Voters in the Palmyra-Eagle Area School District rejected a referendum that would have let the district raise an extra $797,000 a year beyond the state's revenue cap, leaving school leaders without a fix for what they describe as an ongoing structural budget deficit. The measure failed.
According to Greater Milwaukee Today, the referendum was intended to provide additional funding amid projected deficits. The district has faced funding pressures and pursued cost-cutting measures, the outlet reported.
The financial strain didn't appear overnight. The district has pointed to declining enrollment, state revenue caps that do not account for inflation, and a 20% drop in state aid over two years as key pressures on its budget, per the same report.
Enrollment Losses and Competing Programs Add to the Squeeze
The district's own website lists participation in choice programs — including private-school vouchers and open enrollment to other districts — as a financial challenge, the report noted. Palmyra-Eagle also says it has received less state money than expected for special education and less funding from the federal government, according to information posted on the Palmyra-Eagle Area School District website.
That enrollment slide isn't new to the district. Between 2010 and 2018, Palmyra-Eagle's enrollment fell from 1,300 students to a little over 600, costing the district more than $3 million in revenue, according to Education Week. The outlet also reported that more than two-thirds of Wisconsin school districts have faced declining enrollment of their own, a trend that has pushed many toward the ballot box for extra funding.
A District With a Long History of Asking Voters for More
Palmyra-Eagle's relationship with referendums has been a rocky one. Since 1991, the district has gone to taxpayers more than 17 times asking for additional revenue, and voters have approved only three of those requests, Education Week reported. In 2019, voters rejected a four-year, $11.5 million operational referendum by a vote of 2,276 to 1,473, with 61% voting no, according to the Milwaukee Journal Sentinel.
District officials said at the time that the 2019 measure was needed to keep the cash-strapped district from dissolving, per the Journal Sentinel's reporting. The district avoided that fate months later when, on Jan. 9, 2020, the School District Boundary Appeal Board voted 6-1 to deny Palmyra-Eagle's dissolution, according to WUWM.
A Statewide Pattern of Districts Turning to Referendums
Palmyra-Eagle isn't alone in leaning on local ballot measures to plug budget gaps. A growing number of Wisconsin school districts rely on local operating referendums as state revenue limits lag behind inflation, the district's website states. A revenue limit is the maximum amount a district may raise for general operations.
Earlier this year, the Wisconsin Association of School Business Officials delivered a presentation on public-school funding at the CESA 2 Delegate Convention on June 16, covering revenue limits, state equalization aid, and categorical funding for special education and English Learners, according to the district's website.
