2005 Wisconsin Act 25 Equalization Aid Shared Cost Modification

Shared Cost Modification Wisconsin Act 25 potentially modifies: Wisconsin Act 25 potentially modifies: Shared Cost for Aid Paid in Shared Cost for Aid Paid in Shared Cost for Aid Paid in Shared Cost for Aid Paid in

Shared Cost Modification When is Shared Cost Modified? When is Shared Cost Modified? when the school district uses fund balance to pay the school district’s unfunded pension liability under the Wisconsin Retirement System when the school district uses fund balance to pay the school district’s unfunded pension liability under the Wisconsin Retirement SystemAND the result of excluding such expenditures from shared cost is an increase in state aid paid to the school district under State Statute the result of excluding such expenditures from shared cost is an increase in state aid paid to the school district under State Statute

Shared Cost Modification What payments may be excluded from shared cost? What payments may be excluded from shared cost? Any payments made from fund balance that reduce the unfunded pension liability under the Wisconsin Retirement System including: Any payments made from fund balance that reduce the unfunded pension liability under the Wisconsin Retirement System including: Payments made directly to WRS Payments made directly to WRS Debt payments as a result of the district borrowing money to pay off the unfunded liability Debt payments as a result of the district borrowing money to pay off the unfunded liability

Shared Cost Modification Which districts will likely benefit from this law change? Which districts will likely benefit from this law change? Districts that are considered “negatively aided” on the second or third tiers of the equalization aid formula Districts that are considered “negatively aided” on the second or third tiers of the equalization aid formula (For negatively aided districts, a decrease in shared cost typically results in an increase in equalization aid.) (For negatively aided districts, a decrease in shared cost typically results in an increase in equalization aid.)

Shared Cost Modification What are the school district responsibilities? What are the school district responsibilities? Maintain minutes of a school board meeting in and/or that reflect action taken by the Board that the district is using fund balance to pay the school district’s unfunded pension liability under the Wisconsin Retirement System. Maintain minutes of a school board meeting in and/or that reflect action taken by the Board that the district is using fund balance to pay the school district’s unfunded pension liability under the Wisconsin Retirement System.

Shared Cost Modification Report on the and/or PI 1505AC report, the total expenditures made either directly to WRS or for debt paying off the unfunded liability for the year. Report on the and/or PI 1505AC report, the total expenditures made either directly to WRS or for debt paying off the unfunded liability for the year. Check the box on the PI 1505AC that indicates the district used fund balance to make these payments Check the box on the PI 1505AC that indicates the district used fund balance to make these payments

Shared Cost Modification What are the school district auditor responsibilities? What are the school district auditor responsibilities? Request from the district, documentation that the board has taken action and the reported payments have been made. Request from the district, documentation that the board has taken action and the reported payments have been made. Attest to this information on the PI 1506AC. Attest to this information on the PI 1506AC.

Shared Cost Modification What are the school financial services team responsibilities? What are the school financial services team responsibilities? Subtract eligible expenses from shared cost only to the point that it increases district aid eligibility when calculating equalization aid. Subtract eligible expenses from shared cost only to the point that it increases district aid eligibility when calculating equalization aid. Positively aided districts will want to continue having all eligible expenses included. Positively aided districts will want to continue having all eligible expenses included. Negatively aided districts will want eligible expenses excluded to the point aid eligibility is increased. Negatively aided districts will want eligible expenses excluded to the point aid eligibility is increased.

Shared Cost Modification Update the current PI 1505 AC to include: Update the current PI 1505 AC to include: A line to report the district’s total expenditures made to reduce the district’s unfunded pension liability under the Wisconsin Retirement System; A line to report the district’s total expenditures made to reduce the district’s unfunded pension liability under the Wisconsin Retirement System; A checkbox to for districts to check if fund balance was used to make these payments; A checkbox to for districts to check if fund balance was used to make these payments; New language on the certification page to reflect the district’s attestation that the district incurred unfunded liability payment expenditures and used fund balance to do so. New language on the certification page to reflect the district’s attestation that the district incurred unfunded liability payment expenditures and used fund balance to do so.

Shared Cost Modification Please contact any one of the following individuals with questions. Please contact any one of the following individuals with questions. Lori Ames Brad Adams Karen Kucharz