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State projects school aid estimates for next year, but questions linger over COVID-19's impact
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State projects school aid estimates for next year, but questions linger over COVID-19's impact

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The Madison School District is among 114 Wisconsin districts expected to see less K-12 state aid next school year, but those estimates could change as the state adjusts for COVID-19-related shortfalls.

The Department of Public Instruction on Wednesday announced that state general school aids — which represents the largest form of state support for public schools — are expected to increase statewide by $163.5 million, or 3.5%, from the previous year. The fund is expected to total $4.9 billion in the 2020-21 school year.

Of Wisconsin’s 421 school districts, 302 are poised to receive an increase in funds this coming school year. Another 114 districts are estimated to see a drop in funds, and five districts will see no change in funding.

However, Dan Bush, director of school financial services for DPI, said the estimates are based on the most recent 2019-20 budget data and are subject to change. Final funding amounts will be certified in mid-October.

“On balance, it’s unlikely that this estimate reflects the impact of COVID-19 much,” Bush said. “I would anticipate some differences when we get to the fall and we get the final year-end numbers.”

Bush said the overall $4.9 billion fund will not change without a state budget amendment. Also some of the state funding allocations could change based on adjustments made to staffing levels.

“It’ll affect how the pot is divided up,” Bush said. “How that will look depends a lot on the local circumstances of how a district responded to COVID-19, what their changes to staffing and costs were — up or down — and how they responded compared to how the 420 other districts responded.”

The 3.5% increase in school aid funds was approved in the 2019-20 biennial budget. Any amendments to those funds would require the Legislature to convene for a budget amendment — which also requires Gov. Tony Evers’ approval.

State leaders have hinted at the likelihood of convening later this year to take up budget amendment legislation, but lawmakers say they’re waiting for updated financial estimates from the Legislative Fiscal Bureau to get a firm grasp on how much impact COVID-19 has had on state revenue estimates.

LFB reported earlier this year that state sales tax collections were running about $380 million behind last year.

DPI estimates released Wednesday indicate the Madison School District is expected to see a 15% drop in general school aid funds, which Bush said is the maximum allowable annual decline in funding.

The change in general aid funds are based on property valuation, enrollment and shared costs, as well as the total amount of funds available from the state.

“That is really a reflection of the recent property value increases in Madison outpacing the state as a whole,” Bush said.

Bush said consistent growth in Madison property values have resulted in reduced state funds for that district over the last several years.

Madison schools spokesman Tim LeMonds said a projected decrease in funds for the Madison district is nothing unusual.

“We are estimating a 15% equalization aid loss for next year, and this has been a trend for Madison over the last several years,” LeMonds said in an email. “We have seen between 10% and 15% losses per year for a number of years now.”

Assuming that $7.6 million won’t materialize due to the pandemic, the Madison School Board on Monday approved a preliminary budget for next school year that removes previously planned raises. The board in June approved keeping base wages flat and freezing part of the salary schedule.

The $471 million spending package passed Monday on a 5-2 vote would decrease property taxes by $8 for the owner of an average-value home in the district, now estimated at $311,500.

The district’s total budget, which includes payments on debt service, capital maintenance and community programs, would be lower than current-year spending, but the property tax levy would rise 1.2% to $334 million. The district’s portion of property taxes on an average-value home is estimated at $3,333 next year, or 0.2% less than the current year.

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