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If Milwaukee Public Schools don't stop spending, or don't start raising taxes, the district will be $100 million in the hole in five years. 

A new report from the Wisconsin Policy Forum takes a look at MPS' budget for the 2020 school year and beyond. 

The state's largest school district plans to spend about $1.2 billion next year.  The day-to-day operating budget is $944 million. 

That's fine for this year the report states, but not in the coming years. 

"The district’s long-term financial outlook remains quite precarious," the report's long term prognosis states. "The district’s cost pressures exceed its typical revenue growth. Until and unless that dynamic changes – either from enhanced state revenues or substantial changes to major cost centers (or both) – MPS will need to continue to scour its central offices for reductions, explore one-time maneuvers, or again consider the unpleasant options of forsaking pay raises or reducing the teacher workforce."

The report suggests that Milwaukee School leaders may also want to consider a tax increase. 

"Another undesirable option – asking voters to exceed state-imposed revenue limits via referendum – also may need to be considered," the report adds.

The Policy Forum estimates that spending in Milwaukee Public School's will grow, from $944 million next year to $1.04 billion by 2024. That's a nearly 12 percent increase. 

But the report also estimates that revenue will actually shrink by a little less than two percent, from $944 million next year to $933 million in 2024. 

Milwaukee's new superintendent, Keith Posley, recommended hiring 62 more teachers and 22 classroom assistants. There are also raises for existing teachers in the budget. 

The Policy Forum report says the new salaries and added costs for healthcare and other benefits will cost $16 million more next year alone. Those costs will likely only grow over time.  

The report also goes to lengths to explain that lawmakers in Madison are likely not going to send much more money to Milwaukee Public Schools. 

"The proposed budget assumes essentially flat funding in the key areas of property tax levy, state equalization aids, and special education aids, despite Gov. Tony Evers’ proposals to sharply increase those aids and allow revenue caps to increase by $200 per pupil," the report's authors write. "The governor’s proposed budget already has been set aside by the Legislature’s Joint Finance Committee in favor of starting with a base budget."

Evers wanted a $1.4 billion increase for all public schools in the state.  Republicans on the Joint Finance Commission say they will spend $500 million more. 

As for what's next, the Policy Forum doesn't provide any specific recommendations. But the report does offer two general conclusions. 

"The first is that the district continues to face a structural imbalance that will make it difficult to retain even current levels of staffing and instructional quality in the years after 2020," the report states. "The second is that merely maintaining a budgetary status quo will not be good enough to allow the district to attract and retain additional quality teachers, initiate innovative and enhanced instructional and student services, modernize (while “right sizing”) its facilities, and grow its enrollment to help address its revenue challenges." 

That could mean tax increases. 

"Long-term changes to this paradigm will demand both improvements to the district’s unsustainable revenue structure (which could come from increased state aids, relaxation of revenue limits, or even a voter referendum); and operational changes that will help control some of its most formidable cost drivers," the report's conclusion said. 

Reporter

An industry veteran with two decades of experience in media, Benjamin Yount reports on Illinois and Wisconsin statewide issues for The Center Square.