At the Feb. 21 town hall meeting, Prescott School District’s Financial Coordinator Sue Gerdes prefaced the meeting by sharing the reasons why the district needs to pass the operational referendum on the April 2 ballot. Without revenue growth to match anticipated increases in expenses, the district will face reductions in people and programs, and place academic performance in jeopardy, she said.

Following the overview by Gerdes, Elise Murn, school business specialist from Baird, gave a presentation and answered questions on educational funding as it pertains to the upcoming referendum. She explained that the Baird Financial team uses a budget forecast model similar to a weather forecast to help plan for the future with known and unknown variables. As this is an operational referendum, the money can only fund daily operations such as staff, maintenance, busing, food service etc.

Murn explained a few options districts can utilize to raise revenue. One is the biannual budget through state legislature and the other is local authority or seeking community support through a referendum vote.

Murn gave more details about the biannual budget and showed a graph depicting the district which revealed a gap between what was given as result of inflation and what was given via the revenue limit. The biannual budget is a way that the legislature gives additional funding to schools and prior to 1993, it was indexed against inflation. Since then, the disparity between what's been given and what's been happening with inflation has grown.

“So, if you were to crunch those numbers if districts had been given inflationary increases as they had been prior to Act 10, Prescott would have over $4 million,” said Murn. “My team hopes to model scenarios around the biennial budget as well. And we had some districts in areas of the state plugging that number into their budget model and saying this would solve our need to go to referendum. We wouldn't have to go to referendum if this dollar amount was provided via the biennial budget.”

The floor was open to questions from the public. One of the first was why the district’s average dollars per pupil is lower than the state average per pupil?

Murn responded, “That per pupil dollar amount when revenue limits were established was different all across the state. And for a lot of districts, you know, in the $9,000 range. So the idea is that via the biennial budget, there would be increases given and districts would be able to continue to afford inflationary increases, right? So, some districts early on realized that it wasn't going to be enough for them, and they went to referendum early on in the process, recurring referendum that added to their base revenue limit authority, and they added to that per pupil dollar amount. So they naturally were, through the referenda process had more money earlier on. They may have had to go back since that time and that grows that number each time.”

Another question: “Our school district was so frugal trying to do the best they can with the money that we are continuing to pay the consequences of that. Were other districts like you said, property wealthy?”

Murn replied. “It depends on the district. Each district saw a 5.5% reduction in their revenue per member. So if that number was already higher, if your revenue per member was already $14,000 that would take you down to a different point than somebody whose revenue per member was already at $10,000. The idea was to reduce each district's revenue per member by 5.5%. And then that district would also see savings on the expense side because there are other reductions made to teacher benefit packages.”

Another query floated was, why isn’t the 30-year-old formula updated, to which she answered, “I know that superintendents all across the state do a lot of advocacy around this specific topic, over this this most recent biennial budget. No spendable dollars, like base-building revenue was given to schools. The idea was instead that pandemic dollars should take that over. So, I know that superintendents are working to answer that exact question.”

Superintendent Dr. Rick Spicuzza explained the cuts to school operations and what would occur if the referendum failed. Budget downfall would decrease staff size, professional development, class sizes, as well as other services such as busing and meal service. A member of the public asked if other school districts who found themselves depleting their fund balance have consolidated with other school districts and did that solve the problem.

“I can share anecdotally of some districts that I know that did consolidate, and it went well, and I know of some districts and they did consolidate, and it's still a little bit tricky,” said Murn. “And it hasn't necessarily been the cost savings or the tax savings that they expected. I think there's a misconception that once you've combined school districts and school taxes go away or that they are significantly decreased. However, depending on who you're combining with, they may have outstanding debt obligations right, like so Prescott has Fund 39 debt, neighboring districts may not, they may have other liabilities on their balance sheet.”

A question for Spicuzza was what assurance or steps for competence does the community have that the board will be fiscally responsible if inflation continues, that future operational referenda will come up?

“I would say that we are currently operating under an operating levy that happened in 2016. It's been eight years. And that is something that I don't think you could promise will never occur. But I would say that the steps that the board has taken, such as paying off loans early, moving to more energy efficiency, to at least mitigate or lower the cost of lighting. We have newer mechanical, more efficient boilers. We're saving on heating, we're saving on water to the degree that those rates don't change. There are, at least so I think that they're in our last three budgets, you've seen a reduction in expenses. So the board has taken corrective action and steps to lower that,” Spicuzza said. “The flip side is there is a surplus currently in Madison, over $3 billion. However, when they hit $7 billion, they didn't give us a lot. And they gave us kind of 50 cents on the dollar. All I would say is that to some degree with the maps being redistributed, I think it's time for us to at least challenge our representatives to say that the tax money paying out to Madison should be reinvested in its communities. They collect it for a reason. And it shouldn't be in a bank account. And so that's one of the challenges that I think will have to happen if the legislature were somehow to fund and all of a sudden there were major surpluses. The school board has the right to levy in less than the limit that's approved so they can always levy less, or they could use that money to pay off debt so that you ultimately save in the future.”

Spicuzza thanked all for coming to the town hall meeting and reminded all that a recording of the meeting will be posted on the district website. The district will hold another referendum Q&A town hall meeting on March 24 at 1:30 p.m. at PHS.