RACINE COUNTY — After the most recent round of property assessments, homeowners throughout the county have seen a rise in their property values.
That’s good for someone trying to sell their home, since it means their property is worth more. But it might not be good for property taxpayers, who now might have to pay more in taxes.
Renters wouldn’t be directly affected, but if a landlord has to start paying raised taxes, there’s a good chance that the cost would end up falling back on tenants.
Caledonia is seeing the biggest jump in the county, with the property assessment for the typical homeowner going up by approximately 17.55%, according to Caledonia Village Assessor Marty Kuehn.
Mount Pleasant residents saw the second-biggest jump at 10% for the typical homeowner, according to Village Assessor Dan McHugh.
McHugh told the Village Board in May: “In my 25 years of experience, I’ve never seen market values change the way they have around here as they did in 2018,” noting that some condos increased their assessments by over 30%.
Sturtevant’s typical jump will be just shy of 10%, said Jim Henke, owner of DH Assessments. The City of Racine said its typical homeowners received an 8.1% rise in property assessments, followed by the City of Burlington which saw a 6% rise for the typical homeowner.
Statewide, Wisconsin’s residential real estate market grew by 6% in 2019. The governor’s office called the rate: “healthy.” That number was reached by looking at “equalized value” — or the total taxable value of all properties in a district (such as a municipality, county or whole state).
“It is worth noting,” a press release from the governor’s office stated, “2019 is the first year that all counties have positive changes in equalized values since 2007.”
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Potential effect on taxpayers
Roman Dymerski — who is retired and lives in the Prairie Pathways subdivision of Caledonia, just north of Franksville — wasn’t surprised about the jump in his new property assessment. He said that his assessment is going up 20% this year, which makes sense since he said other homes in his neighborhood are selling for 20% more than what they’d been purchased for eight to 10 years ago. Dymerski’s property, like the rest of Caledonia, hadn’t been reassessed since 2016.
What Dymerski is concerned about is what could happen when tax season rolls around. With his previous assessment, Dymerski said he paid $4,107.17 to Racine Unified, the county, Gateway Technical College and the Village of Caledonia combined in 2017, and $4,175.75 in 2018. Under his new assessment, there’s a chance that cost could jump by around $800, although a spike of that size is unlikely.
Village Administrator Tom Christensen explained in an email: “Anyone with an assessment increase near 16% is unlikely to see an increase in the village portion of their property tax attributable to changes in the assessment. If the village increases the overall levy, there could be a modest increase even for those with a 16% assessment increase.”
Christensen continued: “... we are very early on in the budget process, so I can’t yet predict whether there will be any increase in the overall levy. Like all municipal taxing bodies, absent a referendum, any potential levy increase is limited by the state. Levy limits and expenditure restraint are the two most significant limiting factors.”
Dymerski’s concerns lie with Racine Unified School District, which takes a larger proportion of his yearly taxes and where there’s still a lot up in the air in terms of budgeting.
The school district’s estimated 2019-2020 budget is expected to be around $4 million smaller than its previous one —from $91.3 million down to around $87 million.
But Marc Duff, RUSD’s chief financial officer, isn’t sure what’s going to happen with the tax rate; although he estimated in July that it would decrease slightly. But unless it decreases anywhere near 20%, homeowners like Dymerski could end up owing hundreds more come April 15.
Here’s how revaluations work
Assessors look at the sale prices of all recent property transfers around a municipality — sometimes yearly, sometimes less often — and, by looking at those prices and other changes in the area, they estimate how much the rest of the property in the municipality should cost when sold.
The goal is to “recreate that sales price,” Kuehn told The Journal Times.
Those prices are rising here because, despite some population growth, there hasn’t been enough new residential development to prevent sharp increases for some homeowners.
“What you are seeing is a very strong market due to the shortage of housing,” Jim Henke, an assessor who works with several of the county’s smaller municipalities, wrote in an email.