Property Taxes and Mill Rate Q&A

Property Tax Q & A

Why did my property taxes go up this year?
Why did the Richland School District’s portion of my property tax bill increase?
I thought the referendum failed…twice?
The referendum was in 2020. Why am I seeing an increase in 2021?
I thought the District said the mill rate would go up to $9.12 / $1,000 if the operating question passed?
What is the mill rate and how does it affect property taxes?
If taxes went up exactly as the District said they would, why do I see a 40% increase in taxes for the Richland School District?
Ok, 23% makes sense since it was based on 2020. But why is my bill showing an increase closer to 40%?
I think I understand, but can you give me an example that puts it all together?
How can I calculate to see if my tax bill reflects this $9.12 mill rate?
What if my bill doesn’t work out like this? Did the School District make a mistake?
How does the tax rate of the Richland School District compare to surrounding districts?

Q: Why did my property taxes go up this year?

A: Each person who owns property is subject to tax by multiple entities. These entities include, but not limited to: Richland County, Richland School District, Township or City, Southwest Technical College, and the State of Wisconsin. Since your overall tax bill is composed of several entities, all will play a role in the amount of tax you owe. The levy from each of these entities, as well as the overall property value an owner has, will determine your overall tax bill.

Q: Why did the Richland School District’s portion of my property tax bill increase?

Q: I thought the referendum failed…twice?

A: In November of 2020, the Richland School District asked voters to consider two referendum questions. One of these questions pertained adding $1,250,000 to District revenue for general operations. This question was passed by the public and therefore this increase was reflected on the 2021 property tax bill. The second question pertained to the building of a $27,000,000 addition/renovation to buildings within the district. This question failed. A more conservative $19,700,000 question was then presented to voters in the April 2021 election, which also failed.

Q: The referendum was in 2020. Why am I seeing an increase in 2021?

A: The referendum question, which passed in 2020 for $1,250,000 was stated to take effect in the 2021-22 school year. Therefore, this levy was issued in October of 2021 and reflected on the 2021 property tax bill.

Q: I thought the District said the mill rate would go up to $9.12 / $1,000 if the operating question passed?

A: This is correct. In 2019, the Richland School District had an average mill rate of $8.15 / 1,000 of property value. During several community forums to discuss the referendum questions, it was stated that if the operating referendum was successful, it would increase the mill rate approximately 97-cents/$1,000 over the 2019 rate – or $9.12 / $1,000 of property value. $9.12 was exactly what the mill rate for 2021 is for the Richland School District.

Q: What is the mill rate and how does it affect property taxes?

A: The mill rate is the amount of tax a property owner will pay per $1,000 of property value. Each school district in Wisconsin has the authority to levy up to a specific dollar amount for public schools. This amount is different for every district and is set by the State of Wisconsin in what is known as the “Revenue Limit.” The mill rate is calculated by taking the Revenue Limit and then dividing this by the Total Equalized Value for all properties within the school district. This answer is then multiplied by 1,000, to get a mill rate, or rate of tax per $1,000 of property value.

Example: In 2021, the Richland School District had a total levy in the amount of $7,351,256. The total equalized value for the District was $806,058,725. $7,351.256 ÷ 806,058,725 x 1000 = $9.12.

Q: If taxes went up exactly as the District said they would, why do I see a 40% increase in taxes for the Richland School District?

A: The percent-increase can be somewhat misleading, since the increase shown on your property tax bill is the percent increase over 2020 property taxes. However, the Richland School District stated during several community forums, prior to the November 2020 election, the increase was based on 2019 property taxes, since 2020 bills had not yet been released.

Due to tax-breaks created at the state-level, many property owners within the Richland School District enjoyed some property tax relief in 2020. The Richland School District’s mill rate dropped to $7.44 / $1,000 of property value. Therefore, instead of an expected increase of approximately 12% over the 2019 rate of $8.15, the percentage shown on your bill is the increase over the 2020 rate of $7.44. This is an approximate increase of 23% (See next question for more details).

Q: Ok, 23% makes sense since it was based on 2020. But why is my bill showing an increase closer to 40%?

A: While the mill rate per $1,000 of property value is one contributing factor to your overall bill, the second factor is the actual amount of property value a person has. Since almost all property owners saw an increase in the Fair Market Value of their property, the mill rate is applied to a higher number (See next question for an example).

Q: I think I understand, but can you give me an example that puts it all together?

A: Sure. For instance, if a property owner had a Fair Market Value of $150,000 in 2019 and paid $8.12 / $1,000, they would pay approximately $1,218 for the school district’s portion of tax. In 2020, the mill rate dropped to $7.44 / $1,000, so the property owner would have paid approximately $1,116, or an 8% reduction in taxes. Then in 2021, the mill rate increased to $9.12, due to the community passing the operating referendum. This would increase the tax to $1,368. While this is a 12% increase over 2019, it is actually a 23% increase over 2020.

Secondly, this increase is only accurate if the actual property value (fair market value) did not change. Since almost all owners saw an increase in property value of about 12%, this mill rate can no longer be calculated on $150,000, but rather on $168,000 (assuming 12% increase). The $9.12 mill rate on $168,000 property now equates to $1,532 in over tax, which is a 37% increase over 2020 taxes.

Q: How can I calculate to see if my tax bill reflects this $9.12 mill rate?

A: Remember the $9.12 mill rate is an average rate for all municipalities within the school district. Therefore, some individual property owners may have slightly higher or lower rates. However, some simple math should get you close.

Take the Fair Market Value shown on your property tax and divide it by 1,000. Multiply this answer by $9.12, which is the mill rate. This is the expected tax to pay towards the school district’s portion. Subtract the School Tax Credit, since this is a credit from the State of Wisconsin. The answer should be close to the amount listed under your 2021 Richland School District Tax.

Example: Property value of $175,000. $175,000 ÷ 1000 = 175. Multiple 175 x $9.12 = $1,596. Subtract school tax credit and compare to amount shown for 2021 Richland School District tax.

Q: What if my bill doesn’t work out like this? Did the School District make a mistake?

A: If you feel your tax bill is not correct, you should contact your local municipality’s clerk. The Richland School District does not tax individual property owners. Rather, it tells each municipality what they need to collect in taxes and submit to the District. The municipality then divides and collects taxes amongst all property owners within its jurisdiction based on their calculations to collect their apportionment of the Richland School District tax levy.

Q: How does the tax rate of the Richland School District compare to surrounding districts?

A: There are 31 school districts in CESA 3 (SW Wisconsin). Only ten of those 31 districts have a mill rate lower than the Richland School District’s $9.12 in 2021. For comparison, here are some neighboring districts and their 2021 mill rates: Wauzeka: $11.42, Weston: $10.77, Highland: $10.31, Ithaca: $10.31, River Valley: $9.38, Hillsboro: $8.89, Riverdale: $8.56, Boscobel: $8.29, Kickapoo: $8.15