Public Policy Forum Blog

Region’s property tax levies increase only minimally in 2014

A Public Policy Forum analysis of property values and property taxes in southeast Wisconsin – released this morning – finds that in the aggregate, local governments, school districts, and other taxing entities in southeast Wisconsin levied only 0.2% more in property taxes for 2014 than they did in 2013. This year’s small increase – combined with last year’s growth of 1% and a decline in 2012 of 0.3% – means that the average property owner in the region has seen little change in his or her property tax bill in the past three years.

The report is an annual publication that measures trends in property values – one of the region’s most critical indicators of economic health – and examines how they impact the capacity of local governments and school districts to raise revenues. 

The slight increase in overall levies was accompanied by a 2.2% increase in the aggregated gross tax rate for property owners in the region, from $23.42 per $1,000 of property value in 2013 to $23.93 in 2014.  This finding reflects the close tie between property tax rates and property values, which declined by 2.7% in 2013, thus negatively impacting rates for 2014 municipal, county and school district budgets.

Recently released data from the Wisconsin Department of Revenue shows that property values in the region rebounded from five consecutive years of decline in 2014, growing by 2.6%.  That should ease the pressure on property tax rates next year.

The small increase in total levies in 2014 is attributed – at least in part – to local government and school district property tax levy limits that were strengthened in the last two state budgets.  While good news for taxpayers, the limits pose a challenge to local officials, who often struggle to keep up with the cost of critical programs and services. 

Other key findings from the 2014 analysis of property values and taxes in southeast Wisconsin:

  • Every county in the region experienced an increase in property values in 2014, led by Waukesha County at 3.8%. 
  • In 2014, 114 of the region’s 147 municipalities experienced property value growth.  That compares to 29 in 2013 and only eight in 2012.
  • The property taxes levied by school districts are the largest component of the annual property tax bill, accounting for 44% of the aggregate tax levy in southeast Wisconsin.  In 2014, the budgeted aggregate school district levy for southeast Wisconsin decreased by 0.8%, thus helping to minimize overall growth caused by increases at other levels of government.
  • To calculate an average tax bill in southeast Wisconsin, the analysis applies the average residential property value in the region to the gross tax rate. The resulting hypothetical average tax bill in 2014 is $4,416, a slight increase over the 2013 average tax bill of $4,402.

The full report – which was sponsored by Baird – can be downloaded here.

Rob Henken