Over the next few weeks, I will provide information related to the operational referendum that will appear on the ballot on Tuesday, April 7. An operational referendum allows voters to approve additional funding for the day-to-day operations of schools, including but not limited to educational programming, curriculum, recruiting and retaining staff, student services, instructional tools and technology, maintenance of existing school facilities, and transportation.

Operational referendums are not capital referendums, and the dollars cannot flow back and forth between the two different types. The revenue limits that are currently in place were implemented in 1993 and locked in at what the school district was spending at that time. Districts such as Ellsworth, as well as many of our neighboring districts in western Wisconsin, were low-spending districts at that time. Therefore, lower spending districts, who at the time were making every attempt to be fiscally responsible, were then penalized over time as inflationary increases rose, retaining staff and providing a competitive wage became more difficult, health care costs skyrocketed, and more.

When the state legislature removed the inflationary factor from the school funding formula around 2009, it removed the one true safeguard against rapidly rising costs that would allow school funding to keep up with inflation. This is particularly impactful on the heels of the COVID pandemic and some of the largest inflation we have seen in the past 40 years.

As student enrollment (and therefore student aid) remained flat or increased, districts were able to keep pace with budgetary pressure. Now that approximately 70% of school districts in Wisconsin are experiencing declining enrollment coupled with three decades of not keeping up with inflation, the funding challenges have reached a critical juncture. While Wisconsin districts, particularly smaller and rural districts, struggle to keep up with these challenges, the state legislature has simultaneously announced a $2.5 billion surplus.

With that in mind, school districts began conducting operational referendums in order to secure the additional funding needed. According to the Wisconsin Association of School Business Officials (WASBO), since 2009 when inflationary measures were removed from the funding formula, funding per student is lagging inflation by $3,380 per student. In Ellsworth, that means that had we kept up with inflation, we would not need to be seeking an operational referendum at this time.

With the current referendum in place of $1.3 million in additional, voter-approved revenue, Ellsworth currently ranks 249th of 421 Wisconsin districts in revenue limit per member. Without that additional revenue, our revenue limit per member would fall to near the bottom 10% in the state. While we are still a high performing district, these funding challenges are decaying our ability to compete with neighboring districts, some of which are in Minnesota, for high quality instructional staff and the programming and options that students and families seek when deciding where they wish to attend school.

School districts have only two methods of increasing funding. Either state aid increases or the local levy increases. Local school districts have no control over the increases to state aid (or in the case of the most recent state budget, zero increase). Recent per pupil increases granted by the legislature that were celebrated as historic investments in education were, in reality, applied to the local levy putting the responsibility back on the local taxpayer.

The previous, voter-approved operational referendum was a four-year, non-recurring referendum that will expire at the end of this school year. The proposed referendum of $2.185 million is based on the community survey feedback indicating the strongest support was for an amount less than $3 million annually. In addition, the $2.185 million allows the district fund balance to remain at or above 10% at the end of the four-year period, which is required by board policy.

The current operating referendum that expires after this school year was approved in 2022 and is $1.3 million per year for four years. The upcoming ballot question represents continuing the $1.3 million levy that is already in place and adding an additional $885,000 to address rising operating costs. This totals $2,185,000 per year to support operational needs for the next four school years.

Without voter approval, there will be no additional revenue in any amount, including the current amount of $1.3 million. Even with the passage of a successful referendum, the district is committing to making budgetary reductions in the amount of $1,250,000. If the referendum does not pass, the district will need to make an additional $671,000 worth of reductions for a total budgetary reduction amount of $1,921,000. 

Thank you for reading this and as always, if you have further questions or need clarification on any related items, please contact me at 715-273-3900 or nadeaub@ellsworth.k12.wi.us.