(WKOW) — Since 2005, communities across Wisconsin have seen ever-tightening state-imposed limits on their budgets. A combination of state aids that have not increased, and limitations on property tax increases below inflation have made it difficult for communities like Clintonville to make ends meet.
“It’s similar to a lot of challenges that many other municipalities across the state are experiencing lack of growth increased costs for services and construction,” Sharon Eveland who is a Clintonville City Administrator said.
The property tax is strictly a local tax, with its proceeds going only to support the operations of schools, counties and municipal governments. Schools and local governments also rely on the state sharing income and sales taxes. But for city and village government, those state payments often don’t keep up with inflation
“The state has different forms, transportation aid, computer aids, some other things in there. And they have different formulas that they set up and decide how much of the funding that the state collects that each municipality is going to get.”
State levy limits prevent local property taxes from growing beyond the percentage of new buildings built in that community the year before. This “Net New Construction” number has been less than inflation for nine-out-of-ten Wisconsin cities for more than six years. That means cutbacks in essential city services.
It’s a struggle trying to balance being fiscally responsible while trying to make sure that we provide those services that they deserve.”
The problem is particularly acute for small rural communities that often struggle to attract new residents, which in turn means tighter budgets.
“But even when you’re small when you’re near one of these bigger cities you can kind of draw on that, you know, especially for a residential population. And we don’t…I mean there’s not a lot of people that want to drive 45 minutes to an hour to go to work every day.”
Wisconsin is unlike any other state in its reliance on property taxes as the sole source of locally-generated revenues. Eveland says ultimately local governments need a more balanced way to fund local services, and more local control.