Voters in Glendale-River Hills to decide on $9 million operational referendum for schools

Months after it cut 13 positions to save $1 million due to a budget deficit caused by accounting errors, the Glendale-River Hills School District is turning to its voters this November for additional money.

The district's board unanimously agreed Aug. 21 to put an operational referendum on the Nov. 5 ballot. It is seeking an additional $9 million in funds, spread over two years.

Here's what to know about the referendum.

What does the operational referendum entail?

If approved, the district would receive an additional $4.5 million in 2024-25 and again in 2025-26, for a total of $9 million.

The funds would help pay for district operations that include staff salaries and benefits and instructional programming for students.

What is the estimated tax impact of the referendum?

If approved, the district's tax rate is projected to increase $1.16 per $1,000 of property value for the 2024-25 school year. The owner of a $400,000 home would pay an additional $464 in school taxes.

Glendale-River Hills interim superintendent Anna Young said the school tax rate will likely decrease in 2025-26 because the district's 2019 referendum is expiring.

She noted that those numbers are just estimates, since state and local numbers are not finalized until October.

The district's 2023-24 tax rate was $6.13 per $1,000 of property value, according to the district's referendum FAQs.

Why is the district seeking a referendum?

The district has operated at a deficit over the past two years and has depleted the $4.3 million it had in reserves, leaving an ending balance for 2023-24 of zero, Young said.

The district said it obtained a $6 million loan from the Board of Commissioners of Public Lands to pay the final payment of a tax anticipation note and will cover operating expenses in the short term. The district said the loan was needed because the reduction in district reserves "considerably impacted cash flow," according to its referendum FAQs.

Like officials in other school districts, Glendale-River Hills officials said the state's school funding has not kept up with the rate of inflation, which has caused the district and others across the state to seek operational referendums.

The district said the deficit spending was caused by staff wage increases of $956,653 over two years; an increase in special education costs of $940,000 over two years; and increased costs associated with students enrolling out of the district through the state's open enrollment program, as well as voucher spending for district students attending private schools and independent charter schools, amounting to $356,399 over two years.

What led to the district's budget challenges?

The Glendale-River Hills School Board said in a March 22 letter to the community that it had learned in January about "significant errors" in accounting and budgeting by staff members who are no longer with the district. Those errors meant the district's revenue and savings would not be enough to cover the expected deficit in the 2024-25 budget.

"We immediately hired financial consultants to verify and correct the financial data from prior years, investigate past revenue and spending to determine the full extent of the budget deficit, ensure that district operational expenses are fully covered through the 2023-24 school year, and build a fiscally responsible budget for the 2024-25 school year," the district said in the letter.

The school district hired financial consultant Robert W. Baird & Co. in the aftermath of that discovery. The district remains in contact with its legal and fiscal counsel "on all relevant matters," according to the referendum FAQs.

More: $4 million budgeting error discovered in 24-25 Tosa schools budget

How has the district tried to resolve its budget issues so far?

The district has cut $1 million from its 2024-25 budget by cutting 13 positions; revamping and updating its fiscal policies to ensure stronger oversight and fidelity; implementing increased scrutiny and adherence to checks and balances; and hiring a new management team to oversee the district's budget, finance and operations, among other measures.

The school board Young as the district's interim superintendent in April. Michelle Brown joined the district in July as director of business operations.

Young replaced superintendent Alyson Weiss, who submitted her resignation in February. The district's director of finance, Lindsay Johnson, resigned in January a week after she told board members she had made budgeting errors that grossly misestimated the district's financial position.

When was the district's last referendum?

The district's last referendum was in April 2019. Voters approved a $7.9 million operational referendum. The referendum brought an additional $1.58 million per year to the district for five years, starting in 2020-21 and ending with the 2024-25 school year.

Contact Alec Johnson at (262) 875-9469 or [email protected]. Follow him on Twitter at@AlecJohnson12.

This article originally appeared on Milwaukee Journal Sentinel: Glendale-River Hills voters to decide on $9 million operational referendum