In the age of 30-second attack ads that sell candidates no differently that laundry soap and cheeseburgers, most legislators surely felt they had no choice but to support a $100 million property tax cut approved last week.
Anyone who balked surely knew what awaited them at re-election time: “Call Senator Schmedley and ask him why he voted against cutting your property taxes!” Over and over and over.
Bob Jauch of Poplar and Tim Cullen of Janesville, two of the five Democratic state senators who voted against the tax cut, are retiring from the Senate next year. Two others, Fred Risser and Mark Miller, represent the safely Democratic city of Madison. The other, John Lehman of Racine, doesn’t face re-election until 2016, but surely he will be lambasted if he runs again in a previously swing district redrawn in 2010 more favorable to Republicans. Lehman won last year in a re-count.
People will argue that cutting taxes is what the people want. No kidding.
They’ll also argue that our property taxes are too high compared with other states. When all taxes and fees are totaled, however, we move much closer to the national median in state and local spending.
But if you don’t like high property taxes and “excessive spending,” you won’t like this either: In the current 2013-15 state budget, we are borrowing about $2.05 billion. Servicing the state’s debt will consume about 5 percent of state revenues, above the historical target of 4 percent, according to the nonpartisan Wisconsin Taxpayers Alliance.
As we all know, money we borrow from somebody else has to be repaid with interest. The problem is putting all that in a 30-second ad just doesn’t play as well as haranguing Sen. Schmedley for being against lower taxes.
That $100 million tax cut pales in comparison to the borrowing. Of that $2.05 billion we’ll borrow between now and mid-2015, $1.64 billion will be repaid through general fund dollars. So while we will enjoy a $100 million property tax cut that could be described as modest at best ($33 for the typical homeowner), we’ll be spending 16 times as much paying principal and interest on previous state spending, essentially out of the same pot of money.
The majority could argue with some conviction that the tax cut is a thank-you to taxpayers after the state finished the last fiscal year with a surplus of $759 million in the state’s main account, up from an earlier estimated $670 million balance used to plan the current 2013-15 budget, according to state figures.
Tax cut proponents might also sniff that those who don’t want the $33 can donate it back to their school district or favorite charity.
But lowering our borrowing saves us money now and in the future. We all feel the pinch in our own budgets when too much goes out of our paycheck to cover the mortgage, car payment, etc. Collectively, borrowing more to build and fix roads while pocketing $33 per homeowner is smart politics but short-sighted budgeting.
But come next year, the message will be clear and incessant: “Vote for me … I cut your property taxes.” People like hearing that.
They don’t like, “I voted to borrow more that you’ll have to pay back.” Besides, that doesn’t roll off the tongue nearly as well, and most voters wouldn’t understand anyway.
Go nuts with the $33 … renters don’t qualify.