Monday, October 21, 2013

Scotty fails math again- this time on property taxes

It's already been a bad day for the Guv, given that it's now public that there's "The Son of John Doe", which is looking into corruption done from Madison since Walker took office in 2011. So he tried to deflect from that reality in the best way he knew- deceptive economic stats.

This made my BS detector start screeching, and so I had to look into this claim. First, let's take a look at what the last 4 years of the Jim Doyle era had for property taxes, which the LFB has on Page 3 of its 2013 report on shared revenue and related aid programs, and I'll compare the property taxes that were levied in 2006-2010, which would be payable in 2007 and 2011. I will also use the amount after property tax credits are taken out, reflecting what Wisconsinites actually pay.

Wisconsin property taxes, median-value home 2006-2010
2006- $2,733
2010- $2,963 (+8.415%)

Now let's increase the 2010 amount by the same 8.415%, since that's what Walker's claim indicates, and use that as the 2014 projection under "the trend from Gov. Doyle's last 4 years."

2014- $3,212

So, let's compare to what the LFB now says will happen in 2014, since Walker has signed the property tax giveaway into law.

Projected property taxes 2014- $2,954
Change from "Gov. Doyle trend"- $3,212
Difference- $258

Last I checked, $258 is not $680. It's not even half that. And this argument falls apart even more when you remember the context of the housing boom and bust in Wisconsin. While we didn't get "20%+ in a year" changes you may have seen out West or in Florida from 2004-2012, things were far from flat here.

Wisconsin median home values 2004-2014.

So in fact, a large reason for property taxes not increasing in Wisconsin since Scott Walker took office isn't due to tax cuts or other austerity measures, but instead is because home values have continued to drop. And yes, this trend continued after Act 10 was signed in early 2011. (gee, you think denigrating public schools and cutting funding for services had an effect?)

As a sidelight, it's interesting to note is today's release of the Wisconsin Realtors' home sales report for September 2013. This report says that median home price SALES are going up (by 6.7% in September, 7.8% for the year), but those median sales prices are each in the mid-140s. So something's going to give in the next couple of years- either the strong sales continue, the home values go up, and people will pay higher property taxes than predicted (as assessments rise), or home values stay in the doldrums for existing home owners, and while property taxes are lower, the RATES are higher, and any reduced taxes are more than offset with a loss of wealth.

Pretty much the only people benefitting from Scott Walker's policies are developers and large-value homeowners, who the LFB mentioned would get the lion's share of the $100 million property tax giveaway. And gee, what a surprise, guess who the literate, less-bigoted side of Scott Walker's base is? Rich people and developers! The man knows who pays his bills, give him that.

And of course property taxes will also be lower for people when property values go down, or at least it will if the property tax RATE stays the same. While tax rates did indeed fall during the bubble years of the mid-2000s (while Doyle was governor), the rates are now higher than they were 8 years ago. This trend of rising tax rates has continued in the Age of Fitzwalkerstan, and is projected to continue in the next 2 years.

Because of these rising property tax rates, rough math indicates that even if a home value went up by 1.77% between 2010 and 2014, you'd have a property tax increase that would match the 8.415% increase that happened in the last 4 years of the Doyle Administration. So by taking credit for "lower" property tax increases vs. the Doyle years, what Scott Walker is really promoting is a drop in home values of more than $10,000 for his first term in office!

So not only is Scott Walker's claim of "lower property taxes" a lie that falls apart when given even a modicom of investigation, it also is a damning indictment of the failure of his policies, as it illustrates lower property values that result from deteriorating services, low job growth, and a quality of life that doesn't attract people.

But you can bet Scotty will keep trying to throw this type of shit against the wall for the next year, in the hopes that you don't look too deeply. Too bad for him that plenty of us will.

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