Wisconsin School Spending Changes Match U.S. During 2008-12
Badger State Cut Spending in 2012 While Other States Saw Earlier Reductions
MADISON—Per student spending by Wisconsin’s public schools declined 6.2% in 2012 from $11,774 to $11,042. However, Wisconsin’s retrenchment was not unique, according to a new study from the Wisconsin Taxpayers Alliance (WISTAX). Another 19 states reduced spending in 2012, while some made cuts during the recession; six in 2009, 15 in 2010, and 21 in 2011. The new report, “How Have Schools Fared? Wisconsin vs. U.S.,” examines public school spending and revenues among the 50 states during and after the 2007-09 recession. WISTAX is a nonpartisan, nonprofit organization devoted to public policy research and citizen education.
When examined over the entire 2008-12 period, Wisconsin’s school spending growth (3.4%) matched the U.S. average and ranked 30th among the states. However, Badger State per student spending dropped from 15th highest in 2008 ($10,680) to 21st in 2012 ($11,042).
Spending reductions here were concentrated mostly in benefits, driven by 2011 Act 10. Benefit spending per student fell 17.3% in 2012 from $2,294 to $1,898. Only West Virginia (-18.4%) and Florida (-19.5%) had larger drops, WISTAX said. However, Wisconsin’s benefit changes were not as unusual as might appear. Benefit costs fell in 11 states in 2009, 13 in 2010, and 18 in 2011.
During 2008-12, benefit costs here fell 4.0%. Ten other states cut these costs during the four years and seven reduced them more than Wisconsin. Despite the reductions, Wisconsin’s 2012 benefit costs per student were 16th highest among the states.
Like other states, Wisconsin schools shed staff during 2008-12. After increasing 1.5% in 2009, K-12 staff levels here fell for three consecutive years: 1.3% in both 2010 and 2011, and 2.3% in 2012. All told, staff numbers in 2012 were 3.3% below the 2008 level. Over the same years, 26 states trimmed staff, with 13 states making larger cuts than Wisconsin. Nationally, school employment fell 1.2% during 2008-12.
The decline in Wisconsin staff is not altogether unexpected since school enrollments dropped 0.5% over the 2008-12 period, continuing a long-term trend. Nationally, enrollments fell 0.4% during those same years.
Benefit changes resulting from Act 10 also reduced total compensation (salary plus benefits) for Wisconsin school staff, falling 5.4% from $80,853 in 2011 to $76,520 in 2012. However, due to increases during the prior years, total compensation rose 6.0% during 2008-12, compared to 4.9% nationally. Wisconsin ranked 12th in staff compensation in 2012, down two spots from 10th in 2011.
In many states, K-12 spending declines were driven by reductions in state aid to schools. As the recession reduced state tax revenues, many states cut school aids to balance their budgets. In each year during 2009-12, at least 11 states cut state school aids, with the number peaking at 40 in 2010. Wisconsin used $552 million of federal stimulus money to fund 2009 school aids, but then cut them by $200 million in 2010 and $400 million in 2012.
Wisconsin’s revenue-limit law generally allows schools to replace lost aid with local property taxes. During 2008-12, local school revenues here rose 13.5%, significantly more than the national average (4.5%). While local revenues per student in Wisconsin trailed the nation by 2.9% in 2007, they exceeded the U.S. by 9.1% in 2012.
The use of federal stimulus money and the above-average increase in local tax funding provided Wisconsin schools with a greater increase in per student revenues during 2008-12 than elsewhere (4.7% vs. 2.5%), even after accounting for our 4.7% per student revenue cut in 2012. Wisconsin’s increase in total per student revenues during 2008-12 was 27th highest among the states.
A free copy of The Wisconsin Taxpayer magazine, “How Have Schools Fared? Wisconsin vs. U.S.,” is available by visiting www.wistax.org; emailing firstname.lastname@example.org; calling 608.241.9789; or writing WISTAX at 401 North Lawn Ave., Madison, WI 53704-5033.