Elkhorn board hears budget update after drops in enrollment and state aid; two levy options presented

Elkhorn Area School District business staff presented a budget update on Oct. 13, 2025, saying the district faces modest declines in resident enrollment and a reduction in state equalization aid of about $1,792,000, and offering the board two options for the 2025–26 levy: proceed with planned bond defeasance (which staff estimated would push a proposed property tax increase to roughly 13.51%) or postpone defeasance to limit the increase to about 8%.

The district’s business manager, Mr. Earl, told the board that state aid formulas and the district’s rising property values are the main drivers of the change. “One of the areas that I think our legislative committee and then, ultimately, the board that we really need to work on is Wisconsin's revenue limit,” Mr. Earl said, explaining how property-value increases and falling enrollment combine to lower state equalization aid for the district.

Mr. Earl and other staff reviewed enrollment trends and revenue drivers. The district reported a drop of about 39 resident students compared with the prior period; open-enrollment totals remain large (staff said the district typically manages roughly 700–800 open-enrolled students). Staff also said special-education reimbursements have changed: the state special-education reimbursement schedule is designed to reimburse roughly 43% of costs and can rise to higher percentages above certain thresholds; staff said recent budget cycles have raised that reimbursement toward the statutory upper levels, improving reimbursements compared with earlier years.

Board members and staff discussed two principal options for managing debt service this year. The staff presentation included a plan to prepay roughly $2.7–$2.75 million in outstanding debt over about two years; that prepayment was estimated by the district’s financial advisor to save about $500,000 over the remaining life of the loans. Opposing views were voiced during the discussion. One board member said keeping cash in the debt-service fund was preferable given historically low interest rates on the district’s bonds; another board member said paying down debt would reduce referendum-related objections in future campaigns.

Mr. Earl also presented an upper-end mill-rate projection: in a worst-case scenario presented during the discussion, the district’s mill rate would “top out at $7.17,” an increase of about $0.35 per thousand of assessed value from earlier projections. He emphasized that the mill rate remains low compared with many neighboring districts even at that projection.

Board members asked for more homeowner-focused examples comparing the two levy options and requested a clearer repayment schedule to show how the prepayment plan produces the estimated savings. Mr. Earl said staff will request a refined amortization and comparison from the district’s financial advisor (Baird) and circulate the updated numbers before the next meeting. The board directed staff to return with two formal levy presentations and recommended homeowner-impact metrics in time for the levy-setting meeting.

Among other state-driven variables discussed were voucher payments and transfer reimbursement amounts; staff said some final state numbers (voucher reimbursements and transfer-service amounts) remained pending and that small changes in those figures would be reflected in the final levy workups.

The board did not adopt a levy at the Oct. 13 meeting; members asked for a follow-up presentation that includes: (1) a homeowner-level comparison of the two levy options; (2) a clear amortization schedule showing the prepayment timeline and the source of cash; and (3) any updated state aid or voucher figures as they become available.

Ending: The board set a timetable for two levy scenarios to be presented at the next meeting and requested any updated materials from Baird and district staff in advance so members can review before formal action.