Education Committee to Vote Tomorrow on Proposal to Limit Amount Schools Can Raise to Pay for Vouchers

The Assembly Education Committee has officially noticed an executive session (vote) on a modified amendment to Assembly Bill 751 tomorrow afternoon:

Wednesday, February 10, 2016
1:30 PM
300 Northeast

This new (modified) amendment from Speaker Vos is similar to Assembly Amendment 2 (AA 2) to Assembly Bill (AB) 751 in that it would change the revenue limit calculation for new voucher pupils, beginning in 2016-17,  to no longer provide an adjustment that counts an new voucher pupil as a full 1.0 pupil  for revenue limit purposes.

Under both AA 2  and the new amendment new voucher pupils who reside within a district would be counted in a manner similar to the way open enrollment pupils are counted for revenue limit purposes (i.e., ramping the count up by 1/3 pupil each year to a full pupil over 3 years).

Under the original amendment (AA 2), declining enrollment districts would generate  less revenue per new voucher pupil than districts with stable or growing enrollment.  The new amendment attempts to correct this discrepancy.

The new amendment differs from AA 2 to AB 751 in that  it attempts to address negative consequences to declining enrollment districts that would occur as a result of the switch to a new calculation method. It tries to accomplish this by excluding new voucher pupils from membership (enrollment) for purposes of calculating declining enrollment adjustments for three years.   

Despite this change the WASB remains opposed to either amendment.  The net result of either amendment is that school districts in which new voucher pupils reside will see their revenue limit authority reduced substantially, particularly in the first and second years a new voucher pupil participates in the statewide or Racine voucher program.

The explanation below illustrates this issue:

Illustration (Current Law vs. Proposed Amendments):  The current statewide average revenue limit authority is roughly $10,200 per pupil. Thus, under current law (on average) a district is allowed to levy $10,200 (its revenue limit per pupil) for each voucher pupil, but it loses either $7,214 or $7,860 for the voucher pupil, depending on what grade the pupils is in.  Those amounts rise to $7,323 (K-8) and $7,969 (9-12) in 2016-17.

Current law:

  • District can levy up to $10,200 (on average) less $7,300 in lost state aid (K-8); this permits the district to cover its loss and permits (but does not require) the district to raise up to an additional $2,900 (on average).

Amendment 2 and new amendment:

  • First year impact:  District can levy up to $3,400 (on average–1/3 of $10,200) less $7,300 in lost state aid (K-8); this means the district loses $3,900 (on average).
  • Second year impact: District can levy up to $6,800 (on average—2/3 of $10,200) less $7,300 in lost state aid (K-8); this means the district loses $500 (on average).
  • Third year impact: District can levy up to $10,200 (on average—3/3 of $10,200) less $7,300 in lost state aid (K-8); this means the district is permitted (but not required) to gain up to $2,900 (on average).

Why these amendments are bad: Even after three years, the district still hasn’t recovered through its revenue limit authority all the aid it lost to the voucher payments. The district is still $1,500 in the red over that period. Under the amendment, the district wouldn’t recoup through allowable revenue limit authority all the aid it lost until the fourth year the resident pupil participates in the voucher program.

In recent years revenue limits have been frozen, while voucher payments have been increasing.  If this trend continues the gap between the two will close.

The problem not being addressed by any of this discussion is that revenue limits are not providing either growing enrollment district or declining enrollment districts with enough resources to fund their existing educational programs. Too many of both types of districts are being forced to make cuts.  It is a crying shame this problem is not being addressed.