Last May opponents of expanding private school vouchers to Racine argued, among other things, that program expansion would lead to a large property tax increase in Racine. Specific estimates for potential tax increase caused by the choice expansion were as high as 15%.
So what actually happened? According to the Racine Unified School District (RUSD) budget, property taxes went up 4.43% in 2012, and are forecast to increase 4.37% in 2013.
Thirty percent of the expected 2013 $3.56 million overall tax increase in RUSD is attributable to the private school choice program. That amount, $1.12 million, represents a 1.37% property tax increase for Racine. In other words, taxes levied on Racine property owners will increase 1.37% in 2013 to pay for part of the Racine choice program, not 15%.
Several factors account for the difference between the warned and actual tax increase:
- The Racine choice program was capped at 250 pupils in 2012 and will be capped at 500 pupils in 2013.
- Prior eligibility requirements. The Racine choice program is targeted to new students (i.e. kindergartners) and transfers from RUSD. Like the cap in 2012 and 2013, these requirements will limit program, and tax levy growth.
- Walker’s budget. The 2011-13 budget reduced revenue limits by 5.5% in year one, and increased them by $50 in year two. Limiting the total amount districts can raise in state aid and property tax all but ensures tax increases will be minimal.
A lesson from the Racine choice expansion is that the infrastructure of choice takes time to develop. Historic growth in choice programs is slow and fairly predictable – a fact that will prevent sudden large increases in property taxes.
As choice expands in Racine the cost to local taxpayers to pay for the program will necessarily grow. However, taxpayers should not forget that the school choice tax pays for the education of Racine students that would most likely otherwise be in RUSD, where they would also require local tax revenue.