About 60% of Wisconsin School Districts Face Decline in State Aid

School lockers. Photo by Phil Roeder (CC BY 2.0)

About 60 percent of Wisconsin’s public school districts will see a decrease in state aid next year.

The Department of Public Instruction released preliminary aid estimates last week for the 2026-27 school year.

But Sara Shaw, deputy research director at the Wisconsin Policy Forum, says stagnant or lower general school aid payments don’t mean school districts are losing money.

It just changes where schools get their money from.

“In reality, districts’ revenue limit numbers are unchanged,” Shaw said. “What these numbers tell us is where the total is coming from, state general school aids or raising in property taxes.”

Shaw says now the school district will have to bear the fall out of property tax payers who are not pleased with potential increases.

“I would say the primary impact here is to property taxpayers rather than to the district,” Shaw said.

General school aids are the largest form of state support for Wisconsin public schools, offsetting local property taxes under state-imposed revenue limits.

This is the third year state aid to schools will remain flat at $5.58 billion overall.

According to DPI, 92 districts are projected to see a 15 percent decrease in aid in the fall, the maximum allowed under state law. About 38 percent of districts will see an increase in state aid.

The calculations are finalized in October.

When the biennial budget was passed in July, it included $1.4 billion to K-12 education over two years.

That money included $500 million to special education by increasing the reimbursement rate for those programs from 32 percent to 42 percent in the first year and 45 percent in the second year.

But the budget did not increase general school aids. At the time, education leaders cautioned local taxpayers would be hurt.

In the Kenosha Unified School District, general school aids will increase slightly — up 0.6 percent, or just under $1 million. Last year state aid was reduced about $9 million in Kenosha.

The district is facing a $17 million budget deficit. The school board considered going to referendum in November, but decided to wait until April to get more voter support.

The district’s Chief Financial Officer Tarik Hamdan said it’s hard to explain to residents that without general school aid, property taxes go up.

“For us, we’re allowed to spend $2.6 million (more in the coming school year under the revenue cap), but the state is only going to help us with 36 percent of that, so the other 64 percent comes from the taxpayers,” Hamdan said. “That equation is backwards. Because in Wisconsin, we had this promise of the state funding two-thirds and property taxes funding the other third. Now that equation is flipped.”

Kenosha Unified is facing the same budget issues many public school districts are dealing with.

The district had about 17,800 students for the 2025-26 school year, down more than 700 students from the previous year.

Wisconsin’s school funding system caps the amount of revenue school districts can receive each year from state aid and local property taxes. These revenue limits are tied primarily to state-approved adjustments and student enrollment.

For many years, state funding adjustments have not kept pace with inflation.

As a result, Kenosha’s revenue has grown much more slowly than the cost of operating schools, according to district officials.

Meanwhile, expenses such as curriculum and instructional materials, utilities, health insurance, transportation and employee salaries continue to increase.

Hamdan said health insurance premiums are going up 9.9 percent alone — that’s $1 million.

“If nothing else changed in our world, we wouldn’t even be able to cover our health insurance increases,” Hamdan said.

More than half of Wisconsin school districts will see decline in state aid this fall was originally published by Wisconsin Public Radio.