Agenda Item
Meeting Date: 8/29/2019 - 6:30 PM
Category: Reports and Communications from the Board Clerk/Director, Office of Board Governance
Type: Info
Subject: 1. Monthly Report, with Possible Action, on Legislative Activities Affecting MPS
Strategic Plan Compatibility Statement:
Goal 1
Academic Achievement
Goal 2
Student, Family and Community Engagement
Goal 3
Effective and Efficient Operations
Policy: BG 2.13 - Board Legislation Program
Attachments: 2018 Combined Property Tax Report.
MPS-specific Property Tax Examples - Net of levy credit and non-MPS programs.
File Attachment:
2018 Combined Property Tax Report City of Milwaukee Comptroller 8-20-19.pdf
Net MPS Property Tax 8-20-19.pdf
Background: While it is true that, in 2018, the Milwaukee Board of School Directors, under the controls put in place by state law, approved a levy of $250.4 million, and while it would be understandable for property owners, therefore, to be under the impression that they paid $250.4 million to support that levy, they did not. Instead, the actual tax impact related to that MPS levy was $55.9 million less than the $250.4 million shown in the dollar graphic of the City of Milwaukee’s “2018 Combined Property Tax Report” (see attachment to this item): As noted in that report, the $250.4 million “excludes the school tax credit.” To be clear, the levy figure is correctly stated in that document due to the fact that, per state law, the tax credit is issued to the municipality by the state after the school district goes through the public process of setting the levy. At the end of that process, however, the actual property tax impact is lowered. After applying the tax credit, Milwaukee Property owners actually paid $194.5 million, not the $250.4 million that is so often reported as the top line number.

What is perhaps more confusing and more difficult to understand, given the opaque qualities of the laws applied to this issue, is that of that $194.5 million, fully $50.1 million of tax levy is raised to compensate for non-MPS programs that draw state aid away from Milwaukee Public Schools. This happens in other school districts as well and is, therefore, a statewide issue.

In 2018, the MPS levy was increased by $36.3 million due to funding for the Milwaukee Parental Choice Program, $9.4 million due to funding for independent charter programs, and $4.4 million due to funding for the Special Needs Scholarship Program. The MPS Board does not have oversight related to any of those programs.

If MPS received the levy-credit funds as state aid, and if the district did not have its state aid drawn away from it in order to fund non-MPS programs, the figure for MPS on the City’s, “2018 Combined Property Tax Report” would be $106 million lower. In that scenario, the Milwaukee Board of School Directors would have levied $144.4 million.

In his budget, Governor Evers proposed ending the shell game of the school levy tax credit by simply directing more state aid to schools at the front end of the process, rather than having an after-levy credit. Governor Evers also proposed policies that would allow the public to know that their tax dollars are going to support non-public school district programs that public school boards are in essence compelled to levy for. Those proposals were ultimately not enacted.

As it stands, property taxpayers will continue to be involved in a less-than-completely-transparent process concerning how much of their tax dollar goes to support public schools, and they will be left without a complete understanding that public school districts are compelled to raise their levies in order to support programs that are not under their jurisdictions.
Fiscal Impact Statement: This item does not authorize expenditures.
Implementation and Assessment Plan The district will continue to pursue appropriate support for students as part of the MPS Legislative Agenda.
Recommendation:
Approvals:
Recommended By:
Signed By:
Chris Thiel - Legislative Policy Specialist
Signed By:
Jacqueline M. Mann, Ph.D. - Board Clerk/Chief Officer