Community Spirit–January 2025
Ryan Ruggles, District Administrator
Wisconsin School Funding, Local Taxes and the Schools We Want
As the highest achieving district in our conference and one of the highest rated districts in the area per the state report card, we take pride in our success and we are thankful for the support and collaboration of our community. It takes a lot of work, planning and resources to create the type of schools we want for our students and community. A big part of that success is being intentional with our funding/budget.
As a state, Wisconsin has a very complex school funding system. Funding comes from a variety of sources with the majority of the funding coming from local taxes and state aid. Federal funding and other local revenue sources make up a much smaller percentage of our funding. When you add in revenue limits, equalization formula, voucher levy, declining enrollment levy, and mill rates in addition to limited state per pupil increases which have not come close to keeping pace with inflation, we have a recipe for frustration and misunderstanding.
At the local level, each fall at the annual meeting, the community sets the mill rate based on our budget planning and projections. Our goal is to have a stable and/or decreasing mill rate over time. In 2016, the district mill rate was $9.98 and decreased incrementally through 2022 to $7.29 pre-building referendum. Two years ago when the building referendum bond premium was not applied, tax payers saw a dramatic increase in their taxes as our mill rate jumped to $9.72. When the full bond premium was applied last year, it significantly decreased the levy to $5.85 for 2024. While it was necessary (and right) to apply the full bond premium last year and to give the tax relief to the taxpayers, we typically do not want to see that kind of fluctuation. Nobody wants that kind of a surprise at tax time.
Looking at this year’s tax bills, many folks saw an increase in their taxes, as this is bringing us back closer to the pre-referendum mill rate levels. The greatest driver for the overall levy increase is the debt referendum coming back on to the taxes after the one year relief from the bond premium. With the additional added operational referendum costs (up to $900,000 from $400,000) we were projecting a $8.33 mill rate in the spring and we came in under that at $7.71 for 2025. We were excited to come in under the projected rate, but the debt referendum coupled with increasing valuations factored into increased taxes for many.
As we look at the math for this year’s taxes with the debt referendum coming back on it is roughly a $1.31 increase on top of the approved $0.71 increase from the additional operating referendum, for a total of about $2.02 increase per thousand. On a $400,000 equalized home value that is approximately an $808 increase. Municipalities will use the total estimated fair market value in calculating property taxes, and this is another reason for taxpayers seeing an increase. Now each municipality is a bit different in their valuations and each saw different percentages of increases, but the school district plays no part in estimating fair market value. Instead of just looking at percentages of tax increases for this year we would recommend looking at 4 years’ worth of taxes and graphing those increases for a better perspective of changes over time. Another number to look at over that time is the amount your total estimated fair market value increases from year to year.
Overall, we will continue to try to find creative funding solutions to ease the burden on our taxpayers. We continue to apply for grants to fund programs, as well as recruit partners for sponsorships and donations. Please look for opportunities with the #AreYouReady2Fly campaign. We will continue to evaluate programs and staffing for effectiveness and to maintain appropriate and sustainable levels. We will continue to look at our fee structures and other sources, and revenue to keep a balanced approach to our budgeting and planning.
In addition to our internal work, we will engage with the state legislature and our representatives on the school funding formula and all funding related legislation. That is an area in which we can continue to support each other. As we shared in last year’s operational referendum presentations, if the state per pupil allocation would have increased with inflation over the years, we would have no need for an operational referendum in our district. Other areas that would decrease the taxpayer burden would be increased funding for special education in the state and more open enrollment dollars to follow the student. All of these are areas in which you can engage with our state representatives to help taxpayers while keeping our schools strong.
Thank you for your support and partnerships.