Property owners in the Mukwonago Area School District will have a pleasant surprise when they see the school tax rate for the 2016-17 school year on their tax bill. Higher property values and more money in state aid brought down the mill rate from what was estimated in the preliminary budget a month ago.
With third-Friday enrollment numbers in and state aid finalized, the school board approved the 2016-17 tax levy, which included a mill rate of $8.82 per $1,000 of assessed property value.
This is a decrease from the preliminary rate of $9.07 and a 5-cent increase from the 2015-16 tax rate of $8.77. Before the referendum passed, district officials estimated the tax rate would increase about 38 cents per $1,000, Director of Business Services Tom Karthausser said.
For the owner of a $250,000 home, the 2016-17 mill rate would result in about $2,200 in school district taxes, which is about $62 less than expected in the preliminary budget.
While the tax levy was anticipated to come in at $28.1 million, or a 3.44 percent increase over the previous year, a $258,000 increase in state aid helped drop the 2016-17 levy to just over $28 million or a 2.94 percent increase over the 2015-16 levy of $27.2 million.
The lower than expected tax rate is the result of a combination of good interest rates and an increase in property values in the district.
"Usually when property values go up, it brings the mill rate down," Karthausser explained. "Ultimately it doesn't change the amount of money the district has. It just changes who that money is coming from. We either get it from the taxpayers or we get it from the state."
The increase in school district taxes, which makes up about 60 percent of the municipal tax on a property, is the result of higher long-term debt from the $49.5 million referendum passed in April for improvements at Mukwonago High School.
MASD Superintendent Shawn McNulty reminded board members that school taxes are based on property values in each of the 11 different municipalities within the district.
"In some municipalities property values may increase more than others," McNulty said. "We always have to explain that to our taxpayers."