BELOIT - The School District of Beloit expects flat state aid and a potential need to cut $6 million (about 7.2%) from the $93 million projected costs of the last year.
The district's general fund budget for 2018-2019 was $93 million and it is projected to decrease to $87 million due to the decreasing revenue limit, which is attributed to declining enrollment trends and state aid, according to Executive Director of Business Services Robert Thom and Interim Superintendent Tony Bosco.
The district is taking its first look at budget considerations, as managers await the state to finish its biennial budget preparations (see related story on this page). The state's biennial budget is currently bottled up in the fight between Wisconsin Gov. Tony Evers and legislative Republicans. Evers has proposed an increase calling for around $1.4 billion more for the Department of Public Instruction over the biennium. Republicans rejected Evers' proposal and are rewriting their own plan, for about $900 million less. It's still unclear if Beloit will receive more or less money from the state because of the status of the state budget impasse.
Thom will present the preliminary budget numbers at the School District of Beloit Board of Education fiscal meeting at 5 p.m. Tuesday.
The district will hold the annual budget hearing in October when it receives the final state aid figures and property values and adjusts finances accordingly. Thom said all the numbers are preliminary as they are subject to state aid based on property values in the district and student enrollment counts.
The district's revenue limit declined by $6 million, requiring the district to find $6 million in expense reductions to reduce to balance its budget. Last year's revenue limit was almost $78 million and this year it's estimated to be $72 million. The revenue limit is based on pupil count and what was spent the previous year.
To balance the budget, Bosco said the district is looking at deferring some maintenance projects until July 1, 2020 and cutting department budgets. Bosco said he doesn't anticipate any staff cuts.
The district may receive less state aid in 2021 because of the decrease in spending for 2019-2020.
A large part of the decreased spending was due to the district not using the revenue limit energy exemption for construction projects. The state exemption accommodated spending deemed to improve energy efficiency projects, and approved projects were reimbursed approximately 80% the following year through state equalization aid. However, the 2018-2019 school year was the last year the projects were allowable outside of the state revenue limit.
With the revenue limit energy exemption option to raise taxes gone, the district is looking into another tool to collect additional money, which allows property taxes to rise outside state controls.
Bosco said administration will be discussing Fund 80 with the board to help fund after school programs which are currently grant based.
A Community Program and Services (CPS) Fund 80 is used to account for activities such as adult education, community recreation programs, elderly food service programs, day care services and other programs with the primary function of serving the community, according to earlier information from the Wisconsin Department of Public Instruction and Thom.
Districts may adopt a separate tax levy for a Fund 80. The limit on the Fund 80 levy disappeared as of June 30, 2015. A Fund 80 allows the district to tax above and beyond current revenue limits. Unlike other operational costs, reimbursed to the school district by state at about 75 %, none of the amount the district spends on Fund 80 activities will be reimbursed by the state. This would be the first time the district would be using a Fund 80.
Bosco said administration has proposed the district raising $400,000 through Fund 80 to pay for afterschool programs schools which do not currently have 21st Century Community Learning Center grants. To meet the part of the grant requiring community programming to serve adults, Bosco said the programming will likely include offerings such as art or exercise classes for community members.
If the district uses the Fund 80, there still will be a tax savings to property owners, however, it would be less than if it wasn't used, Thom added.