Consolidation One Answer to Budget Pinch

MacIver News Service – It’s almost never a popular idea, but more and more school districts around Wisconsin are beginning to see consolidation as one of their only options as revenues decline and expenses increase.

The MacIver Institute conducted an informal survey of school districts around the state.  Of the one hundred that responded to our inquiries, more than a dozen have at least considered the idea of consolidation.

Consolidating school districts is often an emotional issue in communities.  Many people, especially in rural areas, feel their school district is their local identity.   

Over the past summer, Park Falls and Glidden combined to form the Chequamegon School District.  Mark Luoma, the district administrator, said it was a nerve-racking process. 

Both districts were faced with declining student enrollment, which meant less aid from the state.  Also, more people were starting to buy vacation homes in the district, which made property values go up.  That resulted in state aid declining even further, despite the fact the higher property values did not translate into more revenue for the district.

“As we looked at this trend; as our fund balance continued to decline, we knew we had to try something different if we were going to maintain quality programs for our students,”said Luoma, who was at that time the district administrator in Park Falls.

Glidden had already been sharing programs, including music and sports teams, with neighboring districts.  Just cooperating with other districts had initially been unpopular.

“The immediate reaction in the community, mostly from the adults, was my kids aren’t going to play with those kids.  The old rivalries were alive and well,” said Luoma.

However, after the combined Glidden and Butternut baseball team went to the sectional finals in 2006, attitudes began to change.

“They realized these are our neighbors and maybe we can work together,” Luoma said.

Butternut wasn’t interested in consolidating with Park Falls, but Glidden was open to it.  Since the community had already come to terms with sharing their sports teams, Luoma said it was easier to convince people consolidation was their best option.  A referendum passed in both districts, and they officially consolidated on July 1, 2009.

Luoma said so far the consolidation has been working well, but it will take two years before the district can effectively assess the situation.  

Other districts the MacIver Institute spoke with said consolidation is a short term solution at best.  They argue when you combine two struggling districts with declining enrollment and revenue, you end up with one struggling district with declining enrollment and revenue.

Jerry Walter, district administer in Durand, said “Unless the consolidated districts produce a slow, steady increase in enrollment, all you get from consolidation is a very short term fix, then you’re in the same structural deficit, continuing to reduce offerings, and get to ride on the bus much longer to access the reduced programs.

Dr. Mark Smits, district administrator for Hartford, said “This option has a potential for increasing taxes; not a good option in these hard economic times.”

Back in Chequamegon, Luoma admits consolidation, in itself, is not the final solution for funding problems.

“Consolidation isn’t necessarily about saving money.  It’s about maintaining and enhancing programs,” he said.  

Luoma said “What it does is it gives you time.”  That’s because after consolidating, the state freezes its level of aid to the two former districts for the next five years.  That means it will not decline any further. 

Although consolidation might be too much for many districts for the time being, districts around the state are beginning to cooperate much more with their neighbors.

Jim Harlan, district administrator for Weyauwega-Fremont, said, “While not currently looking at consolidation, it seems quire clear that one outcome of the funding crisis will be an increased focus on regionalism and the efficiencies that might occur.  Another reasonable outcome would be an increased use of technology and blended learning approaches.”

Steve Sedlmayr, district administrator in Alma, said, “We have been sharing teaching staff in areas such as vocal music, speech and language, family and consumer education, chemistry and physics with neighboring schools.”

Luoma said for Park Falls and Glidden cooperating with other districts naturally led to consolidation.  He expects to see that process repeated with other districts around Wisconsin.  There are already indications of that happening in districts like Neillsville.

John Gaier, district administrator in Neillsville, said, “A number of districts in our area are struggling financially.  We already share programs with some of them.  As money gets tighter, we are preparing discussions to cover potential consolidation.  However, consolidation is a very delicate subject and no district seems to want to commit themselves yet.”

Some districts that spoke to the MacIver Institute not only are opposed to the idea of consolidation, they believe fundamental changes must take place in Madison before districts will see any real solutions to their financial problems.

Tom Andres, district administrator at New Lisbon, said, “How would consolidation help?  Eventually the costs would continue to increase and make it difficult for the consolidated school to make ends meet.  The answer is to create a different manner of funding.  The legislature needs to take away some of the unfunded mandates and give local school boards more flexibility.  Start date, number of days of instruction, requirements, and the overwhelming number of state reports need to be addressed.  People in offices (political and DPI) need to spend a week in a school to find out the reality of what is being done instead of creating new ways to put more on the backs of local districts.”

Currently the State Assembly is considering two bills supporters say will help districts consolidate if they choose to.  The districts Montello and Westfield are in the process of consolidating and recently spoke at a hearing in support of those bills.  

By Bill Osmulski
MacIver News Service