MTI Issue Paper: Funding Crisis

Number One – Special Education Funding – April 1999

Introduction: This represents the first in a series of MTI Issue Papers on the current crisis in school funding. Since 1993, school district revenues have been limited by Wisconsin Act 16, the impact of which is being felt by school districts across the state. This issue addresses special education funding and how, because of state and federal mandates requiring school districts to provide services to children who have been identified to be in need of special education, Governor Thompson’s revenue limits have set the stage for a major catastrophe for Wisconsin’s children. Future issues will examine revenue limits in greater detail and will elaborate on why school districts with declining enrollments are particularly squeezed.

Ever look at a picture in the Post Office of a "deadbeat dad"? You know, the father who avoids his obligation to pay child support. How about a "deadbeat governor"?

For years, Wisconsin statutes have required that the state reimburse local school districts for 63% of the costs for educating the most vulnerable students, those identified to have special educational needs. Governor Thompson and Wisconsin legislators, however, have failed to provide anywhere near the required 63% reimbursement. This year, it is projected that the state will reimburse only 35% of the costs. In fact, the state’s categorical
aid fund that finances special education has been FROZEN since 1994-95, even though the number of children needing services has risen dramatically.

So what’s the Governor’s proposed solution? Thompson plans to cut and run. As part of the Governor’s 1999-2001 Budget, he is proposing to simply ELIMINATE the 63% reimbursement rate set by the statute. Thompson’s philosophy seems to be that the state’s not honoring its commitment any way, so why not delete the commitment. Can you imagine the same logic applied to deadbeat dads? Our kids deserve better.

The impact of the State’s failure to fulfill its funding commitments can best be explained with a real life example. Jenny (not her real name) is an elementary student with autism in the Madison Metropolitan School District. As part of her Individualized Educational Plan (IEP), Jenny requires the services of a teacher licensed in cognitive disabilities, a speech and language clinician, an autism specialist, specialized physical education services, occupational therapy, physical therapy and a one-on-one educational assistant for thirty-two (32) hours a week. The total annual cost to the school district: $47,000.

The state is supposed to reimburse 63%, or $29,610 of the $47,000 cost. However, the state is only reimbursing about 35% of the costs, or $16,450. The difference is $13,160 for this one student alone. A powerful statement on its own. However, the impact is many times greater. In the last three school years, the number of MMSD students identified as autistic has increased from 6 to 119.

The administration of the Madison Metropolitan School District has calculated that if the state reimbursed at the statutory rate (63%), the MMSD would have received an additional $11 million during the 1998-99 school year. The additional $11 million could have been used to improve educational opportunity by reducing class size, performing badly needed maintenance, investing in technology, making additional course offerings, and replacing out-of-date educational materials to the benefit of all students. The problem is not Jenny or other children with special educational needs. Every child deserves an education. Such is not possible when the State fails in its funding obligation. The problem is inadequate funding.

This graph displays the difference between the statutory reimbursement rate of 63% and the actual reimbursement rate from 1994-95 to present. Note the actual reimbursement rate has declined from 45% in 1994-95 to only 34% in 1998-99. If the state actually reimbursed at the statutory rate, the Madison public schools would have received an additional $11 million during the 1998-99 school year.

The state’s reimbursement rate creates particularly severe problems in school districts like Madison which finds its special education and English as a second language (ESL) student populations increasing while general pupil enrollment declines. The graph below shows the increase in the percentage of EEN and ESL students combined with the decrease in the percentage of state reimbursement (the statutory reimbursement rate for ESL is also 63%; the actual reimbursement is only 21%).

Madison’s public schools face many needs. Among them are new and additional special education students, growing numbers of students requiring ESL services, facilities in desperate need
of repair, technological improvements, and up-to-date texts and teaching materials to keep pace with a rapidly changing world. With state-imposed revenue limits restricting the size of the budgetary pie, increased spending in one area must be offset by decreased spending in another. Thus, special education cannibalizes regular education. Regular education cannibalizes building maintenance. Building maintenance cannibalizes technology investments. And so on and so on. The negative impact is never ending. Revenue limits cause the dog to chase his tail. School boards cannot provide for the needs of all children under Thompson’s revenue limits.

Madison has a long and proud tradition of providing quality education to all students. It’s time to build on that tradition and turn the tide which is eroding the foundation of our success.

While the revenue limits restrict the size of the budgetary pie, handicapped aids fall outside of the revenue limits. That is why, IF the state would live up to its obligatory reimbursement rate of 63%, the MMSD would not have a shortfall of revenue and it would have the referenced $11 million to spend on programs and services for children. This provides an opportunity!

Governor Thompson has proposed deleting the statutory reimbursement rate and has proposed to continue his freeze on categorical aids. Those who care should tell the governor and the state legislators to honor their commitments to Wisconsin’s children. In that regard, MTI is organizing teachers, educational assistants, parents and students to attend the April 15 PUBLIC HEARING on the governor’s proposals. People need to tell their stories. Speak up for children.

This publication is an outgrowth of the MTI-MMSD Joint Committee on the Common Good which was created as part of the 1997-99 Contract settlement. The charge to the Committee is to study and make recommendations on a framework for MTI and the MMSD School Board and Administration to collaborate on issues of mutual concern, such as legislation. In that regard, MMSD Superintendent Art Rainwater and MTI Executive Director John Matthews recently sent a joint letter to every school superintendent and teacher union president in the State asking them to get involved in reversing this damaging trend.

Scott Fitzgerald Sen.Fitzgerald@legis.state.wi.us 266-5660

Charles Chvala Sen.Chvala@legis.state.wi.us 266-9170

Dale Schultz Sen.Schultz@legis.state.wi.us 266-0703

Fred Risser Sen.Risser@legis.state.wi.us 266-1627

Jon Erpenbach Sen.Erpenbach@legis.state.wi.us 266-6670

Tom Hebl Rep.Hebl@legis.state.wi.us 266-7678

Mark Miller Rep.Miller@legis.state.wi.us 266-5342

Terese Berceau Rep.Berceau@legis.state.wi.us 266-3784

Spencer Black Rep.Black@legis.state.wi.us 266-7521

Mark Pocan Rep.Pocan@legis.state.wi.us 266-8570

Richard Skindrud Rep.Sindrud@legis.state.wi.us 266-3520

David Travis Rep.Travis@legis.state.wi.us 266-5340

Governor Tommy Thompson wisgov@mail.state.wi.us 266-1212