Let Them Eat Exemptions: The nationwide rebellion sending local governments to the guillotine

Root Causes is our policy analysis series, grounded in rigorous, nonpartisan research, and written by Rachel Bouzis, the Trust’s Director of Policy & Learning. Each installment examines the systems, data, and decisions that shape the health and well-being of Natrona County residents by going beyond the headlines to understand why things are the way they are, and what it means for the people who live here. We believe an informed community is a healthier one.

As home values have increased an average of 50% nationwide since 2020, so too have the property taxes homeowners pay on them. A flurry of tax reform initiatives has ensued in more than two dozen states to significantly reduce or eliminate property taxes entirely¹. Voters in Florida, Oklahoma, Tennessee, Indiana, North Carolina, Michigan, and right here in Wyoming² will all be asked this November whether the taxes they pay on their homes are worth the services they receive in exchange. Welcome to the Property Tax Revolt election.

At the Trust, we hear that as a health question. Property taxes pay for a great deal of what keeps people in Natrona County healthy and safe from one day to the next: the firefighters and paramedics who answer 911 calls, the lunch and company at the senior center, the library, the park down the street, and the schools our kids attend. At the same time, a tax bill that grows faster than a paycheck is a health risk of its own. Financial stress costs people sleep, and households stretched thin on housing costs cut back on groceries, prescriptions, and doctor visits. Both sides of this debate are talking about the wellbeing of our neighbors. The real question is which trade-off leaves them better off.

An old tax with an image problem

Property taxes can be traced all the way back to ancient Mesopotamia, and today nearly every country in the world and all 50 states institute some form of tax on property ownership³. Debate over them is as old as America itself, beginning with Alexander Hamilton (pro) and Thomas Jefferson (con)⁴. It’s nice to know some things never change.

Our disdain for property taxes may well be due to one of its benefits: transparency. Unlike sales tax which is spread across thousands and thousands of transactions or even income tax that’s incrementally withheld throughout the year, property tax is one lump sum that’s easy to find. Homeowners can more easily weigh that amount against the services they receive. We’re seeing this accountability in action as homeowners speak out against the drastic increases they’re seeing. It also makes them easy to resent.

A constitutional amendment to abolish local property taxes, with no plan to replace the lost revenues, would quite literally ‘defund’ the police – and fire departments, schools, libraries, senior centers, and other local government services – in our communities statewide.

Ohio Gov. Mike DeWine

What property taxes buy

What property taxes lack in goodwill, they make up for in efficiency. This is for a few different reasons, some of which are economically based and the others more practical. Unlike sales and income taxes, which penalize spending and productivity, property taxes do little to discourage growth. Second, property tax is a stable source of revenue. This matters especially in Wyoming, where without an income tax, we’re exposed to the booms and busts of extraction. Sales tax isn’t much safer. It rises and falls along with energy cycles and drops fast in a recessions. Property tax affords government some predictability in budgeting. But perhaps most importantly, property taxes give communities what they’re paying for.

Property tax is best understood as the mechanism by which homeowners pay for goods (streets, parks, public transit) and services (police, snow removal, weed and pest control) that protect the value of their homes. It is definitionally local control.⁵

It is undeniably true that the benefits funded by property taxes align with the value of a given property far better than under almost any other system, at any other level of government.

Jared Walczak of the Tax Foundation

While many taxpayers don’t directly benefit from many programs funded by federal and state taxes (although there’s ample evidence of their broader social benefits), every homeowner benefits from the services provided by property tax. Properly funded emergency services are critical for homeowners’ safety but also for the value of their home. Similarly, childless homeowners may not ever use public schools for enrollment, but the resale price of their house is directly tied to the quality of the local school district. The same can be said of parks, libraries, and other recreational amenities⁶.

In Casper, our fire department has earned an ISO Class 1 rating, which is the highest rating from the independent Insurance Services Office. ISO grades four fire safety components: emergency communications, staffing, municipal water reliability and supply, as well as risk reduction. This puts our fire department in the top 1% of all fire departments nationwide. For homeowners, this is worth more than peace of mind; insurance companies factor this rating into the price of coverage. Certainly property tax reductions would not result in our entire fire department dissolving, but its capacity would be unquestionably reduced. Some local fire chiefs have warned that the fire safety ecosystem is so dependent on property tax revenues that insurance rate hikes may actually erase property tax savings⁷.

When the bill grows faster than the paycheck

When a retired schoolteacher cannot afford to stay in the home she paid off 30 years ago because her government keeps raising her taxes on its inflated paper value, the American Dream is not slipping. It is being taken.

Fred Harrison in Cowboy State Daily

None of this is to say that the system is perfect. Runaway property tax growth can cause serious financial strain on homeowners, especially in the face of widespread inflation. Between 2022 and 2024, residential property taxes in Wyoming rose 24%, from $530 million to $657 million⁸ while consumer prices rose about 7%⁹. Lawmakers enacted new exemptions that cut residential taxes to $535 million in 2025¹⁰. Homeowners needed relief and our legislators responded.

Older residents on fixed incomes have become the face of the push to cut property taxes. This group deserves protection, so many of them in Wyoming receive the Long-Term Homeowner’s Exemption, a 50% property tax reduction to qualifying homeowners 65 and older¹¹.

It’s worth noting that Wyoming foreclosure rates have remained relatively static over the past 10 years and well below the national average. Of course, avoiding foreclosure is hardly an indicator of wellbeing, nor does this metric account for the immense burden of financial stress. It simply illustrates that foreclosures have not spiked alongside property taxes.

Lessons from California’s Prop 13

This isn’t the first Property Tax Revolt since Hamilton and Jefferson sparred. In 1978, California voters were facing extreme inflation, skyrocketing home prices, and ballooning tax bills. They passed Proposition 13 by nearly a 2-to-1 margin. This measure, among other things, cap most property tax rates at 1% of a property’s full cash value and caps annual assessment increases at 2%. For example, if a homeowner in Los Angeles purchased a home in 1977 that is worth $1 million today, they would pay less than $500 in annual property taxes. If their neighbor purchased the house next door at that same price in 2025, their bill would be $10,000¹².

Nearly 50 years later, Prop 13 has reshaped California property markets, services, and stability. After property taxes were slashed by nearly 60% overnight, local control was essentially relinquished as local governments looked to the state for backfill. Today, this measure is estimated to have cost California local governments more than $1 trillion¹³. The state is now heavily reliant on the notoriously volatile sales and income taxes, rendering state budgets unpredictable and exposed to drastic surplus to deficit swings¹⁴. It’s also made home ownership less attainable, as existing homeowners are enormously incentivized to stay put, even in homes that no longer fit their needs, while would-be buyers are forced to remain renters.

Meant to make life more affordable, Prop 13 instead unintentionally manipulated real estate markets, stifled growth, and steepened inequality. Voters ultimately made California more expensive¹⁵.

Proposition 13’s proponents argued that it was a simple property tax reform. Yet its effects were not simple, altogether expected, or always benign.

Jeffrey Chapman on California’s Prop 13

Could it happen here?

But this could never happen in Wyoming. We’re too thoughtful to make such a consequential decision nearly impossible to reverse. That period of high inflation, government distrust, and economic uncertainty may have spooked California into a disastrous overcorrection, but we would have kept cooler heads here. We’re way too independent to ever risk handing over local control. Plus, in 1978, the state of California had a large, cushy surplus¹⁶, and those Californians were easily seduced by a quick payoff. We would never give way to that temptation. We would never trade a smaller tax bill for a longer wait on an ambulance, a thinner fire crew, or fewer meals and less help at the senior center. We would never tell that retired schoolteacher she can keep her house but must give up the services that help her stay healthy in it. We are too disciplined, too conscientious, too cowboy to be so foolish.

No, Wyoming could never be like California.

Sources

1. Do You Really Own Your Home? A Tax Revolt Says No. ↩
2. Understanding Property Tax Revolts: An Explainer ↩
3. Confronting the New Property Tax Revolt ↩
4. Do You Really Own Your Home? A Tax Revolt Says No. ↩
5. The Great American Property Tax Freak Out ↩
6. Confronting the New Property Tax Revolt ↩
7. Proposed property tax exemptions imperil fire services statewide, chiefs say ↩
8. Wyoming Taxpayer Association Publications & Reports ↩
9. U.S. Bureau of Labor Statistics ↩
10. Wyoming Taxpayer Association Publications & Reports ↩
11. State of Wyoming Homeowner and Long Term Homeowner Notification ↩
12. Do You Really Own Your Home? A Tax Revolt Says No. ↩
13. Learn from Prop 13 History to Avoid Repeating Past Mistakes ↩
14. Do You Really Own Your Home? A Tax Revolt Says No. ↩
15. The Property-Tax Revolution ↩
16. The Great American Property Tax Freak Out ↩