State Aid Up 31 Percent for Shorewood Schools Due to Assessor's Error

While most school districts across the state cope with flat or declining state education funds, Shorewood will experience a dramatic hike as a result of an assessment error made late last summer.

will see one of the largest state aid percent increases among public school districts in Wisconsin next year — a whopping 31 percent — due to late last summer.

The district will receive an estimated $1,128,518 in additional state aid next year — $4,759,539 compared to $3,631,021 this year — according to state Department of Public Instruction data. That's the third-highest increase statewide, behind Twin Lakes No. 4 and the Stone Bank School Districts.

By comparison, the Whitefish Bay School District expects a 2.16 percent state aid increase and Fox Point-Bayside schools a .83 percent decrease next year.

DPI’s data is only preliminary and actual aid figures will not be known until October after final enrollment and other information is calculated.

It's ironic that the very same  had village officials scrambling to avoid a $2 million artificial increase in their property tax levy. To avoid that spike, , borrowed cash to fund the difference, and then will raise the levy the next year by the same amount.

Where the error came from

occurred when Associated Appraisal Consultants Inc., the village's assessor, recorded the value of Shorewood’s Tax Incremental Financing District No. 1 — which blankets much of the business district — as $77 million instead of $77,000. It then sent that figure to the state Department of Revenue, which then published that incorrect value.

Department of Revenue officials said state law prohibited them from changing the inflated value after it had been published. And as a result, the total equalized value of property in Shorewood was artificially inflated and village property owners could have had to fork over $2 million more on their tax bills.

State education officials use the value of the village, excluding the special taxing district, when calculating aid each district receives. And while the total value of Shorewood is overstated because of the error, the value excluding the special taxing district is actually understated, resulting in the increase of state funds, said District Business Manager Mark Boehlke said.

And this gift will keep on giving. Even when the assessment is corrected, there is a 15 percent cap on state aid decreases in any given year, Boehlke said.

"It will take a few years for the district to even out to where it would otherwise be," he said.

Boehlke said , state officials would likely find a way to fix the funding glitch, but when contacted after the funding estimates were released, the state said it would go with the current numbers.

How to use the extra cash

The increase in state aid typically means a decrease in the tax levy and the district's portion of resident's property tax bill, but Boehlke said the district is talking with its financial advisors about using some of the extra cash for a energy conservation project in the district.

The Shorewood School Board has yet to approve a 2012-13 preliminary budget. The board that allowed the district to move forward with hiring of new staff. School officials recently hired .

Shorewood expects to save nearly $475,000 in this budget cycle due to the , while it is still vetting additions like a at a cost of $75,000, and a computer technician at $70,000.

The DPI estimates are derived from two areas: the and the relevant school district data from the 2011-12 school year. These include membership, shared costs and property value, according to a press release from the DPI.

James R Hoffa August 02, 2012 at 06:06 AM
Awarding a mistake with taxpayer dollars instead of holding those who made the mistake personally accountable for their blunders. WTF?
Bob McBride August 02, 2012 at 11:32 AM
Actually it all comes out in the wash - sort of. They're not really being rewarded. They screwed up last year, didn't get the proper amount they should have from the state due to grossly overstating the value of commercial properties in the Village. They had to borrow money to cover the shortfall (rather than hit up local property owners for the $2MM in one year) and this rights the ship from the state funding standpoint. They're still on the hook for the $2MM plus interest. This was anticipated last year when they were panicking over the shortfall. Granted, the folks that screwed up were let off the hook with the equivalent of "hey, mistakes happen" (best I can tell anyways), but then again "hey, it's the government".
Bob McBride August 02, 2012 at 11:54 AM
I stand corrected. Yes, it looks like they're being rewarded, essentially, for screwing up, thanks to the limitation on annual decreases in State aid. And, of course, instead of cutting property taxes and kicking the money back to SOME taxpayers at least, they're going to spend it.
Shorelander August 02, 2012 at 01:39 PM
Hey, Shorewood, way to work the system. Could we get our money back? Signed, Every other school district in Wisconsin
The Donny Show August 02, 2012 at 06:52 PM
Shorewood should not take the money. It is not due to them. Be honest!
Adam W. McCoy (Editor) August 02, 2012 at 08:44 PM
The district didn't work the system. The error was made by the village's assessor, and it just happened to work out in the district's favor in terms of state aid.


More »
Got a question? Something on your mind? Talk to your community, directly.
Note Article
Just a short thought to get the word out quickly about anything in your neighborhood.
Share something with your neighbors.What's on your mind?What's on your mind?Make an announcement, speak your mind, or sell somethingPost something