The Sauk Prairie School Board unanimously approved the district’s final 2017-18 budget with a tax levy of $17,952,312 Oct. 24.
The tax levy is the financial burden district residents share in taxes for the purpose of operating a school district.
“The budget as a whole has not changed a lot from what we approved in June,” said Brent Richter, executive director of building services for the district. “So statutorily boards are required to approve a proposed draft budget in June. That gives us a working budget and gets something in the books for the district to start the fiscal year with. Then we … bring it back to you after we have key data by a Nov. 1 time frame statutorily we need to adopt a final budget.”
Richter said the things the district should take note of is this year going to have a reduction in state aid by almost $500,000.
“That is simply a function of our growing property values and the expenses from last year,” Richter said. “That will moderate over the next couple of years.”
Richter said the district’s state equalization aid has bounced between 53 percent and about 35 percent over the last 15 years.
“Not a bad spot for us but we’d like to get back up in the forties near 50 again,” Richter said. “But that would require some changes; we would need to grow by 50-100 students for that to happen and our property value would have to really not grow that much. And for us, we’re going to have growth in property—about 10 plus kids per year. I think what I would suggest is our state aid will live around 40 percent for the next few years.”
Richter said the key message about the budget is 50 percent of the district’s total revenue comes from property tax, and that other state aids contribute to total revenue, such as categorical aid, of which the district receives $200 per student. That puts the district at receiving just over $1 million in categorical aid from the state.
“That’s a pretty sizable amount of our revenue,” Richter said. Federal grants, Title I, 2 and 3, common school funds and transportation aid, registration fees and other local revenues make up the rest.
“That’s what our revenue stream looks like, big picture,” he said.
For every dollar the district loses in state aid, the financial burden gets shifted onto property tax. Because the district is receiving $500,000 less in state aid this fiscal year, that gap in aid shifts to the residents of Sauk Prairie.
“I always think of it as a scale,” Richer said. “Some districts see a lot of state aid, like a Florence or an Argyle; farming communities. And then the property taxes are low. But as you go down the road to Middleton, they get very little aid, so property taxes are much greater.”
Because of those dynamics, Richter said the district will have a 9.52 mill rate again this year.
“How does that happen? The beauty about the way we calculate this … its just the matter of we are increasing our total revenue limit and correspondingly we are increasing our property value,” Richter said. “So it comes out to 9.52 again.”
He said one of the ways the district can save to mitigate the loss of state aid is by using Fund 41 – the capital projects fund. “This will be new to our district,” Richter said. “If we can’t add anything to our total revenue but we can take $135,000 out of Fund 10, levying it into fund 41. We will run our projects through, so, the parking lot at Bridges, and a few others that have been identified, we will run those through Fund 41 this year and that will help save state aid down the road.”
School Board president Ryan Jesberger said to reiterate, the district’s mill rate will remain the same for this school year after a 7.8 percent decrease from the previous year.
“So taxes from the school district side of things are not going up,” Jesberger said. “So as you can see on the tax impact, 0 percent across the board from the school district’s side. Taxes are remaining stable from our side of things.”
“Our budget is pretty stable from where it has been in recent years,” said board member Richard Judge. “If our budget were adjusted for inflation, back to 2003 which is where Brent started, we would be at over $30 million in spending. And if our state aid had kept pace with inflation we would be getting almost $16 million in state aid. Obviously we are doing more with considerably less.”