Since 1994, Wisconsin school districts have been mostly funded by a combination of state aid and local property taxes.

Wisconsin has revenue limits for each district that are created by the state budget. This limit caps the amount of money a district can receive through state aid and local property taxes. A district’s revenue limit is directly linked to two things: enrollment and state-approved adjustments.  State  revenue limits have not kept pace with inflation. If public schools had been allowed to keep up with inflation in the last decade, spending  would be about $2300 more per student per year than currently allowed. Our district serves approximately 900 students, which would equate to approximately 2 million dollars a year of lost revenue  for students over the past 10 years.

The public school funding model Wisconsin established 1994 is designed to empower local voters to decide how to fund their district rather than automatically keeping pace with increasing costs through state funding and automatic tax levy increases. School boards can ask voters to pass an operating referendum. An operating referendum allows the district to raise its revenue limit authority.

Most districts in the state have used operating referendums to meet their budget challenges.

The majority of Wisconsin school districts (86%) have proposed operating referendums to meet their budget needs. Since 2018, 77% of operating referendums have passed. When operating referendums fail, significant cuts to the school districts need to be made. 

Education funding from the state Legislature has not kept pace. This, coupled with an economy complicated by the pandemic and inflation, is causing school districts across Wisconsin to navigate serious funding issues. The gap between rising costs and frozen state funding is necessitating more districts to turn to voters to maintain operations and to meet capital needs.

Unless Wisconsin school funding methods change, operating referendums will continue to be necessary to avoid drastic cuts in programs and services.

82% of Wisconsin school districts have proposed operating referendums since 1992. Neighboring districts in southeastern Wisconsin that are among the 295 that have proposed and passed operating referendums since 2018 include:

Shorewood 2023

Nicolet 2021 & 2022

Fox Point-Bayside 2018 & 2022

Mequon-Thiensville  2020

Maple Dale-Indian Hill 2019

When can Wisconsin school districts place referendum questions on a ballot? What is the process?

A school district can only place a referendum question on a ballot after going through an official process. The referendum process starts when a school board adopts a resolution to exceed the limit. The permission to exceed the revenue limit can be for either recurring or nonrecurring purposes, i.e., can continue indefinitely or be only for a set period. 

The school district clerk must then submit the referendum to voters at the next primary or general election, as long as at least 70 days pass between the resolution’s adoption and the election. 

The Glendale-River Hills School District has met these requirements and a non-recurring operating referendum question will be included on the November 5, 2024 ballot.

Districts may not conduct referendums to exceed the revenue limit or issue debt more than twice per year. 

*Info provided by the Wisconsin Legislative Reference Bureau

A school district can only place a referendum question on a ballot after going through an official process. The referendum process starts when a school board adopts a resolution to exceed the limit. The permission to exceed the revenue limit can be for either recurring or nonrecurring purposes, i.e., can continue indefinitely or be only for a set period. 

The school district clerk must then submit the referendum to voters at the next primary or general election, as long as at least 70 days pass between the resolution’s adoption and the election. 

The Glendale-River Hills School District has met these requirements and a non-recurring operating referendum question will be included on the November 5, 2024 ballot.

Districts may not conduct referendums to exceed the revenue limit or issue debt more than twice per year. 

*Info provided by the Wisconsin Legislative Reference Bureau

Recurring means “occurring again periodically or repeatedly.” In a recurring referendum, there is an amount of dollars added each year in perpetuity.  Non-recurring means “not occurring repeatedly or occurring one time only.” In a non-recurring referendum, the amount of dollars is added on a temporary basis (number of years specified).

Two types of referendums to increase funding may be initiated. 

A district may hold a referendum to issue debt for a specified purpose. This is  referred to as “capital referenda,” because the funds are typically (but not always) for construction and other large capital projects.  A capital referendum provides the authority to issue a certain amount of bonds/notes to pay for a capital project.

A district may initiate a referendum to exceed its revenue limit without issuing new debt. These are referred to as “operating referenda.” An operating referendum pays for things such as utilities, routine maintenance, salaries and benefits of all staff, insurance, supplies, etc.

Glendale-River Hills is seeking an operating referendum.

RefHistory

“Shall the Glendale-River Hills School District, Milwaukee County, Wisconsin be authorized to exceed the revenue limit specified in Section 121.91, Wisconsin Statutes, by $4,500,000 per year for two years, for the 2024-2025 school year and the 2025-2026 school year, for non-recurring purposes consisting of operational expenses to maintain district programs?”

• The District has operated at a deficit over the past two years and depleted its fund balance.  Specifically $4.3 million of fund balance was used.

• The District has obtained a $6 million State Trust Fund loan that will be used to pay the final payment of a tax anticipation note and will cover operating expenses in the short term.

• The State School funding formula has not kept pace with inflation, causing GDRH and districts across the state to pass an operational referendum to increase funding.

• Certified staff wage increases of $956,653 over a two-year period.

• Increase in Special Education costs of $940,000 since 21-22 (two-year period)* 

• Open Enrollment, voucher and (Independent Charter Schools) ICS increase of $356,399 over a two-year period.

*The 2023-24 school year has not been audited.

There is no evidence that district money was diverted by anyone for personal gain. Although expenditures were in excess of budgeted amounts, they all appear to be investments intended to enhance district operations, and student success. 

After determining cash flow, a $6M Land Trust loan was secured to allow the district to fulfill its financial obligations. Over $1M in staffing cuts were made and staff salaries were frozen. Curriculum and technology updates were limited. Supply purchasing was diminished, and maintenance has been deferred where possible in our buildings and on our grounds. Despite these reductions if the referendum does not pass the district will be facing over a $3M deficit based on projected revenue in 2025-26. We understand that we need to continue to explore financial efficiencies in our operations, but a two year referendum would maintain current programing. This would allow us to engage our community in a long term vision for our district and its fiscal future without sacrificing the education of our students. We believe that the community deserves to weigh-in with  their vote on this important matter. 

OutcomesImage

The District levied $14.99 million for the 2023-24 School year. If the $4.5 million operational referendum passes in November, the District would be levying approximately $18.18 million, an increase of $3.19 million. The 2023-24 Mill Rate is $6.13. If the referendum passed in November the estimated Mill Rate would be $7.29 an increase of $1.16. This will likely decrease in 2025-26 due to the 2019 operational referendum discontinuing after this school year. 

PropTaxImpact

Wisconsin has revenue limits for each district that are created by the state budget. This limit caps the amount of money a district can receive through state aid and local property taxes. A district’s revenue limit is directly linked to two things: enrollment and state-approved adjustments.  State revenue limits have not kept pace with inflation. Like most schools in the state of Wisconsin Glendale-River Hills will likely continue to need operational referendum support.

The anticipated revenue for the sale of Good Hope building is not enough to address the district's financial need. The sale of district property must align not only  with our current needs but also our future fiscal security. The School Board and District will continue to explore options around this property to ensure strong decision making. 

Visit: https://myvote.wi.gov/en-us/ 

Call: Toll-Free: (866) VOTE-WIS or Local: (608) 266-8005

Glendale Voter Information: https://www.glendale-wi.gov/234/Elections 

River Hills Voter Information: https://riverhillswi.com/voting-information/ or Call:414-352-8213

The last audit was conducted for the 2022-23 fiscal year. The 2023-24 audit will begin in October.

The district took out a $6 million operational loan because the reduction in fund balance considerably impacted cash flow.  Over 80% of the district's general fund revenues are from property taxes which begin flowing into the district in January. GDRH, like many other districts across the state, engages in short-term borrowing to cover expenditures. With the depletion of fund balance caused by two years of overspending, an operational loan was necessary to cover the final payment on a tax anticipation note and to cover operational expenses for the short term.

The district is working with Robert W. Baird and Co. to ensure that we have an accurate forecast of revenue and expenses. They are working with us to support comprehensive financial data to determine the full extent of the budget deficit, to advise on spending without impacting student experiences, and to seek additional revenue opportunities. The district also remains in contact with its legal and fiscal counsel on all relevant matters.

To start, we have:

• Reduced approximately $1 million dollars through the reduction of staff and positions for the 2024-25 school year.

• Limited spending by reducing upgrades to technology, scaling back curriculum resources, except for those mandated by the state.  Identified additional savings to uphold quality student experiences.

• Worked closely with Baird to conduct financial planning and forecasting.

• Explored strategies to rebuild the fund balance in alignment with board policy and provide future financial sustainability

• Revamped and updated school board fiscal policies to ensure stronger oversight and fidelity.

• Implemented increased scrutiny and adherence to checks and balances with new leadership in our business office.