Equalization must remain a fundamental principle of government finance applied to all major appropriations. Tax base equalization has been a fundamental principle of local governmental finance in Wisconsin for over 30 years. The state uses its taxing authority to overcome fiscal inequities between communities and help assure a minimum level of services regardless of location. Appropriations for local governments to deliver services on the state s behalf should also increase to reflect the realities of the cost of delivering those services and meeting demand. Therefore, funding levels should reflect such variables as inflation, population growth, demographic changes and changes in service demands generated by federal and state action.
Property tax is the main source of revenue for local governments.
However, over the past several decades the property tax base has been eroded by the enactment of numerous property tax exemptions. There has been extensive discussion of new local revenue options. In cases where local governments are providing services at local discretion, they should have the option of diversifying their revenue base, including taxes, fees and charges, within a specific set of criteria. However, local governments should not be expected to create additional local taxes to fund services they are required by the state to deliver.