligible for.

Looking at the largest school districts, Milwaukee, Madison and Racine were already above an $11,000 per-student revenue limit, while Kenosha, Green Bay, Appleton, Waukesha and Eau Claire will be bumped up.

Some districts punished for failed referenda

Nineteen school districts will continue getting less than $11,000 per student because they had a failed referendum in the past three years, as state law precludes districts with failed referenda from benefitting from changes to the minimum funding allowance. Evers had proposed eliminating that exception from state law but Republican lawmakers rejected it.

The 19 districts are: Arcadia, Auburndale, Beloit, Berlin Area, Bristol No. 1, Horicon, Lake Mills Area, Merrill Area, Milton, North Lake, Northern Ozaukee, Parkview, Silver Lake J1, Southwestern Wisconsin, Sparta Area, Spring Valley, Valders Area, Walworth J1 and Westby Area.

John Humphries, executive director of the Wisconsin Association for Equity in Funding, which represents 62 school districts, said the organization was "very pleased" with the increase for many districts but had asked lawmakers to consider allowing the referenda-losing districts to be included.

In Spring Valley, a small school district west of Eau Claire, superintendent John Groh said his district has been locked into low spending levels since 1993. The district had to pull $200,000 from its savings to make it through this school year and expects to dip into savings again, as he can't come up with other cuts.

"We have been frugal for years, so we don’t even have the luxury of cutting," he said.

This spring, he said, the district asked taxpayers to support a referendum to allow the district to increase its operating budget; it failed by nine votes. Groh calculated that if the district hadn't held a referendum, and therefore would be eligible for the bump to $11,000 per student, the district would be getting about the same amount of funding it had hoped to get via referendum: about $500,000 a year.

Groh hoped to use that money to attract and retain staff. The district is paying about $15.50 per hour for key support staff — less than the nearby Kwik Trip, Groh said. He said there were only two days in the last school year when the district was fully staffed, as the district has struggled to retain those support staff.

All schools could spend more, but they won't catch inflation

Lawmakers didn't raise revenue limits at all over the past two years, when a Legislative Fiscal Bureau memo showed the inflationary increases would have been $343 and $372 per student each year. The bureau estimated inflationary increases for the next two years would be about $393 and $403 per student each year, based on projections by S&P Global.

Under the state budget bill, schools will be allowed to spend $325 more per student this coming school year and another $325 the following year. Additionally, the percentage of special education costs covered by the state will increase to 33.3% from 30% under current law, down from Evers' proposed 60%.

School leaders said they are looking at cuts. In South Milwaukee, superintendent James Shaw said the district is cutting three high school teaching positions, one teacher coach and four support staff from for the next school year, while also dipping into savings. Going into the next year, he expects a deficit of over $1 million.

"I've never seen the needs higher, and the budgets have been frozen," he said. "We are defunding our schools systematically by not allowing schools an inflationary increase."

In Pepin, a village along the Mississippi River, superintendent Bruce Quinton said the plan will leave about 7% of the district's operating budget unfunded. The schools only have one teacher per grade level and one teacher per subject at the high school level, he said, so he doesn't have positions to cut. He said the district will dip into its savings and likely won't be able to afford a full cost-of-living wage increase for staff.

Quinton was considering retiring at the end of the school year, but now he's worried about leaving behind an operating budget that bleeds the district's savings.

"It's a struggle to think that after 20 years of doing this, I may have to leave the district in a fiscal bind," he said.

Milwaukee Public Schools has balanced its budget for the next school year by planning not to fill hundreds of jobs. There was hope that more state funding would allow the district to walk back those planned vacancies, but the state plan was disappointing.

Jilly Gokalgandhi, vice president of the MPS school board, said district leaders would continue pushing for more funding. At a board meeting Thursday night, as the Assembly prepared to vote on the budget, Gokalgandhi said she took "solace" in believing that court decisions would eventually walk back electoral maps that favor Republican lawmakers in Wisconsin.

"I cannot wait for the day that these same Republican legislators are ejected from their seats, and we can start the process of undoing all the wrongs that they’ve done," she said.

Contact Rory Linnane at rory.linnane@jrn.com. Follow her on Twitter at @RoryLinnane. 

This article originally appeared on Milwaukee Journal Sentinel: Some schools win bigger than others under Wisconsin budget plans