K-12 property taxes go way up in Wisconsin. And it's gotta be fixed

It’s December, so that means property tax bills are out in Wisconsin. And ours are especially big here in the Capitol City.

You dig into the Wisconsin Policy Forum report, and it says this is the largest property tax increases for schools that we have had in decades.

Property tax levies for all Wisconsin K-12 school districts combined are expected to rise by about $476.1 million to $6.58 billion on December tax bills, according to preliminary data from the Wisconsin Department of Revenue (DOR).

This would be the largest percentage increase since 1992 to these gross tax levies, which account for nearly half of all property taxes statewide. It also would be a significant bump from last year’s 5.7% statewide school levy increase, which at the time was the biggest annual increase since 2009…..

Typically, a portion of the per pupil revenue limit increase is covered by rising state general school aids. Our previous research details the interaction between per pupil revenue limits and property taxes. Nearly every two-year budget over the past two decades has included at least one annual increase in general school aids, a form of aid that is distributed to school districts based on factors including property values, spending, and enrollment. This time, state leaders instead kept the funding for these payments flat, leaving property taxes as the sole means by which school districts collectively could access the allowed $325 per student increase.

And without help from the state and with costs still rising due to inflation, the Policy Forum says that property taxes for K-12 schools are jumping by nearly 8% for this year, while other municipalities have increases in line with recent years.

I still have a mailing in my office from the Wisconsin Realtors Association from this Summer that pleaded with the GOP Legislature to add funds to K-12 public schools to keep this from happening.

So let’s see if the typically right-wing Realtors go after WisGOPs next Fall for not doing so and causing much of the large increase in property taxes that Wisconsin homeowners are now having to pay.

If you want to check what changed with state aid for your district, click right here.

In Madison's case, that district had a reduction of $11.94 milion in state aid vs 2024-25 - a loss of 19.5%. That throws even more costs onto the property tax, above and beyond any referendum. But then combining it with this being the first year of the referendum's increased revenue limit and the large enrollment in the district, and the property tax increase for Madison schools is by far the largest in the state.

There is one type of K-12 schooling that Republicans have had no problem funding in the 14 years they have been in control of the State Legislature. And this latest budget continues to increase voucher payments from the state even as General Aids for public schools were passed over.

The Policy Forum report mentions how this increase in voucher payments also raises your public school’s property taxes.

One additional factor that contributed to the tax increases was the growth in enrollment and payments for private school choice programs. Under the state’s complex K-12 funding system, growth in publicly funded private school enrollment can contribute to property tax increases. In addition, the 2025-27 state budget raised the amount paid per enrolled student in these programs, further increasing their impact.

That’s because vouchers for kids that live outside of Milwaukee are funded by taking money away from the public school district that the kid lives in – even if the child never attended a day of public school. For Madison schools, this led to a reduction of $6.6 million in state aid. In Wauwatosa, which had a 34% increase in its tax levy after two referendums passed in 2024, vouchers cut $1.58 million for this year. And in Beloit, whose school tax levy went from $5.6 million to $16.2 million this year, they had a double-whammy, where General Aids went down by $9.8 million, and vouchers cut another $1.76 million.

Losing some potential students to vouchers isn’t going to cause a current facility to be sold off or generally any kind of reduction in staff – especially if those kids never attended public schools in the first place. But it does cost them money, so in order to keep the same amount of resources going to provide the education that public K-12 students are required to have, that voucher takeaway raises property taxes.

My suggestion for any Dem running for office in 2026 is to campaign on getting rid of that reduction in aid that vouchers require. If we’re going to have two publicly funded education systems, then let’s pay the full amounts for those two systems. We already do this for kids in Milwaukee, by the way. Doing so statewide would allow for another shift away from property taxes being used for K-12 education, and state tax dollars paying for them instead.

In addition to using more state aid to pay for school expenses and getting rid of the voucher takeaway of aid instead of offloading both those items onto property taxes, I have another idea for property tax relief. Why not an up-front $300 rebate that could be passed into law and sent to homeowners in early 2026. This would could essentially be an increase in the tax credit for property taxes and rent that already exists, but hasn’t been boosted since 2000.

As the Legislative Fiscal Bureau noted this Spring, this property tax credit is limited to $300, and only applies to the first $2,500 in property taxes a homeowners pays, or $1,500 in rent paid. The LFB says that doesn’t account for anywhere near as much today, given what’s happened to housing prices and the amount of property taxes paid.

Proponents of enhancing the PTRC might argue that the credit targets individuals who pay property taxes (or the rent equivalent) more effectively than other modes of property tax relief (such as the school levy credit) that also benefit commercial properties. If the $2,500 maximum property tax amount eligible for the credit had been adjusted annually for inflation since 2000, the value would be $4,770 in tax year 2025 (implying a maximum credit of $572) and estimated at $4,900 in tax year 2026 (a maximum credit of $588). Setting the maximum allowable property taxes at these levels would decrease estimated individual income tax collections by $228.6 million in 2025-26 and $245.7 million in 2026-27

Why not make it easier and double up the credit limit to $600 for property taxes? I would think a whole lot of Wisconsinites pay $5,000 or more in property taxes these days, which would put the price tag around…$255 million a year? Not a small amount to be sure, but we just cut income taxes by $323 million for this year in the last budget, and cut taxes on retirees’ income by $395 million for this year (retirees who already didn’t pay state income tax on Social Security as well as some IRA/401K income and military retirement benefits, by the way).

Given that our surplus is projected to dwindle away, we would need to figure out a way to pay for the $255 million in boosting the property tax and renters’ credit and/or the $600 million a year in general aids that was part of Evers’ budget for 2025-27 that the LFB said would have limited this year’s K-12 property tax levy increase to 1.6% instead of the nearly 8% we got.

But there are plenty of ways to do that, and Evers had a few of those as part of the state budget. That includes limiting the Manufacturers and Agriculture writeoff to $300,000 (around $395 million a year), stopping a write-off for capital gains for individuals making $400,000 or more and couples making $533,000 or more (around $210 million a year), or legalizing marijuana and making taxes on vape products be based on prices vs volume ($83 million a year). Or it could be as simple as taxing people making $1 million or more at a higher rate ($650 million a year).

There are many ways to pay for it, and it seems like this is a great time to advocate moving K-12 school costs off of the property tax and onto the state side. The Waler/GOP-imposed system of “constrain district resources and cause referendums” isn’t working, and it was why I voted against the boost in operational limits for both the City and School District here in Madison in 2024. School financing needs wider reforms instead of band aids, and while my wife and I will grumble but still be able to afford the additional $1,500 in property taxes this year, other people are going to find that higher bill along with jacked-up health care and food costs to be a burden they can’t put up with this Winter.