Wednesday, October 22nd, 2014

Walk-O-Meter

Freeze property taxes


“I want to lower the tax on employers, lower the tax on income, freeze property taxes and phase out retirement income taxes. States that have a lower tax burden have more jobs and better budgets, and its time Wisconsin was a better state to do business.”

Subjects: Taxes

Updates

Lawmakers followed Walker's lead -- and then he used veto to make measure permanent

The state Legislature largely went along with Gov. Scott Walker"s property-tax limits, which experts have described as a freeze with very limited loopholes.

Indeed, when the Legislature"s budget included efforts to loosen it a bit and include a sunset provision, so it would not be permanent, Walker vetoed those changes.

To be sure, property taxes won"t stay static, because communities that see property growth can still raise revenue equal to that growth, and the freeze is not airtight. Property tax collections are estimated to go up about 1 percent. But that"s not attributable, for the most part, to higher taxes on existing properties.

Based on the final budget, we"re moving this to Promise Kept.

Sources:

Milwaukee Journal Sentinel, "Walker signs budget bill, vetoes just 50 items,” June 26, 2011

WisPolitics.com, "Walker vetoes item on property taxes,” June 26, 2011

Interview with Fred Ammerman, section chief Transportation and Property Tax Relief, July 7, 2011

Property taxes aren’t frozen yet, but the ice is chilling

Wisconsin Gov. Scott Walker called for a property tax freeze on the 2010 campaign trail, one of several tax promises he made in his bid for governor.

In his first two-year budget, Walker included a tax-levy limit measure that includes what he called a property tax freeze on county and municipal governments.

The provision toughened a tax-levy limit that was already in place -- the main mechanism for the state to force local units of government to comply with a cap or a freeze.

The best description we found was from the Wisconsin Counties Association: "The Governor wants to set allowable levy increase for the next two years at 0 percent or the net increase in new construction, whichever is higher.”

The old cap allowed a 3 percent increase, according to the state"s Legislative Fiscal Bureau.

Major media and interest groups termed Walker"s proposal a tax "freeze” because of that harder cap.

Taxes could still go up slightly based on new construction, but that is an allowance for new tax base rather than increased taxation of the existing properties.

The fiscal bureau estimated the Walker-proposed limits would result in a tax increase of $23, or 0.8 percent, for a median value home on the bill that will go out in December 2011, the Journal Sentinel reported. The following year the increase on such a home would be $13, or 0.4 percent.

"The school revenue cap tightening -- with an actual reduction -- is certainly the most restrictive we have seen in the history of revenue limits,” said Todd Berry, president of the Wisconsin Taxpayers Alliance, a nonpartisan research organization. "The municipal and county revenue limits … are tighter than they have been since levy limits returned earlier in the decade.  And the levy freeze for technical colleges is, I believe, unprecedented.”

The freeze is moving through the Republican-controlled Legislature.

Walker may be well on his way to keeping this promise, but we can"t pass final judgment until a final bill is passed and signed.

For now, we label it In The Works.

Sources:

Wisconsin Department of Administration, budget overview

Wisconsin Counties Association, press release, May 9, 2011

Wisconsin Legislative Fiscal Bureau, paper on biennial budget, April 15, 2011

Milwaukee Journal Sentinel, "Tax bills for average home to rise less than 1% under Walker"s budget, April 16, 2011

Milwaukee Journal Sentinel, "Walker"s budget cuts would touch most Wisconsinites,” March 1, 2011