School board votes to move forward with spring operational referendum

The board of education has chosen a date for the School District of Rhinelander’s next operational referendum. The board voted 8-1 Monday to place a referendum question on the April 1, 2025 ballot.

The request will be to exceed the revenue limit by $3 million per year in 2025-26 and 2026-27 and then $7 million in 2027-28 and 2028-29 when the current $4 million referendum expires, according to the motion.

Board member Duane Frey cast the lone dissenting vote.

According to a memo from the district’s business director Bob Thom to the board, the 2023-24 school year ended with a deficit of $3.2 million which reduced the fund balance. 

“We cannot sustain this deficit level for three more years. We have made reductions for 2024-25 and have a deficit of $2.7 million budgeted,” Thom wrote. “There will be a new state budget starting in July of 2025. We expect some increase in school funding in that budget, although no guarantee. The $3 million referendum would get us back to a balanced budget and any new state funding would provide for increasing costs over the next four years. The referendum gives the district the authority to levy $3 million but we do not have to levy the money if the budget picture improves.”

In the memo, Thom reiterated that the district has found itself in this position due to rising costs across the board as well as the need to respond to a student population that has more complex needs following the COVID-19 pandemic.

“Inflation and student needs have impacted the district budget greatly since 2022,” he wrote. “Our costs have increased by 16 percent over the two years while our total revenues have only increased 3.3 percent. This has forced us to utilize the school district fund balance to maintain our programs. If we wait until Fall 2026 (to go to referendum) and continue our current programs we will spend down the fund balance to a projected 12 percent which is significantly below our threshold of 21 percent, per policy. A strong fund balance allows us to operate without borrowing for cash flow needs and has allowed us to make many enhancements to our programs and facilities.”

A low tax rate will mitigate the impact of the referendum on the taxpayer, Thom stressed.

“An additional $3 million referendum potentially adds $0.84 to the tax rate,” Thom calculated in the memo. “In 2023-24, the tax rate is $7.30 plus $0.84=$8.14 (per $1,000 of property value). This rate is still lower than any tax rate in the past 40 years.”

For perspective, the tax rate in 2020-11 was $9.67 per $1,000 of property value.

During the public comment portion of the meeting, the board heard from a resident who is concerned about the prospect of another referendum.

“Many residents are overwhelmed by rising costs across the board,” she said. “Homes, vehicle insurance, groceries, and other essentials. It’s clear that families are under financial strain and the prospect of another referendum has sparked significant frustration. We appreciate the value in quality education and efforts made by our schools, but we must also acknowledge the realities that our community faces. It’s critical for the school board to explore cost-cutting measures before asking residents for additional financial support. Transparency regarding budget adjustments and resource allocation has helped restore trust and demonstrate commitment to fiscal responsibility. I urge you to prioritize exploring efficiencies and reduce expense wherever possible. By doing so, you can better align with the needs of our community and show that any future proposals are more pliable.”

For his part, district superintendent Eric Burke stressed that every effort has been made to cut expenses wherever possible. 

A major part of the problem is rising special education costs. These costs are unavoidable, as the district must provide services to all students, he explained. The frustration is that the state legislature refuses to increase reimbursement for these costs despite a state budget surplus of more than $4 billion.

Another recent unavoidable cost was in transportation, he noted.

“We have one bus company that bid on us,” Burke explained. “We tried hard to get other bus companies to bid on us, but that went up. And they, the bus company, there’s a reason for that, right? Their costs have gone up too, but that went up 30%. So that was about $300,000 right there that we weren’t expecting, that we don’t have a choice (but to incur), we can’t not have busing.”

Burke also noted that the district has invested in its staff, in the form of more competitive wages, and that has led to measurable results.

“The test scores, for example, have gone up considerably, and not just in math and English, and not just at the high school, but third through eighth grade in all areas,” he said. “Not just math and English, but science and social studies had their highest scores this past year. Why is that happening? Part of that is the supports that we’re putting in place. That’s a big part of it. We have a lot of staff in the room right now, and they’re obviously very invested in this community.”

Rhinelander is far from alone in its reliance on referenda. According to Burke, approximately 100 referenda are currently planned in Wisconsin. Thom also noted that the biggest losers in terms of state aid in the whole state are Hayward, Spooner, Lakeland, Northland Pines, Three Lakes, Minocqua, Phelps and Woodruff.

“So, as far as the state’s concerned, the Northwoods doesn’t need state aid,” he said, reiterating that the Rhinelander has long been considered a “property rich” district despite a high number of low income families.

Several board members indicated they understand the district is “caught between a rock and a hard place.”

For his part, Frey was concerned about timing.

“I think our principals, teachers are doing a wonderful job in our district,” he said. “I hear positives all the time about what’s going on. My worry is we’re coming off the heels of the $26 million (tech ed referendum approved in April 2024) and we’re throwing at them a $7 million referendum down the road and the timing is not ideal. I understand that the longer we go it’s not going to get any better, but I worry about the timing of this in the moment.”

The referendum approved in April will fund renovations and upgrades to the tech ed facilities at Rhinelander High School and James Williams Middle School. Voters were persuaded that the current technical education facilities are antiquated and no longer meet student needs.

In that regard, district officials stressed the need to train the next generation of the local workforce. They explained that the district focuses heavily on career readiness with a goal of ensuring that every student is ready for the next step on their path to success whether that involves immediately joining the local workforce, attending technical school or college or military service.

After being told that there will be enough time to properly explain the reasons for the referendum to the taxpayers, the board chose April 2025.

While Monday’s vote sets a date for the next referendum vote, the exact language of the question to be put to voters will be approved at a later date. District officials indicated they would consult with legal counsel and bring the matter back to the board for approval.

Heather Schaefer may be reached at [email protected].