The state Senate’s K-12 funding package unveiled on July 18 (see previous post) contains an especially troubling referendum-related provision that has not been previously considered by the Legislature. The July 18 package was the first time it was made public.
The provision specifically targets low-property-wealth-per-pupil districts and impacts their ability to receive state aid. As described in the Senate package, going forward, it would exclude from “shared cost” any amount levied by a district in a prior year for either operating or debt service costs that were authorized by a referendum if doing so would not increase the district’s equalization aid entitlement. The provision first applies to referenda held after the budget bill becomes law.
The effect of this provision would be to permanently prevent a positively-aided school district (i.e., a district with below-average property wealth per pupil) from seeing any increase in state equalization aid as the result of passing a referendum authorizing additional district spending.
All of the districts shaded in dark green on this map produced by the Department of Public Instruction (DPI) would potentially be adversely impacted by this provision. In addition, most of the districts shaded in light green on the map would also potentially be adversely impacted by this provision.
For property poorer districts that are positively aided at the first two levels of Wisconsin’s three-tiered equalization aid formula (227 districts during the 2016-17 school year) and for many districts that are positively aided at all three levels of the formula (244 districts in total), this provision would be a severe deterrent to going to referendum because all of the district’s additional referendum-approved spending would be funded by property taxes. None of the district’s additional costs would be aided by state aid.
As the map indicates, many rural districts would be affected if they go to referenda in the future. So would 13 of the state’s 15 largest school districts (by enrollment), as all but Madison and Waukesha would be impacted.
Property wealthy districts with already high spending levels (negative tertiary aid districts) that pass referenda would not be affected by this provision. Those districts would continue to have their state aid reduced under this proposal as they do under current law; however, they might benefit over time from internal shifts in the formula as referendum spending from property poorer districts is excluded from future aid calculations.
This proposal reflects a big step away from the principles underlying the equalization aid formula. One of those principles is that rate at which school costs are aided through the formula is determined by comparing a school district’s per pupil tax base to the state’s guaranteed tax base under the formula.
Here is a list of the districts (244 by our count) that the WASB believes likely would have been affected (based on 2016-17 Equalization Aid figures) had this provision been in effect during the 2016-17 year and had they successfully passed an operating or borrowing referendum:
|Algoma||Genoa City J2||Osseo-Fairchild|
|Amery||Granton Area||Pecatonica Area|
|Appleton Area||Green Bay Area||Pittsville|
|Athens||Hartford J1||Portage Community|
|Augusta||Hilbert||Prairie Du Chien Area|
|Baldwin-Woodville Area||Hillsboro||Prairie Farm|
|Beaver Dam||Howards Grove||Reedsburg|
|Beloit Turner||Jefferson||Rio Community|
|Benton||Johnson Creek||Ripon Area|
|Berlin Area||Juda||River Falls|
|Black Hawk||Kaukauna Area||River Ridge|
|Black River Falls||Kenosha||Riverdale|
|Bonduel||Kimberly Area||Saint Croix Central|
|Boscobel||Ladysmith||Saint Croix Falls|
|Boyceville Community||Lake Mills Area||Seneca|
|Brillion||Lancaster Community||Seymour Community|
|Brown Deer||Little Chute Area||Shawano|
|Cadott Community||Loyal||Sheboygan Falls|
|Cashton||Manitowoc||Silver Lake J1|
|Cedar Grove-Belgium Area||Marinette||Somerset|
|Central Westosha UHS||Marion||South Milwaukee|
|Chippewa Falls Area||Marshfield||Sparta Area|
|Clear Lake||Mayville||Spring Valley|
|Clinton Community||McFarland||Stanley-Boyd Area|
|Colby||Mellen||Sun Prairie Area|
|Cuba City||Menomonie Area||Tomah Area|
|Cudahy||Merrill Area||Tomorrow River|
|D C Everest Area||Milwaukee||Tri-County Area|
|Darlington Community||Mineral Point||Two Rivers|
|Deerfield Community||Mishicot||Union Grove J1|
|Dover #1||Mount Horeb Area||Watertown|
|Eau Claire Area||New Glarus||Wausau|
|Edgerton||New Richmond||West Allis|
|Elk Mound Area||North Crawford||West Salem|
|Ellsworth Community||North Fond Du Lac||Westby Area|
|Evansville Community||Oak Creek-Franklin||Wheatland J1|
|Fall River||Oconto||Wisconsin Rapids|
|Fennimore Community||Oconto Falls||Wittenberg-Birnamwood|
|Fond Du Lac||Oostburg|
(Note: This list is based on 2016-17 aid calculations and may be subject to change in future years.