WEDNESDAY NIGHT SUMMER RERUN: When is a 5.9% property tax increase NOT a 5.9% property tax increase?

EVERY WEDNESDAY NIGHT THROUGHOUT THE SUMMER, I’M RE-POSTING SOME OLD BLOGS I THOUGHT WERE INTERESTING AND WORTH A SECOND LOOK, OR A FIRST GLANCE FOR MY MANY NEW READERS.

Recently the Franklin Public Schools announced five new administrators who will fill district or building leadership positions.

Not new to his position is James Milzer, longtime Director of Business Services. Milzer engaged in fiscal chicanery I exposed on my blog years ago, and is a big reason I’ve never trusted the school system since.  We revisit the story I ranked as #3 in my top ten Franklin stories of 2007.

December 29, 2007

After the August 27th Franklin School Board meeting, I was convinced Franklin taxpayers were going to get hit with a huge school tax levy increase.

The problem was that I and everybody else thought the increase was going to be 5.6%.

Following the meeting that night, I blogged:

There was no talk or consideration or even thought of making cuts to avoid a whopping 5.6% school tax levy increase.

From the outset it was clear the intent was to label the state as the villain. School Board member Sue (God I wish I could triple your taxes right this second) Huhn started the state-bashing by saying the state “doesn’t always give money when we need it.”

Huhn also offered an ominous note, referring to the “need to revisit how to address that situation,” meaning the capacity of the school buildings. Translation: here comes another referendum.

Then Franklin School District Business Manager Jim Milzer was sent in to spearhead what could only be described as “OPERATION GLAZE THEIR EYES OVER,” giving a loooooooonnnnng numbers-heavy, yawner of a presentation on every single line of Franklin expenditures.

Milzer could have saved a lot of time and energy had he just got up and said, “TAX INCREASES……GOOD! STATE OF WISCONSIN………BAD!”

The Board gave temporary approval to a 5.6% school tax levy increase in August.

Then appropriately, on Halloween night, FranklinNOW blogger Bryan Maersch wrote the following:

About 6:30 tonight did you hear a big sucking sound coming from Franklin.

That was the sound of your Franklin School Board voting a 5.9% increase in your school taxes. No that is not a typo, I said 5.9% not the 5.6% that was projected at the Meeting of the Electorate back in August.

In what seemed to be a perfectly choreographed question and answers session between School Board members and Franklin School District Business Manager Jim Milzer the question was asked, “Is a 5.9% increase our fate for the future?” Jim answered that it would be for the next 15 to 20 years.

The choreography continued with Board President Dave Szychlinski stating that residents would not support those continuous increases and community input would be needed to see what the community would support for cuts in future years.

Just a few weeks ago, I uncovered that the school tax levy increase wasn’t really 5.6% or 5.9% but, unbeknownst to the public, an incredible 11.7%. I was the first to announce this. There was no public accounting or acknowledgment from Franklin officials until I blogged about it. I am in the process of investigating what, if anything can be done about this situation.

School Board President Dave Szychlinski assured me he thought the Board was approving a 5.9% increase.

*FRANKLIN’S ACTUAL SCHOOL TAX LEVY INCREASE NOT WHAT THE PUBLIC WAS TOLD*

By Kevin Fischer
Monday, Dec 10 2007, 05:12 PM

The school tax levy increase approved by the Franklin School Board is 11.7% and NOT 5.9% as citizens were told the night in October the Board adopted the 2007-08 school district budget.

The 11.7% school tax levy increase is based on a follow-up I did with the Wisconsin Taxpayers Alliance (WTA) that, as I blogged last week, issued a report outlining the school tax levy increases for every school district in the state. Franklin’s was listed as 11.7%.

The WTA gets its figures from the state Department of Public Instruction (DPI). The DPI gets its numbers from the Franklin School District.

In a discussion I had with WTA Research Director Dale Knapp, he informed me that he double-checked the numbers with the DPI and the 11.7% figure is correct.

Knapp told me that analyzing the expenditure figures for Franklin, there is no way the tax levy increase could work out to 5.9%. Knapp told me the correct figure could only be somewhere between 11 and 13 %.

In a memo dated November 29, 2007 to the Franklin Mayor and Aldermen, Franklin Director of Finance and Treasurer Calvin Patterson writes, in part:

“All taxing jurisdictions have provided the required information to calculate the combined tax rates for the year 2007 tax bills. The Oak Creek-Franklin school district has the largest percentage tax levy increase of 13.2% and as a result has the largest tax rate increase of 12.9%. The Franklin school district had the next largest percentage tax levy increase of 11.7% and as a result had the next largest tax rate increase of 9.2%.”

Over the weekend, I asked Franklin School Board President Dave Szychlinski to investigate the discrepancy in the numbers. He said he would get back to me and I trust he will, but hasn’t as of 5:00 this afternoon. Here is part of his e-mail to me:

I just saw your posting about the Taxpayers Alliance Report.  Very curious.  At the October Board meeting, we approved a total equalizedtax levy rate increase of 5.9%.   I can assure you that I will ask JimMilzer and the business office to clarify for me on Monday.   I’m notsure who is counting what..or if it’s apples to apples…and while I don’t have my budget documents here….I do remember that the budget document we received indicated +5.9%

dave

This issue raises some very serious questions:

1) How did Franklin school district business manager Jim Milzer arrive at the 5.9% figure?

2) Were the Franklin School Board members advised they were voting on a 5.9% school tax levy increase, and if so, why?

3) Didn’t the Franklin School Board members know what they were voting for?

4) Can the Franklin School Board go back and correct this error?

This is extremely serious.

It reminds me of the Milwaukee County Board approving outrageous pensions, only to plead ignorance later, claiming they had no idea what they were voting for.

The WTA stands by their numbers. The city of Franklin has issued a memo quoting the 11.7% figure.

The 11.7% figure is DOUBLE the increase that the Franklin citizenry, and quite possibly, the Franklin School Board, was told the levy increase was going to be.

It is plausible that the Board, and subsequently, the taxpaying public were issued FALSE information.

In that case, there needs to be accountability. If Jim Milzer gave false information to voting members of the Board, he should resign or be terminated.

An increase of 5.9% was inexcusable. An actual increase of 11.7% when the public was promised for several weeks that the increase would be 5.6% is misconduct in office.

I anxiously await Dave Szychlinkski’s findings.

December 11, 2007

Today (12/11/07) I received a response from Franklin School Board President Dave Szychlinski to my question about the discrepancy in the school tax levy increase numbers approved by the School Board and actual numbers reported by the city of Franklin and the non-partisan Wisconsin Taxpayers Alliance.

Here is the response I asked for from Dave Szychlinski two days ago that I greatly appreciate. Please read it very carefully and then my response:

Kevin,

Thanks for your patience. Before responding to your earlier email, I wanted to collect as much information as I could about the WI Taxpayers Alliance report and the confusion over the numbers which you reported in your blog.

As it turns out, Business Manager Jim Milzer received updated amounts from the state and communicated that to the Board this afternoon. I’m attaching a copy (below) for your information.

Based upon those new figures, the tax rate for operating the schools will go up 4.2% from last year. You will recall that at the annual meeting, Mr. Milzer estimated a 5.6% increase. If a person’s home has an assessed value of $100,000, that portion of their tax bill will go up $43.

The 11.7% figure in the Taxpayer Alliance report includes the cost of operating the Community and Recreation Department and the debt service which the District is paying for previous projects. Those are separate funds which are all approved at the annual meeting. When Mr. Milzer and Sue Huhn presented the budget at the annual meeting, the combined figure included an increase of 9.9%. When the State shifted some of the money it would have given the District into a School Tax Credit fund (which taxpayers will see as a separate credit line on their tax bill) , that bumped the figure upwards. Also included in that adjustment is consideration of the community’s “wealth” as Mr. Milzer’s memo outlines. When our numbers are reported to the State, the District must include debt service, recreation and operations in its figures.

I’ve already suggested to Mr. Milzer, and a few of my Board colleagues, that we need to change the way we prepare our budget so that there is more input from the community early in the process….not in mid-December. There are many mandates which the District must pay for. It would be interesting to have a discussion with the community about what it is willing to pay for beyond those mandates.

Thanks for your interest.

dave

Dave also forwarded me this e-mail from Jim Milzer to the Franklin School Board

The District has received an update regarding the assessed valuation information from the City of Franklin. This is the last piece of information that we need to calculate the tax rate. The assessed value of the portion of Franklin that lies within the District increased by more than 7%, which was higher than we anticipated. Based on this new growth in the tax base, we have estimated that the tax rate for 2007 should be 4.2% higher than 2006. This would equate to a property tax increase of about $43 for every $100,000 of assessed value. This is less than we projected at the annual meeting. As you may recall, at that time we were projecting a 5.6% increase, or about $56 per $100,000 of assessed value.

As always, it is important to note that we estimate the increase in the tax rate so that we can let the community know the estimated increase in the property tax bills. As we discussed during the budget deliberations, there are two major reasons for the increase in the amount of revenue from property taxes this year. As we know, local tax revenue and revenue from the State make up almost all of the revenue that the District receives. For 2007-08, the percentage of revenue from the State decreased by 4%, or about $1.75 million. Essentially, the State is shifting $1.75 million of the cost of education to the community because they believe that the community can afford it better than other communities in the state. If the State had maintained its level of support, the tax rate would have decreased. Because of the funding mechanism set up by the State, as Franklin grows compared to other communities in the State, we will continue to receive less revenue from the State. The other major factor is that the state did not complete it’s budget on time and although funding was provided for K-12 education, the state put the additional educational funding into the school tax levy credit rather than giving it directly to the school he effect of making the District’s tax levy look almost $500,000 larger than it will be after the City adjusts the amount with the tax levy credit. Both of these factors; the state taking funding away, and the state putting funding into the tax levy credit, have resulted in an increase in the total tax levy from operations, debt service, and recreation of 11.7% overall. This is greater than the 9.9% increase projected in draft #1 of the budget due to the State moving our funding to the tax levy credit. Again, individual property tax bills will be much less than we originally anticipated.

David E. Szychlinski
Franklin School Board

With all due respect to my friend, Dave Szychlinski, this doesn’t cut it.

1) Dave writes: “As it turns out, Business Manager Jim Milzer received updated amounts from the state and communicated that to the Board this afternoon.”

How convenient!

Milzer first gave the Board new figures this afternoon??? The city was aware of the accurate numbers and reported them in a memo on November 29, 2007. The Wisconsin Taxpayers Alliance knew about the numbers and reported them last Friday when I found out about them.

When did Milzer learn of the numbers and why was he first informing the Board of them this afternoon? Could it be because of stories on the blogs?

2) Dave writes: “The 11.7% figure in the Taxpayer Alliance report includes the cost of operating the Community and Recreation Department and the debt service which the District is paying for previous projects. Those are separate funds which are all approved at the annual meeting.”

That’s true, so why didn’t Milzer make the Board and the public aware of that information at the annual meeting months ago?

Dave Szychlinski told me the Board was told they were voting on a 5.9% increase.

Just what amount of increase did the Board approve? If it was 5.9%, why didn’t Milzer make the Board aware of the separate funds that raised the increase to 11.7%?

3) What is the actual increase that was approved and legally appropriate? The announced 5.9% or 11.7%? If it’s 11.7% and that appears to be the case, why was 5.9% announced to the Board and the public?

4) When did Milzer learn that the increase was 11.7%?

5) Without pressure from my blog, when was Milzer going to inform the Board and /or the public of the increase in the levy?

6) Why wasn’t the public informed?

7) Why didn’t the Board call and announce to the taxpaying public a special emergency meeting to discuss the updated amounts and hold a public hearing(s) on what to do about this development?

8) What other problems are being swept under the rug by this district and School Board?

9) Where is the outrage from School Board members who were not given all the updated or correct information before they made their most important vote of the year?

10) Jim Milzer is either inept, incompetent, or a scam artist. His late explanation is laughable, filled with the usual excuses of trying to pass the buck to the state. He needs to be held accountable and either asked to resign or fired. How can a local blogger, the city, and the Wisconsin taxpayers Alliance come up with correct budget figures before he does?

The response I received today was not satisfactory.

The School Board President told me in an e-mail the Board was told (by Milzer, I presume) that they were approving a 5.9% increase. The taxpayers are now on the hook for an 11.7% increase that the Franklin School Board never approved and never informed the public about.

*****************************************************************************

TODAY

Jim Milzer reports to the superintendent and school board every year what the proposed school property tax levy should be. The board members, like sheep, generally just nod their heads and blindly accept the recommendation.

Milzer, according to the latest data from the WI Dept. of Public Instruction (DPI) has an annual salary of  $148,169.00 and an annual benefits package worth $40,697.00. That makes him the second-highest paid administrator sticking it to taxpayers in the Franklin school district.

Do I begrudge Milzer those figures? No.

Do I believe they’re too high and not worth it? You betcha.

BTW, the annual meeting of the electorate will soon be held by the Franklin School Board. I blogged about what a ridiculous sham this meeting is in 2010, a true insult to taxpayers and again in 2009.

God made the Idiot for practice, and then He made the School Board
Mark Twain

One thought on “WEDNESDAY NIGHT SUMMER RERUN: When is a 5.9% property tax increase NOT a 5.9% property tax increase?

  1. Pingback: My Most Popular Blogs (07/25/16) | This Just In… From Franklin, WI

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