A Summary of the Final 2017-19 Budget for K-12 Education

September 26, 2017

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Wisconsin state lawmakers have approved an education budget that significantly increases resources for Wisconsin K-12 schools. Although this is the first major influx of new funding for K-12 schools in several years, most of the increase is delivered in a way that will move the state away from its commitment to providing more assistance to districts with less capacity to boost local property tax support for schools. The budget also increases the amount of public money going to private schools and cuts property taxes compared to what they would otherwise be.

Large, Mostly Untargeted Increase for Schools

Education-summaryThe budget includes a $636 million increase in state support mostly for public K-12 schools over the course of the two-year budget period, which runs through June 2019. In Wisconsin, public schools are funded mostly through a combination of state aid and local property taxes. Private schools will be eligible to receive a small portion of the $636 million in new resources.

Wisconsin calculates the bulk of state aid to school districts by using a formula that accounts for differences in property values among districts, giving more state aid to districts with less capacity to increase local property tax support for schools. The budget will deliver $505 million of the increase for public schools outside of that formula, on a flat per-student basis. Each school district will receive an increase of $200 per student in the first year of the budget, and an increase of $404 over the current level in the second year. In the second year of the budget, $24 of the $404 increase will be considered one-time funding and not carry over into future budgets.

Other increases in funding mostly for public schools include:

  • $12 million aimed at addressing the challenges of rural school districts, which often have declining enrollment and higher-than-average student transportation costs;
  • $9 million to improve special education in public schools, including providing grants to schools to help students transition to higher education or employment;
  • $9 million to public and private schools to buy personal electronic devices for students. The state will pay schools $125 for every ninth grader, an amount that must be matched by the school. The resources cannot be used to provide broadband services;
  • $7 million to improve mental health services in public and private schools; and
  • $5 million in new resources for Milwaukee Public Schools, districts that receive the lowest grade on school report cards, and private voucher schools in either of those districts.

More Money for Public Schools

The budget increases per-student payments to private schools participating in the state’s voucher program and charter schools not under control of a school board by $217 in the first year of the budget and $434 in the second year, slightly more than the per-student increase for public schools.

The budget expands eligibility for school vouchers by increasing the family income ceiling for participating students and watering down limits that determine whether students who already attend private schools may receive publicly-funded tuition vouchers. These changes will redirect $14 million from public school districts to private schools over the course of the budget.

Expanding Property Tax Cuts

The budget includes two tax cuts related to education:

  • A $73 million property tax cut delivered by requiring most schools districts to cut taxes. The budget includes an increase in the general state aid distributed through the funding formula in the second year of the budget, but does not raise the state-imposed cap on the amount of revenue that school districts are allowed to raise though a combination of state aid and local property taxes. The result is that most districts will be forced to cut taxes by the same amount of the increase they received in general state aid. The $636 million total in new funding for schools includes this $73 million property tax cut, even though it does not result in additional resources for schools.
  • An $87 million property tax cut delivered through the School Levy Tax Credit, which is applied directly to the property tax bills of property owners. This credit lowers the property tax bills of all owners of Wisconsin property, including industrial and commercial property. Property owners do not have to live in Wisconsin to receive the credit, and there is not an income ceiling for receiving the credit.

Other Changes to Education

The budget includes other changes that will affect K-12 education, including:

  • Eliminating the ability of school districts to exceed their state-imposed budget caps in order to fund energy efficiency improvements, and limiting when school referendums can be held;
  • Expanding the ability of organizations other than school boards to establish charter schools, lifting restrictions on where those schools are located, and removing a requirement that charter school authorizers adhere to principles set out by the National Association of Charter School Authorizers;
  • Making it easier for wealthier communities in the Racine Unified School District to split off and create their own districts; and
  • Prohibiting municipalities from obtaining land from owners who do not want to sell, in order to build sidewalks or bike paths. Education advocates have said that restricting the ability of municipalities to build safe pathways for children to get to school will raise transportation costs for districts.

Tamarine Cornelius