Janesville66.8°

Changes to state law put schools in vexing tax situation

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FRANK J. SCHULTZ
July 30, 2011
— After touting their plans to hold the line on taxes, Republicans say they can’t help Janesville taxpayers facing a school-tax increase as high as 7.6 percent.

Janesville School Board President Bill Sodemann said he listened to lawmakers and expected they would hold property taxes down, so he was surprised when the latest estimate included such a potential large tax hike.


Officials with the Wisconsin Association of Schools Boards, the nonpartisan Legislative Fiscal Bureau, Janesville School District and the Department of Public Instruction could not provide a clear answer about what led to Janesville’s tax situation.


The answer might lie in the massive, new state budget, but experts were unable to put a finger on what change or changes made the difference.


Rep. Joe Knilans, R-Janesville, who voted for the state budget, said the governor did the best he could. And indeed, state officials agree that on a statewide average, property taxes for schools will rise only 0.6 percent.


But as is always the case, individual school districts’ tax situations vary because of the state school-funding formula. Enrollments, property values, and previous taxing and spending decisions all play a role in determining a district’s maximum tax levy.


Janesville is not alone in finding itself in this situation. Tomah schools are facing an 8.5 percent levy increase, according to the La Crosse Tribune.


The Janesville School Board is facing a new budget hole because the July 1 state-aid estimate shows about a $5 million cut in state aid instead of the previously announced $3 million cut.


Raising taxes to fill the deficit would mean an estimated 6.4 percent property tax increase. Officials have said that would be an increase of about $55 a year on the average house.


“Gov. Walker has indicated that property tax control is a priority,” Walker spokesman Cullen Werwie was quoted as saying in February.


Asked why the state didn’t hold down property taxes for Janesville, Werwie and Knilans said that’s not the issue. The governor gave school districts the tools to balance their budgets, they said, by imposing economic concessions on workers.


Knilans returned to this line in several phone calls: If Janesville teachers began paying their share of their pension payments this year, that would save the district $3 million. That would be more than enough money to eliminate the need for any tax increase.


Teachers and other Janesville district workers don’t have to make those payments because they’re protected by pre-existing contracts that remain in effect until 2013. The only way to use the governor’s “tools” is if the unions volunteer to make concessions.


“Property taxpayers are stuck getting the bill because the Janesville school board rushed contracts through prior to enactment of the reforms that would have allowed them to realize savings from the provisions in Gov. Walker’s budget,” Werwie wrote in an email to the Gazette. “Now the teachers union is refusing to reopen those contracts to realize the savings.”


Werwie did not respond to a follow-up email that pointed out that the teachers’ contract was approved last September, months before Walker and other Republicans took over state government and cut state aid.


Knilans understands that chronology, but he is adamant that the Janesville teachers hold the solution, not only to averting a tax hike but also from the need to lay off more teachers for the 2012-13 school year because the district’s budget troubles are projected to continue.


“I understand the school board is in a tight situation, here, but the state budget was in a tight situation, too,” Knilans said when asked whether there’s something lawmakers can do now to help districts such as Janesville.


“I’m a Janesville homeowner. I understand that my taxes probably are going to go up if the school district isn’t able to negotiate with the JEA and come to a conclusion,” Knilans said.


JEA is the teachers union, whose members will not take up the question until they return to their jobs in late August, the union president has said.


The school board on Tuesday instructed Sodemann to meet with teachers-union president Dave Parr to find out whether there’s a chance the union would make concessions.


Sodemann said he hopes to have that meeting and report to the board at its Aug. 9 meeting.



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