K-12 Tax, Referendum & Spending Climate: Tax base and government income decline

Dean Mosiman: As a result, Rhodes-Conway is implementing actions including a hiring freeze on all positions with exceptions for essential services, additional review and approval for seasonal hiring, and a halt to purchasing of all nonessential supplies and services in order to reduce spending in the $341 million operating budget for this year. The revised … Continue reading K-12 Tax, Referendum & Spending Climate: Tax base and government income decline

Commentary on the growth of redistributed Wisconsin K-12 tax & spending

David Blaska: Governor Evers vetoed another middle class tax cut this week. The bill that passed with bipartisan support in the Assembly last week would have: • Reduced nearly $250 million in income taxes for middle and lower income levels by increasing the sliding scale standard deduction by 13.2% for each filer. This would have resulted … Continue reading Commentary on the growth of redistributed Wisconsin K-12 tax & spending

Property Tax Explosion Stunts Chicago Real Estate Market

AK Thomson: Bryce Hill, research analyst at the independent Illinois Policy think-tank, says that the annual property-tax take in Cook County, which includes Chicago, increased 76 per cent more than median home values between 1996 and 2016. “Both the city and the state are wrestling with unbalanced budgets, massive amounts of pension debt, and limited … Continue reading Property Tax Explosion Stunts Chicago Real Estate Market

No, voucher schools haven’t raised property taxes by $1B since 2011

Eric Litke: Voucher schools are an ongoing point of contention in Wisconsin’s divided government, with Democratic Gov. Tony Evers even promising to tighten or end the decades-old program. The system, which uses taxpayer money to send low-income students to private schools, has been tweaked and debated but ultimately expanded under Republican control in recent years. … Continue reading No, voucher schools haven’t raised property taxes by $1B since 2011

K-12 Tax & Spending Climate: Ongoing Spending And Property Tax Growth….. Madison Plans Another 4.5% increase

Molly Beck: In April, 76 percent of the referendums to exceed revenue limits passed. That compares to a typical rate of about 50 percent in years prior. This represents a changing perception of the state’s support of public schools, said Todd Berry, president of the Wisconsin Taxpayers Alliance. “This reflects a shift in public opinion … Continue reading K-12 Tax & Spending Climate: Ongoing Spending And Property Tax Growth….. Madison Plans Another 4.5% increase

Property Tax Season: Comparing Madison Area Burdens in light of quarterly payments

The arrival of Thanksgiving means local homeowners will soon see their annual property tax bills. The chart below compares Madison area homes sold in 2012, ranging in price from $239,900 to $255,000 Tap to view a larger version. Excel. A Middleton home’s property tax burden is about 13% less than a similar property in Madison … Continue reading Property Tax Season: Comparing Madison Area Burdens in light of quarterly payments

K-12 Tax & Spending Climate: States Grapple With Unpopular Property Taxes; Madison Seeks Continue Annual Increases; Chicago to Fund Pension Deficits

Elaine S. Povich State Sen. David Argall thinks Pennsylvania’s law to fund schools with property taxes, which dates from the 1830s, has outlived its usefulness. He is pushing a bill that would eliminate property taxes levied by school districts and replace the revenue with higher state income and sales taxes. For the first time, his … Continue reading K-12 Tax & Spending Climate: States Grapple With Unpopular Property Taxes; Madison Seeks Continue Annual Increases; Chicago to Fund Pension Deficits

School Board Property Tax Increase Votes and State Politics

Chris Rickert

So I get why Burke was the only board member to vote against a tax-raising, 2013-2014 school district budget.
Still, just once I’d like to see a candidate throw caution to the wind and mount a data-based defense of good, if politically unwise, choices. If voters don’t buy it, well then they deserve what they get.
Burke explained her latest no vote on the budget last week by saying the district needs to consider whether salary increases for district residents are keeping up with school district tax increases.
To back up that concern, Burke provided me with a May 1 news release from the Bureau of Labor Statistics showing that in Dane County, residents saw a 3.9 percent drop in average weekly wages between the third quarter of 2011 and the third quarter of 2012.
I did a little more digging and found that wages also dropped by 0.1 percent between the second quarter of 2011 and the second quarter of 2012, and by 0.3 percent between the first quarters of 2012 and 2013.
Nevertheless, a broader view of the most recent available data suggests her concern is largely unfounded.
The BLS reported that wages were up 7.7 percent and 5.9 percent respectively, in the first and fourth quarters of last year – essentially wiping out, and then some, the wage decreases.
Plus, over the most recent 10 years for which data are available, personal income and per-capita income in Dane County rose, on an average annual basis, by 4.29 percent and 2.92 percent, respectively, according to the U.S. Bureau of Economic Analysis.
By contrast, next year’s school district budget raises taxes on the average homeowner by 2.5 percent, and over the past 10 years, the average annual school district tax increase has been 1.75 percent.
If anything, district tax increases aren’t keeping up with district residents’ ability to pay them.
Despite the old tax-and-spend myth frequently pinned on liberal Dane County, the school district isn’t unique, either, at least when it comes to Madison and county government.



Mr. Rickert neglects to mention the changing composition of Wisconsin K-12 tax revenue sources. Redistributed state tax dollars grew substantially during the past few decades. That growth has now largely stopped. Absent a serious look at our agrarian era school organizations and practices, property tax & spending growth are going up annually.

A Public Hearing on the Madison Schools’ Proposed 4.5% Property Tax Increase Monday, No Mention of Last Year’s Significant State Tax Dollar Funding Increase



More charts on Madison schools’ spending & property tax growth over the years, here.

Karen Rivedal:

The Madison School Board will hold a one-hour public hearing at 5 p.m. Monday on a preliminary $391 million budget proposal for the 2013-2014 school year, in the McDaniels Auditorium of the Doyle Administration Building at 545 W. Dayton St.
After the hearing, the board is to vote on the budget, which includes a $260.4 million property tax levy, increasing the tax bill on an average $230,831 Madison home by about $102. The board will take a final vote on the tax levy in October, after official state aid figures are known.

Related: Madison Schools’ 2013-2014 Budget Charts, Documents, Links, Background & Missing Numbers.
Finally, Rivedal’s article fails to mention this: Up, Down & Transparency: Madison Schools Received $11.8M more in State Tax Dollars last year, Local District Forecasts a Possible Reduction of $8.7M this Year. Local household income changes are unmentioned, as well (national data).
Much more on the 2013-2014 Madison schools’ budget, here.
A Middleton home paid $4,648.16 in 2012 while a Madison home paid 16% more, or $5,408.38. Local efforts to significantly increase property taxes may grow the gap with Middleton..
Rivedal’s article is unfortunately a classic “low information” piece. It would not take much effort to challenge the new Superintendent’s rhetoric on “state funding decline”. The prior year’s significant increase goes unmentioned.
Is it the State Journal’s policy to simply publish rhetoric without investigation?

Free dual enrollment is a big deal for many Roanoke students; Madison continues one size fits all approach

David Kaplan:

It’s now even easier and cheaper for local high school students to get a college education.
At a joint meeting between City Council, The Roanoke City School Board and Virginia Western the community college talked about it’s newest program.
Back in March, Virginia Western announced it’s waiving tuition for students taking dual enrollment classes.
Those are classes students can take in high school and earn college credit, but many students weren’t.
They can now.

Related: Obtaining credit for non Madison School District Courses has been an ongoing challenge. Perhaps this issue has faded away as past practices die? Madison’s non-diverse or homogeneous governance model inflicts numerous costs, from one size fits all curricula to growth in the ‘burbs accompanied by ever increasing property taxes on top of stagnant or declining income.

Madison’s Proposed Property Tax Increase: Additional links, notes and emails

I received a kind email from Madison School Board President Ed Hughes earlier today regarding the proposed property tax increase associated with the 2013-2014 District budget.
Ed’s email:

Jim —
Your comparison to the tax rates in Middleton is a bit misleading. The Middleton-Cross Plains school district that has a mill rate that is among the lowest in Dane County. I am attaching a table (.xls file) that shows the mill rates for the Dane County school districts. As you will see, Madison’s mill rate is lower than the county average, though higher than Middleton’s. (Middleton has property value/student that is about 10% higher than Madison, which helps explain the difference.)
The table also includes the expenses/student figures relied upon by DPI for purposes of calculating general state aid for the 2012-13 school year. You may be surprised to see that Madison’s per-student expenditures as measured for these purposes is among the lowest in Dane County. Madison’s cost/student expenditures went up in the recently-completed school year, for reasons I explain here: http://tinyurl.com/obd2wty
Ed

My followup email:
Hi Ed:
Thanks so much for taking the time to write and sending this along – including your helpful post.
I appreciate and will post this information.
That said, and as you surely know, “mill rate” is just one part of the tax & spending equation:
1. District spending growth driven by new programs, compensation & step increases, infinite campus, student population changes, open enrollment out/in,
2. ongoing “same service” governance, including Fund 80,
3. property tax base changes (see the great recession),
4. exempt properties (an issue in Madison) and
5. growth in other property taxes such as city, county and tech schools.
Homeowners see their “total” property taxes increasing annually, despite declining to flat income. Middleton’s 16% positive delta is material and not simply related to the “mill rate”.
Further, I continue to be surprised that the budget documents fail to include total spending. How are you evaluating this on a piecemeal basis without the topline number? – a number that seems to change every time a new document is discussed.
Finally, I would not be quite as concerned with the ongoing budget spaghetti if Madison’s spending were more typical for many districts along with improved reading results. We seem to be continuing the “same service” approach of spending more than most and delivering sub-par academic results for many students. (Note the recent expert review of the Madison schools Analysis: Madison School District has resources to close achievement gap.)
That is the issue for our community.
Best wishes,
Jim
Related: Middleton-Cross Plains’ $91,025,771 2012-2013 approved budget (1.1mb PDF) for 6,577 students, or $13,840.01 per student, roughly 4.7% less than Madison’s 2012-2013 spending.

A Look at Property Taxes Around the World and Madison’s 16% increase since 2007; Median Household Income Down 7.6%; Middleton’s 16% less





Sources:
Department of Numbers.
City of Madison Assessor Reports
Related:
August, 2006 (Deja-vu): Property Taxes Outstrip Income.
Budget Cuts: We Won’t Be as Bold and Innovative as Oconomowoc, and That’s Okay.
Madison Schools’ 2013-2014 Budget Charts, Documents, Links, Background & Missing Numbers.
Madison’s long-term disastrous reading results.
The Hated Property Tax: Salience, Tax Rates, and Tax Revolts.
Levying the Land.
Revenue Potential and Implementation
Challenges (IMF PDF)
.
Tax Policy Reform and Economic Growth (OECD).
Stagnant School Governance; Tax & Spending Growth and the “NSA’s European Adventure”.










Analysis: Madison School District has resources to close achievement gap.
A Middleton home paid $4,648.16 in 2012 while a Madison home paid 16% more, or $5,408.38. Local efforts to significantly increase property taxes may grow the gap with Middleton..

Communities Rebel Against Cuomo’s Cap on Local Property Taxes; Madison’s Property Taxes Flat this year after a 9% increase in 2010

The Madison School Board unanimously adopted the 2011-12 district budget and tax levy on Monday, saving the average Madison homeowner $2.74 over their 2010-11 property tax bill.
The $372 million budget requires the district to levy slightly more than $245 million in taxes, down 0.03 percent, or about $62,000, from last year’s levy.
The district gets more than $40 million in state funding and more than $10 million in federal funding. The rest of the budget gap is filled by student fees, special education funding and small-class-size funding, said Assistant Superintendent for Business Services Erik Kass.
Superintendent Dan Nerad’s $3.5 million spending recommendations were amended into the adopted budget, but Kass said $2.5 million of that amount was reallocated money that already was built into June’s preliminary budget.

Much more on the Madison School District’s 2011-2012 $372,000,000 budget, here.

K-12 Tax & Spending Climate: Report: Wisconsin taxes claim 12 percent of income

Scott Bauer:

Wisconsin taxes as a percentage of personal income are 12th highest nationwide and greater than any of its neighbors, according to a new report.
The Wisconsin Taxpayers Alliance report was based on U.S. Census Bureau data from 2007, the most recent year available.
While the tax burden has been steady in recent years, the president of the independent Wisconsin Taxpayers Alliance said Monday he expects it to get worse given recent tax increases and slowed growth in personal income.
During the earlier part of the decade, personal income in Wisconsin grew faster than the national average while taxes increased less, said Todd Berry, president of the alliance.
However, Wisconsin faced a record state budget shortfall this year as tax revenue took a dive during the recession. That resulted in the Legislature approving about $3 billion in tax increases to be collected by mid-2011. That doesn’t count local property taxes, which also are expected to increase by hundreds of millions of dollars.

2008 Madison Schools’ Referendum – Key Issues

1. Mortgage on future property with permanent increase: Asking taxpayers to refinance/mortgage their futures and that of the school district with a permanent increase of $13 million yearly for the operations budget. It has been stated the district needs the money to help keep current programs in place. It is expected that even after 3 years of this referendum totaling $27 million, the Board is projecting a continued revenue gap and will be back asking for even more.
2. No evaluation nor analysis of programs and services: The Board will make budget cuts affecting program and services, whether or not this referendum passes. The cuts will be made with no assessment/evaluation process or strategy for objective analyses of educational or business programs and services to determine the most effective and efficient use of money they already have as well as for the additional money they are asking with this referendum.
3. Inflated criteria for property value growth: The dollar impact on property to be taxed is projected on an inflated criteria of 4% growth in property valuation assessment; therefore, reducing the cost projection for the property tax levy. The growth for property valuation in 2007 was 3.2% and for 2008 it was 1.0%. Given the state of the economy and the housing market, the growth rate is expected to further decline in 2009. [10/13 Update: The above references to property valuation assessment growth are cited from City of Madison Assessor data. See ACE document “Watch List Report Card” [2008 Referendum Watch List 755K PDF] for State Department of Revenue citations for property valuation base and growth rate used for determination of MMSD property tax levy.]
4. No direct impact on student learning and classroom instruction: There is District acknowledgement of a serious achievement gap between low-income and minority student groups compared with others. There are no plans evident for changing how new or existing money will be spent differently in order to have an impact on improving student learning/achievement and instructional effectiveness.
5. Lack of verification of reduction in negative aid impact on taxes: District scenarios illustrating a drastic reduction in the negative impact on state aids from our property-rich district is unsubstantiated and unverified, as well as raising questions about unknown possible future unintended consequences. The illustrated reduction is from approximately 60% to 1% results by switching maintenance funds from the operations budget and 2005 referendum proceeds to a newly created “Capital Expansion Fund–Fund 41” account. [Update: 10/13: The reduction in the negative aid impact will take affect regardless of the outcome of the referendum vote. See the ACE document “Watch List Report Card” [2008 Referendum Watch List 755K PDF] for details.]

Wisconsin State Tax Based K-12 Spending Growth Far Exceeds University Funding

via WISTAX

WISTAX published a fascinating chart in their most recent issue of FOCUS [Page 1, Page 2]:

However, the state pledge to provide two-thirds of schools revenues in 1996-97 changed the budget landscape. By 2006-07, state-tax support for the UW System had almost doubled during Ihe 25 years prior. However, inflation (CPI, up 115%). school aids/credits (320%). and overall slate GPR expenditures (222%) rose more.

Related:

Further proof that there is no free lunch. The ongoing calls for additional state redistributed tax dollars for K-12 public education will likely have an effect on other programs, as this information illustrates. I do think that there should be a conversation on spending priorities.

“Bitter Medicine for Madison Schools”:
07/08 budget grows 3.6% from 333M (06/07) to $345M with Reductions in the Increase

Doug Erickson on the 2007/2008 $345M budget (up from $333M in 2006/2007) for 24,342 students): As feared by some parents, the recommendations also included a plan to consolidate schools on the city’s East Side. Marquette Elementary students would move to Lapham Elementary and Sherman Middle School students would be split between O’Keeffe and Black Hawk … Continue reading “Bitter Medicine for Madison Schools”:
07/08 budget grows 3.6% from 333M (06/07) to $345M with Reductions in the Increase

Property Tax Levies in Wisconsin #1 As a % of Home Values

Avram Lank: Property taxes in Wisconsin are the nation’s highest in proportion to the value of owner-occupied homes, according to a recent national study. hat is “nothing terribly new or earth-shaking,” said Todd A. Berry, president of the Wisconsin Taxpayers Alliance in Madison, who predicted the taxes still are too low to cause a fundamental … Continue reading Property Tax Levies in Wisconsin #1 As a % of Home Values

Wisconsin Tax Climate Update & Local Property Tax Levy Changes

Wisconsin State Journal Editorial: The first step toward improving the state’s tax climate must be for lawmakers to control spending. The state cannot afford to cut taxes and thus forgo revenue unless the next governor and Legislature do a better job of paring, consolidating and conserving. Even the promise that lower taxes will generate more … Continue reading Wisconsin Tax Climate Update & Local Property Tax Levy Changes

Fall Referendum Climate: Local Property Taxes & Income Growth

Voters evaluating the Madison School District’s November referendum (construct a new far west side elementary school, expand Leopold Elementary and refinance District debt) have much to consider. Phil Brinkman added to the mix Sunday noting that “total property taxes paid have grown at a faster pace than income”. A few days later, the US Census … Continue reading Fall Referendum Climate: Local Property Taxes & Income Growth

Nice Article on some Parenting Costs; Deeper Dive?

Natalie Yahr cites a University of Wisconsin Survey of families with young children. Conducted by the UW Survey Center and analyzed by UW-Madison’s La Follette School of Public Affairs, the survey went to around 3,500 people across the state. Researchers compared the responses of participants who have children under age 6 with those who don’t. … Continue reading Nice Article on some Parenting Costs; Deeper Dive?

Commentary on Wisconsin’s state tax burden (complete list, including fees?) to 2019

Wisconsin Policy Forum Since 2011, the state generally has restricted the percentage increase in municipal and county property taxes used for operations to a community’s rate of net new construction, which at the statewide level has been below 1.7% since 2008. The state has also limited revenues for school districts, including property taxes, and made … Continue reading Commentary on Wisconsin’s state tax burden (complete list, including fees?) to 2019

Wisconsin Governor Evers seeks to freeze voucher school enrollment and suspend charter school expansion

Molly Beck: He said in the Milwaukee program especially, enrollment freezes in private voucher schools would disproportionately affect children of color living in low-income households. “Most of our families don’t have the kind of income where they would have realistic choices,” he said at the time. Under Evers’ proposal, voucher schools also would be banned … Continue reading Wisconsin Governor Evers seeks to freeze voucher school enrollment and suspend charter school expansion

The typical male U.S. worker earned less in 2014 than in 1973

David Wessel: read that right: The median male worker who was employed year-round and full time earned less in 2014 than a similarly situated worker earned four decades ago. And those are the ones who had jobs. This one fact, tucked in Table A-4 of the Census Bureau’s annual report on income, is both a … Continue reading The typical male U.S. worker earned less in 2014 than in 1973

K-12 tax & spending climate: We borrow too much from the future at our peril

Peter Fisher: Why are central bankers so concerned with liquidity? Is this sympathy for the plight of the hard-working bond trader? It is more likely they wonder if the lofty asset prices they have engineered with quantitative easing can be sustained. By liquidity we mean our ability to sell an asset without material loss. In … Continue reading K-12 tax & spending climate: We borrow too much from the future at our peril

K-12 Tax & Spending Climate: Fed Policy May Have Widened America’s Wealth Inequality, Philadelphia Fed Paper Says

Pedro Nicolaci Di Costa: Federal Reserve policies launched in a historic economic slump may have exacerbated wealth disparities in the U.S., according to new research from the Philadelphia Fed. “Monetary policy currently implemented by the Federal Reserve and other major central banks is not intended to benefit one segment of the population at the expense … Continue reading K-12 Tax & Spending Climate: Fed Policy May Have Widened America’s Wealth Inequality, Philadelphia Fed Paper Says

Wisconsin school spending grew 10.2% during 2008-11, compared to 2.9% nationally, according to newly available Census figures

Wistax:

Despite cuts to state school aid in 2010, and slower growth of school revenue limits in 2010 and 2011, Wisconsin per student spending increased 2.6% in 2010 and 3.6% in 2011. Wisconsin school spending averaged $11,774 per student in 2011, 15th highest nationally and 11.5% above the national average ($10,560).
What is not yet known (since federal data have a two year lag) is how Wisconsin will stack up with other states in light of state budget actions in 2011-13. However, researchers from the Wisconsin Taxpayers Alliance (WISTAX) estimate that the 5.5% cut in 2012 Wisconsin school revenue limits will trim spending to $11,126 per student, potentially shrinking the gap between school spending here and nationally. WISTAX is a nonpartisan, nonprofit research organization dedicated to policy research and citizen education.
The new federal figures for 2011 show that, unlike Wisconsin, many states saw declining combined aid (state and federal) to schools during 2009-11; 11 states in 2009, 17 in 2010, and 22 in 2011. By contrast, state-federal support in Wisconsin rose 3.3% in 2009, 0.4% in 2010, and 2.7% in 2011.
The difference in aid trends between Wisconsin and the nation was reflected in per pupil expenditures. U.S. school spending grew 2.3% in 2009 and 1.1% in 2010, before falling 0.5% in 2011. In Wisconsin, however, per student spending during those years rose 3.7%, 2.6%, and 3.6%, respectively.
Many states trimmed school spending during 2009-11. Two states made cuts in all three years, and another seven cut spending in both 2010 and 2011. As national figures have already suggested, retrenchment did not occur in Wisconsin until 2012.

Related: A Look at Property Taxes Around the World and Madison’s 16% increase since 2007; Median Household Income Down 7.6%; Middleton’s 16% less and Madison School Board Passes 2013-2014 Budget, including a 4.5% Property Tax Increase.

Daytona State, school districts reach agreements on dual enrollment

Daytona Times:

As opening days for fall classes draw near, agreements in support of dual enrollment have been reached between Daytona State College and Volusia and Flagler school districts.
The college’s District Board of Trustees on Aug. 13 approved agreements to cover the majority of the schools’ costs for services associated with dual enrollment in 2013-14.
The Volusia and Flagler school boards will vote on the agreements in upcoming weeks.
Dual enrollment provides college-credit classes on Daytona State campuses, giving college-bound students a head start on their higher education, at no cost to them.

Related:Obtaining credit for non Madison School District Courses has been an ongoing challeng. Perhaps this issue has faded away as past practices die? Madison’snon-diverse or homogeneous governance model inflictsnumerous cost, fromone size fits all curricula to growth in the ‘burbs accompanied byever increasing property taxes on top of stagnant or declining income.

Superintendent Comments on Wisconsin School Budgets

Susan Troller:

In his rural district, which serves 249 students, the 2011-13 state budget has been nothing to celebrate. In fact, it has accelerated a difficult process of belt-tightening that’s been going on for almost 20 years due to revenue controls that have limited the amount districts can increase taxes to keep up with rising costs. The revenue controls hit some schools especially hard, especially those with declining enrollment, high-needs students or high property values. The new state budget’s huge reduction in overall aid for schools — $793 million over the biennium — accompanied by new limits on how much money districts can raise in property taxes to offset those losses — has, for many school districts, made a bad situation worse.
According to Quinton, Pepin parents are supportive of education, and he credits his School Board and staff for helping run “a tight financial ship.” Nonetheless, many of the district’s programs and services have been trimmed once again, from transportation to teaching staff, athletics to academic assistance for at-risk students. Paring back has been a way of life in Pepin for many years, Quinton says, but the newest round of losses caused by this budget cut to the bone.

Related:

Wisconsin State Tax Based K-12 Spending Growth Far Exceeds University Funding and K-12 Tax & Spending Climate: Wisconsin State and Local Debt Rose Faster Than Federal Debt During 1990-2009 Average Annual Increase in State Debt, 7.8%; Local Debt, 7.3%
Wisconsin’s essential challenge is to grow the economy. We’ve been falling behind Minnesota for decades.
Siobhan Hughes:

The U.S. economy will have another big budget deficit in fiscal 2011 and faces at least a couple more years of sluggish growth, as the effects of the recent recession persist, government forecasters said Wednesday.
The Congressional Budget Office projected a deficit of almost $1.3 trillion for fiscal 2011. Though that will mark the third straight year of deficits above $1 trillion, the deficit forecast was a slight improvement from the almost $1.4 trillion estimated in an April analysis and reflected higher-than-anticipated revenue from individual income taxes.
The outlook for the U.S. economy also remains challenging, with growth expected to remain too slow this year and next year to make a big dent in the unemployment rate. The jobless rate will fall to 8.9% by the end of calendar 2011 and 8.5% by the end of 2012, the forecast said, as the economy grows by 2.3% this year and 2.7% next year, measured from fourth quarter to fourth quarter.

Federal Tax Receipts Decline 18%, Dane County (WI) Tax Delinquencies Grow

Stephen Ohlemacher:

The recession is starving the government of tax revenue, just as the president and Congress are piling a major expansion of health care and other programs on the nation’s plate and struggling to find money to pay the tab.
The numbers could hardly be more stark: Tax receipts are on pace to drop 18 percent this year, the biggest single-year decline since the Great Depression, while the federal deficit balloons to a record $1.8 trillion.
Other figures in an Associated Press analysis underscore the recession’s impact: Individual income tax receipts are down 22 percent from a year ago. Corporate income taxes are down 57 percent. Social Security tax receipts could drop for only the second time since 1940, and Medicare taxes are on pace to drop for only the third time ever.
The last time the government’s revenues were this bleak, the year was 1932 in the midst of the Depression.
“Our tax system is already inadequate to support the promises our government has made,” said Eugene Steuerle, a former Treasury Department official in the Reagan administration who is now vice president of the Peter G. Peterson Foundation.

Channel3000.com recently spoke with Dane County Treasurer Dave Worzala on the growing property tax delinquencies:

While there aren’t any figures for this year, property tax delinquencies have been on a steep climb the last few years, WISC-TV reported.
Delinquencies increased 11 percent in 2006, 34 percent in 2007 and 45 percent in 2008, where there is now more than $16 million in unpaid taxes in the county.
“It affects us in that we have to be sure that we have enough resources to cover county operations throughout the year even though those funds aren’t here. And we do that, we are able to do that, but 40 percent increases over time become unsustainable,” said Dane County Treasurer David Worzala.
“I can see that there are probably some people that either lost their jobs or were laid off, they’re going to have a harder time paying their taxes,” said Ken Baldinus, who was paying his taxes Thursday. “But I’m retired, so we budget as we go.”
Big portions of those bills must go to school districts and the state. Worzala said the county is concerned about the rise in delinquencies because if the jumps continue the county could run into a cash flow issue in paying bills.

Resolution of the Madison School DistrictMadison Teachers, Inc. contract and the District’s $12M budget deficit will be a challenge in light of the declining tax base. Having said that, local schools have seen annual revenue increases for decades, largely through redistributed state and to a degree federal tax dollars (not as much as some would like) despite flat enrollment. That growth has stopped with the decline in State tax receipts and expenditures. Madison School District revenues are also affected by the growth in outbound open enrollment (ie, every student that leaves costs the organization money, conversely, programs that might attract students would, potentially, generate more revenues).

Referendum Climate: A Look at the US Government Budget

.

NY Times Graphics.
Related:

Further proof that there is no free lunch. The ongoing calls for additional state redistributed tax dollars for K-12 public education will likely have an effect on other programs, as this information illustrates. I do think that there should be a conversation on spending priorities.

The current financial system “crisis” presents parents with an excellent opportunity to chat with our children about money, banks, politics and taxes (When you deposit the baby sitting money, where does it go? What happens if the funds are no longer in the bank?). It is a rather potent mix. Much more, here.

School Board to Focus on Money

Andy Hall:


In the first major test for newly hired Superintendent Daniel Nerad, Madison school officials this week will begin public discussions of whether to ask voters for additional money to head off a potentially “catastrophic” $8.2 million budget gap for the 2009-10 school year.
The Madison School Board’s meetings in August will be dominated by talk of the possible referendum, which could appear on the Nov. 4 ballot.
The public will be invited to speak out at forums on Aug. 12 and 14.

Related:

Props to the District for finding a reduced spending increase of $1,000,000 and looking for more (The same service budget growth, given teacher contract and other increases vs budget growth limits results in the “gap” referred to in Hall’s article above). Happily, Monday evening’s referendum discussion included a brief mention of revisiting the now many years old “same service” budget approach (28mb mp3, about 30 minutes). A question was also raised about attracting students (MMSD enrollment has been flat for years). Student growth means additional tax and spending authority for the school district.
The Madison school board has been far more actively involved in financial issues recently. Matters such as the MMSD’s declining equity (and related structural deficit) have been publicly discussed. A very useful “citizen’s budget” document was created for the 2006-2007 ($333M) and 2007-2008 ($339M) (though the final 2007-2008 number was apparently $365M) budgets. Keeping track of changes year to year is not a small challenge.

Media Education Coverage: An Oxymoron?

Lucy Mathiak’s recent comments regarding the lack of substantive local media education coverage inspired a Mitch Henck discussion (actually rant) [15MB mp3 audio file]. Henck notes that the fault lies with us, the (mostly non) voting public. Apathy certainly reigns. A useful example is Monday’s School Board’s 56 minute $367,806,712 2008/2009 budget discussion. The brief chat included these topics:

  • Retiring Superintendent Art Rainwater’s view on the District’s structural deficit and the decline in it’s equity (Assets – Liabilities = Equity; Britannica on the The Balance Sheet) from $48,000,000 in the year 2000 to $24,000,000 in 2006 (it is now about 8% of the budget or $20M). (See Lawrie Kobza’s discussion of this issue in November, 2006. Lawrie spent a great deal of time digging into and disclosing the structural deficits.) Art also mentioned the resulting downgrade in the District’s bond rating (results in somewhat higher interest rates).
  • Marj asked an interesting question about the K-1 combination and staff scheduling vis a vis the present Teacher Union Contract.
  • Lucy asked about specials scheduling (about 17 minutes).
  • Maya asked about the combined K-1 Art classes (“Class and a half” art and music) and whether we are losing instructional minutes. She advocated for being “open and honest with the public” about this change. Art responded (23 minutes) vociferously about the reduction in services, the necessity for the community to vote yes on operating referendums, ACT scores and National Merit Scholars.
  • Beth mentioned (about 30 minutes) that “the district has done amazing things with less resources”. She also discussed teacher tools, curriculum and information sharing.
  • Ed Hughes (about 37 minutes) asked about the Madison Family Literacy initiative at Leopold and Northport. Lucy inquired about Fund 80 support for this project.
  • Maya later inquired (45 minutes) about a possible increase in Wisconsin DPI’s common school fund for libraries and left over Title 1 funds supporting future staff costs rather than professional development.
  • Beth (about 48 minutes) advocated accelerated computer deployments to the schools. Lucy followed up and asked about the District’s installation schedule. Johnny followed up on this matter with a question regarding the most recent maintenance referendum which included $500,000 annually for technology.
  • Lucy discussed (52 minutes) contingency funds for energy costs as well as providing some discretion for incoming superintendent Dan Nerad.

Rick Berg notes that some homes are selling below assessed value, which will affect the local tax base (property taxes for schools) and potential referendums:

But the marketplace will ultimately expose any gaps between assessment and true market value. And that could force local governments to choose between reducing spending (not likely) and hiking the mill rate (more likely) to make up for the decreasing value of real estate.
Pity the poor homeowners who see the value of their home fall 10%, 20% or even 30% with no corresponding savings in their property tax bill, or, worse yet, their tax bill goes up! Therein lie the seeds of a genuine taxpayer revolt. Brace yourselves. It’s gonna be a rough ride.

The Wisconsin Department of Revenue noted recently that Wisconsin state tax collections are up 2.3% year to date [136K PDF]. Redistributed state tax dollars represented 17.2% of the District’s revenues in 2005 (via the Citizen’s Budget).
Daniel de Vise dives into Montgomery County, Maryland’s school budget:

The budget for Montgomery County’s public schools has doubled in 10 years, a massive investment in smaller classes, better-paid teachers and specialized programs to serve growing ranks of low-income and immigrant children.
That era might be coming to an end. The County Council will adopt an education budget this month that provides the smallest year-to-year increase in a decade for public schools. County Executive Isiah Leggett (D) has recommended trimming $51 million from the $2.11 billion spending plan submitted by the Board of Education.
County leaders say the budget can no longer keep up with the spending pace of Superintendent Jerry D. Weast, who has overseen a billion-dollar expansion since his arrival in 1999. Weast has reduced elementary class sizes, expanded preschool and kindergarten programs and invested heavily in the high-poverty area of the county known around his office as the Red Zone.
“Laudable goals, objectives, nobody’s going to argue with that,” Leggett said in a recent interview at his Rockville office. “But is it affordable?”
It’s a question being asked of every department in a county whose overall budget has swelled from $2.1 billion in fiscal 1998 to $4.3 billion this year, a growth rate Leggett terms “unacceptable.”

Montgomery County enrolls 137,745 students and spent $2,100,000,000 this year ($15,245/student). Madison’s spending has grown about 50% from 1998 ($245,131,022) to 2008 ($367,806,712) while enrollment has declined slightly from 25,132 to 24,268 ($13,997/student).
I’ve not seen any local media coverage of the District’s budget this week.
Thanks to a reader for sending this in.
Oxymoron

Schools’ Use of Community Levy up

Amy Hetzner:

Local school districts continued to turn to the unrestricted community service levy this school year, boosting taxes paid to the fund by 10%, almost twice the increase in their total property tax income.
For the 2007-’08 school year, the 60 public school districts in the five-county metro Milwaukee area plan to raise nearly $22.6 million through the community service levy, which has grown rapidly since the state Legislature removed it from under revenue caps seven years ago.
Statewide, school systems will receive about $66.6 million in community service funds through property tax increases this school year, according to information from the state Department of Public Instruction. That compares with just over $17 million raised by Wisconsin school districts for community service activities in 2000-’01, the first year the fund came out from under the state revenue controls.
When legislators first removed community service activities from under the strictures of revenue caps, they said they did so because school districts that run recreational departments for their communities should not be forced to cut educational services to fund outside activities.

Tax and spending growth in Madison’s Fund 80 has also been controversial.

School Finance: K-12 Tax & Spending Climate

School spending has always been a puzzle, both from a state and federal government perspective as well as local property taxpayers. In an effort to shed some light on the vagaries of K-12 finance, I’ve summarized below a number of local, state and federal articles and links. The 2007 Statistical Abstract offers a great deal … Continue reading School Finance: K-12 Tax & Spending Climate

Tax Climate Notes & Links

The arrival of local property tax bills signal the onset of tax season. Accordingly, there has been a number of recent articles on Wisconsin’s tax climate: Barbara Miner: More than 16,000 private properties in Wisconsin pay no property taxes. As a result, everyone else pays more. Why? In Milwaukee, for instance, almost 20 percent of … Continue reading Tax Climate Notes & Links

Community service levies climb since cap lifted

Five years after state legislators released them from state-imposed revenue caps, school districts’ community service tax levies have nearly tripled, reaching $49 million this year. The rampant growth in these property taxes – earmarked for community-based activities – took place as the total levies for schools statewide rose by 22.7%. That has raised concerns about … Continue reading Community service levies climb since cap lifted