Our latest research examines trends in municipal finance, compares Wisconsin’s municipal funding structures to other Midwest states and the nation, and provides insights on alternative financing options. We find that cities and villages in Wisconsin rely more heavily on property taxes than any other state in the Midwest, and to a greater degree than most states nationally.
Key findings:
- Wisconsin municipalities depend on the property tax more than their peers in any other Midwestern state and as a result also make the least use of all other taxes.
- Over the last generation, property taxes have grown as a share of city and village revenues as state aid to Wisconsin municipalities has lagged.
- Since 2006, state caps on property tax increases have slowed the growth in municipal levies and helped lower Wisconsin’s overall tax burden. However, among the 10 most property tax reliant states, Wisconsin appears to have the tightest cap on increases.
We do not argue in this report for higher or lower local taxes and spending. Instead, this study seeks to outline municipal revenue options and their inevitable tradeoffs. In so doing, we hope to avoid partisanship and instead give readers insight into the best ways of financing essential local services.