Wisconsin

Wisconsin education finance can be characterized as being in the doldrums; that is, a state of stagnation exists in the aftermath of historic cuts in state aid to school districts in fiscal year (FY) 2011 that translated to a median per-district cut of 9.9%. Although state aid increased 1.3% in FY 2012, this meager amount did little to restore fiscal adequacy or stability to schools. Neither does the 2013–15 biennial budget hold out much hope. In FY 2014, the first year of the biennium, school districts received a 2.36% increase in state aid, largely owing to funding increases for some categorical programs. For FY 2015, the second year, a 1.27% increase has been approved. At the same time, state-imposed local property tax limits make it difficult for school districts to compensate for reductions in state aid without seeking a local referendum.

Background

Wisconsin educates 872,436 students in 424 school districts. There are three types of districts: elementary, high school, and K–12. The state provides 44.1% of school district revenues, while the local school district provides 47.1%. Federal aid represents 8.8% of revenues. In FY 2014, the state will distribute approximately $5 billion in state aid to school districts. This represents around one-third of the state’s general fund and its single largest appropriation. Average per-pupil expenditure, including all sources, is estimated at $12,000 for the 2013–14 school year.

Over 40% of Wisconsin’s student population is considered economically disadvantaged, defined as eligibility for free or reduced-priced meals. Approximately 14% is classified as having a disability and 5.5% is identified as an English-language learner. Although the high school graduation rate was 87.5% in 2013, only a little over one-third of Wisconsin students scored proficient or advanced on state tests in reading, while approximately one-half scored at these levels on mathematics.

The structure of state aid in wisconsin

Wisconsin is the only state in the nation to still use the guaranteed tax base formula, referred to as the “equalization formula,” as its sole form of basic aid. Equalization aid is computed via a complex three-tier guaranteed tax base formula in which the first tier acts like a flat grant and the second as a foundation, without a required minimum local tax rate. The third tier most resembles a true guaranteed tax base approach, although it also contains a “negative aid” feature, which, on paper, acts like a recapture provision. For the 2013–2014 school year, total basic state aid to PreK–12 public education is $4.3 billion. State education funding also includes 29 categorical aid programs, totaling $680.8 million, approximately 12% of total state aid. Special education is the largest categorical aid program at $368.9 million, more than half of the total. No state aid is available for school infrastructure.

Expansion of scope and funding of private school vouchers

Under the current governor, Scott Walker, a Republican, and a Republican-dominated legislature, Wisconsin has seen the original “Milwaukee Parental Choice Program,” a private school voucher program limited to the city of Milwaukee and low-income families, expand geographically to include the entire state. At the same time, eligibility has been expanded to encompass what many would consider middle-class families. State funding has been increased to allow for higher enrollments, and the amount of funding for a voucher has risen dramatically. Interestingly, if a child’s parents are married, they are permitted to qualify for a voucher with a higher income than a single parent household or a two-parent household in which the parents are unmarried.

Summary

• • Funding priorities for the governor and legislature:

  • ◦ Dramatic increases in state per-pupil voucher amount

  • ◦ Expansion of vouchers statewide

  • ◦ Expansion of voucher eligibility from low-income to include moderate-income families

  • ◦ Maintenance of state aid to public schools at current levels with some consideration for inflation

• • No substantive changes in state funding formula for public schools

• • Pressing state issues affecting K–12 education

  • ◦ State aid in the current biennium has done little to restore historic cuts made in...