The big taxpayer costs of WisGOP property tax "cuts"

On Thursday, Wisconsin's Joint Finance Committee finally got back into action, and among the items they signed off on was another property tax cut proposed by Governor Walker.

The state would wipe out its only property tax, which now funds forestry programs, and instead use general purpose revenue to cover those expenses after the Joint Finance Committee voted 12-4 along party lines to support Gov. Scott Walker’s proposal.

The forestry mill tax would be expected to bring in roughly $181.5 million over the next two years. But that property tax would be pulled off homeowners bills starting this December under the provision.

Dems argued the savings from eliminating the state property tax — an estimated $25 to $26 for a typical Wisconsin home — did not outweigh the risks the move posed, both to forestry programs and the fiscal picture for future budgets.

There's another property tax cut that the WisGOP-run Joint Finance Committee is expected to approve on Monday. This one would reduce the personal property tax (generally paid by businesses on equipment and similar items) by $73 million a year, and just like with the Forestry tax, General Fund tax dollars would be used to make up the difference so the average homeowner doesn't end up paying higher property taxes due to businesses paying less. No printed bill says exactly what businesses can write off, but Republican leaders on Joint Finance have said that's what the compromise will be, after they realized there wasn't enough money available to get rid of the entire $239 million in personal property tax.

The Forestry tax and the potential reduction in the personal property tax are not the only areas that Republicans have shifted off of the property tax that in Wisconsin since 2014. Take a look at these 2 "school spending" measures that aren't going into the classroom.

1. Giving away $406 million a year to the state's Tech College System in 2014, but mandating that the money had to go entirely for property tax relief.

2. Increasing the School Levy Credit by $105.6 million a year in the 2015-17 budget, and Governor Walker has proposed increasing it by another $87 million a year in this budget.

Neither of these measures has any other tax associated with them, Walker and WisGOP just assume the money will be there, so they can spend more of it on these property tax credits. This naturally means that other needs can't be funded because there isn't any money left in the state's General Fund to do so.

Now if your "reform" is taking the funding for Forestry and the Tech Colleges off of the property tax and onto the General Fund, I can see where that's going, and frankly it may be a good idea (we do rely too much on property tax in Wisconsin when it comes to services). But YOU SHOULD TAX IN SOME OTHER WAY TO MAKE UP THE DIFFERENCE. Republicans aren't doing that, and are merely increasing spending without asking for the money to make up the difference. That is not sustainable, and it helps explain why the state is looking at a $1 billion structural budget deficit in 2019 because these ongoing bills need to be paid.

So let's add up the unfunded property tax breaks that have been passed or proposed from the last 3 1/2 years, and look at what it'll cost us in a 2-year budget.

1. Forestry tax $181 million
2. Personal Property Tax $146 million
3. Tech Colleges $812 million
4. School Levy Credit $385.2 million
TOTAL $1,524.2 MILLION

Think we could fix a few roads (or at least not borrowed for them), eliminate the need for increased amounts of local sales and wheel taxes, and/or prevent tax-raising school referenda with $1.5 BILLION? And for what? Maybe $200 a year in lower property taxes (which can be written off on your federal and state taxes) while having to pay more in fees and other local taxes (many of which are not able to be written off)? Oh, and there's the lagging job growth and lower quality of life that has hit in the Age of Fitzwalkerstan as well. Doesn't sound like a good trade to me.


Remember that these are the same Republicans who cried crocodile tears from the day President Obama took office about "overspending" causing increases in US budget deficit, and some still are peddling that bullcrap with their calls for a new Constitutional Convention to require a "balanced budget." Well, whether WisGOP likes it or not, to balance budgets GOVERNMENTS NEED REVENUE TO PROVIDE SERVICES, and any small bump in the economy that might come from lower taxes is more than wiped out with the extra fees and cuts that have to be imposed to make the numbers balance.



It's a stupid fiscal strategy based entirely out of short-term thinking to trick voters into keeping the scam of "lower taxes for our donors, lower services and lower wages for normal people" going for another 2-year cycle of giveaways. This "spend on gimmicks, borrow and pray" method of budgeting will continue until we boot these GOPs out of office, and I don't want to wait for the train wreck that the next recession will give to this state's Kansas-like finances to see that change happen.