Milwaukee schools’ financial woes won’t affect state aid payments to Wisconsin school districts

The financial scandal that unfolded at Milwaukee Public Schools over the last six months hasn’t negatively affected general school aid distribution to Wisconsin school districts. 

More than half of the state’s public school districts will see an increase in state aid payments this year, according to data released by the Department of Public Instruction Tuesday.

DPI said in May it needed financial information from all school districts to calculate general school aid. 

MPS still has not submitted financial reports from fiscal year 2023. Those reports are expected by Thanksgiving. 

But DPI spokesperson Chris Bucher said the department and MPS made sure all accounting errors were corrected to minimize any significant further adjustments. The state deducted $42.6 million in state aid from its payment to the district last month due to district reporting errors in the 2022-23 school year.

“This took a tremendous amount of time, energy, and effort from both the DPI and MPS, and we both believe we are in a good place with the 2023-24 data,” Bucher said. “We don’t anticipate any significant future adjustments at this time.”

MPS will receive about 7.7 percent less in general state aid this year. The total amount is $587.1 million. 

In a press release, MPS officials said the district’s 2024-25 proposed budget estimated $595 million in general aid.

“The district is calculating additional changes related to the Special Needs Scholarship Program and is in the process of determining the final adjustment amount,” MPS officials said.

Of 421 districts, two-thirds will receive more aid for 2024-25 than in 2023-24, while 137 districts will receive less. 

General school aids are paid in four installments during the school year and are part of a complex school district budgeting formula that also includes property taxes and federal dollars. 

State aid calculations are based on school district expenditures, property values in the district and how many students are enrolled in the district. 

Independent charter schools, the Wisconsin Parental Choice Program, Racine Parental Choice Program and Special Needs Scholarship Program are funded out of aid from districts where students participate in those programs. 

The Wisconsin Parental Choice Program, which are taxpayer-funded private schools, affects 366 school districts and receives $225.5 million.

The Racine Parental Choice Program has a $40.8 million impact on the Racine Unified School District. 

Racine Unified is still receiving 11.6 percent more this school year than in 2023-24. The district will get $180.7 million in general school aid. 

Madison Metropolitan School District is seeing a 61.8 percent increase in state aid this school year. The district is receiving $61.3 million. 

Payments to districts increased by an estimated $234.3 million because of two factors: an increase of $224.9 million per the state budget as passed by the Wisconsin State Legislature; and the decrease in the required Milwaukee Public Schools funding for the Milwaukee Parental Choice Program due to statutory changes, according to DPI.