changes in shared revenue and the effects on wisconsin taxpayers
DESCRIPTION
Changes in Shared Revenue and the Effects on Wisconsin Taxpayers. Jenna Griffin, Jennifer Klippel, Kathryn Maguire, Brendon Riggs. May 5, 2006. Overview. The Shared Revenue Program Measures Analytical Approach Results Conclusions. The Shared Revenue Program. Background Goals - PowerPoint PPT PresentationTRANSCRIPT
Changes in Shared Revenue and the Effects on Wisconsin Taxpayers
Jenna Griffin, Jennifer Klippel, Kathryn Maguire, Brendon Riggs
May 5, 2006
Overview
The Shared Revenue Program
Measures
Analytical Approach
Results
Conclusions
The Shared Revenue Program
Background
Goals
– Property Tax Relief
– Guaranteed Tax Base
Formula Components
Per-capita
Utilities
Aidable Revenues
– Local purpose revenues
– Tax base weight
Minimum Guarantee
The Issue
Changes to Shared Revenue
– Level-Funding
– Discontinuation of Formula
– Per Capita Reductions
Circumstances
– Medicaid
– Truth in Sentencing
– School Aid
Measures of Fiscal Disparity
Tax price: price to taxpayers, in mills, of a given level of expenditures
t/E ratio: tax price of $1,000 in per capita expenditures
– low t/E ratio indicates a high level of fiscal well-being
Coefficient of variation: measures of disparity across time, using
variation in t/E ratios for each year (standard deviation ÷ mean x 100)
– high coefficient of variation (given as %) means high disparity
Taxpayer equity: municipalities with similar property tax rates should
be able to afford similar expenditures, regardless of property wealth
Analytical Approach
Municipalities by 2000 EQV deciles
– not population weighted
– not counties and school districts
Milwaukee analyzed separately
Interaction with School Aid
Municipal t/E Ratio, 2004
Monona Ingram
Per-Capita Expenditures $1,400 $520
Municipal Mill Rate 5.4 mills 2.0 mills
t/E Ratio (Mills per $1,000 Per-Capita Expenditures)
3.84 3.82
Per-Capita Intergovernmental Aid
$150 $510
Per-Capita Equalized Value
$98,000 $16,000
Coefficient of Variation of Mills-per-$1,000 Expenditures
0%
10%
20%
30%
40%
50%
60%
1990 1995 2000 2004
2000 Mills-per-$1,000 of Expenditures by EQV Deciles
0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
8.00
First Second Third Fourth Fifth Sixth Seventh Eighth Ninth Tenth Milwaukee
Equalized value Decile
Mills
2004 Mills-per-$1,000 of Expenditures by EQV Deciles
0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
8.00
First Second Third Fourth Fifth Sixth Seventh Eighth Ninth Tenth Milwaukee
Equalized Value Decile
Mills
2000-04 Cuts in Shared Revenue as Percent of Total Revenue Loss
-7%
-6%
-5%
-4%
-3%
-2%
-1%
0%
First Second Third Fourth Fifth Sixth Seventh Eighth Ninth Tenth Milwaukee
Equalized Value Decile
Impact on Municipal Levy2000-2004
-5%
0%
5%
10%
15%
20%
25%
First Second Third Fourth Fifth Sixth Seventh Eighth Ninth Tenth Milwaukee
Equalized Value Decile
Impact on Combined Levy (School and Municipal), 2000-2004
0%
5%
10%
15%
20%
25%
30%
First Second Third Fourth Fifth Sixth Seventh Eighth Ninth Tenth Milwaukee
Equalized Value Decile
Coefficient of Variation of Combined Municipal and School District Mill Rate
0%
5%
10%
15%
20%
25%
30%
1990 1995 2000 2004
Alternatives
Return to Equalizing Formula
Revisiting Land-Use Assessment Policy
Reconfiguring the Current Expenditure
Restraint Program
Diversifying Municipal Revenue Sources
Conclusion
Formula Decreased Disparities
Changes Increased Disparities
Long-term Consequences
Questions?