Report Shocker! Oops, the Wealthy Getting bigger Property Tax break than Poor. How did that happen?

As a property owner and father of two elementary school age boys, taxes and school funding are right at the top of my list of issues. Like most people, I believe there is a better way to fund schools and lower property taxes. With the following report, we might be a whole lot closer to changing things:

Two Wisconsin property tax credits are not only expensive - nearly $900 million per year out of a $13 billion general fund budget - but they are a highly inefficient means of delivering property tax relief to the Wisconsin homeowners and renters for whom the property tax creates the greatest economic hardships, according to a new analysis from the University of Wisconsin-Madison.

Andrew Reschovsky, an economist and school finance expert with UW-Madison's La Follette School of Public Affairs, suggests "the Wisconsin Legislature may want to phase out the school levy credit and the first dollar credit and use the resulting budgetary savings to help finance the reform of education funding and to expand the existing homestead credit."

"A substantial proportion of the credits goes to non-residents, to high-income individuals, and to others not in serious need of property tax relief," he says. "Conversely, only a small share of the credits end up benefiting those whose property taxes are high relative to their incomes."

Reschovsky finds that on a per-student basis, property owners in school districts with the highest property values receive school levy credits that are nearly seven times larger than those going to property owners in districts with the lowest property values.

The first dollar credit results in above-average property tax relief on a per student basis in school districts with the highest property values and below-average property tax relief in the state's poorest school districts.

Reschovsky argues that with money freed up by phasing out the school levy and first dollar credits, the state could expand the number of families eligible for the homestead credit and the amount of property tax relief provided to these families.

All owners of property in Wisconsin receive the credit, whether they are Wisconsin residents or not. Reschovsky finds that only 51 percent of the total school levy credit reduces property taxes of Wisconsin homeowners on their primary residences.

The road map to property tax and school funding relief is now clearly laid out. Will both parties embrace change?