Yes, diarrhea can be a symptom of a food allergy/intolerance. I would switch him over to goat's milk and see if the symptoms go away. I live in MN, so I don't know where you can get it in Racine, but here, most of the grocery stores do carry it. If you have a co-op or natural food store, they would surely carry it.
It's possible he is not tolerating another food, so if this doesn't clear up w/goat's milk, keep a food journal and see if you notice a pattern.
My own son (13 months) screams and vomits when he drinks cow's milk or soy milk. This reaction is somewhat sporadic, but we just pulled him off of cow's milk completely, and now give him goat's milk. I recommended goat milk's--and not soy milk--for your son, because a lot of toddlers who can not tolerate cow's milk also can not tolerate soy. My son also tolerated milk-based formula and my breastmilk (I eat a lot of dairy) just fine.