As the COVID-19 pandemic wreaks havoc on the economy, many Dane County homeowners will see higher tax bills this month largely due to higher property values, a decrease in the state lottery credit and rising school levies.
Based on new construction and school district levies, “I would expect property tax levies in Dane County to rise by a greater percentage here than in the state as a whole — just like last year,” said Jason Stein, research director for the Wisconsin Policy Forum.
The local increase is notable because overall statewide levies have been going up more the past two years than in the rest of the decade, Stein said. But the county’s increase in part reflects greater new construction, as well as choices by voters on school levies, so that context is important, he added.
In the city of Madison, the total tax bill for the average assessed home in the Madison School District is rising about $293, or 4.3%, to $7,082. That compares to an increase of about $374, or 5.8%, to $6,789, in 2019. In 2018, the bill rose just $64, or about 1%, which was the lowest percentage increase since 2014.
The sums reflect tax bills after the school tax credit is applied but before the state lottery credit, which actually decreased this year, and another credit for building improvements on property are deducted. The city’s $40 vehicle registration fee, also known as a wheel tax, now in its second year, does not appear on the tax bill.
For this year, every taxing jurisdiction except the state, which has levied no property taxes since 2017, raised property taxes for Madison property owners.
The Madison schools had the highest percentage and dollar increase, as well as the highest overall tax, a 6%, or $213, increase to $3,757 for the average home, now valued at $315,200. The city’s tax rose 1.8%, or $48, to $2,728 on that average-value home.
“This year’s tax bills reflect property tax collections for city of Madison services that has the smallest rate of increase in over five years,” city finance director David Schmiedicke said.
The city’s adopted budget for 2021 reflects the economic effects of the pandemic on city revenues and required difficult decisions by the mayor and City Council, including cuts, changes in services and employee furloughs, Schmiedicke said. Larger cuts and service impacts were averted by use of one-time funding from the city’s “rainy day” reserves.
As always, individual bills will vary, driven by changes in values in municipalities and local factors such as referendums or growth in the tax base, officials stressed. Some municipalities also add charges, such as for trash collection or recycling, improvements to streets or sidewalks, or unpaid bills.
This year’s tax bills are influenced by several factors.
One is growth. In Madison, real estate values rose 6.6%, with a 5.5% increase in the value of residential properties, including single-family homes and apartment buildings with up to three units, and an 8.6% rise in the value of commercial properties, including offices, hotels and big apartment buildings, according to the city assessor’s office.
“The overall tax rate continues to decline due to the strength of Madison’s economy before the onset of the global pandemic,” Schmiedicke said.
The increase in net new construction in Dane County increases the tax base and allows municipalities, the county and Madison Area Technical College to raise levies under state limits.
Another common thread in the county is an average decrease in the lottery credit by 12% this year, county treasurer Adam Gallagher said. The lottery credit is a state property tax credit for people who own their primary residence. The credit in Dane County for tax year 2020 ranges from $150 to $225, depending on the school district.
“This decrease is likely reflective of fewer lottery credit sales in 2020,” Gallagher said.
The decrease of lottery revenues is similar to the experience being seen nationally, Stein said.
Meanwhile, property tax increases are being driven in significant part by increases in school district levies, Stein said. Some examples include the Middleton-Cross Plains School District’s 9% increase, Madison’s 6% rise, and those in Verona, 6%; Oregon, 7%; Columbus, partly in Dane County, 22%; and Wisconsin Heights, 14%, he said.
“Each of these districts has passed referenda in the past several years, in some cases by wide margins,” Stein said.
Still, more than one-third of the state’s school districts, including Stoughton and Monona Grove in Dane County, will have levy decreases, he said.
Madison, which delivers the most services and has the most employees and the biggest budget, continues to make key investments but struggled with financial impacts of the pandemic, officials said.
Balancing the 2021 city budget in the midst of the global pandemic required taking a number of difficult steps, including allocating $8 million from the city’s rainy day fund and cutting over $6 million in spending, Mayor Satya Rhodes-Conway and council leadership said in a letter to property owners sent with tax bills.
While it’s tempting to compare tax bills from one municipality to another, communities assess properties at different rates compared with their fair market value. That makes it difficult to compare tax rates — the amount charged per $1,000 in valuation that determines one’s overall bill — between communities. But by factoring in how close to fair market value each community’s assessments are, it’s possible to compare tax rates on a typical home.
In Madison, for example, the total tax bill for a $250,000 home in the Madison School District assessed at 100% of its fair market value was $5,258, among the highest in the county. The highest was $5,771 for a Madison home of the same value in the Monona Grove School District, followed by $5,680 for a Fitchburg home in the Verona School District and $5,672 for a Madison home in the Verona School District.
The lowest for a home of the same profile was $2,900 in the town of Christiana in the Cambridge School District.
Tax bills began arriving in mailboxes in mid-December. The deadline for owners to pay at least the first installment of their property taxes is Jan. 31.
The initial deadline is the same in Madison, but the city has switched from two to four installments, with the second installment due March 31, the third May 31 and the final on July 31, which is the same final due date as other municipalities in the county.
A fair way to compare taxes
|Cities||School District||2020 assessed value tax rate per $1000*||2020 assessed ratio to fair market value||2020 fair market value tax rate per $1000||2020 tax on a home worth $250,000|
|Sun Prairie||Sun Prairie||$22.01||0.981||$21.58||$5,394.79|
|Average, all cities||$20.81|
|Average without Edgerton **||$20.87|
|Average without Edgerton or Madison **||$20.31|
|Black Earth||Wis Heights||$23.21||0.892||$20.69||$5,173.59|
|Blue Mounds||Mount Horeb||$18.91||0.937||$17.73||$4,432.65|
|Cottage Grove||Monona Grove||$20.68||1.006||$20.80||$5,199.48|
|Cross Plains||Mid-Cr Plains||$21.66||0.949||$20.55||$5,137.25|
|Mount Horeb||Mount Horeb||$20.17||0.894||$18.04||$4,508.98|
|Average, all villages||$19.39|
|Black Earth||Wis Heights||$20.59||0.873||$17.99||$4,496.34|
|Blue Mounds||Mount Horeb||$14.06||0.957||$13.45||$3,363.02|
|Cottage Grove||Monona Grove||$22.12||0.809||$17.90||$4,476.18|
|Cross Plains||Mid-Cr Plains||$18.62||0.825||$15.36||$3,839.67|
|Sun Prairie||Sun Prairie||$20.05||0.858||$17.21||$4,301.48|
|Average, all towns||$15.57|
|* Tax rates include state, county, municipal, school district, technical colleges, any special tax districts and the state school credit.|
|** Because only a small portion of Edgerton is in Dane County, including the city with other Dane County cities distorts that comparison.|
Dean Mosiman’s memorable stories for 2020
Dean Mosiman's memorable stories for 2020
In an unthinkable year dominated by COVID-19, I chose as my most memorable stories on struggles with homelessness, gun violence and handling of protests for racial equity, as well as pieces on big projects that will shape the city's future.
Early in the year, just before the COVID took hold, I teamed with photographers to look at the city's "barely humane" shelter system for homeless men in church basements. I've continued to cover how the pandemic forced changes in serving the homeless and the current search for a site for a new men's shelter. Meanwhile, many are addressing the needs, including Occupy Madison's opening of a "tiny hut" village on the East Side in December.
In 2018, I did a four month project on gun violence in Madison, including a look at root causes and solutions. Tragically, the city experienced a record numbers of shots fired incidents and rise in shooting homicides this summer. The city and Dane County are now investing more in peer support to de-escalate tensions and a public health approach to violence.
The Black Lives Matter protests laid bare strains between many in the community and police. I tried to show how city officials struggle to protect protesters’ First Amendment rights while keeping citizens and property safe amid continuing unrest Downtown.
Amid it all, in an expression of confidence in the local economy, Urban Land Interests offered and the city approved a complex, $125 million redevelopment that involves historic preservation, demolition and new construction on Capitol Square. And it was a joy to detail how the $35 million Madison Youth Arts Center, which will be a diverse hub for children and families, is quietly taking shape on the Near East Side.
In late February, before the pandemic took hold, we took a raw look at the “barely humane” conditions at men’s homeless shelters in three chur…
In an expression of economic confidence, Urban Land Interests proposed a complex, $125 million redevelopment on Capitol Square.
This story explores record numbers of shots fired incidents and a tragic rise in shooting homicides this summer.
In this story, I tried to show how city officials struggle to protect protesters’ First Amendment rights while keeping citizens and property s…
Amid all the challenges of 2020, it was a joy to highlight the $35 Madison Youth Arts Center quietly taking shape on the Near East Side.