- Wisconsin
Wisconsin's state school funding formula (formula) utilizes an equalization aid, which makes up about 98% of Wisconsin's state contribution to most districts. The formula uses a 3-tier, guaranteed-tax-base. Equalization Aid for 2014-15 was approximately $4.492 billion.
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• Tier 1 provides aid for a district's costs up to $1,000 per student. This is calculated using a $1.93 million per member valuation, which is set by statute.
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• Tier 2 provides aid provides aid for cost over $1,000 but less than a secondary ceiling (approx. $9,225 in 2014-15). The ceiling is set at 90% of the prior year's statewide total shared cost per member.
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• Tier 3 provides funds for cost that exceed $9,225 per member.1
FUNDING PRIORITIES FOR P-12 AND/OR HIGHER EDUCATION2
In his annual state of the state address, Governor Walker pledged to boost the state's support for improved internet connectivity for schools. The goal is to bring total spending for broadband services up to $52 million. This would be an increase of $36 million over current levels. Walker also cited that he will continue to expand charter schools and private vouchers in Wisconsin.3
CHANGES TO FUNDING FORMULA FOR P-12 AND/OR HIGHER EDUCATION
There were no significant changes in the funding formula for K-12 education in 2016.
In higher education, state lawmakers changed the funding model for the Technical College system in the 2013-15 biennial budget, shifting support from the [End Page 320] local property tax to the state General Purpose Revenue. This move about $406 million in annual support from local to state levels. However, Wisconsin did not increase per-student funding which fell over 25% between 2008 and 2016.4
PRESSING STATE ISSUES AFFECTING K-12 AND/OR HIGHER EDUCATION FUNDING
Spending in Wisconsin is lower today than in 2005. Total spending for students in was $11,253, a 5.4% decrease from 2005. The national average spending per student increased 4.2% during the same period. The spending cuts have resulted in teacher shortages, especially in the areas of math, science, and technology.5 Total salaries and benefits are down 7.4% from 2005 while the national average has increased by 3.9%.6
Higher education spending is less per student than pre-recession levels. Between 2008 and 2016, tuition at public colleges and universities has increased over 20.3%, or $1,485 per student. Part of the fallout in these cuts has been large layoffs at institutions of higher education. The University of Wisconsin-Madison laid off about 400 faculty and staff positions and have frozen faculty salaries.7
Wisconsin has also enacted large-scale tax cuts to corporations which limit resources for higher education. Since 1979, the state issued 2,512 tax subsidies totaling over $1.811 billion. There were over 10 mega deals since 2009 for tax cuts over $15 million, totaling over $441 million alone.8
One area of funding stress is the state's regressive tax structure. Although it ranks 37th on the Institute for Tax and Economic Policy's (ITEP) Tax Inequality Index, corporate taxes represent less than 0.2% of income for corporations making over $1 million per year. In contrast, the bottom 20% of income earners (making less than $13,700) pay over 8.9% of their income in state taxes (after any Federal offset), while those at the top 1% of income earners (earnings over $1 million) pay only 6.2% of taxes from total income. Those in the second, third and fourth income brackets ($29,300, $49,000, and $74,500) pay over 10% of [End Page 321] income in state taxes after federal offsets.9
EXCLUSIVE TO K-12: FORCES DIVERTING FUNDS FROM TRADITIONAL PUBLIC SCHOOL DISTRICTS AND/OR EXCLUSIVE TO HIGHER EDUCATION: TRENDS IN STATE FUNDING FOR PUBLIC INSTITUTIONS
Overall funding is low in Wisconsin compared to pre-recession levels (5.4% less than pre-recession levels). Fund reduction resulted in staff reduction and more crowded classrooms, shorter school years, and lower graduation rates.10
Between 2013 and 2014, the Wisconsin legislature has reduced personal income tax...