Kicking the Spending Can
Governor Jim Doyle has very flexible shoulders.
He must, considering how much he’s been patting himself on the back lately.
The source of his pride: property taxes, which have grown at a historically-slow rate this year, thanks (according to him) to his property tax “freeze.”
He says property taxes are up by only 0.8% statewide. The Wisconsin Taxpayers Alliance says it’s more like 2%, which is still about half the average annual increase of the last 10 years.
A lower-than-average statewide increase, but that doesn’t mean everyone got a nice surprise in their property tax bills this year. There are wide disparities of increases and decreases in individual tax bills. Some are much smaller, others much bigger, still others unchanged.
This is to be expected – local conditions mean a lot to our property tax bills. But even if your bill is lower than last year, don’t be too pleased. It’s not going to last.
We have to keep several things in mind. First, our state government paid for the “freeze” by playing games with taxpayer money. The recently-passed state budget shifts $427 million from the Transportation Fund, and makes up the hole with greater borrowing.
Then, Governor Doyle uses that money to spend $330 million more on schools – this “buys down” property taxes. The dirty little secrets: it all comes from the same place: the taxpayers. And it will cost the taxpayers even more in the long run.
Second, many local governments are enacting new “fees,” like the Rain Tax, to generate more revenues. In many cases, these new fees are offsetting and surpassing any decreases in property taxes.
Third: even the success of holding statewide property taxes to a 2% increase won’t last.
As the Wisconsin State Journal’s Scott Milfred writes:
“…smaller property tax increases during or soon after an election year inevitably lead to larger property tax increases.”
For example, after school revenue caps were put into place in 1993, property tax growth slowed for four years, and even fell for one of those years. But then:
“After that, property taxes grew faster again. The levy increase was more than 4.5 percent during six out of the next seven years, and as high as nearly 10 percent in 2001.”
That’s what will happen in this case, too. The “freeze” is only law for two years. After that, property taxes will begin to rise again, possibly even faster than they would have without the “freeze,” as local governments try to “make up for” the frozen years.
Bottom line: this is the same old, same old. Higher taxes (in the form of higher “fees”), accounting tricks, and kicking the problem – government spending that grows faster than our ability to pay – down the road for another budget to solve.
All the things Governor Doyle and the Legislature promised to stop two years ago. And people are surprised when I vote against the budget every two years.
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Lasee’s Notes is a weekly column by Representative Frank Lasee, 2nd Assembly District, covering events in the Legislature and statewide.
He must, considering how much he’s been patting himself on the back lately.
The source of his pride: property taxes, which have grown at a historically-slow rate this year, thanks (according to him) to his property tax “freeze.”
He says property taxes are up by only 0.8% statewide. The Wisconsin Taxpayers Alliance says it’s more like 2%, which is still about half the average annual increase of the last 10 years.
A lower-than-average statewide increase, but that doesn’t mean everyone got a nice surprise in their property tax bills this year. There are wide disparities of increases and decreases in individual tax bills. Some are much smaller, others much bigger, still others unchanged.
This is to be expected – local conditions mean a lot to our property tax bills. But even if your bill is lower than last year, don’t be too pleased. It’s not going to last.
We have to keep several things in mind. First, our state government paid for the “freeze” by playing games with taxpayer money. The recently-passed state budget shifts $427 million from the Transportation Fund, and makes up the hole with greater borrowing.
Then, Governor Doyle uses that money to spend $330 million more on schools – this “buys down” property taxes. The dirty little secrets: it all comes from the same place: the taxpayers. And it will cost the taxpayers even more in the long run.
Second, many local governments are enacting new “fees,” like the Rain Tax, to generate more revenues. In many cases, these new fees are offsetting and surpassing any decreases in property taxes.
Third: even the success of holding statewide property taxes to a 2% increase won’t last.
As the Wisconsin State Journal’s Scott Milfred writes:
“…smaller property tax increases during or soon after an election year inevitably lead to larger property tax increases.”
For example, after school revenue caps were put into place in 1993, property tax growth slowed for four years, and even fell for one of those years. But then:
“After that, property taxes grew faster again. The levy increase was more than 4.5 percent during six out of the next seven years, and as high as nearly 10 percent in 2001.”
That’s what will happen in this case, too. The “freeze” is only law for two years. After that, property taxes will begin to rise again, possibly even faster than they would have without the “freeze,” as local governments try to “make up for” the frozen years.
Bottom line: this is the same old, same old. Higher taxes (in the form of higher “fees”), accounting tricks, and kicking the problem – government spending that grows faster than our ability to pay – down the road for another budget to solve.
All the things Governor Doyle and the Legislature promised to stop two years ago. And people are surprised when I vote against the budget every two years.
------------------------------------------------------------------------------------
Lasee’s Notes is a weekly column by Representative Frank Lasee, 2nd Assembly District, covering events in the Legislature and statewide.
posted by John Q Cheesehead | 10:43 AM
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