MARINETTE — At Tuesday’s Board of Education meeting, finance Director Sean Kelly gave an overview of the district’s finances and presented the board with a preliminary 2020-21 budget.

“What we’ve got is an interesting situation. Here’s the problem in a nutshell: We’ve got a $2 billion decrease in state revenue, mainly COVID-related. If you take that $2 billion and break it down, there’s about $650 million in that ‘Rainy Day’ fund, that’s going to cover a third of it,” he said.

Kelly said schools were slated to receive a $600 million increase in the original state budget for the 2020-21 year, however he said that is currently up in the air. The remaining $750 million would come out of all state agencies, with about one third coming from schools. “So we’re anticipating a pretty significant cut coming as well,” he said.

Kelly said several assumptions were made in preparing the preliminary budget. This included a decrease of $200 per pupil in revenue cap for resident students, equalized value remaining stable, enrollment decreasing by about 30 students, a 2% wage increase, a 2.7% health insurance increase and a 26% reimbursement rate for special education.

“One of the problems we have in school finance goes back to Gov. (Tommy) Thompson. We had a three-legged stool back then, that’s what we referred to it as, where the state gave you two thirds of your aid, and that was eliminated. The QEO (Qualified Economic Offer) was the law that managed compensation, and that’s gone. The third part of that was the revenue limit, limiting what you could raise through your state and property tax. We’re still working off of that,” he said.

He said the Marinette School District has been doing a tremendous job with their revenue limit over the last 20 years. “The state average is pushing $11,000; we’re doing it at $9,700, the minimum you can do it at. We’re doing a lot more wonderful work with a lot fewer resources,” he said.

He said the state does still provide some state aid, and so the district is keeping an eye on how much is being put into that, since that will determine what needs to be raised through property taxes. Kelly estimated that property tax will decrease by 17 cents, meaning the owner of a home worth $100,000 would pay $17 less in property taxes.

Kelly also said the district is finally getting some guidance on the Coronavirus Aid, Relief, and Economic Security (CARES) Act and what the district is able to do with the money that comes from it. “It’s one time only, and it is limited in uses, so we’re going through all of that documentation right now and getting ready to plan how we’re going to do that.”

In preparing the budget, Kelly said the district has had to communicate with state lawmakers to let them know what the district has been doing since the closure. “We found that a lot of them were thinking ‘close school buildings’ equals ‘close school’ in their minds. So we’ve had to tell them all of what we’ve been doing,” he said.

He said there doesn’t seem to be an appetite for additional federal money to come in to help the states out, so he said that wouldn’t be factored into the budget. He said the most frustrating aspect in talking to lawmakers was in regards to budget repair bills. “They said ‘We really don’t want to do that prior to the November election.’ As much as I understand the political side to that, as regional business folks we said, ‘On Oct. 15 they’re going to certify us, and that’s your rule, not ours,’” he said.

Kelly said the district might be certified for one year with that increase, and then pull it back in the next state budget. He said the district decided to plan the budget without factoring in a budget repair bill. “If we get a little bonus next year, we’ll find ways to put it in our capital plan. I think we need to adjust now, then when it does happen we’re in better shape,” he said.