Seeing Through the Fog of K-12 School Funding
A worrisome Wisconsin weather condition we endure in the spring and fall is the early morning dense fog that blankets our low-lying landscapes, and unfortunately, our roadways. For those of us who report to work early, this is a weather phenomenon we know all too well. Conversely, if we could just linger a bit longer in our comfortable beds, the hazardous fog most often burns off with the radiant heat of the sun.
Comparatively speaking, the inherent fogginess of how Wisconsin funds our public schools is equally concerning. Much like our Wisconsin weather conditions, the “fogginess” of school finance does not burn off until the middle or end of October. Consequently, the levy we predicted in September at the Annual Meeting is often different when certified in October.
Some key factors playing into the development of our specific local schools’ levy are: a) enrollments, b) equalized valuations, c) debt service transfers, and d) general aids. Without a general understanding of how property owners are taxed for schools, it becomes easy to conjecture erroneously as to why taxes go up or down. The fact is, very little is within the district’s control. The following is an explanation of these key factors:
- Enrollment has steadily increased over the past three years. Per pupil revenue is directly affected by the number of students in a district; therefore, the more students, the higher the per pupil revenue collected through property taxes and general state aids. To put it into perspective, in 2014, we had approximately 687 students K-12. This year, 2017, we have 754 students K-12; that is an increase of 67 students in just three years.
- Equalized valuations in 2015-2016 were slightly more than $179 million. Our equalized value for 2017-2018 is over $211 million, representing an increase of $41.5 million from last year.
- Debt service transfer is a result of a defeasance meant to shorten the payoff timeline of approved referendum debt which is the district's best bet to thank the community for approving a referendum eight years ago. In two successive years (2015-2017), there was a total debt service transfer of $1.28 million. This year, 2017-2018, there will be no debt service transfer.
- General state aids are one-half of the revenue equation for public school districts. The other half of the equation is the tax levy. The amount of support expected from taxpayers versus general state aid is entirely based on the amount of property wealth within the district. The greater the property wealth of a school district, the more the state of Wisconsin expects taxpayers to support the schools whereas the lower the district property wealth the more general state aids received.
The School District of Abbotsford remains heavily aided. General state aids have decreased only slightly for 2017-2018. However, as a result of expenditures to lower our debt service and the release of the Curtiss TIF last spring the School District of Abbotsford's levy rate will rise back toward a normal level. Last year we saw a drastic drop in the mill rate from $10.62/$1,000 of property value in 2015-2016 to $7.96/$1,000 of property value in 2016-2017.
For 2017-2018 the board of education will certify a Fund 10 Levy of $1,050,722 with a mil rate of $9.95 per $1,000 of property value. This rate still remains lower than it was only two years ago at $10.62 per $1,000 of property value.
In short, much like the sun can dissipate dense fog, the Department of Public Instruction and the Department of Revenue have finally shed enough light on the school funding formula for us to certify our Fund 10 levy.
So why is it necessary to explain all of this to the readers? To put it simply, the School District of Abbotsford does not want our local taxpayers to erroneously link its initiative of adding classrooms to our elementary and middle school buildings with this levy rate increase. The board is committed to providing classroom space for a growing student population without asking the taxpayers for more money through referendum. Through continued frugal spending, the district will provide much needed classroom space for a growing student population by tightening the district’s “spending belt” over the next two fiscal years.
If you have any questions regarding Wisconsin school funding or the district’s decision to add classrooms, please stop by and chat or give me a call as I’d be happy to discuss either with you. My door is always open!
For the Cause of Our Kids!