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How Is the Governor's Budget Impacting Local School Districts?

By: Leah Kraus Email
By: Leah Kraus Email

When Governor Scott Walker signed the state budget, closing a 3.5 billion dollar budget gap, no area saw steeper cuts than education. Many districts in the area are scrimping because of the cuts, including Marshfield.

"We've gotten to the point where there really aren't any areas for us to go anymore so we're cutting to the bone now," says Pat Saucerman, Director of Business Services at the Marshfield school district.

Governor Walker is taking a 900 million dollar chunk out of public education to help balance the state budget without raising taxes. But the changes to collective bargaining have also given school districts new ways to cut spending and balance their budgets, despite the funding cuts.

That's what's happened in Marshfield, where a change in health insurance carriers, made possible by the collective bargaining changes, saved them $850,000. As part of the new budget, teachers pay more toward their health and retirement benefits. A record number of retirements also helped Marshfield close the gap caused by cuts in aid. But in their district, and many others, those items are one-time savings, and won't help them in years ahead.

Saucerman says his staff in the Marshfield school district has been handling the cuts well. But he wants to make sure their sprits stay high.

"It's been a very difficult process for our staff obviously always concerned about employee morale we want to do the best we can and make certain that we're offering a good product to our students and that the staff are happy to be here and doing their jobs," he says.

School district employees now contribute 5.8% of their pension costs and 12.6% of their health insurance. Last year, they did not pay anything toward retirement and only paid 5% of their health insurance. For a teacher who makes $55,000 (the national average) that's about $4,500 more out of pocket each year, or about $175 every two weeks.

The Governor says asking public employees to pay more allowed the state to avoid massive teacher layoffs. His press secretary, Cullen Werwie, sent us a statement saying:

"Ultimately the budget reforms enacted by Governor Walker saved thousands of jobs for hardworking public employees, including teachers. Just yesterday in Illinois, Governor Quinn announced his budget plan, which included massive layoffs of public employees—and this is after they increased taxes on both individuals and businesses last year. Rather than kicking the can down the road the Governor thought the best way to show respect for teachers is by telling the truth about our past budget challenges and making sure that when solving these problems, we avoid at all costs, massive teacher layoffs in Wisconsin."

But many administrators say that with lower take-home pay for teachers, they're worried about how many will continue to look for jobs in education.

"It's possible, we've had discussions that over time the teaching profession may become unattractive," says Cherna Gorder, Chief Finance & Business Services Officer at the Wausau school district. "If there are frozen revenues or even more reduced revenues, [it] may not attract people into education."

Wausau isn't the only school district sying this. Merrill is one district in the area that is freezing some salaries due to financial reasons and they are worried about the profession too.

"If we continue to freeze salaries for a second year to make the budget work and other districts are giving even small increases overtime that makes other places more attractive," says Bruce Anderson, interim superintendent of the Merrill school district.

Perhaps no district is facing a tougher situation in the area than Merrill. Anderson says they saw a cut in State funds of about $400 per student, and were already one of the leanest-running Districts in the State.

Aside from the Governor's budget cuts, Merrill is facing additional financial woes. They have a declining enrollment which means less state funding. They estimate between enrollment drops and State budget cuts, their State aid amount has dropped by almost 1.7 million dollars from the previous year -- more than ever before. The district's budget for 2011-2012 is about $40.5 Million. (This number corrects the $32 million budget figure initially given to us by the District) Fund balances have also dropped. Anderson says they haven't had to cut any programs yet, but they may have to hire new employees at lower salaries.

The district has already voted to close an elementary school next year, and they're worried about what other changes may be needed down the line.

"If we end up having to keep cutting back and cutting back and cutting back," says Anderson, "what is it we're taking away from students? And at what point in time can we no longer attract quality employees?"

The Wausau school district will experience a loss of about ten million in aid over the next two years. Most of that -- six million dollars -- is made up by increased contributions by district employees. The district says a "significant" portion of the remaining deficit will be covered through staff attrition and program and operational reductions, but they will still see a deficit of two million for the 2011-2012 school year. But the tax rate in Wausau went down in 2011 and even with the deficit they do not expect to have to make wide-range layoffs.

The Stevens Point school district says they will be able to balance their budget this year. Like many other districts, they saw their tax rate go down. Cutting back on instruction and support services from the past year has allowed them to come in at just under 73 million. Over 90 percent of their expenditures come from salaries and benefits for employees as well as purchased services, which includes things like maintainance, utilities, and information technology. Schools expect they'll need to continue to find ways to do more with less.

"We're handed the cards we're dealt and we have to make it work," says Tom Owens, Director of Business Services at the Stevens Point School District. "Our job isn't to second-guess what the legislature does it's to carry out what they've done and to provide for the education of children."


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