24MB mp3 audio file. Mitch and Don discuss the Madison School District’s $12M budget deficit, caused by a decline in redistributed tax dollars from the State of Wisconsin and generally flat enrollment. Topics include: Fund 80, health care costs, four year old kindergarten, staffing, property taxes (which may increase to make up for the reduced state tax dollar funding).
Madison School District Board President Arlene Silveira sent this message to local Alders Saturday:

Good afternoon,
Below is an update of the MMSD budget situation.
As you know, the biennial budget was signed into law at the end of June. The budget had numerous provisions that will effect the future of public education that include:

• Repeal of the Qualified Economic Offer (QEO)
• Decrease in funding for public education by the state of approximately $14720million
• Decrease in the per pupil increase associated with revenue limits

The repeal of the QEO will potentially impact future settlements for salries and benefits. The decrease in funding for public education by the state creates the need for a tax increase conversation in order to sustain current programs. The decrease in the revenue limit formula will cause MMSD to face more reductions in programs and services for the next 2 years at a minimum.
EFFECT OF STATE BUDGET ON MMSD

• Decrease in state aid: $9.2 million
• Reduction in revenue: $2.8 million (decrease in the per pupil increase from $275 to $200/pupil)

Total decrease: projected to to be $12 million
Last May, the Madison Board of Education passed a preliminary 2009-10 budget that maintained programs and services with a modest property tax increase. The groundwork for our budget was laid last fall when the Board pledged our commitment to community partnership and the community responded by supporting a referendum that allowed us to exceed revenue caps to stabilize funding for our schools. Two months later, with programs and staff in place for next year, we find ourselves faced with State funding cuts far exceeding our worst fears.
HOW DID THIS HAPPEN?
We are in this position in part because Wisconsin’s school funding formulas are so complicated that the legislature and supporting agencies did not accurately predict the budget’s impact on school districts. State aid to Madison and many other districts was cut by 15%. In practical terms, coupled with additional State cuts of $2.8 million, MMSD is saddled with State budget reductions of $12 million this year.
This grim situation is a result of a poor economy, outdated information used by the legislature, and a Department of Public Instruction policy that penalizes the district for receiving one-time income (TIF closing in Madison). Federal stimulus funds will, at best, delay cuts for one year. We are left with a gaping budget deficit when many fiscal decisions for the upcoming school year cannot be reversed.
WHAT ARE WE GOING TO DO?
We are working on strategies and options and are looking carefully at the numbers to ensure our solutions do not create new problems. We will evaluate options for dealing with the budget in early August.
To repair our budget, we are working with legislators and the DPI to appeal decisions that have placed us in this position. We continue to look for changes in resource management to find additional cost reductions. We are seeking ways to offset the impact of school property tax increases if we need to increase our levy.
At the same time, we pledge that we will not pass the full cost of the cuts along as increased property taxes. We will not resort to massive layoffs of teachers and support staff, t he deadline having passed to legally reduce our staff under union contracts.
I will be back in touch after our August meeting when we have made decisions on our path forward.
If you have any questions, please do not hesitate to contact me.
Arlene Silveira
Madison Board of Education
608-516-8981

Related: Sparks fly over Wisconsin Budget’s Labor Related Provisions.