District administrators concerned with biennial budget
By Heather Graves
BROWN COUNTY – There is much still to come, in terms of specific details, for school districts throughout the state regarding the biennial budget signed by Gov. Tony Evers July 8.
District administrators are attempting to read between the lines as they start to determine what the budget means for their individual school districts going forward.
Initial reactions among top area school leaders are pretty similar – disappointment.
“My biggest disappointment is that neither the Legislature nor the governor’s budget addressed what is a systemic inequity for many districts across the state,” Green Bay Superintendent Steve Murley said. “This isn’t an urban or rural issue. This isn’t a large, small issue. This is a 1993 issue from when those spending limits were set. And here we are 28 years later and there has been no concerted effort to close that gap.”
The $87-billion, two-year budget includes $685 million in additional aid to schools, and reestablishes the state’s promise of two-thirds funding for the first time in two decades – a promise former Gov. Tommy Thompson made when the revenue limit cap formula was enacted in 1993.
Murley said what often gets lost in translation, though, is it is true the state is putting additional money into the school finance pot, in essence, it is just leveling things out.
He said the amount of school funding from property taxes decreases because the amount of state aid increases.
Murley said “on its face, it is true” school districts will receive more state aid, but it’s linked to the per-pupil revenue spending limit freezes.
“If they don’t shift the spending limits, which they didn’t do, and they increase the amount of money that comes to each district through that funding mechanism from the state, then what they simply do is decrease your local property taxpayer burden for funding public education,” he said. “When you couple those two things together, keep the spending limit flat, but increase to two-thirds state funding, you are simply using the budgeting process to pass a local property tax reduction.”
Murley said he is frustrated the state doesn’t “own it.”
“I am not saying if that is a good or bad thing,” he said. “I am just saying if that is what you are going to do, you should probably own that and be upfront about what it is you are doing. It is a property tax reduction.”
Pete Kempen, business manager for the Seymour Community School District, said the state didn’t do school districts any favors.
“Basically, the money they are putting into school districts is property tax relief and we cannot spend one dime of it,” Kempen said. “So, we have no added revenue this year. It’s a great talking point. It is what politicians do well. It is great that they are actually putting money into the education pot. But with the revenue limits in place, school districts can’t use that money.”
Mike Juech, assistant superintendent of operations for the Howard-Suamico School District, said he’s disappointed, it’s a start.
“While we are disappointed in the lack of adjustment to the revenue limit, which continues to negatively impact low-revenue districts, such as Howard-Suamico, the adjustment to two-thirds funding is a good first step to address a school funding formula that has significant gaps,” he said.
Ashwaubenon Assistant Superintendent Keith Lucius said it is also important to note the two-thirds funding is statewide, not locally specific.
“In Ashwaubenon, we are nowhere near two-thirds state-funded,” he said.
Lucius said state equalization aid funds about 39% of Ashwaubenon’s revenue limit, which is below the two-thirds average included in the state budget.
Spending limit freeze
Murley said the freeze on spending limits is a “double whammy” for Green Bay.
“Not only does it put us in a very difficult position when the biennial budget is over, because there won’t be enough funding to sustain staffing and programs at that point in time,” he said. “But the other hit that we take is that we are a low-spending district, and the state continues to fail at both the legislative and gubernatorial level to address that in their budgets. That persistent inequity is amplified by this freeze on the spending limits.”
Murley acknowledges things take time but said it has to start somewhere.
“I would like to see a plan that reduces the gap between high-spending and low-spending districts over time,” he said. “I understand that this gap can’t be closed in a year. I would like to see a plan that commits to reducing the gap by a fixed percentage each year – 20%, 10%. We would need five to 10 years to reach the goal, but no journey begins without a first step. Make sure 10 years from now we aren’t penalizing kids based on their zip code.”
West De Pere Superintendent Dennis Krueger shares the same concerns.
He said the freeze will have the district reevaluating its Elementary and Secondary School Emergency Relief (ESSER) grant funds, which were allocated to districts in response to the COVID-19 pandemic.
“The budget that was passed really has a freeze, or a zero increase per student, so that causes us to look at our ESSER money differently,” Krueger said. “And it will make things much more difficult next year and in the future, if we don’t get the increase per student, because we have increased costs.”
Kempen said all costs are going up, which requires increased funding.
“With the cost of everything going up – increases in costs need to be covered,” he said.
Seymour Superintendent Laurie Asher said what’s frustrating is districts are continuing to be asked to do more with less.
“I think that the frustrating piece is that our costs continue to rise, yet we continue to be asked to educate and provide the same programs with the same amount of money we had last year,” Asher said.
Lucius said districts are being put in a position where they may need to use ESSER dollars for operating expenses, which he fears could affect future funding.
“It is my personal opinion that we are not using ESSER funds as they were intended – for the purpose of keeping schools safely open and helping students that struggled during the pandemic,” he said. “I believe that when we are given funds for a specific purpose that we should not use them for other purposes or to balance our budget. I think federal agencies will see that this money is being used to support our operating budget, not for things specific to the pandemic. This may cause the (federal agencies) to be hesitant to provide resources when needed in the future, and it will prompt them to tightly mandate how the money is spent instead of leaving some flexibility to local school boards to use funds to meet local needs.
$100 million additional funds
Lucius said while the extra support for schools – the $100 million of additional dollars pledged by the governor from federal relief funds – is good, he said it creates an unstable situation.
“It creates a funding cliff,” he said. “When it is gone, how will we continue to fund those things?”
Murley said while helpful, it doesn’t solve the systematic issue districts face.
“I appreciate the fact that (Evers) is again planning to fund public education and try to drive dollars into a system, which I think has unfortunately been chronically underfunded for some time,” he said.
Juech said the additional $100 million helps address some financial concerns, however, it doesn’t address the longer-term funding challenges after this biennial budget.
“Using one-time funds can work for districts for this budget, but without a longer-term plan, we may be facing a cliff in two years, unless school funding is addressed with a more comprehensive approach,” he said.
Murley said he is concerned the issue will become political.
“I know that the Legislature is trying to use politics to drive where those dollars go,” he said. “And again, just come out and be honest. You are trying to drive dollars into districts that supported in-person and not online education last year. So you are going to penalize districts in the future for choices they made in the past. I have a problem with that. If you wanted to tell us that is the way you were going to do it when we made those decisions, then our school boards that made those choices would have known there was going to be a penalty in the future. Now, they may have still made the same choice, based on other factors, but they are using past behavior to now penalize future funding mechanisms, and I struggle with that. I don’t think that inherently that is a good funding practice to follow.”
Nothing has been released yet by the Wisconsin Department of Public Instruction in terms of how the additional funds will be distributed.
“The DPI needs to interpret,” Krueger said. “What is going to happen with the $100 million of ESSER that the governor set aside? Is it really $125 per student, and if it is, that is good, but that is one-time money, so what happens in the future?”
Asher said she hopes the state allows flexibility with the money.
“Because I think each individual school district has its own needs and different areas they need to address, holes we need to fill,” she said. “So hopefully there is some flexibility around that, not tied to a lot of mandates or a lot of strings, in essence.”
Kempen said districts are required to have a certified budget in October, and until specifics are released, districts are in limbo.
“It is only as fast as what Madison can get it done,” he said. “Once they figure out how much money is going to go into the aid formula, DPI is usually pretty quick on getting that information to us.”
Asher said the budget planning process is fluid with readjustments happening constantly.
“As a school district, we understand the challenges that the legislators are under balancing tax refund and funding of all the programs,” she said. “But our mission is to continue to provide the best education, and we rely on that funding to be able to do that. So we hope that our legislators continue to keep advocating for schools and finding ways to make sure that we have adequate funding, and not just Seymour but in the whole state. And continue to look at that, because I do think the system is really broken in the aspect of future financial support to schools.”
Britt Cudaback, communications director for the governor’s office, said districts and schools will be able to use the funds for non-pandemic-related expenses, recognizing districts spent funds from their base budgets on pandemic expenses.
“Schools can use these funds for any school-related expenses, including yearly expenses, such as salaries or cost-of-living increases,” Britt said. “The funds will be distributed on a per-pupil basis, estimated between $120-$130 per pupil. The final allocation will be determined as we have per-pupil information available for the upcoming school year.”
Murley said it’s important to keep the focus on education.
“I am a firm believer in public education being an engine for economic development,” he said. “It is one of those few areas in our publicly-funded economy where you can clearly see an investment by today’s citizens in the future of tomorrow. And I am disillusioned, disheartened, disappointed, all those other words that fall in that category, when I see a community, and by that I mean our state, that is not interested in making an investment in our future. And I wonder what it bodes for the long-term success of the State of Wisconsin when we are unwilling to invest in our children, so that they are prepared to lead our state in 20, 30, 40 years from now.”
De Pere Superintendent Ben Villarruel said while there has been much talk about the budget, DPI has not communicated specific details with districts yet.
“Once they do, I would be in a better position to comment,” Villarruel said.
This story was produced by the NEW News Lab, a collaboration of newsrooms that focuses on issues important to Northeast Wisconsin.