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Your Tax Bill in 2023
Your Tax Bill in 2023
Your annual tax bill from the city starts with the assessed value of your property, as recorded in the city tax roll. Bayfield contracts with a professional assessor to keep our roll current, as sale prices go up and improvements are made. While the assessor updates some records annually, by 2023 our tax roll needed what they call an interim market update. Hence most of us -- 690 of the 757 property owners who pay tax -- received word that the assessed value of our property had increased.
When tax bills arrived in late 2023, though, conversation with neighbors revealed that not everyone whose assessment had increased in 2023 also saw an increase in tax owed in 2023 versus 2022. This struck me as something a member of city council should be able to explain, so I took a dive into the tax rolls. The county treasurer Jenna and her skilled GIS technician Carmen were generous and prompt in supplying the data I needed.
The figure below shows the change in assessed value (%) between 2022 and 2023 for properties valued below $1,500,000 or that had less than a 150% increase in their assessment. The solid dots indicate parcels that had an increase in tax owed and open circles are those that saw either no increase or a decrease. (Limiting the range like this greatly improved clarity of the graph and eliminated just eight tax parcels.)
The line separating those of us (well, of you) who paid higher taxes in 2023 occurs at an increase in assessed value in 2023 of 33.46%. Those of us with increases less than this (or decreases) owed less tax in 2023 than in 2022.
The explanation: your tax bill is the product of your assessed value times the city mill rate ($ tax/$ assessed value). The mill rate decreased from 0.006987213 in 2022 to 0.005235104 in 2023, so unless your assessed value increased by more than about 33.46%, your tax bill went down. (You can do a little math to prove this to yourself with the equation: tax = assessed value X mill rate, for both years and setting them equal.)
Well, ok, but who decided the mill rate? This gets messy. The mill rate is calculated by dividing the tax levy (total amount of real estate tax the city wants to collect in a year) divided by the city's equalized value. This equalized value is set by the Wisconsin Department of Revenue, related loosely to our total assessed value compared to other municipalities (that's just about as far as I understand it -- sorry).
But the state also enters the picture by capping the tax levy that the city council can impose, and thereby capping or driving down the mill rate. This is a big problem for many cities in Wisconsin and why we will face a structural deficit -- that is, insufficient revenues to fund day-to-day operations of the city -- real soon now. A big boost in some new revenue source and a referendum to raise our taxes will likely both be needed.
Originally published May 16, 2024
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