LFB Analysis of Governor’s High Cost Transportation Partial Veto

By John Forester | July 14, 2021

The Legislative Fiscal Bureau has produced a memo detailing the impact of the High Cost Transportation Aid Program Modification Under Enrolled AB 68 and Under 2021 Act 58.

Governor Evers used an item veto to delete the eligibility criterion limiting eligibility to districts with a membership of less than 3,500 pupils and restore the prior law eligibility criterion under which a district would not qualify for aid if its pupil population density was greater than 50 pupils per square mile. Based on the 2020-21 distribution of aid, this change would have resulted in two districts with a membership of greater than 3,500 pupils gaining eligibility (Kettle Moraine and Hortonville) and four districts losing eligibility as a result of the restoration of the population density criterion (Maple Dale-Indian Hill, Glendale-River Hills, Fox Point J2, and Nicolet UHS).

The memo shows the distribution of aid in 2020-21 under current law, as well as estimates of the aid distribution under the bill as passed by the Legislature and under 2021 Act 58.

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Evers Suggests $100 Million Will Be Distributed On Per Pupil Basis

By John Forester | July 14, 2021

Comments from the Evers administration, detailed in a Wisconsin State Journal article from this morning, suggest that the $100 million in additional federal funds for K-12 education that the Governor announced last week during the state budget signing will be distributed on a per pupil basis.  Check it out here.  We will forward additional information on this issue as we receive it.

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Evers Signs State Budget

By John Forester | July 8, 2021

From WisPolitics.com …

Gov. Tony Evers OK’d a more than $2 billion income tax cut that reduces one of Wisconsin’s three brackets as he largely signed off on the budget that Republicans sent him last week.

But he nixed a provision to update income tax withholding tables and a $550 million transfer to the budget stabilization fund that Republicans had proposed.

In his veto message, Evers wrote taxpayers will already see significant savings in the budget he signed and nixing the update in withholding tables will not impact anyone’s tax liability. Rather than seeing additional money in their paychecks, taxpayers will instead continue to see the money in their refunds from the state.

He also wrote the budget stabilization fund was already flush with cash and the $550 million, which will now remain in the general fund, could be used to “address gaps and shortfalls in the Legislature’s budget actions.

In all, Evers’ veto message listed 50 changes he made to the budget.

During a signing ceremony at a Whitefish Bay school, the guv also announced he’s investing more than $100 million in federal funds into K-12 education.

Read the veto message here.

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Second School Funding Benchmark Could Jeopardize CIVID-19 Relief Funding

By John Forester | July 8, 2021

From WisPolitics.com …

Some new guidance from the U.S. Education Department added a wrinkle in the debate over education funding ahead of Evers’ final deliberations on the budget.

The budget GOP lawmakers produced met one benchmark to qualify Wisconsin for $2.3 billion in federal aid. But citing the new guidance from the Biden administration, Department of Public Instruction officials said it was unclear if the budget would hit a second benchmark that requires states to maintain aid to high-poverty districts.

Complicating matters, it won’t be clear until this spring whether the state meets the second mark. If it falls short, the state could need to pump additional general purpose revenue into K-12 schools to shore up its qualifications for the federal money.

As the Joint Finance Committee deliberated the budget, Evers had knocked the original proposed investment in K-12, in part, because it failed to meet a maintenance of effort requirement in the last two COVID-19 packages to qualify for $2.3 billion in federal aid for K-12. That benchmark required states to maintain how much they put toward K-12 and higher ed as a share of their overall spending. The GOP budget later met that mark after the committee used some of the $4.4 billion in unanticipated revenue growth to put more money into K-12 and tech colleges.

The American Rescue Plan Act that President Biden signed also included a second benchmark requiring states to maintain their support for high-poverty districts. It was noted in a March LFB memo. But the requirement began receiving new attention late last month after the U.S. Department of Education provided additional guidance.

The agency wrote the “maintenance of equity” provisions were designed to ensure schools that serve large proportions of historically underserved groups — including students of color, those from low-income backgrounds and with disabilities — receive an “equitable share” of state and local funds. What’s more, the effort is designed to make sure those schools that serve the highest poverty districts don’t see a decrease in state funding below what they received in 2018-19.

DPI’s Tom McCarthy said the agency, now being led by new Superintendent Jill Underly, is still working through a host of calculations that will go into determining whether the state meets that requirement.

For example, the provision includes a formula that takes into account a community’s poverty based on Census data and district enrollment to determine which districts will be used to determine if the state meets the benchmark. DPI is still working on that calculation.

The benchmark for the highest poverty districts will take into account both general school aids and categorical aids.

DPI last week released its first estimate of what districts will receive through general school aids, and four of the state’s 20 poorest districts are projected to receive less for the 2021-22 school year than they did in 2018-19.

But those numbers won’t be finalized until October.

Meanwhile, categorical aids are paid out in the fall and spring. That means the state can’t determine whether it met the benchmark for the high-poverty districts until spring.

It also remains unclear what the federal government would do if it determined the state failed to meet the maintenance of equity benchmark. The money distributed through the COVID bills is a reimbursement program in which districts spend money on qualified expenses and then receive payment from the federal government to cover the outlay.

During debate on the maintenance of effort requirement, Joint Finance Co-chairs Howard Marklein, R-Spring Green, and Mark Born, R-Beaver Dam, questioned whether the federal government would try to recoup money from school districts if the state fell short of maintenance of effort benchmarks.

Asked about the latest fed guidance, the GOP lawmakers issued a joint statement accusing DPI and Evers of playing politics. They cited DPI’s failure to submit to the feds for final approval a plan to divvy up some of the federal money among districts that Evers signed off on in mid-June “in hopes that the Biden administration will help him move the goalposts once again.”

A DPI spokesman said the agency was waiting until the state budget was finalized to submit the plan and expected to submit it by mid-August.

“It’s sad that Governor Evers is playing politics with this K-12 funding plan,” Born and Marklein said.

See the U.S. Department of Education guidance here.

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Evers to Act on State Budget This Morning

By John Forester | July 8, 2021

From WisPolitics.com …

Gov. Tony Evers will take action on the budget today during a morning news conference at a Whitefish Bay elementary school, his office said.

Evers will be joined by Revenue Secretary Peter Barca and new state schools Superintendent Jill Underly.

The guv also will travel to an Eau Claire hospital and UW-Green Bay today for additional news conferences.

A livestream of the 10 a.m. news conference in Whitefish Bay will be available on Evers’ Facebook page:  https://www.facebook.com/GovernorTonyEvers

 

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DPI Releases July 1 General Aid Estimate

By John Forester | July 1, 2021

The Wisconsin Department of Public Instruction today, as required by state law, released an estimate of the general school aids each public school district will receive for the 2021-22 school year. The estimate is based in part on the 2021-2023 state biennial budget recommendation approved by the Joint Committee on Finance on June 17, 2021.

For more information, and for full estimated general school aids, see here.

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Budget Heads to Evers’ Desk After Clearing the Senate

By John Forester | July 1, 2021

From WisPolitics.com …

The state budget is now before Gov. Tony Evers after it cleared the Senate on a bipartisan vote.

Three Dems joined all 20 Republicans last night in backing the bill. The massive bill drew four Dem votes in the Assembly.

The Senate Dems who supported the bill were: Minority Leader Janet Bewley, of Mason; Brad Pfaff, of Onalaska; and Jeff Smith, of Brunswick. None spoke before the vote to explain their support.

After the vote, Bewley and Pfaff told WisPolitics.com they were hoping Evers would use his line-item veto to improve the document. Bewley said she had received no assurances from the guv on what he would do, but was operating under the assumption he will use his line-item veto and then sign the budget.

“I really believe in the governor’s ability to make a silk purse out of a sow’s ear,” Bewley said. “Some of us have to pay attention to our districts.”

Pfaff, elected to his western Wisconsin seat last fall by 582 votes out of more than 97,000 cast, said: “This isn’t the budget that I would have written if I was in the majority. But this is the budget that’s before us.”

It is the first time since 2007 that a budget cleared either house of the Legislature with bipartisan backing.

That year Republicans controlled the Assembly while Dems had the state Senate and guv’s office. The budget was delayed until October when a group of minority Dems and Assembly Republicans worked together to pass a budget in that house.

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DPI Distributes $1.74 Billion to Wisconsin Schools

By John Forester | June 30, 2021

The Wisconsin Department of Public Instruction announced today the agency distributed a total of nearly $1.74 billion to schools across the state to support mental health programs in public schools, students with individualized education plans, transportation costs, and other categorical state aids.

For a full news release and for specific amounts by type of aid see here.

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Assembly Passes Budget; Senate to Vote on Spending Plan Today

By John Forester | June 30, 2021

From WisPolitics.com …

The Senate is set to begin debate on the budget early this afternoon after it passed the Assembly with four Dems joining all Republicans in backing the $89.2 billion two-year package.

Rep. Steve Doyle, of Onalaska, was joined by fellow Dems Deb Andraca, of Whitefish Bay, Beth Meyers, of Bayfield, and Don Vruwink, of Milton, in voting yes.

Doyle said his vote for the budget wasn’t one of joy, but sadness. Still, he predicted Gov. Tony Evers would rework the plan with his partial veto authority, similar to what he did two years ago.

“I’m not sure it’s harmful. I just don’t think it’s helpful,” Doyle said. “But I have confidence our governor will exercise his veto pen to turn it into a budget that I think will be helpful to our state.”

Two years ago, all Dems and three Republicans voted against the budget in the Assembly before Evers signed the document after using his broad partial veto authority. That put Dems in the awkward spot of unanimously voting against a budget that Evers would later champion after making changes.

Rep. Evan Goyke, D-Milwaukee, knocked the GOP version of the budget, saying it was driven by an anti-Evers hysteria. He jokingly urged his Republican colleagues to get vaccinated against “Evers fever” and demanded to know what the Republican vision was for the state. He pointed to other GOP-run states that have proposed new, innovative programs. Instead, the centerpiece of the Wisconsin Republican plan is a tax cut paid for with a surplus that Goyke said was driven by the latest stimulus package President Biden signed and the successful roll out of the COVID-19 vaccine Evers has overseen.

“What’s the new idea? Where are you taking us? What is your vision? You have defined success by comparing yourself to Tony Evers,” Goyke said.

But Speaker Robin Vos, R-Rochester, countered the ideas from Evers’ February budget amounted to a tired liberal wish list of one government program after another. He said that’s why one of the first moves Republicans took in rewriting the document was to strip out many of the guv’s ideas.

He argued the only answer that Dems seem to have is to turn to the government for answers.

“If I look at the fastest-growing states, they aren’t the ones that have the fastest-growing government,” Vos said.

Vos predicted Evers will sign the budget.

The Senate is expected to convene at 1 p.m. today.

See more on yesterday’s debate here.

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LFB: State Would Miss $2.2 Billion in K-12 Aid if Full Budget Vetoed

By John Forester | June 29, 2021

From WisPolitics.com …

Wisconsin wouldn’t qualify for some $2.2 billion in federal K-12 education aid if Gov. Tony Evers vetoed the GOP-authored budget in full and Capitol leaders failed to pass a new one, the Legislative Fiscal Bureau says.

The LFB memo underscores the risk some insiders have raised for Evers if he chose to veto the budget now before the state Legislature. Republicans have already signaled they wouldn’t come back to pass a new budget. Some also have said they could point to the veto and blame Evers for the state failing to qualify for the money under the last two COVID-19 stimulus packages.

Those packages — one signed by President Biden this spring, one by former President Trump in December — include a requirement that states maintain their current spending commitments to K-12 and higher education to qualify for the money.

The Cares Act, which Trump signed, requires that maintenance of effort extend into the 2021-22 fiscal year. Under the American Rescue Plan Act, which Biden signed, the commitment must be met in both 2021-22 and 2022-23.

If the budget is vetoed and no new one is approved, the state would continue with the appropriation levels in place for the 2020-21 fiscal year, which ends tomorrow.

In a memo requested by Sen. Jon Erpenbach, LFB estimated the state wouldn’t meet the maintenance of effort requirements under either package if that happened.

See the memo here.

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