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December 23, 2006

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 change in state policy.

The study results are "a combination of two things," Berry said. "We are a higher property tax state . . . (and) our median home value is lower. Put those together, and it is going to push us up."

The Tax Foundation [Gerald Prante]:
No tax riles the American people more than property taxes, especially real estate taxes that are based on the value of their homes and land. According to a recent Tax Foundation poll, property taxes are thought to be the least “fair” of all state and local taxes.

Most likely, part of the reason for this loathing is that taxpayers are more acutely aware of what property taxes cost them than they are of income, payroll, corporate, or sales taxes. Sometimes, property taxes are paid into an escrow account without much personal attention from the taxpayer, but often property taxes involve the actual writing of a huge check to the local government.

Key Findings:

  • Property taxes highest in the Northeast, Texas, Illinois, and Wisconsin
  • New York and New Jersey dominate list of high-tax counties
  • About half of all property taxes go to public schools
  • Property taxes rose faster than incomes from 2002 to 2004
  • Housing market decline may force local governments to cut spending or raise property tax rates
Prante's last point regarding the relationship between changes in the housing market, tax assessments and rates is an important factor to watch. Madison has experienced substantial housing growth (and therefore parcel quantity and values) over the past decade. If/when that changes, there will be some blowback with respect to assessments, millrates and the net taxes we pay.

Add the Madison School District's recently revealed 7 year structural deficit, the subsequent need to reduce the annual school district spending increases in it's current $333M+ budget by a larger than normal amount and we have a rather challenging school spending environment. Complete report: 409K PDF

Posted by Jim Zellmer at December 23, 2006 7:10 AM
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