Saturday, September 04, 2010

Reinvesting the school levy tax credit.

Hi everyone,

The answer to our current school district funding squeeze has been a droning chant that sounds like this: "cutcutcutcutcut."

This suggests that we're thinking inside the box. What if there were money that we'd already put into the tax pipeline we could redirect to fix the problem. Wouldn't that be cool?

Well, there is and we can.

Saturday's column.

Reinvest school tax levy credit

When I was 6, my favorite elephant joke was:

Q: How do you get down off an elephant?
A: You don’t, you get down off a duck.

The West Bend School District needs about $2 million to remain solvent but, instead of finding ways to resolve this terrible problem, our local cut-everything cartel keeps trying to get down off an elephant. The shrinking education funding stream, increasingly choked off by its own framing legislation, will accommodate only a shrinking educational experience. It cannot support even an equal level of performance.

We can’t solve a problem by using the same tools that are causing the problem. We need to get down off a duck instead. Here are a few feathers in that direction.

The school levy tax credit, possibly as much as any other factor, has caused the precipitous fall in state contributions to local district funding. Our representatives in Madison nonetheless include this tax credit in their calculation of how much state aid the state provides to schools -- and that's a scam.

No real money goes to the schools or back to you as the taxpayer. What we get instead is a tax credit on our property tax bills, a form of currency those of us accustomed to the state budgeting process call "funny money" -- even though it isn’t funny and it isn’t money.

It’s like paying your money then getting a store coupon or rebate for the same amount. This looks great until you realize that the store has already spent it for you, and on something you didn't want. Clever trick. It allows our state guardians to claim that they're returning money to the taxpayer without having to actually return any money.

Things are even worse if you rent. When you rent, part of your monthly check goes to pay property taxes for the apartment’s owner, so you’re already paying into the system but the levy goes back to your landlord’s property tax bill. As a renter, do you ever see any direct benefit from that? Did your rent drop a few years back when they passed this bill? I’d bet the answer is no.

When the Legislature decided to give money directly back to taxpayers (or, rather, property owners in the form of a tax credit on a property tax bill) the district in West Bend lost about $2.7 million from its budget: roughly the amount the district is currently, and bravely, struggling to find. So far the only solutions we’ve seen involve an increasingly desperate hunt for more programs to cut.

But bleeding the elephant simply means it’ll roll over on to you sooner and finding smarter ways for the school district to survive it’s state-imposed educational anorexia simply condemns the district to death by starvation.

According to a Legislative Finance Bureau memo to Sen. Russell Decker (from Feb. 2, 2010), if we were to shift money from the school levy tax credit back to the equalization aid formula, West Bend would (re)gain $2,784,119 in revenue for the school district.

The Legislature seems unlikely to go back to the old funding formula so what about this: What if local taxpayers could get that money back in the form of real dollars, instead of funny money tax credits and then reinvest that money in the school district? In other words, what if local taxpayers decided to spend that money on the schools? If we did, the district would remain solvent and we wouldn’t have to gut the programs we want to keep our kids competitive in the global economy.

Reinvesting the school levy tax credit would halt the current, legislatively structured, strangulation of district finances. It would more than cover the current short falls and – best of all – it wouldn’t be a new tax, it would be a re-apportionment of money we’ve already put into the pipeline. Plus we’d get to decide how we want it spent, rather than that infamous faceless bureaucrat in Madison.

Crediting our tax levy credit back to its original purpose would buy us time to work out the systemic problems with a funding formula that is pushing poor and, in our case, frugal districts over the cliff ahead of districts like Elmbrook where they can still afford to teach fourth-graders to play the violin while we can’t even afford to fix the roof.

When the deck is stacked, pick another game.



Mike said...

You'll notice that there are very few comments on this post. That is because conservative critics of public ed really do not understand the financing of schools. If they did they would be agreeing with you 100%. Even DQ boy.

Kevin Scheunemann said...


I just want to correct you, so you don't speak from future ignorance.

I serve as volunteer treasurer of my local Christian Day school/church, which includes payroll and tax return filing.

I understand very well the issues of school financing and understand the bloat and excess in the public school budget.

The fact that you advocate further forced sacrifice to wasteful, and racist public school systems like MPS, disturbs me greatly. MPS has a HS grad rate of less than 50%. Putting more money into that system is like using $100 bills to kindle your fireplace.

I have no problem with you defending Peterson's call for further government waste, (its your right to call for dumb government policy) but please, when referring to me on a personal level, understand the facts first.