– Letter to the Editor –

In my previous two letters to the editor, I have suggested we are on a path to have property tax become much more significant in the funding of school budgets. However, school funding is not alone in the funding dilemma, as municipal governments are also seeing property tax as the only viable alternative to increase funding.

With that in mind, I will provide an example of one (there are many) modification to the property taxation system that tends to make one question whether property tax is an equitable answer to additional funding.

USE VALUE – as defined in the Wisconsin 2024 property guide: Beginning in 2000, agricultural property is assessed, according to its use as farmland, instead of its market value, as indicated by sales. The guideline values are based on five-year average income and expense data, modified by the tax rate in each taxation district in the state.

Now, to an example that uses information from the Town of Sigel: For 2023 state equalization purposes, a value of $3,700, per acre, was assigned to Sigel agricultural land. This is a blended value from land sale information, including all classes of agricultural land.

Use value for Sigel agricultural land by class for 2023, Class 1, $296; Class 2, $260; Class 3, $202; and Class 4, $76 (Class 2 used for example).

Sigel’s 2023 assessed value ratio is 68.29 percent. A 20-acre parcel size will be used for comparison purposes So, the Sigel 2023 tax rate of $15.36, per $1,000 of assessed value, is before the first dollar and lottery credits.

Residential taxable full value is $74,000; agricultural use taxable full value, $6,600 (20 multiplied by $260); residential assessed value at 68.29 percent, $50,534; agricultural use assessed value, $5,200; residential tax rate, $15.36/1,000; agricultural use, $15.36/1,000; residential tax, $776; agricultural tax, $80.

Times have changed since use value was adopted in 2000, as we can plainly see when driving through the countryside. The number of farms has decreased, equipment is larger and more significantly, growing of crops is concentrated in what most would consider very large business operations.

The major reason you see crop fields in areas of commercial development, is that developers take advantage of the concession to agriculture and are able to “sit” on their land, without paying property tax, based on the fair market value of that land.

My simple example above only shows how the system works and does not do justice to areas of the state, where property values are much higher.

Vernon Haas, Cadott