WisGOPs chose lower prop taxes vs helping schools + communities. Dems should ask "why not both"?

Now that the Joint Finance Committee has pushed through the WisGOPs' version of a state budget, it's time for the Legislative Fiscal Bureau to release their reports that tell us where we stand as the full Legislature plans to vote on the document next week. One of these traditional reports from the LFB deals with what would happen to property taxes under current law, and compare it to what Gov Evers had in his budget, as well as the WisGOP budget. One key part of JFC's changes was to drop property taxes by a significant amount through a few methods.

The Joint Finance Committee modified a number of the Governor's provisions affecting property tax levels. For counties and municipalities, modifications included deleting the Governor's recommended changes to county and municipal levy limits. The Committee also included a reestimate of the current law lottery fund condition to reflect higher projected lottery sales during the biennium, as well as a higher opening balance in 2021-22. As a result, an additional $75.9 million in 2021-22 and $29.8 million in 2022-23 is available for property tax relief through the current law lottery and gaming credit, compared to estimates under AB 68/SB 111. For school districts, modifications included deleting the Governor's recommended changes to the revenue limits. The Committee increased base funding for general school aids by $110.0 million in 2021-22 and by $298.0 million in 2022-23. The Committee also deleted the general school aid reduction associated with certain independent charter schools, which would increase the net general aid payments to districts and reduce the gross school levy by an estimated $82.8 million in 2021-22 and $83.9 million in 2022-23. In total, the Committee's actions would reduce school levies by $192.8 million in 2021(22) and by $381.9 million in 2022(23), compared to current law, which would represent reductions of $147.8 million in 2021-22 and $326.9 million in 2022-23 from the Governor. In addition, the Committee also increased property tax relief aid to technical colleges by $29.0 million in 2021-22 and by $43.0 million in 2022-23, which would reduce their levies by an equal amount each year.

All of these moves will result in a notable drop in property taxes for the typical Wisconsin homeowner.

As a result of the preceding changes, gross property tax levies are estimated to increase on a statewide basis by 0.3% in 2021(22) and by 0.5% in 2022(23), and net tax levies would decrease by an estimated 0.7% in 2021(22) and increase by 1.2% in 2022(23). These tax changes would result in tax bills for a median-valued home estimated at $3,214 in 2021(22) and $3,246 in 2022(23). These represent a decrease of $101 (3.0%) in 2021(22) and an increase of $32 (1.0%) in 2022(23). Compared to estimated tax bills under AB 68/SB 111, these tax bills would result in a decrease in the estimated tax bill of $72 (2.2%) in 2021(22) and $135 (4.0%) in 2022(23).

None of this is surprising, as the GOPs on Joint Finance chose to use the billions in excess state money to cut property taxes vs allowing K-12 schools and the state’s Tech Colleges to use the added resources in the classroom and on fixing buildings. The WisGOPs will argue that federal stimulus funds can make up the difference for the next two years, but as I noted earlier this week, for many districts, this isn't the case.

While the LFB says that property taxes going to education are slated to drop by nearly $150 million next year under the WisGOP budget, all other local governments are slated to have their property taxes continue to rise. So total property taxes paid in Wisconsin won't end up being that different, although increased properties allows for a lower tax bill to individuals.

I find it odd that WisGOPs had no problem with replacing property taxes with state aid when it came to education, but they did little to add shared revenues for cities, villages, towns or counties, which means those places are going to have to tap property taxes to maintain their level of services. WisGOPs could have gone along with Gov Evers’ plan to allow these communities to put in their own sales tax, and not even had to send another dime in state tax dollars in order to get property taxes lower. But they didn't choose to do that.

So WisGOPs really aren’t using this surplus as an opportunity to lead a reform away from property taxes as a method of funding Wisconsin’s schools and local governments, they just want a tax-cut gimmick to run on in 2022. With that in mind, I’d say Evers and WisDems should take the next step, and say that we should be going away from property taxes in general.

We can do that by having the rich and corporate, who have gotten tax break after tax break at the state and local levels throughout the last decade, start paying more of the burden instead of the typical Wisconsin homeowners. Especially now that it isn't worth it for many Wisconsinites to write off their property taxes anymore, due to the GOP Tax Scam!

The advice is worth what you paid for it, WisDems. But I think a message of lower property taxes combined with better funding of schools/communities is a winner. And yes, we can do both if we choose.