The Prescott School Board took care of current financial needs at its meeting Wednesday, Oct. 18 and is starting some tough community conversations for the coming year.

With expectations for higher contributions in state per-pupil education aid not coming through when the Wisconsin State Legislature passed its two-year budget over the summer, The Prescott School District is dipping into its savings to plug a $900,000 gap in the 2023-24 budget. The school board unanimously passed the local tax levy to support the budget of $10,350,998, up 6.14 percent from the 2022-23 levy of $9,752,610. The amount of the levy that goes to general fund expenditures is $5,778,722.

The remainder of the levy goes to referendum debt service totaling $3,981,041, non-referendum debt service of $391,041 and $200,000 for the community service fund which covers Prescott Community Education and Prescott Community Recreation programs.

The district presented the budget and levy at its annual meeting last month. Since that time, numbers came into focus, after the final enrollment count and total from the state on the actual amount of aid the district will get.

“We did learn that we did get an adjustment, a little bit of a haircut from the amount of money coming from the state,” Superintendent Dr. Rick Spicuzza said.

The certified district enrollment dipped slightly, from 1,327 students last year to 1,310 this year. Per pupil aid is on a three-year rolling average, meaning Prescott lost $55,000 to put to this year’s budget because of having less “butts in chairs,” as Spicuzza put it.

Prescott taxpayers will pay $7.70 per $1,000 of property valuation on their tax bill this year. That tax rate has dropped over the last several years as the district valuation has grown.

About 75 percent of the school district lies within the City of Prescott and Oak Grove Township. The City of Prescott reassessed property this year, and the average property increased in value by 22 percent. A home in the city valued at $200,000 last year would be valued this year at $244,000 under that scenario. The school share of taxes on that home last year would have been $1,716. Using this year’s formula, the tax bill would be $1,878.80.

“There has been a precipitous drop in the mill (tax) rate,” said Spicuzza. “It does not account for the overall assessed value of homes.”

The school district was hopeful to get a per pupil increase in the state budget of $650 per student. However, the state approved an increase of $325 per pupil. Coupled with the loss of federal pandemic-relief funds, it’s left many school districts statewide scrambling for funding.

Overall state funding for Prescott dropped from $9.2 million last year to $8.8 million, said Spicuzza.

“That’s a 4 percent drop that gets passed on to the local community,” said Spicuzza.

Total revenue in the 2023-24 budget is $16,744,133, with expenses projected at $17,699,156. The board has committed to balancing that with district fund balance, but that’s for this year only.

“We are approving a budget that is unbalanced for the first time in my tenure here,” said Spicuzza.

The board held a work session earlier this month to talk about future budgets. Spicuzza said that things discussed were how to generate revenue, how to contain costs and how to make sure the district is “able to retain our staff, our programs and our performance.”

Spicuzza said many costs are fixed, and the district also knows it will enter the next budget cycle still short that $900,000.

“We’re talking about elephants, and elephants have to be $50,000, and we need 20 of them,” he said.

In the end, the district likely will need to turn to voters for an operating referendum to allow the district to raise an additional $500,000 above the current limit set by the state. In turn, the district will look to find $500,000 in expense cuts or operational efficiencies.

“No good idea will be left unturned,” he said.

The most likely time for a referendum would be during the spring election in April 2024. Board members agreed it needs to be explored.

Pat Block said the district worked hard to get the fund balance to the point where they could weather the 2023-24 storm, but district policy won’t allow it to dip further into it in future years.

“Everything needs to be on the table as we look into next year’s budget. That includes potentially an operation referendum,” he said. “It all has to be on the table for people to consider and full community input.”

“We can take a year, this year, to really be purposeful and plan. This will probably be the topic of every board meeting this whole year,” said Tanya Holub.

Vicki Rudolph said the district needs to make sure it continues its academic programs that are among the best in the state, statistics show.
“We’re trying, but yet there’s only so much out there. Prescott has done a really great job of maintaining certain standards that we put out to the community. There’s a reason our kids are doing as well as they are. There’s a reason they’re improving every year, and the scores show that,” she said. “We may have to come back to the community and ask for an operations referendum. We wouldn’t be the only district that would have to do that. Our state funding isn’t keeping up with what our district needs. We’re going to try our best. Everyone in administration is going to try their best. That might be the final option.”

“Prescott’s not only in this,” said Helen Stoeckel. “Across the state, funding is not what it should be. Everything is on the table.”

Board President Mike Matzek said the state is putting districts in a difficult place.

“They’re making this a local decision. The state is choosing to put the burden on the local taxpayers and make them decide what kind of education they want to provide,” he said.

“It’s pretty loud and clear the board’s stance was to use the fund balance. Next year we can’t do that. We know we have to make some changes. What we don’t want to cut is anything that has to do with staff retention and academic performance. We’ve made so many great strides to put Prescott top on the list when it comes to academic achievement. I don’t think the board is interested in taking backward steps,” said Matzek. “We’re going to need to ask the public for money.”

If the district decides to go to referendum in April, the board will need to pass a resolution by Jan. 23.

“If we were to try to do something, the likely date would be the spring election. We’d have to figure out what we need. There are tax tolerance implications. We need all that info teed up and ready to go in a very, very short window here,” said Matzek.