Tuesday, November 19, 2019

Milwaukee Public Schools Set to Kill & Bury Homeowners

Apparently the Milwaukee Teachers' Union Milwaukee School Board is even more short-sighted than anyone could believe.  In their latest referendum proposal, they propose to kill and bury the taxpayers of the City, not to mention destroying the tax base.

...MPS officials laid out two potential scenarios: a "gold-standard" education that would cost an additional $640 million a year and a lesser "plan B" costing about $319 million more a year. The proposals would lower class sizes and expand programming on a number of fronts, from early childhood education to gifted and talented and career and technical education. And they would increase staffing by 1,982 and 966 employees, respectively.

MPS' has a current budget of about $1.2 billion a year and employs about 10,000 people.
The proposals would increase the MPS portion of Milwaukee's property taxes from the current $9.58 per $1,000 of assessed value to $15.72 for the lower figure and $22.41 for the higher, according to its financial advisers from Robert W. Baird & Co.

For a home assessed at $300,000, that would push property tax bills from $2,874 to $4,716 on the low end and $6,723 on the high end — increases of 64% and 134% respectively....
Don't forget:  MATC, the City, and the County taxes are on top of those numbers.

First off, that $300K house would lose about $25-30K in value immediately.  Houses are purchased on cash-flow, meaning that someone looking at purchasing a house will try to fit the house payment into their budget.  Higher taxes mean higher payments; thus, the potential buyer will offer LESS for the house with the objective of reducing payment to fit their budget.

And that will be ongoing for several years as City residents get the hell out of Dodge, getting far less for their comfy bungalow in Bay View than they hoped, because few buyers can afford the payment.  (That assumes that there will be buyers in the first place.  Remember the just-beginning decrease in the 'first-home'-buying cohort?  That's going to get worse, too.  Look at college enrollment predictions.)

Also recall that Federal income tax deductions for property-tax payments are FAR smaller than they were last year, and that scenario is NOT likely to change in the next few years.  

Look for Tom Barrett's retirement soon, as he sells his house in the Heights and moves to anyplace outside the City.

No comments: