Renegotiate city deal
As Gov. Scott Walker and state legislators take up the state budget this year, they should pay attention to what Milwaukee leaders told them Monday: The city is getting the short end of the stick in its financial deal with the state, and it’s time to renegotiate.
The problem is simple: The state has been giving the city less money in shared revenue while at the same time limiting the tools the city has to raise its own revenue. And, of course, the city’s costs aren’t fixed: They go up for such things as benefits and personnel. That’s not sustainable. Common Council President Ashanti Hamilton described Milwaukee as “a net exporter” of revenue to the state, and Mayor Tom Barrett said that city taxpayers send far more money to state coffers than they receive back from the state in shared revenue. He also said the city was launching an “offensive to change the narrative” about Milwaukee sucking up an excessive amount of state funds.
They’re right on the gist of their argument: City figures show that state shared revenue in 2005 was $230,605,000, which more than covered the Police Department budget of $185,962, 917. Last year, the aid didn’t come close as shared revenue was at $218,992,000 and the department’s budget is at $277,233, 534. How does the city sustain its budget with numbers like that?
Rob Henken of the nonpartisan Public Policy Forum had this to say last September in a commentary on this page: While city officials have been managing their finances responsibly, “The city’s revenue structure is broken, as frozen state aids combined with a lack of local revenue options leaves it unable to generate the resources needed to accommodate growth in its fixed costs. Until state lawmakers allow that structure to be modified to reduce the city’s reliance on property-related revenue, and to provide wherewithal for annual increases that mirror the rate of inflation, city finances will continue to be stressed, and hopes for substantial new investment in public safety and other needs likely will be out of reach.”
Yes, Milwaukee has the highest concentration of poverty in the state, which carries with it a heavy cost in social services. But Barrett’s point is that the cost is more than offset by the revenue and business generated in the city and, we would add, the region. Legislators need to remember that, and to understand that if Milwaukee succeeds, the state succeeds. And that if the city is left to struggle, the state will struggle as well.