A survey of Fox Cities communities shows that an average household will pay $2,271 in property taxes and user fees for municipal services next year.
Taken as a whole, $2,271 is a looming sum, especially since it accounts only for municipal services — not school or county services. Broken down, though, the monthly cost is about $189. That’s comparable to a family’s monthly heating and electric bill, cable TV and Internet bill, or cellphone bill.
For $189 a month, municipal governments supply residents with water and treat their sewage. They protect against fires and maintain peace and order. They pave and plow streets. They carry away garbage and recyclables. They build and maintain public parks. They provide books, magazines and DVDs for education and entertainment.
“Given that you get police and fire and library and water and sewer and garbage pickup and roads plowed and all of that, it’s not a bad deal,” Neenah Finance Director Mike Easker said.
Post-Crescent Media surveyed finance directors from eight communities to calculate the 2014 property taxes on a $150,000 home and the annual sewer, water and stormwater fees for an average household. The towns of Grand Chute and Menasha have the lowest costs, followed by the villages of Kimberly and Little Chute and then the cities of Appleton, Neenah, Kaukauna and Menasha.
“It’s not surprising that the full-service cities cost a little bit more,” Easker said.
The abundance of municipal services is partially responsible for the high quality of life in the Fox Cities, but those services have come at an increasing cost in both property taxes and user fees.
Retiree Don Miller of Neenah said the burden forced him to move from his house of 46 years into an apartment in August. Miller said while state levy limits have kept property taxes in check, residents on a fixed income have been overwhelmed by double-digit increases in user fees.
“I know I’m paying all of those costs indirectly with my apartment rent,” Miller said, “but it’s something that I can plan for because the rent doesn’t increase 20 to 30 percent (like utility rates).”
Neenah’s sewer fees rose 15 percent this year and will rise another 15 percent next year to help pay for a $22.5 million modernization of the sewage treatment plant. The city’s sewer fees increased 20 percent in 2012, 25 percent in 2010 and 54 percent in 2009.
Neenah’s water fees will increase 3 percent next year, largely to make up for the loss of revenue from Fox Valley Energy Center, which ceased operations in June. The city’s water fees increased 32 percent in 2011.
Miller thinks municipalities should explore outsourcing services to cut costs. He said the collection of garbage and recyclables could be handled more efficiently by companies that specialize in such services, thereby avoiding the recycling fee that Neenah has charged since 2012.
Little Chute Finance Director Teri Matheny said the recent shift from property taxes to user fees will largely stop with new legislation that requires a municipality to reduce its levy limit by the amount generated by any new fee for services that were funded by the levy.
The rules continue to change, Matheny said, but the goal of municipal government does not.
“The bottom line is that every one of us is focused on providing good, quality services to our residents at the lowest cost possible,” she said.
In the survey of communities, Grand Chute’s municipal services cost $1,644, and Menasha’s services cost $2,886. The cost to an Appleton homeowner is just above average at $2,298.
Comparing taxes and fees across municipal boundaries by numbers alone, however, doesn’t tell the full story because each municipality offers a different level of services.
Menasha Mayor Don Merkes said he cringes to see Menasha at the bottom of the list. “It’s just so hard because it’s not apples to apples,” he said. “You kind of get what you pay for.”
For starters, the two low-cost communities, Grand Chute and the Town of Menasha, don’t operate a municipal library. Town residents pay for the use of library services in neighboring communities, but the money is part of county tax levies, which are not reflected in the survey.
Town residents typically receive a narrower spectrum of services.
“We don’t do leaf pickup at the curb, for example, which some of the neighboring cities do,” Grand Chute Town Administrator Jim March said. “We don’t have full-time park staff that put on a lot of different programs. We don’t have a swimming pool.”
March said most residents in the town understand the tradeoff. “We focus on the core, central services, and our tax rate reflects that,” he said.
Accounting for differences
Appleton and Menasha each have higher costs because they fund a health department. Health services in other communities are funded through county tax levies.
The Menasha Health Department accounts for about 5 percent of the city’s expenditures and serves residents across county lines. Without a city health department, Merkes said, Menasha residents in Calumet County would receive a lower level of services than Menasha residents in Winnebago County, creating a divide.
Menasha also pays for street reconstruction projects through its tax levy. In other communities, a portion of the reconstruction costs are billed to adjacent property owners through special assessments.
“It’s a really important thing that we don’t special assess because you don’t get stuck with some big, huge bill that you were not expecting,” Merkes said. “You might be paying a little bit more every year, but you never have this $5,000 surprise one year, either.”
Some of Menasha’s tax burden traces to the city’s failed steam plant. The 2014 levy includes nearly $1.5 million to pay debt incurred for the plant. That translates to $1.59 on the tax rate, or $239 on a $150,000 home.
“We are dealing with it,” Merkes said. “We could have ended up in a situation that was much, much worse. We found a way to make it manageable rather than go down to a part-time fire department and get rid of half our police officers and close our parks.”
Kaukauna and Menasha, the two highest-cost communities in the survey, operate electric utilities that provide some relief to residents. Kaukauna boasts residential electric rates that are 27 percent lower than We Energies, and Menasha touts rates 19 percent lower than We Energies.
The difference can save Kaukauna customers about $270 annually and Menasha customers about $200 annually. The survey on taxes and fees didn’t account for electric costs because most communities don’t have an electric utility.
— Duke Behnke: 920-729-6622, ext. 32, or firstname.lastname@example.org; on Twitter @DukeBehnke