State of the Hudson Schools

Message from the Board of Education - February 2026

State Support For Special Education is Vital for Hudson Schools

The Hudson School District Board of Education is committed to two primary goals: providing a premier education for every student and being responsible stewards of your tax dollars. To achieve this, Board members have engaged with state legislators to address a critical funding gap that impacts every classroom in the Hudson School District.

The Challenge: A $9.4 Million Transfer

The reality of school finance today is that the state's commitment to special education funding has fallen short. While the intended state reimbursement rate was set to reach 42% this year and 45% next year, the actual funding has lagged significantly.

The Impact on Hudson: Last year alone, the School District was forced to transfer $9.4 million from the general fund to cover mandated special education costs.

The Sustainability Issue: This represents more than 10% of the School District's annual budget. Relying on general fund transfers of this magnitude is simply not sustainable.

The Local Cost: For the current school year, underfunding special education alone represents an estimated $1 million loss to the School District.

A common misconception is that special education funding only affects students with an Individualized Education Program (IEP). In reality, it affects every student in every classroom.

The Transfer: Because special education is a federally mandated service, a school district must provide it. When the state doesn't pay its share, the money is pulled directly from the General Fund.

The Trade-Off: The $9.4 million Hudson transferred last year is money that otherwise would have funded instructional materials, updated technology, elective courses, and extracurricular activities for the entire student body.

Difficult Decision and Fiscal Responsibility

The lack of predictable state funding creates a ripple effect across the School District. This fall, the Board made the difficult decision to close Houlton and Willow River elementary schools. Driven by declining enrollment and projected budget shortfalls, this move was necessary to ensure the School District's long-term financial stability. 

Protecting Taxpayers

The School District is aware of the community's concerns regarding property taxes.

Currently, Wisconsin uses sum-certain funding for special education. This means the state sets aside a fixed pot of money.

The Problem: If more students across the state require services, or if the cost of those services goes up due to inflation, that fixed pot doesn't grow.

The Result: The reimbursement rate is prorated. Even if the state promises a 45% reimbursement, if the total claims exceed the "pot," every district gets a smaller slice. "Sum-sufficient" funding would require the state to pay the full promised percentage regardless of how many students need support.

When the state fails to meet its funding promises for special education, school districts across the state are often left with no choice but to seek operational referendums. Board of Education members are advocating for the state to use a portion of its $2.3 billion surplus to fund special education at the promised 45% level.

The Hudson School District remains a strong advocate for students and community. The Board will continue to urge state representatives to make special education categorical aid a top priority in this legislative session. We want to ensure that Hudson remains a place where every child thrives.