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Rising referendums: Largest districts spend big

By Heather Graves

WISCONSIN – The results of the referendum that would bring $1 billion over 30 years to the Racine Unified School District – one that would allow the district to revamp buildings that date back to the Civil War – came down to just five votes.

On April 7, 2020, voters approved the referendum by this impossibly thin margin.

Little more than two weeks later, observers gathered in Festival Hall and held their collective breath as they watched the recount of 33,315 ballots.

Racine Unified School Board President Brian O’Connell said it felt like fans watching the final seconds of a championship.

“It was like a really close basketball game – until the buzzer sounded you weren’t sure,” he said.

After six rounds of ballot-counting, the results were final: The referendum had passed.

“All the staff and volunteers let out a huge sigh of relief,” O’Connell said. “I remember feeling delight, relief, appreciation to the voters of our district – a whole jumble of emotions.”

It was a hard-fought campaign for the referendum, O’Connell recalled, one that met staunch opposition from HOT (Honest, Open and Transparent) Government, the same group that would later challenge the five-vote victory, appealing all the way to the state Supreme Court. 

School officials are awaiting a final verdict from the court before they break ground on the full slate of projects the referendum money would fund.

Despite its hefty price tag, the district claims the measure is not projected to increase the property tax rate – although any increase in assessed value will raise individual tax bills.

For now, school funding advocates in Racine applaud increased tax dollars that will allow what school officials said will “right-size” the district, allowing it to close under-enrolled schools, refurbish or expand others, and add new technology, including a Science, Technology, Engineering, Arts and Math school. 

Matthew O’Neill of Fox, O’Neill & Shannon, S.C. the Racine school district’s attorney, looks at ballots during the April 23, 2020 recount, which saw the district pass a $1 billion referendum by five votes. Racine Unified School District Photo

Advocates hope the improvements will put the district on more equal footing compared to neighboring districts – like Kenosha Unified School District and Oak Creek-Franklin Joint School District – and spread investment more equitably, because the oldest buildings in worst repair are located in Racine proper.

“So the plan is well-balanced to make sure investment is spread across the city,” O’Connell said. “People of color are primarily concentrated in Racine, so it was very important to us that those improvements served everyone.”

Ballot questions continue to be used in Wisconsin because school officials find the state’s revenue cap, implemented nearly 30 years ago, doesn’t keep up with what it costs them today to provide education.

Last year, 182 of Wisconsin’s 421 public school districts went to referendum, with voters approving 138 of the ballot measures.

O’Connell said there is no other place to go to raise money.

“I think that’s why you see so many school districts, big and small, urban and rural, going to referendum,” he said. “If you find a school district that’s been able to raise money without going to referendum, please let me know.” 

Perpetually behind in Green Bay 

The Green Bay Area Public School District, the fourth largest district in the state, is no stranger to referendums – going to referendum eight times since 1993.

Its most recent pair passed in 2017, which included $68.25 million for a districtwide building and facilities improvement plan and an operational referendum authorizing the district to exceed the revenue cap by $16.5 million per year for 10 years.

This collaboration nook at Eisenhower Elementary School in Green Bay wouldn’t have been possible without a successful referendum effort in 2017. Green Bay Area Public School District Photo

Pete Ross, the district’s chief operations officer, said when former Gov. Tommy Thompson enacted the revenue limit system back in 1993, he’s sure he didn’t expect it to still be used today.

“I guarantee you when Tommy Thompson put it in place in 1993, he never thought it would last 30 years, or 28 years technically,” he said. “So the revenue cap is what needs to change. Pure and simple. It has not increased with inflation in any of the years since it’s been put in place.”

Ross said Green Bay was fortunate the community passed the operational referendum in 2017, but not all districts are as lucky.

“Their spending cannot keep up with just mild, and modest and very low inflation,” he said. “They are falling further and further and further behind.”

Though the Thompson-era school funding formula once seemed effective, nearly three decades later, Ross said it seems to be missing the mark.

Slated as a low-spending district in 1993, Green Bay is still classified as a low-spending district today, which Ross said is part of the problem.

“In 1993, we were fixed as a low-spending district and could not move out of that fixed spot we were in,” he said. “It was like set in granite. Districts were fixed where their spending was in 1992. So going into the 1993 school year, if you were a poor district, a low-spending district, you were destined to be that forever.”

Ross said this puts low-spending districts at a disadvantage.

“So in this district, a low-spending district, the limit is actually about 88% of the state average, the low-spending limit,” he said. “So the $16.5-million override that the taxpayers in this district graciously allowed us to do gets us close to the average spending district in the state of Wisconsin. But then when that override goes away, of course, the district will have to ask the taxpayers again to do that.”

Lori Blakeslee, the district’s communication director, said in 2017 Green Bay’s per pupil spending was $9,691, and the state average was $10,444.

“If the governor’s budget would pass – not for this year, for the following school year – we would finally be at $10,500 per student,” Blakeslee said. “We are way over that for the state average now. And that is only if those pieces of the governor’s budget hold steady and not get cut out of the final budget. See how far behind we are? We cannot keep up. That becomes a problem with a district like Green Bay. We are always behind.”

Blakeslee said the district was transparent in 2017 about possibly having to come back to taxpayers in the near future.

“When we went to the referendum in 2017, we were very clear with the community that we would more than likely be coming back in three to four years,” Blakeslee said.

She said if the 2017 operating referendum had not passed, the district would have faced an $18 million deficit.

Blakeslee said this would have resulted in cuts in programming, services and course offerings and approximately 150 staff members, as well as an increase in class sizes.

At the time, Blakeslee said the district chose a non-recurring referendum, anticipating change at the state level.

“The rationale at the time, why we went for the non-recurring referendum and doing the 10 years, was at that time the bipartisan Blue Ribbon (Commission) for School Funding was meeting,” Blakeslee said. “The hope was that there would be a long-term fix to school funding. So rather than say we need this money indefinitely, to our community we said, ‘Give us this 10-year (period). Hopefully, what is happening at the State Legislature would come up with a fix for some of the funding struggles that we have.’ Unfortunately, not a lot has happened from that. So here we are.”

The district is already in early conversations regarding a future referendum to continue to address district needs.

Capitol city voters approve

In Madison, School Board Vice President Savion Castro said his district grapples with many of the same struggles.

The district passed a pair of referendums in November 2020 totaling $350 million – $317 million in bonds for capital projects and $33 million in operating funds that will phase in over four years.

According to referendum documents, if the operational referendum had not passed, the district would have faced $40 million-plus in budget reductions over the next four years.

The total referendum amount – $350 million – will average an extra $130 annually based on an average-priced home for district property taxpayers by year four.

But it was something Castro said was necessary “given the state funding level uncertainty.”

“We could pray for a Hail Mary at the state level, but if we were interested in controlling our own destiny, we needed this referendum,” he said.

Both referendums passed with a near 80-percent approval rate, which Castro said proves the Madison community supports public education.

“(Voters) are all enthusiastic about supporting public education as an institution in general,” he said. “This is Madison. I think this is a community that is really laser-focused on closing the opportunity gap. In many ways, every member of the school board and the superintendent were chosen because we have a mandate from the community to take action on this opportunity gap. We made it clear that that is what the referendum was about. And the community, in turn, showed its support.”

Castro said the desire to support schools isn’t exclusive to the Madison school district, but unfortunately, the lack of resources make it an uphill battle for districts.

“We are seeing schools that want to meet the needs of their families more and more, but unfortunately they feel they are being under-resourced from the state government and so they are trying to do it on their own (with referendums), and in many ways, just to operate so they don’t have to lay folks off and they can maintain their class sizes. I think a lot of districts feel like they are being left out to dry from the state in a lot of ways.”

Due to the COVID-19 pandemic, this year was like no other. But Castro said it only further highlighted the importance of the public school system.

“To be honest, we started this conversation (about the 2020 referendums) before COVID happened,” he said. “I think COVID happening only underscored how necessary education is and it’s not time to draw back funding for our public education system.”

Castro said the state formula is based on assumptions, which is where the problem starts.

“The formula wrongly assumes that all students in a community benefit from property value growth,” he said. “Basing funding off of where you live betrays the promise of education being a great equalizer,” he said. “We have very, very, very high levels of inequity in our school system. West High School has the highest level of income inequality in the whole state. So we need to have a level of discernment with those figures. The assumption that because a community has higher property value that it can afford to fund schools more, I think, is a flawed assumption.”

Castro said much of the work done at the Madison School District focuses on the big picture.

He said the same rationale should be used when looking at state funding.

“Big picture, I think we need to come up with a formula that is reflective of the actual needs of students and the changing demographics that we are seeing in our schools,” he said.

Cream City finds success

Milwaukee, the largest public school district in Wisconsin, passed a successful referendum in April 2020. 

A previous attempt in 1993 to issue $336 million in debt failed. 

Voters in 2020 approved the district going over the state-imposed revenue cap by $87 million on a permanent basis with 78 percent in favor.

The district started by exceeding the cap by $57 million this school year and will get up to $87 million by 2023-24. 

District literature said it will use the funds to attract and retain teachers, offer more career and technical education programs and expand library services, music, art, physical education and language programs. 

Milwaukee administrators did not return messages for comment on this story. 

Mario Koran, Wisconsin Watch, and Press Times Editor Ben Rodgers contributed to this story. 

This story was produced by the NEW News Lab, a collaboration of newsrooms that focuses on issues important to Northeast Wisconsin. 

Next week: Spending big in the burbs 

Brown County residents outside of Green Bay are familiar with referendum questions, with every school district in the metro area going to the voters at least once since 2015.

Next week’s story looks at the unique issues each local district faces, and how they choose to go voters for support. 

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