Consolidation Aid

Overview

Public school districts consolidating under Wis. Stats. 117.08 or 117.09 are eligible for additional funding from the State General Aid appropriation. The additional funding is not counted in a district’s Revenue Limit computation.

Additional aid is generated by altering the formula factors for consolidating districts within the aid computations. Most consolidating districts are eligible for additional Equalization Aid (Source 621), and given certain circumstances, also Special Adjustment Aid (Source 623). The additional aid is vouchered under the general aid program where it was generated but is often referred to as “Consolidation Aid.” The School Financial Services (SFS) team notifies each eligible district of their "Consolidation Aid" each year.

Statutory References

121.07(6)(e) - Cost Ceilings

For a school district created by consolidation under 117.08 or 117.09, in the school year in which the consolidation takes effect and in each of the subsequent four school years, the primary cost ceiling per member and the secondary cost ceiling per member shall be multiplied by 1.15 and rounded to the next lowest dollar.

121.07(7)(e) - Guaranteed Valuations

For a school district created by consolidation under 117.08 or 117.09, in the school year in which the consolidation takes effect and in each of the subsequent four school years, the primary, secondary and tertiary guaranteed valuations per member shall be multiplied by 1.15 and rounded to the next lowest dollar.

121.105(3) - Special Adjustment Aids

In the school year in which a school district consolidation takes effect under s. 117.08 or 117.09 and in each of the subsequent four school years, the consolidated school district’s state aid shall be an amount that is not less than the aggregate state aid to which the consolidating school districts were eligible in the school year prior to the school year in which the consolidation takes effect.

121.90(2)(bm) - State Aid Exclusions

"State aid" (as defined for revenue limit purposes) excludes all of the following:

• any additional aid that a school district receives as a result of ss. 121.07 (6) (e) 1 and (7) (e) 1.; and
• 121.105 (3) for school district consolidations that are effective on or after July 1, 1995, as determined by DPI.

Calculation Details

All General Aid is paid on prior-year information, so in the first year of the consolidation when each of the consolidating districts has individual data from the prior year, aid is computed for each district separately, summed and vouchered to the single, newly-consolidated entity. In all subsequent years, there will be only one set of prior-year data: That of the single consolidated district.

Three-step Process

A three-step process computes aid in the following order:

1. Equalization
2. 85 percent Prior-Year Hold Harmless Special Adjustment (if applicable)
3. Five-Year Hold Harmless Special Adjustment

Step 1. Compute Equalization Aid

This is actually done twice. The first time, the district's membership, shared cost, property value data and the same cost ceilings and guarantees as a district of similar type (K-12, K-8, UHS) are used to get an aid amount. This version is otherwise known as the "At Law" computation.

The second time, everything remains the same for the district except that the cost ceilings and guarantees are increased by the statutory-determined incentive percentage. This version is known as the "With Incentives" computation (currently, the incentive increase is 15 percent). The dollar difference in aid between the two versions is the "Consolidation Aid."

Calculation Examples

Two Consolidating Districts (Equalization Aid Only)