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Legislative Update

WPF issues report on school referenda

by | Apr 10, 2024 | Legislative Update Blog, State Issue

From Wisconsin Policy Forum: “Voters across Wisconsin approved 62 of the 103 school district referenda placed on primary and general election ballots this spring. The 60.2% approval rate was the lowest in a midterm or presidential election year since 2010, with the most ballot questions for spring elections since at least 2000. More districts asked to increase property taxes for operations rather than capital needs, a sign of the stress they are facing from inflation, state caps on their revenues, declining enrollment, and the expiration of federal pandemic aid.

Across ballots from February and April, 66.0% of all referendum questions asked voters to raise property taxes to support school district operations. This represents the highest share of operating referenda since at least 2000.

Yet as districts’ requests for additional revenue have intensified, voter support for these requests appears to be waning. Voter approval rates of school district referenda hovered around 50% for most of the late 2000s and early 2010s. Starting in 2012, however, voters approved referenda in greater numbers, with the passage rate peaking at 89.7% in 2018.

As schools’ costs increased, their major sources of revenue did not keep up. Since 2009, revenue limit increases have lagged inflation. Over time, school districts’ reliance on revenues from successful referenda has grown; in 2022, 100 districts drew on these dollars to fund more than 10% of their total education cost, according to research from Forward Analytics.

In addition to the impact of inflation, many districts face financial pressure from enrollment declines. Statewide public school enrollment has been dropping steadily since 2014 and the decline has been exacerbated by COVID-19. Over time, a decline in students means less money for districts. While enrollment losses allow districts to cut spending, it is difficult for school leaders to make up for the entire loss through cuts. Enrollment declines have been a particular challenge for MPS, but to a lesser degree are also affecting the vast majority of districts statewide.

Next year is also the first in which schools will be without the federal pandemic aid that began flowing in 2020, which amounted to an additional $2.4 billion for Wisconsin schools. While some districts used these funds only for one-time expenses, others used them to plug ongoing budget holes or fund permanent new spending.”

Read the full report here.

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