Proposal reduces reliance on local property taxpayers, increases special education reimbursement, provides sustainable resources to support students

MADISON — State Superintendent Dr. Jill Underly today announced the Wisconsin Department of Public Instruction’s proposed 2027-29 biennial budget, including roughly $2.75 billion in new aid for Wisconsin K-12 schools and libraries. At the center of the proposal is a fundamental shift in how Wisconsin funds public education: fixing a school funding system that has failed to keep pace with inflation, leaving local communities increasingly responsible for making up the difference through property taxes and operational referendums.

For more than 15 years, Wisconsin’s school revenue limits have been disconnected from inflation. As the costs of educating students reach historic levels, state funding has not kept pace. Districts are left with fewer resources to cover growing expenses, pushing more communities to the ballot box to fund the staffing, programs, and services students need. The DPI’s budget proposal seeks to change that by making foundational changes to how Wisconsin funds its public schools.

“The era of operating referendums needs to come to an end,” Dr. Underly said in a video message. “We shouldn’t have to choose between strong public schools and protecting property taxpayers. We can do both. By strengthening the state’s investment in public education and changing how we distribute funds to reflect student needs, we can reduce the pressure on local property taxpayers, give school districts greater stability, and create more opportunities for students.”

“We know what needs to change, and we have a framework to do it. Now, we need state leaders to come together and put this solution into action. It’s time to fix the formula. It’s time to put school referendums out of business. And it’s time to put Wisconsin students first.”

More information on the DPI’s budget proposal is available in this resource. Additional budget resources are available on the department’s website.

Fixing the funding formula and reducing pressure on property taxpayers

Wisconsin’s revenue limits were originally tied to the Consumer Price Index, allowing school spending authority to adjust as inflation increased. That connection ended in 2009 in what was supposed to be a temporary change amidst a historic economic crisis. Since then, revenue limit adjustments have been determined through the state budget process, creating a growing gap between the resources available to schools and the actual cost of educating students. As a result of legislative inaction, operational referendums have increasingly become a way for communities to fill those gaps, shifting more responsibility onto local property taxpayers.

The DPI’s proposal offers a solution by providing more state support through a reworked funding formula that better recognizes student needs and gives districts a more dependable foundation.

Key components of the funding formula solution include:

Increasing per-pupil funding: Providing a $366 per-pupil increase in 2027-28 and an additional $374 in 2028-29, with both increases building into the base for future years. 

Recognizing student needs: Adding funding weights for students from economically disadvantaged families and English learners. 

Restructuring existing aid: Moving $574.7 million in Per-Pupil Aid into general and equalization aid, better connecting state support to the school funding formula. 

Providing additional resources: Including an additional $742 per pupil in 2027-28 to account for funding currently provided outside the revenue limits.

Importantly, the proposal does not increase the statewide property tax levy. By shifting more responsibility for school funding to the state and providing districts with more predictable resources, the proposal, if passed, reduces districts’ reliance on operational referendums and eases the growing pressure on local property taxpayers to fund public education.

More information on the school funding formula budget provisions is available in this resource.

Making special education funding more reliable

The proposal also makes a significant change to how Wisconsin funds special education, moving both special education categorical aid and high-cost special education aid to a sum-sufficient model.

Under the proposal, the state’s special education reimbursement rate would increase to 50 percent in 2027-28 and to 60 percent in 2028-29. More reliable state reimbursement helps districts manage growing special education costs, reduces pressure on district budgets, and ensures schools have the resoruces needed to serve students with disabilities.

More information on the special education budget provisions is available in this resource.

Putting students at the center

Fixing the school funding formula is about more than how money is distributed. It’s about making sure schools have the resources and stability to focus on what matters most: helping students learn, grow, and prepare for their futures.

The DPI’s proposal includes targeted support for students’ academic success, well-being, and future opportunities, including:

– Literacy and mathematics: Providing $12.5 million annually beginning in FY29 for grants to help schools improve student achievement in reading and math. 
– Literacy coaching: Providing $12.5 million annually beginning in FY29 to support 100 literacy coaches working alongside educators to strengthen reading instruction. 
– Career and technical education: Providing nearly $45 million annually to expand access to career and technical education programming and pathways, alongside $6 million for grants supporting student participation in career and technical student organizations. 
– School nutrition: Supporting access to nutritious school meals and helping schools offer healthy food options, including more opportunities to bring fresh, locally grown and produced foods into school meals. 
– Student mental health: Increasing Mental Health Aid to $24 million over the biennium and expanding access to hire school social workers and school nurses. 
– Out-of-school-time opportunities: Providing $15 million for grants to expand access to programs and opportunities outside of the school day. 
– Public libraries: Providing $7.5 million in additional state aid over the biennium to support Wisconsin’s public library systems. 
– Tribal language revitalization: Providing grants to preserve and strengthen Tribal languages through language revitalization programs.

The proposal also includes investments in specialized support for students who are deafblind, as well as programs connecting students with arts, athletics, and other experiences.

“Every decision we make comes back to students,” Dr. Underly said. “Whether we’re helping a child become a stronger reader, making sure a student with a disability receives the services they need, supporting a student’s mental health, or opening the door to a career pathway, our schools need the resources to do that work. The future of Wisconsin will be in the hands of the students walking into our classrooms today. When we continue to shortchange our schools and the students they serve, we aren’t just limiting their opportunities; we’re holding back Wisconsin’s ability to grow, compete and prosper.”

“Fixing the funding formula gives schools a more stable foundation. We owe it to our students, and to the future of our state, to give every child the opportunity and support they need to succeed. It’s time for the state to step up, support our schools, and put students first.”

Additional information on the DPI’s budget proposal, including one-page resources and other materials, can be found on the department’s website.

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Contact: Media.Inquiries@dpi.wi.gov