Wawasee property tax rate is the lowest in the state

Since property taxes are currently a hot topic in the Indiana legislature and will continue to be for some time, I thought I would share some information about the WCSC tax rates.

Because the Wawasee area has so many lakes and lake property, Wawasee School Corporation is ranked second in the state in property wealth per pupil. This property wealth, called assessed valuation (AV) impacts property tax rates by driving them down.

Wawasee Community School's property tax rate is now the lowest of any public school corporation in the state. This ranking data is available on the internet by clicking here and then clicking on "Top 10 corporations" under the title "Delve Deeper into Data." Then click on 2004 tax rate (before CAGIT).

These rankings are based on the latest state figures using 2004 (before CAGIT) tax rates. CAGIT stands for County Adjusted Gross Income Tax which some counties have used to lower dependence on property taxes. Using before CAGIT taxes is a better picture of the true tax impact.

You will see two school districts ranked lower than Wawasee on the chart. However, Brown County's tax rate says 0.000 because apparently they don't have their assessments done. The other one, Prairie Township in Laporte, is evidently not a public school system like ours because it has no students. I assume they are taxing the whole county for some administrative school services under the Prairie Township title.

The highest rate in the state is Medora Community School Corporation at 2.4755. The state average was 1.4457 and Wawasee had the state's lowest public school tax rate of 0.8605. So what does that actually mean for a tax payer? Let's say that your property tax bill shows about $1,000 going to schools. (Remember, not all property taxes are school taxes although in most counties it makes up a pretty good chunk of it.) If you lived in the higher tax rate areas your bill could be around $2,877 for schools. If you were just taxed at the state average you have approximately $1,680 going to schools.

Another way to look at it is to add $292.60 for every $50,000 of assessed valuation in your home over and above your current WCSC property taxes. This is what you would pay if your home was taxed at the state average. If your home was located in the highest school tax area of the state you would have to add $807.50 for every $50,000 of assessed valuation in your home.

Some people have said the only reason the rates are so low is because the home values around the lakes are so high. That is true. However, if you owned a home of similar value in another school district you would pay THEIR tax rate not ours. Having said all that, while we would like to take credit for such low tax rates we should remind everyone that we (meaning administrators and school board members) have minimal control over tax rates and no control over the funding formulas the state uses. When your property VALUES go up, it lowers the taxing RATE to fund the formula. The school system does NOT get more revenue just because the property values increased. In fact, the state essentially withholds state revenue and sends it to other schools. While towns and municipalities can often capture some increased revenue when AV’s go up, schools cannot. In fact, this year and next year mark the first time in my administrative career that our school system received no new money through the state funding formula.

When the debt payments for Wawasee Middle School come off the tax rolls in 2007 I am sure it will help maintain our "lowest" tax rate status in the state of Indiana by driving them even lower.

However, there is good news and bad news for local taxpayers in this situation. When our AV is high and tax rates are low, the state funding formula will kick in and try to drive those rates up closer to our state designated “target tax rate.” The state’s purpose in this is to try to create a little more tax rate equity across the state.