County schools’ state aid cut by $4 million
Five of the seven Waupaca County school districts will see their state aid cut by just over 10 percent this year.
State aid for the seven districts combined will drop by over $4.2 million.
The Wisconsin Department of Public Instruction released its annual estimates of state aid to school districts in June.
According to the DPI, aid will be reduced for 410 of the state’s 424 school districts in the 2011-12 academic year.
State aid for the Waupaca School District will decrease from $10.7 million in 2010-11 to $9.62 million in 2011-12.
District Administrator Dave Poeschl said Waupaca has been anticipating this decrease for several months.
“As a result, the district has been proactive and made program and staffing decisions in preparation,” Poeschl said.
He also noted that cuts in state aid are not new to Waupaca.
“In fact, this recent $1,084,444 reduction contributes toward a total reduction of $2,726,740 since 2008-09,” Poeschl said. “The reality is the state’s decision to fund education to less than the degree previously stated has shifted the burden from the state to the local property taxpayer. The school board has been very aware of this shift and has limited the burden to the taxpayer by levying below the amount allowed by the revenue cap formula by approximately $2,100,000 over the past few years.”
When asked if the Waupaca School District would need to cut any programs or lay off any teachers, Poeschl said that approximately 22 full-time equivalent teaching positions “have either retired or left the district since the end of the 2010-11 school year. The district will replace approximately half of those FTE positions resulting in a decrease of approximately $700,000 in expenditures for 2011-12. No teachers lost their jobs due to a layoff between the 2010-11 school year and the 2011-12 school year. The district was able to reduce positions through attrition instead of layoff.” While no specific programs are scheduled to be cut in 2011-12, Poeschl said there is concern the effectiveness of existing programs may be reduced by increasing class sizes and reducing the number of staff available to serve students.
“We will be monitoring this and attempt to make adjustments accordingly,” Poeschl said. “The district will continue to participate in the state SAGE program, limiting class size at the early elementary grade levels.”
Poeschl said the Waupaca School Board’s decision “to not levy to the revenue cap in previous years works in our favor now by giving us room to raise more revenue if we need it. The legislative change allowing our district to recoup (through an increase in property taxes) some of the revenue cap monies left on the table over the past couple years, if we decide to do so, gives us flexibility and is much appreciated.”
Due to declining enrollment, Waupaca schools have already been reducing the number of teaching and administrative positions over a period of time rather than having to make drastic cuts all at once.
“I would also point out the board and teachers have worked together over the years in making decisions relative to collective bargaining limiting the need for drastic changes now. While other districts must compensate for costly early retirement benefits negotiated with their teachers and administrators, the School District of Waupaca has a relatively modest early retirement agreement with our teachers and administrators, thereby limiting the long-term financial exposure,” Poeschl said.
“In addition, our teachers already pay 15 percent of the premium for a family health insurance plan and have done so for more than 20 years. This obviously helps keep our annual costs down and limits the need for making drastic changes during times like this,” he said.
Poeschl also noted that the school board’s previous decisions relative to the use of fund balance, paying off state retirement debt, and refinancing debt have all made positive contributions toward the district’s current financial situation.
Since Waupaca teachers already contribute toward family health insurance, there will be no additional savings for the Waupaca School District under Wisconsin Act 10, which requires public employees to pay a larger share toward their health insurance premiums and pension plans.
“The employee contribution toward retirement required by Act 10 will generate a district expenditure reduction of approximately $892,000 for the 2011-12 school year,” Poeschl said.
According to the estimates released by DPI, the Weyauwega-Fremont School District will see its state aid cut by approximately $455,000 in the 2011-12 academic year.
District Administrator Scott Bleck said Weyauwega-Fremont schools will be able to retain all current programming and, due to retirements, retain all teaching staff.
“As a district, we extended the current bargaining agreement with the Weyauwega-Fremont Education Association for one year, which recognized increased contribution to health care costs and the Wisconsin Retirement System. Additionally, language was eliminated on the current insurance opt-out option,” Bleck said.
The Weyauwega-Fremont School District’s contract extension with the teachers included a 50 percent contribution toward their retirement plan and a 14 percent contribution toward the cost of their insurance.
Previously, the district paid 95 percent of the teachers’ health insurance cost, while the employees paid 5 percent.
The contract extension with teachers also recognizes the 2010-11 pay schedule for 2011-12, thereby freezing salaries at their present level.
“Act 10 will allow greater flexibility for the district to develop potential means to recover lost state aid. Just as with any new tool (Act 10), one must not overestimate its ability. The Board of Education will continue to examine potential cost-saving avenues established by the passing of Act 10 to enhance district allocations. Throughout the examination process, appropriate staffing and programing must be retained to allow districts to be competitive with neighboring school districts and online educational options,” Bleck said.
When asked if the Weyauwega-Fremont School District was prepared for a 10 percent drop in state aid, Bleck said, “As a public school it is our responsibility to appropriately utilize all state funds that are available. No one likes to experience a decrease in funding. It will continue to be a goal of the district to maximize our current funds that are available to foster student-focused programing which allows our children to be competent and competitive in an every changing society.”
Bleck said the work of the current and prior school boards had created an “understanding of sound fiscal practices.”
In addition to a $400,000 cut in state aid in 2011-12, the Iola-Scandinavia School District will experience a drop in its revenue cap of nearly $655,000 in 2011-12 as compared to 2010-11.
“We will do everything we can to maintain excellent educational opportunities for our students, while working within the state imposed revenue limits,” according to Joe Price, the district administrator. “We will use the remaining $154,000 in federal stimulus money to help address this need. We also plan to reduce our contribution to Fund 73 for post-employment benefits by $150,000.”
Price said administrators in the Iola-Scandinavia School District have also agreed to pay their half of the Wisconsin Retirement System obligation. Along with other changes in administrative contracts this will reduce administrative costs by more than $66,000.
“We also reduced our purchase of contracted services from CESA 5 (Cooperative Educational Service Agency 5) by $55,000,” Price said. “To meet the entire reduction in revenues, we have had to allow our class sizes to increase in grades four and six for next year.”
Price said Iola-Scandinavia schools were able to eliminate one staff position by not hiring a replacement for a teacher who retired.
“Regrettably, we did have to lay off one full-time teacher,” Price said.
When asked if his district was prepared for a 10 percent drop in state aid, Price responded, “Yes, we have no other choice.”
Price noted that the Iola-Scandinavia School District was considered a low-spending district according to criteria set by the state Department of Public instruction.
“We strive to operate as efficiently as we can while providing quality programs for our students,” Price said.
The changes in collective bargaining under Wisconsin Act 10 will help compensate for some of the district’s lost revenues.
“Our teachers have agreed to pay their half of the contribution to the Wisconsin Retirement System. This reduces the district’s obligation by about $142,000,” Price said. “We reached a voluntary agreement with our teachers to extend their collective bargaining agreement with the district through June of 2012, so those changes won’t affect us until the 2012-13 school year.”
School districts total revenues are comprised of the local tax levy and state aid. The state sets a cap on the total revenues a district may collect.
Price said the state budget has not only cut state aid, but has reduced the district’s revenue cap.
The Iola-Scandinavia School District’s revenue limit will be $654,845 less in 2011-12 than it was in 2010-11.
“A few years ago, the state cut aid, but not the revenue cap and that resulted in an increase in our tax levy in 2009-10,” Price said. “There will actually be a decrease in our tax levy. Our tax levy will go down by 5.5 percent this year.”