Arcadia cuts nearly $800K from school budget

With the failure of the operating referendum earlier this month, the Arcadia School District Board of Education approved cutting approximately $800,000 from its 2025-26 budget. 

The district asked taxpayers for permission to exceed revenue limits by $3.75 million over four years but received just 41 percent of the vote. At its regular meeting last Monday, the board began figuring out how to handle its budget constraints, which meant eliminating positions and offerings to students. 

Superintendent Lori Frerk said the district attempted to limit the effect on students, “However any reductions will somehow have an impact.”

This year, even with reductions in spending, the district will face a $100,000 operational deficit. Most of the expenses for this year were approved before Frerk joined the district last summer. With the failure of a second operational referendum within three years, the district is facing many questions. 

“Us being in a $100,000 hole by June, what do we do with that? How are we able to do that,” board member Tonya Rebhahn asked.

“You’re not able to stay long and that’s why school districts have dissolved,” Frerk responded. 

Frerk said that technically, the district has enough cash on hand to pay its bills, but it also has a $2 million loan to pay back. “I don’t know where the cash fund comes from to pay a $2 million debt that we owe to our local banks.” 

The superintendent said she is working with the school’s financial advisors to find a way out of the hole. “Right now, we need to find a way. I’m not sure how we’re going to find a way, but we need to find a way.”

The board went into closed session near the end of last week’s meeting and ultimately approved cutting $778,808 from the upcoming budget. 

Among the positions not being replaced is the building and grounds director — a role Frerk will fill herself — a middle school instructional coach and an elementary school English language teacher. In each case, the person who held the job for the current school year was planning to retire or resign from the district. The district had already decided not to continue with an elementary school associate principal. With salary and benefits included, those cuts figure to save the district close to $400,000. 

There will be cuts to the school athletic programs. The gymnastics program — which didn’t have any participants this past season — is being eliminated, two coaching positions have been cut, the district won’t pay for new uniforms and fees will be added for streaming competitions online. Those reductions are expected to save the district around $60,000.

The district is also making a change to how it operates regarding college credits or courses students take in outside districts. State law requires that the district pays for up to 18 college credits for students, but the district will not pay for additional credits. It will also not pay for students to attend courses in other schools, outside of TVC 2.0 classes. Instead, it will be up to parents or guardians to provide transportation. In all, Frerk estimated that will be a $100,000 cost saving for the district. 

Frerk said that the district has several teachers who have or are working on degrees that would allow additional courses to be taught in the district, which will make it so fewer students need to take courses only offered by other schools. 

While the threat of the school dissolving may be the most significant issue with the failed referendums, Frerk said the part community members may not understand is that district taxpayers are going to have to pay similar tax rates than they would if the referendum had been approved. 

While the Wisconsin schools still haven’t received finalized figures from either the state or federal governments, Frerk figured the net difference in what taxpayers would’ve paid had the referendum passed versus what they will now pay is less than $1 per $1,000 of assessed value. 

The tax rate will lower in the 2025-26 school year, but because of the way the state funds schools, the state aid will be reduced going forward. The state funding formula dictates that state aid is based on the amount of money districts spend. When a district spends less money, it receives less aid, instead, it will be local taxpayers who are asked to cover more of the costs. 

“The gap between the state aid and the levy for the students is going to grow and when that grows, the community is the one that picks it up and pays for that,” Frerk said in an interview with the Times. 

The superintendent added that was part of her messaging before the referendum, but isn’t sure that she has earned the community’s trust since she is new to her position. “It’s going to be a shock,” she said. 

That also raised issues with the state funding formula, which state superintendents have questioned for years. Frerk noted the Prairie du Chien School District has to cut $1.4 million from its budget. 

“You have to get to a point where the state has to start thinking something is wrong here if this many districts are out in this manner,” Frerk said. “Something is wrong and fix it. Have both sides sit down and fix this thing. It’s unreal how they can’t gather that.” 

While the cuts approved last week might be enough to prevent the district from operating at a deficit in the near future, Frerk said that might not be the case if there are some unexpected expenses. Like most other districts, the school will still have to borrow money, but interest rates could cause issues. Other things, like insurance costs, could skyrocket. 

“We’re just going to be kind of on a shoestring budget,” Frerk said. 

While she hasn’t opened negotiations, Frerk did project a two percent raise for teachers. She said that teachers are losing a lot with the cuts and she doesn’t want the district to lose any more teachers. 

“I’m taking a lot away, I can’t take everything away,” Frerk said. “I’m trying to be courteous to our staff members because without them we can’t run either.”

The next steps for the district are unclear. While board members acknowledged it will have to go to another referendum, that won’t happen until April 2026. Even if that referendum passed, the district would not receive any additional funds until January 2027. 

Technically, the district could call a referendum in November, but it would have to pay for the costs related to the special election, “Which we don’t have the money to do,” Frerk said.