School District Faces $2.4 Million Deficit Amid Budget Cuts

During a recent school board meeting, officials discussed the financial outlook for the McFarland School District, highlighting a projected general fund of $13.2 million, which includes a $249,000 allocation for capital projects. This funding is crucial for maintaining infrastructure, including the replacement of aging boilers at the high school, with costs estimated at $90,000.

The district has seen a significant increase in state aid, amounting to nearly $5 million since the 2017-2018 school year, which has helped to reduce property taxes for residents. However, the aid does not contribute to new revenues for the district, as the revenue cap minus state aid determines property tax levels. The district's low property value per student has positioned it favorably within the state aid formula, allowing it to avoid negative tertiary state aid, a situation faced by many rural districts in Wisconsin.

The board also addressed the complexities of school finance, noting that property values and student enrollment directly impact funding. With declining enrollment, the district anticipates changes in its value per student, which could affect future funding.

In terms of budgeting, the district is preparing to approve draft budgets for various funds, including a general fund deficit of $2.4 million for the upcoming year. This deficit is attributed to the cessation of one-time federal funds previously used to offset operating expenses. The special education fund is projected to reach nearly $8 million, with over half of that amount sourced from the general fund.

Looking ahead, the district plans to finalize its budget after receiving updated equalized values and state aid amounts in October. The board emphasized the importance of clear communication with taxpayers regarding property tax implications, particularly as school property taxes are expected to decrease compared to previous years.