Increase in assessed values good news for most Shawano city property owners

SHAWANO — Most city property owners can expect some relief on their tax bills this year, even with an increase in the tax levy, thanks to higher assessed property values and a broader tax base, according to the 2020 budget that will head to the Shawano Common Council for approval later this month.

The city is proposing a tax levy for city purposes of $5.28 million, up from $5.2 million in 2019. The total tax levy when all other taxing entities — county, school district and technical college — are included will rise from $12.6 million to $12.98 million.

But higher assessed property values, as a result of a citywide revaluation, and fewer tax dollars needing to be set aside for Tax Incremental Finance (TIF) districts this year has given the city a broader base over which to spread the tax burden, according to city officials.

“We have a larger pool to tax from,” City Administrator Eddie Sheppard said at a special meeting Tuesday of the finance committee and Common Council.

TIF districts are areas where municipalities invest in infrastructure, such as sewer and water, to attract development where it might not otherwise occur, or to make improvements, such as eliminating blight.

Whatever increase in tax revenue that results from development in those districts goes to paying back the debt the municipality incurred from making improvements to the district.

Two of the city’s TIF districts were retired this year, allowing that revenue to go back onto the tax base; a change that is benefiting all taxing entities, including those that had projected tax rates to go up.

The city’s tax rate will drop from $10.17 per $1,000 of assessed value to $9.55 per $1,000, a decrease of 62 cents. That means the owner of a $100,000 home will pay $62 less in taxes this year.

Shawano County, which had projected an average countywide increase of 30 cents per $1,000 of equalized value, will actually see its city of Shawano residents paying 13 cents per $1,000 less based on assessed values.

The county’s tax rate in the city will drop from $5.32 per $1,000 of assessed value to $5.19 per $1,000. That means a decrease of $13 on a $100,000 home.

The Shawano School District’s assessed tax rate in the city will drop from $10.08 per $1,000 to $9.58, a decrease of $50 on a $100,000 home.

Once the state school tax credit is figured into all that, the total tax bill for city property owners will drop from $24.64 per $1,000 of assessed value to $23.48 per $1,000.

That means a decrease in the tax bill of about $116 on a $100,000 home.

That also comes with a caveat, however, because a higher assessment means a lower tax rate on a more expensive home.

According to calculations from the city, which looked only at the impact of the city’s tax rate and not the total tax rate, a $100,000 home still valued at last year’s assessment will see a $62 decrease in the city’s portion of the total tax bill.

That will change for property owners whose homes increased in value due to the citywide revaluation.

If the home rose in value by 5%, from $100,000 to $105,000, the property owner would see a $14 decrease in the city’s portion of the tax bill.

If the reassessed property value rose by 7%, from $100,000 to $107,000, property owners will actually see a $5 increase for city purposes in their tax bills, according to city calculations.

The tax bill continues to go up depending on the increase in the assessed value.

Overall, the city’s operational budget is increasing by 2.6%, with the general fund rising from $7.38 million to $7.57 million.

The budget includes a 2.5 percent across-the-board wage increase, but no new positions or programs.

The budget includes an increase in garbage collection fees of $4 from $154 to $158 because of increased recycling costs the city is facing, according to Sheppard.

Debt service is increasing from $1.97 million to $2 million.

The city will borrow $126,500 for capital improvement projects next year that include a police department conference room, roof repair at the fire department, a cemetery truck for the parks department, a furniture upgrade at the civic center and an office furniture upgrade at city hall.

Also included in that is $30,000 in matching funds for a dog park, provided someone comes forward with a donation in that amount for the project.

The Shawano Common Council will hold a public hearing and vote on the budget on Nov. 20.