The Answer to MMSD Budget Woes: A Modest Proposal

A number of Republican legislative leaders are working on what they term a charter school reform bill.  According to reports,  “authors” of the legislation  apparently include the chairs of the Senate and Assembly Education Committees as well as the co-chairs of the Joint Finance Committee, which I guess is the group you’d want to be working on the bill if you’re a supporter.   While the legislation has not yet been introduced, a draft is available.   

The Republicans who have railed against the proliferation of state government bureaucracies intend through this legislation to create a new state government bureaucracy, the Charter School Authorizing Board (CSAB).  The purpose of this Board is to reduce local control of schools by approving charter school proposals anywhere in the state. 

These CSAB-authorized schools would function like the charter schools in Milwaukee that currently are operating under the chartering authority of UW-Milwaukee and the Racine charter school operating under the chartering authority of UW-Parkside. 

Funding for these charter schools comes from the state – the schools are entitled to $7,775 per student in state funding.  As I understand it, the local school district is not required to contribute more to the schools’ operations, but the local school district also cannot include students enrolled at the charter schools in their student counts for purposes of the state funding formula and the school district’s spending limits. 

If this proposal becomes law, we’d have to adjust in the Madison school district.  Here’s one way to think about that adjustment.  What if we consider converting all of our Madison schools into charter schools authorized by CSAB?  We could establish the required governing board for the charter schools and include as members the Board of Education.  The legislation provides that a governing board can enter into contracts for multiple charter schools, so this shouldn’t be a problem.

What’s the advantage of this approach?  For the 2010-2011 school year, we receive just under $50 million in state equalization aid.  If instead, we enroll our 24,628 (2009-2010 figure) in CSAB-authorized charter schools, we’d be in line for a bit more than $191 million in state aid ($7,775 x 24,628), or about a $141 million bump. 

Our property tax levy for this year totals about $246 million.  We could reduce this to about $105 million.  The property tax levy on the mythical $250,000 home would go from about $2800 to about $1300. 

Naturally, there would be some complications with this approach.  The most pressing would be that if all our students were enrolled in state-authorized charter schools, the District would have a student count of zero and so we’d probably have no authority to levy property taxes.  In order to avoid the issues that might come from a school district with no students, we might want to keep one of our schools operating in the traditional way. 

As for the property taxes, we’d need to talk to our friends in the city of Madison.  Perhaps we could cut a deal with the City whereby it would effectively levy property taxes on our behalf.  We could propose to the city that we would eliminate our $246 million property tax levy on city residents in return for an annual grant from the city at an initial level of $105 million.  I think that would be a deal that city property owners would find appealing.  (I’m ignoring for the moment the slight complication that the boundaries of the school district are not coterminous with the boundaries of the city). 

 The proposed legislation specifically authorizes charter school governing boards to “solicit and accept gifts or grants for school purposes,” so arranging for a significant grant from the City to make up for the school district’s loss of tax levy authority would be fully consistent with the legislative intent.   

So, what’s not to like?  The sponsors of this legislation obviously think that schools (even virtual schools) are entitled to $7,775 per student in state funding.  Let’s take them at their word.  Perhaps our Republican friends in the legislature are looking out for us folks in Madison after all.

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5 Responses to The Answer to MMSD Budget Woes: A Modest Proposal

  1. TJ Mertz says:

    Mr Swift would be proud of his “student.”

  2. Erik Paulson says:

    The city has limits on what it can set for a property tax levy, so I think a grant from them would be difficult.

    Though, keeping with the spirit of the post, presumably so many charter schools would make Madison a more attractive place to live, so our property becomes much more valuable – perhaps the assessor just doubles the value on everything, and reassesses frequently.

  3. Laura Chern says:

    A very comprehensive change to say the least. My favorite part is the Charter School Authorizing Board make-up: 9 members, three appointed by the governor, 3 appointed by the Senate Majority leader and 3 appointed by the Speaker of the assembly. The question is: how many relatives do the Fitzgerald brothers need to find state employment for?

  4. Thanks for the great comments.

    In response to Erik’s point, I spoke to the ever-helpful Dean Brasser, the City Comptroller. It is true that the City is also subject to a property tax levy limit and an expenditure limit. But the City doesn’t get that much in state aid to start with.

    If the City decided to ignore the limits the state has sought to impose on its spending and property tax levy authority, the City would lose a total of about $14 or $15 million in state aid (as a result of exceeding both an expenditure limit and a property tax levy limit). However, it might be worth losing $15 million in state aid to the city in order to end up with an additional $140 million in state aid to the city’s schools.

    It is interesting to note that the City gets a total of about $36 million in state aid. Add that to the $50 million the school district gets in state equalization aid, and we’re still less than half way to the amount in state aid we’d get if all the school district’s students were enrolled in state-authorized charter schools under the proposed legislation.

    Ed

  5. BarbS says:

    This is the first time I have smiled in the past three days! Let me know if you get a working group going on this idea:>)

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