KUSD's referendum failed in February, and as the state budget process progressed, the district had a $19 million budget gap to fill. A participant at a February rally rolls out a scroll with the names of every school district that has gone to referendum since the last state budget. Photo by Baylor Spears/Wisconsin Examiner.

Between the Wisconsin state budget providing no new general aid to schools and the Trump administration withholding federal funds, Kenosha Unified School District (KUSD) Superintendent Jeff Weiss and Chief Financial Officer Tarik Hamdan say school funding has never been so uncertain.

“We really, right now, are at a very unsure, very uncertain time, and it just makes planning extremely difficult,” Weiss told the Wisconsin Examiner in an interview.

The district leaders were among many public school advocates who for months lobbied for large investments in Wisconsin’s K-12 schools during the state budget process that wrapped up earlier this month. 

Weiss said state funding for schools that has not kept pace with inflation over the past 16 years has created the difficult financial situation that Kenosha and other districts across the state are facing and are the reason so many have gone to local taxpayers through referendum to ask for more money.

A recent Wisconsin Policy Forum report found the state’s per pupil education spending has fallen below the national average. In the 2023 fiscal year, Wisconsin spent $14,882 per pupil on public education — 9.9% less than the national average of $16,526 per pupil.

KUSD sought a referendum early this year to bring in $23 million annually for five years to help the school district meet its safety improvements, staffing, curriculum, technology and major maintenance costs. The process was controversial in the community, dividing residents and even eliciting boos at a chorus concert. 

The referendum failed in February, and as the state budget process progressed, the district had a $19 million budget gap to fill. In April, Weiss asked lawmakers at a public hearing to address the long-term problem so he and the district could spend less time struggling to get local taxpayers to pay more and more time on student learning and improving educational offerings.

“This is not how I want to spend our time in the school district,” Weiss said at the time. 

District leaders were hoping for two main changes in the budget: an increase in the state’s share of special education costs to cover 60% and an increase to the state’s general aid to schools of $415 per pupil in year one and $430 per pupil in year two. 

“Special education reimbursement at 60%… would have generated about $11 million,” Weiss said. “The additional per pupil increases would have added around $2 million, a little bit less than that, so together, these two items would have generated about $13 million of additional funding for KUSD.”

Ultimately, the bipartisan budget deal approved by lawmakers and Evers provided an increase for special education funding but no general aid increases. Evers has defended the education portions of the budget, saying it helps with school funding in a “significant way.” 

“That’s a good thing, because we did exactly what the school districts were asking us to do,” Evers said. 

Education advocates haven’t had the same reaction. The Wisconsin Public Education Network called on lawmakers to vote against the budget, and for Evers to veto it. Peggy Wirtz-Olsen, president of Wisconsin Education Association Council, the state’s largest teacher’s union, said the budget was “a complete betrayal of public schools” and schools could not handle the “double-blow” from federal cuts to public education and the state’s inadequate investments. 

“Given the ugly truth about this budget, educators are exploring every option to force politicians to bring forward a long-term solution to Wisconsin’s school funding crisis,” Wirtz-Olsen said. “This state can’t keep shattering the foundation of our public schools and expect the professionals who teach them to pick up the pieces.”

For his part, Weiss said he was glad to see some movement from lawmakers, who agreed to raise the special education reimbursement rate to 42% in the first year and 45% in the second year of the budget — a significant jump from the current 30% and the biggest increase in over 30 years. However, the total cost picked up by the state — $207 million in year one and $297 million in year two —  still falls short of what districts need. 

“The fact that there was movement — I was glad to see that,” Weiss said. “Is it game changing? No, not by any means.”

The district is now trying to plan with the new budget.

District budget planning 

Kenosha leaders said they are anticipating the special ed reimbursement rate will fall below the estimated levels. That’s because the pool of money for special education is finite as a “sum certain” allocation, meaning if costs for districts are higher than estimated the state won’t pay more and the percentage of those costs the state covers will go down.

“We’re expecting to get 39[%] just based on some of the historical patterns of sum certain funding,” Weiss said.

Weiss said district officials are expecting about $3 million per year in additional funding from the boost — $10 million per year less than what they initially hoped for from the state budget.

The district has already made significant cuts of about $5 million to help balance its 2025-26 budget. Staffing is the largest expense and most of the cuts came from the elimination of nearly 43 positions. Prior to seeking a referendum, the school district had already closed schools, including five elementary schools and a middle school, and made other cuts to staff and programs.

Salaries and benefits are increasing, driving up costs. 

“Health insurance trends have been increasing at about 10 to 13% each year alone. The salary component, when you’re talking about inflationary increases… and movement on salary schedule just in recent times, is somewhere around 4.5%,” Hamdan said. “There’s all these factors that make budget planning… very, very difficult.”

Weiss said the district also put some items on hold, including security upgrades, staff raises and curriculum.

“As we’re able to find funding, we’ll start putting some of those [on] short term holds — trying to fund those,” Weiss said. “We know that we can’t stop buying curriculum materials or fixing our buildings or buying technology.”

Weiss said there is also some pressure on compensation from neighboring school districts, one of which recently succeeded in passing a referendum. 

“How do we stay competitive with compensation for our employees?” Weiss said, adding that the state budget money will likely be used for labor costs and other items on short-term hold. 

Long-term items, including controlled entrances for seven schools, will continue to be on hold.

“We’re going to have to find another funding stream for that,” Weiss said. “At this point, we haven’t identified what that funding stream is, so those are some of the things that we have taken into account as we look at the budget.”

Potential property tax increase 

Even with the failed referendum, Kenosha’s district leaders are concerned about how property tax changes could appear to residents. School districts will be allowed a $325 per pupil revenue limit increase each year due to a partial veto by Evers in the last budget, but there is no state funding behind it in the 2025-27 budget.

“The state is not going to pay their portion of that. It’s going to be a straight tax increase,” Hamdan said. The last state budget that established the $325 increase paid for it in part through a general aid increase.

The total state general aid to Wisconsin schools is $5.58 billion, the same as 2024. The distribution of the funds is determined by a formula that considers property valuation, student enrollment and shared costs.

The Department of Public Instruction’s July 1 estimate shows that 135 districts — or 32.1% — will get an increase, while 277 districts — or 65.8% — will lose general aid.

In comparison, in 2024 when a general aid increase was budgeted, 68.6% districts were estimated to receive more general aids, while 29.5% of districts were estimated to receive less. 

Hamdan compared it to having one pizza at dinner for a family. 

“The state budget determines the size of the pizza that all 421 districts are going to eat from that year. Is it a 16-inch pizza? Is it an 18-inch pizza?” Hamdan said. “Depending on how hungry each of our school districts are, some of us are going to eat a bigger portion than the others, but there’s only so much pizza available. When some of the other school districts are passing referendums to increase their spending, they’re changing their position in that formula so their hunger is getting higher. They’re allowed to eat more, and that leaves less for some of the other school districts.”

With its increasing property values, decreasing student enrollment and the failed referendum, KUSD is estimated to lose 4.55% — or about $7 million — in general aid funding for 2025-26.

The decrease doesn’t mean the district loses its ability to bring in revenue, but means the district will have to make it up via property taxes — a worry for school leaders. The school board will be responsible for approving any levy increases meant to fill the loss of state general aid and the $325 per pupil school revenue increase. 

“When we lose equalization aid, that does not mean that we get $7 million less budget authority, that means that the state will pay $7 million less towards our revenue limit number,” Hamdan said. “The board then will increase tax levies to make that up and that’s what the kicker is, we end up with a tax increase bump without getting more spending authority.”

Wiess said they are worried about whether community members will understand any property tax raises and the situation schools are in.

“My concern is that the message is going to be: ‘Our taxes were raised and we voted no. What did you do?’” Weiss said. “When you have to dive into the intricacies of the state funding formula, it’s not a quick answer to explain it. It’s very concerning.”

The long-term solution 

On a state level, Weiss and Hamdan said part of the issue is that state leaders have yet to address the long-term problem that schools face.  

“The whole point is that the state budget doesn’t keep up with our inflationary increases, and this state budget does not do that either,” Hamdan said. “It’s not that we don’t appreciate the movement and the increases, but the point is still being missed, that there’s a problem here, and it’s not being fixed.”  

Weiss said the pathway for a long-term solution can be found in the 2019 bipartisan Blue Ribbon Commission report, which included raising the special education reimbursement to 60% and adjusting per pupil funding based on inflation. 

“I don’t know why it hasn’t been enacted, but that’s the type of action that’s needed at the state to fix this problem,” Weiss said. “It’s not a two-year budget cycle. It’s a long term plan. It’s not a band aid.”

Trump administration withholds money 

In addition to concerns about state funding, Wisconsin school districts are facing uncertainties about federal funding as the Trump administration has pushed ahead with trying to close the U.S. Department of Education and is withholding already approved funding for programs that support English language learners, migrants, low-income children, adult learners and others.

Wisconsin gets about 8% of its funding for schools from the federal government, and over $72 million is being withheld from the state for these programs. 

About $1.6 million of that is meant for Kenosha Unified School District.

“We have staff attached to those grants,” Hamdan said. Withholding the funds, he said, “causes us to front that money while we wait for this other stuff to be figured out until we can claim reimbursement on it. The uncertainty is at an all-time high in my 20-year career.”

Wisconsin has joined a multi-state lawsuit against the Trump administration.

The funds were already approved by Congress and signed into law on March 15 and are typically distributed to states by July 1. The Department of Education notified state education agencies across the country on June 30 they would be withholding the funds without any specific explanation. On July 18, the Trump administration confirmed it would release a portion of the $6.8 billion in withheld funds, worth about $1.3 billion, for after-school and summer programs. 

Weiss said he thinks the district will eventually receive all the funds, but is still disappointed and worried about  federal funding. 

“I anticipate we’ll receive it,” Weiss said. “I don’t know when, but it does — moving forward, it makes me wonder what future budgets will look like, and well, what we will do for some of our students who have needs in those areas?”

Kenosha isn’t the only district concerned. 

Madison Metropolitan School District Superintendent Joe Gotthard and Verona Area School District Superintendent Tremayne Clardy warned at a press conference on July 9 that school districts will continue to be stuck in a cycle of seeking funding through referendum. 

“Although we have community support, public education, including our district, continues to feel the impact of decreased funding from the state and federal level,” Gothard said. “This defunding of public education has to stop.”

Weiss said that even with the federal and state challenges, the school district is going to continue doing “what’s right by our students” and working “to give them the best education we possibly can.”

Hamdan added that he hopes in general people understand that public education is at the core of communities. 

“Whether it’s building up the next workforce or creating the citizenry in your own community, your property values and what’s going to attract your businesses, public education is at the core of every single community and it needs to be supported.”

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