And I suspect the 13% index level is the source of Tyler Lamb's confusion. The actual cut to public library system funding is $1,688,100 in first year of the 2011-13 biennium, flat funding in the 2nd year.
Public Library System Funding
Libraries take a hit in funding. (DeForest eNews, 9/14/2011)
Excerpt: After six divisive months of political theater in the state Capitol, Walker signed the 2011-13 state budget into law as Act 32. The measure hits state municipalities hard by cutting funding to key programs like shared revenue and recycling grants.
At the same time, the governor's budget-repair bill also cuts library funding by more than $18 million in 2012 alone, threatening a wide variety of services, including those seeking jobs.
Cuts to Wisconsin's library budgets come in three areas: private, municipal and county. State aid to school libraries was cut by $4.6 million  and funding to the state's 17 public library systems - which serves Columbia, Dane and five other counties - was cut by $13.5 million, essentially ending materials sharing. [Emphasis added.]
The effects of those cuts are exacerbated by Walker's successful elimination of the conditions for participating in the state public library system, which repealed the statutory requirement that local libraries be funded at a level not lower than the average funding for the previous three years. 
 I must be missing something here.
In 2010, the Common School Fund distributed $32,000,000 in categorical aid payments.
In 2011, the Common School Fund distributed $33,600,000 in categorical aid payments.
 A portion of the reporter's explanation of maintenance of effort excludes municipalities and then has me scratching my head. Each county was required to maintain its support for library services at a level not lower than the average of the previous three years. The three-year average was adjusted to reflect cost savings from consolidating services or for a municipality levying its own equivalent tax for library services.
Looks like Tyler might have recycled elements of this Jay Rath Isthmus article.
When I google state aid to school libraries cut by $4.6 million (no quotation marks), all roads lead to Jay.
This article was also published in the Poynette Press under the headline Libraries could face shortfall and the Waunakee Tribune, Libraries lose out in state budget.