Revised school budget: 15% tax hike

By Todd Krysiak, Sauk Prairie Eagle

The Sauk Prairie School Board learned July 13 that in order to maintain its budgeted programs, it must ask taxpayers to pay twice what administrators expected and significantly more than state officials led the district to believe they would.

Sauk Prairie School District Business Administrator Judy Weinstock said in the school's original budget, which the school board passed June 29, she factored in a 3.1 percent decline in state aid.

In the budget passed by the Wisconsin State Legislature and signed by Gov. Jim Doyle, state aid to school districts followed suit by declining on average 3.1 percent across the state.

However, according to Sauk Prairie School District Superintendent Craig Bender, the Wisconsin Department of Public Instruction applies that change to the state's equalized aid formula.

The result: A decline of 10.62 percent in state aid for Sauk Prairie schools, representing $1.4 million less in funding from the state for the district than it received last year.

"It came as a

surprise to all of us, from the people I've talked to across the state," Weinstock said. "Nobody expected this kind of a result."

Total projected expenditures for the district remained unchanged at $27.8 million in the revised budget, but a projected increase of 15.33 percent in the local tax levy was approved by the school board to make up for the changes from the state.

"It didn't happen exactly the way they said it would at the time," Bender said about the way state officials advised school districts to prepare their budgets. "People all over are very embroiled over this."

The change reduces the percentage of the school's budget that is provided by the state from 53 percent to 43 percent. Funding from local taxes increased from $15 million in the original budget to $16.1 million in the revised budget. In 2008-09, local taxpayers paid $14 million into the district.

Money the district expected to receive from the state declined from the original budget of $12.8 million to $11.8 million. In 2008-09, the state paid $13.2 million to the district.

"They just flipped the expense over to property taxpayers," Bender said during the finance and personnel committee meeting prior to the full board's meeting. "The state, to fix it's budget problem, did this and is saying they're not raising taxes. Yes they are. They're putting it on the property taxpayers."

Bender also said there was little the district could do to adjust its numbers at this point because of laws requiring the district to publish its budget two times prior to the Aug. 10 annual meeting.

He also pointed out that a majority of the budget is in personnel, and state law requires the district to lay off any teachers prior to May 1.

"We don't have too many choices here, we already have our budget," Bender said. "You can't make this big a cut and do it reasonably in that amount of time."

Finance and personnel committee member Jeff Hicken asked whether the district could use its fund balance to reduce the tax burden.

Bender said the move could pull the district away from the revenue cap, which would make it hard for the district to catch back up and could leave money from the state on the table in future budgets.

Weinstock also pointed out that the district borrowed $600,000 last year to maintain its fund balance due to the timing of payments from the state and the timing of expenditures. She said using the district's fund balance would increase the amount the district would have to borrow during the school year and could affect the district's credit rating, which might also negatively affect its interest rates on loans.

She said the new projected mill rate of $9.11 per $1,000 of assessed valuation is less than the actual mill rate of $9.34 per $1,000 in the 2003-04 budget and significantly less than the $14.67 mill rate in 1995-96. The change does represent an increase above the sub-$8 per $1,000 assessed valuation levy that taxpayers received in 2006-07 and up through this year's budget.

Bender said he thought it was wrong that the state used furloughs for its employees to balance its budget, but did not give schools any opportunity to modify their expenses.

"They didn't change any of our requirements," he said. "We still are expected to do all of the same things."

All of the board members individually were asked whether they wanted to put off announcing the budget changes and address them after the annual meeting and all declined, citing a desire to keep the public informed.

According to the Wisconsin Department of Public Instruction Web site, most area schools saw a decline in state aid, including Baraboo, which saw a drop of 7.4 percent, or $1.2 million; Lodi, which had a decline of 1.3 percent or about $100,000; and Reedsburg, which saw a decline of 7.7 percent representing about $1.1 million.

In an informational sheet handed out by the district during the meeting, administrators stated that of the 426 school districts in Wisconsin, 97 received the maximum decline in state aid of 15 percent — including the Madison Metropolitan School District. Ninety districts, including Wisconsin Dells, had an increase in state aid.