WHILE THIS POST IS ABOUT FRANKLIN, LIKE OTHER FRANKLIN ITEMS I’M SURE THAT IF YOU DON’T LIVE IN FRANKLIN YOU WILL STILL FIND IT RELEVANT AND INTERESTING. THIS IS VERY IMPORTANT AND EDUCATIONAL TO PROPERTY TAXPAYERS.
When Tom Taylor was mayor of Franklin he was obsessed with the city’s tax rate.
He talked about it, wrote about it, had city staff prepare reports on it.
Problem. The city tax rate is meaningless.
Here’s what I blogged in December of 2010:
Last month, the Franklin Common Council on a vote of 5-1 with support from Mayor Tom Taylor adopted a 2.6 percent property tax levy increase during a recession when taxpayers are facing salary and benefit cuts, job losses, and foreclosures. We who pay the bills were lectured that this tax and spending increase was “responsible.” In other words, keep your mouth shut, accept it, and pay your bill on time.
Just a few weeks later, could it be that a case of the guilts has descended upon City Hall?
At the request of Mayor Taylor, an informational report has been compiled for Tuesday’s Franklin Common Council meeting entitled: “Comparison of Municipal Property Tax Rates and Other Municipal Charges.” The intent is crystal clear. The report, prepared November 30, is to be used as ammunition in defense of the recession property tax levy hike.
The Mayor, the report states, asked for the analysis “to address whether or not Franklin has high taxes compared to other communities.” It further claims, “Franklin has very low municipal property taxes when compared to other Milwaukee County communities, and when other municipal special charges are considered, Franklin fairs (sic) even better.”
I’m sure that comes as great comfort to Franklin taxpayers who will be brimming with exuberance when they get their annual Christmas present from the city in the mailbox later this month.
City staff analyzed the assessed property tax rates for all 19 Milwaukee County communities and then applied the 2009 Aggregate ratio of Assessment to those rates to determine an equalized property tax rate for each community. The Franklin report states, “Franklin has the third lowest rate with 13 of the communities exceeding Franklin’s rate by more than fifty cents per thousand dollars of equalized value and nine of those communities exceeding Franklin’s rate by more than $1.00 per thousand dollars of equalized value..”
The report then makes this bold claim:
“From this perspective, Franklin clearly has very low municipal property taxes when compared to other Milwaukee County communities.”
Another key point of the report is that other communities impose “special charges” for services. Franklin does not assess a special charge for garbage collection, recycling, or storm water utility.
Finally, the report asserts, “Franklin’s equalized municipal property tax rate is one of the lowest in the County. (The special charges in other communities) clearly solidifies Franklin’s position as a comparatively low taxed and charged community.”
This analysis is not convincing and, quite frankly, flawed.
The report emphasizes tax rates, a common ploy of the tax and spenders. The tax rate is meaningless. It’s the property tax levy that’s important.
This Just In…December 6, 2010
Fast forward to now.
I’ve been accused of being friends with current mayor, Steve Olson.
That baby really hurts.
Guilty as charged.
I know the mayor agrees with me that the tax rate is meaningless. Then he and his administration need to drop the Tom Taylor routine and stop emphasizing it in city literature.
The latest city newsletter opens with a front page piece on the budget and a terrific paragraph on the tax levy. But in the next paragraph we are informed how wonderful our tax rate is. Take a look.
THE TAX RATE IS MEANINGLESS!
I’m doing this for the umpteenth time, but with all kinds of new readers and recognizing the old axiom that “repetition is the mother of all students,” this is a must read from a former blogger, posted on October 31, 2007:
It’s the tax levy, stupid…
It’s that time of year again. News story after news story about budgets and property taxes. How are you supposed to read them? Very carefully – and using your head.
So, for just a little help with the “using your head part,” below is a slightly updated repeat of last year’s “It’s the tax levy, stupid….”
Numbers, numbers, everywhere numbers. It’s a field day for the media and local governments when tax time comes around.
If there’s nothing else you remember about your property taxes, remember this: It’s the tax levy, friend, the tax levy. (“Stupid” is memorable, but perhaps a little too harsh and Clinton-esque.)
An individual’s tax payments, are ultimately determined by two things: 1. Total tax levy required by the community 2. A property’s value, relative to the rest of the property in your community.Given even these couple of numbers, the very best way to judge a community’s budget is to look at the increase in the TOTAL TAX LEVY. (well, I suppose in the history of the world, a decrease has been registered – somewhere!)
Some would say you can look at the change in the “total” budget or the “operating budget,” but budgets have lots of different categories, and it’s often difficult to compare apples to apples, one year to the next.
So, Junior, it’s the TAX LEVY, the TAX LEVY.
The fussy variable that wants to confuse property owners, local officials and especially the guys with the ink, is property values. They change. Sometimes it’s new construction, new value added to the community. Sometimes it’s just inflationary increases of existing properties. It all combines to make a big mess of tax numbers and tax season information.
Because of this business of property value, tax RATE numbers are meaningless. Absolutely meaningless. And so, in most instances, are the calculations that tell you the tax on a $150,000 home. Was it $150,000 last year too? And if not, how much did it increase? Depending on your community, your home may or may not retain the same value for a number of years at a time. Therefore…. disregard all information presented to you about tax RATES and taxes on a $150,000 (or whatever) home.
Remember. It’s the TAX LEVY. The TAX LEVY.
Now that we have that down…. one more point to consider. And it’s an important one.
At budget time, look for information about the increase in new construction in your community. This is really important and often a hard number to find in print.
Because unlike increases in value from reassessment of existing properties, new construction is real growth in a community. And if the TAX LEVY rises by less than the increase in new construction, then on average, an individual property owner’s taxes really are going down.
That new construction number is also important because it serves as the Property Tax “Freeze” tax cap if it’s higher (in 2008) than 3.86%. Too many numbers and explanations already. More on the tax cap calculation another day.
-Jo Egelhoff, FoxPolitics.net.