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Legislative Update

Budget Committee’s K-12 Proposal Secures Federal Funding, Freezes Revenue Limits

by | Jun 18, 2021 | Legislative Update Blog, State Budget | 0 comments

After initially passing a K-12 state budget package that put federal COVID relief dollars at risk, lawmakers on the budget-writing Joint Finance Committee have approved an overall state spending plan for the next two years that preserves Wisconsin’s access to more than $2.3 billion in one-time federal funds for K-12 education. 

By adding $408 million to state general school aids over the next two years ($110 million in 2021-22 and $298 million in 2022-23) on top of K-12 spending previously approved on May 27 (see below), the committee-approved package meets “maintenance of effort” (MOE) requirements imposed by Congress, according to the non-partisan Legislative Fiscal Bureau. Those federal MOE provisions require the state to maintain the same proportion of its overall spending on K-12 education in the next two-year state budget as in previous state budgets. 

While the committee increased state general aids, it did not allow an increase in state-imposed revenue limits. That means the additional state aid will be swapped for local property taxes within the revenue limit with no additional school district spending allowed. Thus, the additional state dollars will not help schools meet their ongoing operational costs but must go to lowering property taxes.  In effect, the state is using state aid to “buy down” local school levies.

The committee also addressed two long-standing school funding issues by: 1) eliminating a provision that skims-off a portion of the state general aid from every school district in the state in order to fund charter schools authorized by the UW-Milwaukee, UW-Parkside and the City of Milwaukee (resulting in public school districts receiving about $167 million more general aid for over the biennium); and 2) eliminating a delay in the payment of $75 million of each year’s state school aids until four weeks into the next fiscal year.  (This $75 million will be folded into the existing four payments school districts receive. This change will not alter the amounts paid out, just the timing of when those amounts are paid.)

The committee had previously provided an increase in resources for special education and mental health grants  and had also previously provided targeted assistance to rural schools on May 27. Those funding increases are incorporated into the budget bill that moves forward.  Here are the details of that previous action:

Special Education Categorical Aid

  •  $86 million in additional special education categorical aid over the biennium ($17.8 million in 2021-22 and $67.6 million in 2022-23) to reimburse eligible special education costs at the current level of 28.2% and 30% in those fiscal years, respectively.

School-Based Mental Health

  • $6 million more in each year of the biennium for school mental health categorical aid (for hiring of additional social workers only).
  • $3.5 million more in each year of the biennium to fund school-based mental health collaboration grants.

Sparsity Aid

  • $3.1 million more in 2021-22 and $3.2 million more in 2022-23 for sparsity aid. Additionally, created and additional tier of aid funded at $100 per pupil for districts with enrollment between 745 and 1,000 and population density of less than 10 pupils per square mile.

High Cost Pupil Transportation Aid

  • $6.4 million more in each year for high-cost pupil transportation. Reduced the threshold for qualifying for this aid from 145%  to 140% of statewide average per pupil transportation costs.

From here, the budget bill goes to the full Legislature where it must be passed in identical form by each house in order to reach the governor’s desk.  It is expect the bill will be taken up first by the state Assembly on June 28 and then by the state Senate on June 30.

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