School district’s prelim budget includes deficit

Board looks at using ESSER funds to erase $434K deficit for 2021-22 school year
By: 
Lee Pulaski
City Editor

The Shawano School District will need to figure out where to cut over $434,000 from its 2021-22 budget after the Shawano School Board signed off July 19 on some preliminary figures.

According to Finance Director Josh Swanson, the deficit is coming about due to the continued decline in enrollment, something the district has seen in the last five years, as well as the state keeping school districts’ revenue limits flat with previous years. The preliminary budget is just shy of $31 million, while the district operated with a budget of $30.4 million this past school year, which ended June 30.

The projected revenue for 2021-22, however, is $30.55 million, so the district will need to find a way to either obtain additional funds or cut the budget before the final numbers are approved at the end of October. Swanson said the revenue figures will be dependent on what the final numbers are for summer school enrollment and what the enrollment for the third Friday in September is, a benchmark that the state uses to decide how much funding a school district gets.

“We’re looking at about a $550,000 decrease in our revenue cap, which is the amount we’re able to generate per student, so those factors all play into the budget deficit for next year,” Swanson said.

He noted that the school district could get some funding from the Elementary and Secondary School Emergency Relief (ESSER) fund, which comes out of the state’s Coronavirus Aid, Relief and Economic Security (CARES) fund, but he pointed out that those funds will not renew on an annual basis and the district would have to eventually cut somewhere down the line.

‘Those grant funds do expire, so we don’t want to put those in the budget on a long-term basis,” Swanson said. “Eventually those funds will dry up, so we want to use those funds for one-time purchases.”

Board member Mart Grams questioned why cuts aren’t already being implemented, given the size of the deficit.

“We’re short a half a million dollars. Somebody’s got to go,” Grams said.

Board member Diane Hoffman pointed out that the budget being approved was preliminary, and that the work to balance the budget will come in the next few months.

“Those are the tough discussions that we’re not having at the moment,” Hoffman said. “We’re presenting a proposed budget, which will show those shortcuts. We have to put it out there. The finalizing of it with the tax levy will come in October after we have all of our student counts data in. We have to present a budget based on the numbers we know we have.”

Hoffman said the ESSER funds were intentionally left out, as the district didn’t want to use them to bolster the district’s operational costs.

Grams believes the district should at least be mapping out scenarios where cuts will need to be made in the event that additional funding doesn’t materialize.

“Are we just going to hope and pray that the state changes its mind?” Grams said.

Superintendent Randi Anderson pointed out that administrators presented three scenarios to the district’s finance committee in February — one with a zero increase in per pupil aid from the state, one with the $200 annual increase that school districts have seen from the state for several years, and the third one showing an increase above that.

“At that time, the administration said, if we don’t make reductions in staff, we would be looking at about a $500,000 deficit moving into the 2021-22 school year,” Anderson said. “At that point, the finance committee said let’s move forward with the current staff that we have, knowing we would have to use some of the ESSER dollars to backfill that and start to have those conversations as we move into the 2021-22 school year.”

The district won’t be able to kick the can down the road forever, Anderson said.

“We are in a declining-enrollment district, and that right-sizing conversation is going to happen as we move forward,” she said.

For Grams, using one-time dollars and not making necessary cuts did not sit well, and he was concerned that taxpayers might have to suffer the consequences. He noted that people who are not part of government might not see the deficit as something that can easily be fixed.

“As a personal example, I’m over $2,000 in spending. That means next month I don’t get to spend $2,000,” Grams said. “When we’re short as a government, we just tax people more or hope some other government fills in the hole. That’s not how we’re supposed to run things. When we have less money, the taxpayers — be they federal or local — should not have to fill in the hole. We need to cut somewhere.”

Grams added the matter needs to be taken up by the finance committee immediately, in his view.


lpulaski@newmedia-wi.com