Marj Passman carries around a $2 bill from Singapore, one side of which depicts a teacher instructing a classroom of children. For her, the note is a salient reminder of America's diminishing commitment to public education.
"If Singapore can put a classroom of students on its money, and we can't even put our money into children, what kind of country are we?" asks Passman, Madison school board vice president. "It's going to be a horrible budget this year."
On April 16, district administration will present the school board with next year's preliminary budget, which begins with a $12.4 million deficit.
The preliminary budget, which approaches $400 million, doesn't take into account the costs of new initiatives, such as a plan to close the racial achievement gap. That plan, unveiled in early February, hasn't been finalized, but will almost certainly come with a multimillion-dollar price tag.
While $12.4 million is nothing to sneeze at, there are remedies that the board will discuss in the months ahead that can potentially bring the deficit closer to $2 million.
For example, the district has already saved $5 million by eliminating a high-cost WPS health care option for teachers. But to help cover the rest, the board, unless it makes cuts, will almost certainly have to raise property taxes.
"There are only so many things you can do before your system falls apart," says Passman. "Anything that inflicts any more damage on our classrooms I have to say no to."
The district currently has $10.5 million in unused tax levy authority - the so-called under levy - in addition to $4 million in new levy authority, derived from enrollment in 4-year-old kindergarten.
Some board members worry about the repercussions a tax hike might have on residents, especially those in precarious financial situations.
"When you start talking about raising property taxes in this environment we're in - putting more costs on people that are already suffering - that's a very difficult conversation," says board president James Howard.
In a recent blog post, board member Ed Hughes says spending decisions for next year will be driven by how comfortable the board is with raising taxes, but says these are "normal challenges."
"I don't think things are looking particularly grim," he says.
Below are three of the biggest budgeting issues the board will face before approving a final budget in May or June.
Federally funded positions
Over the last two years, 38.2 positions have been created with funds from the American Jobs Act. Because that funding goes away after this year, the school board will have to decide whether to continue funding them out-of-pocket.
Though allowing these positions to expire would shave an additional $3.2 million from the deficit, Passman says the board is unlikely to allow all of them to go away.
"Some of them are very crucial, and we may have to pick them up," she says. "Others we're just going to have to bite the bullet on. It's very troublesome."
District administration hasn't yet made any staffing recommendations, but Passman says some tech positions will likely be spared. "Every time we increase our technology we need more tech people downtown," she says.
Hughes anticipates staffing for 4-year-old kindergarten will emerge intact, but positions created to assist teachers in the classroom may prove too expensive.
In a district survey sent out in February, teachers were asked what their biggest barrier was in closing the achievement gap. "The answer from almost every single school was: Give us more help in the classroom," says Passman. "Letting these go really bothers me."
$1.4 million state aid
The district is eligible for a one-time categorical aid payment of $1.4 million if it uses $4 million in new levy authority to fund 4-year-old kindergarten.
"It'll be an interesting conversation on whether we should levy $4 million dollars to get another $1.4 million or whether we don't levy that and give up a one-time payment of $1.4 million," says Erik Kass, assistant superintendent for business services.
Originally, the plan was to fund 4-year-old kindergarten without relying on property taxes, but a clause in Gov. Scott Walker's biennial budget gives school districts a one-time payment of $50 per kid, with the caveat that districts don't increase their under levy.
Ed Hughes is confident that the district will not lose the $1.4 million in one-time aid. "There's no chance in the world we'll increase our under levy this year," he says.
"The $4 million in new levy authority, plus the $1.4 million in aid - in addition to the $5 million in health insurance savings - would bring the deficit down to about $2 million.
But Kass suggests it's not that cut and dried. "It's hard to give up $1.4 million of money from the state," he says. "But it'll also be hard to balance that with what's an appropriate property tax increase."
Achievement gap plan
The preliminary plan unveiled in February to close the district's more than 40-year-old racial achievement gap came with a price tag of $105 million, though no one expected the full plan to be approved.
Instead, the administration - using community feedback - is developing a pared-down plan that will go to the board sometime in early May. The announcement by Superintendent Dan Nerad that he plans to leave the district by 2013 when his contract runs out (or earlier if another opportunity beckons) could complicate matters, but school board members say parts of the proposal will proceed.
The $12.4 million deficit doesn't take into account the cost of new initiatives.
"If we decide that there are meritorious parts of that plan we decide to implement next year, we would have to probably use some of that authority to do that," says Hughes.
But tapping the levy authority has consequences, since the district will then lose around 40 cents in state aid for the 2013-14 school year on every dollar it taxes. For example, if the district levies $100 to fund the plan, it'll have to tax $140 to make up for losses in state aid.
"Under the state funding formula we really get punished by spending extra money to help reduce the achievement gap," says Hughes. "There is no logic to it. We shouldn't lose state aid because the community is deciding to dig into its own pockets to support this necessary effort."
Staffing and pay raises
The board wants to approve the budget earlier than in previous years so that human resources can hire new staff ahead of other school districts. "We're losing talented people to other communities because we hire so late," says Passman.
She hopes a budget is approved by late May.
Whatever the board decides regarding taxation, Hughes would like to save some of the unused levy authority for staff pay raises during the 2013-14 school year.
"We'll be coming off two years of having teachers' salaries frozen, as well as the givebacks we imposed as part of Act 10, so we're going to have to raise salaries for our teachers," Hughes says. "And that takes up a chunk of money."
But a big unknown looking to the 2013-14 school year is what Gov. Walker - or his successor should he lose the recall election - will do with the state's next budget. The current state budget, approved last year, slashed public education funding by $800 million over the next two years.
Walker's collective bargaining reform bill, Act 10, gave school boards new tools to offset state aid cuts - namely by giving school boards more power to force concessions from staff.
"I don't like these tools," says Howard. "These concessions continue to hit hard at our employees, whether it's teachers or nonprofessional staff. I don't like that."