How Does a “Late” State Budget Affect July 1 School Aid Estimates?

The Department of Public Instruction (DPI)  is statutorily required to prepare and provide school districts with an estimate of their next year’s general aid distribution by July 1 each year using the most accurate data available.

Coming up with a July 1 estimate will be a bit trickier this year given that a new 2015-17 state budget appears unlikely to be passed by July 1, when the 2015-16 fiscal year begins. 

Wisconsin statutes provide that if a new budget has not been signed by the end of the fiscal year (June 30), the appropriation amounts continue from the previous budget. This means, if the legislature doesn’t pass and Gov. Walker doesn’t sign the 2015-17 budget before June 30, appropriations will continue at their 2014-15 levels.

Because the current proposed 2015-17 biennial budget provides for no change in state general school aids in 2015-16, the DPI can use the same funding level ($4.476 billion) for its July 1 estimate. However, the DPI will have to make assumptions regarding some provisions that are included in the budget bill the legislature is currently working on and how those items might affect 2015-16 state general aid.

Several provisions in the current proposed 2015-17 biennial budget could have an impact on the distribution of general school aids. These include the proposed expansion of the statewide voucher program that would be funded by withholding general aid from districts in which new voucher participants reside, a proposed phase-out of Chapter 220 program which would result in a redistribution of a portion of general aids, and independent “2r” charter expansion, to name a few.

School leaders should keep in mind that the July 1 estimated aid numbers are preliminary and will be finalized by the DPI in its October 15 aid certification when the DPI uses audited information from school districts to make its calculations. School districts set their levies based on the October 15 DPI aid numbers.