County sales tax
But hearing comes after floor session has ended
Milwaukee area officials make their pitch for an increase.
MADISON - Milwaukee area officials got their chance Thursday to make the case for raising the sales tax, but the timing of their public hearing underscored how doomed their effort is.
Local leaders have long argued they need more money to fund their operations, but Republicans who control the Legislature have emphasized the need to contain taxes. They have put tight caps on property tax increases, declined to raise the sales tax and cut the income tax.
Supporters of a higher sales tax got a victory of sorts Thursday with a hearing before the Assembly Ways and Means Committee. But the hearing came two weeks after the Assembly ended its floor session for the year, which means there is virtually no chance the measure can pass in 2020.
The committee’s chairman, Republican Rep. John Macco of Ledgeview, said he was holding the hearing “for the sake of discussion.”
“We want to hear (some bills) even though we know they probably won’t advance,” he said at the outset of the hearing.
Local officials contend their needs are essential and used Thursday’s hearing to make their arguments. With flat state aid, limits on property taxes and rising costs, a higher sales tax is necessary to pay for government operations, they said.
“The dollar is not stretching far enough to keep up with inflation,” said Sen. LaTonya Johnson, a Milwaukee Democrat leading the push for the legislation.
Milwaukee Mayor Tom Barrett testified that actuaries have determined the city needs to put $165 million a year into its pension fund starting in 2023 — more than double what it pays now.
“Now you know why I’m here,” Barrett told lawmakers. “We have to figure out how we deal with this issue. It’s not today. It’s not tomorrow. It’s 2023.”
He noted the police budget exceeds the total amount of property taxes collected by the city. That means more and more of the city’s state aid is going to the police.
“That’s going to continue ad infinitum,” he said.
Republicans were skeptical of the legislation.
“This is a straight-out tax on the people who already can’t afford it,” said Republican Rep. Kevin Petersen of Waupaca.
GOP Rep. Robert Wittke of Racine said officials should be looking for ways to reduce property taxes and income taxes.
“This doesn’t fundamentally change the way we do anything,” he said.
Republican Rep. Timothy Ramthun of Campbellsport said Wisconsin comes in too high in tax rankings.
“We’re not in a good place and we need to get off that list,” he said.
Outgoing Milwaukee County Executive Chris Abele testified that more funding for the county is necessary. If lawmakers don’t want to raise the sales tax, he would be happy to negotiate coming up with other revenue sources, he said.
“The one thing I would have an issue with is inaction. We need to do something,” he said. “Inaction comes with a very, very serious cost.”
Assembly Bill 521 would allow Milwaukee County to raise its sales tax by 1 percentage point if approved by voters in a referendum. A quarter of the money would go toward property tax relief and 7% of it would go toward infrastructure projects affecting public health, such as replacing lead pipes. The remaining 68% of the revenue would be split between Milwaukee County and municipalities within the county to use as they saw fit.
The current sales tax in Milwaukee County is 5.6 cents per dollar, with 5 cents going to the state, 0.5 cents going to the county and 0.1 cents going to Miller Park. The Miller Park portion of the sales tax will end this year.
If the tax were raised under the proposal, the sales tax in Milwaukee County would be 6.5 cents per dollar. It would generate about $160 million a year.
Democratic Rep. Evan Goyke, a sponsor of the legislation from Milwaukee, said he would be open to an amendment that would make the bill apply to other communities as well.
“We are showing the need the greatest because we’re the biggest,” he said. “But we’re not unique.”
The prospects of passing the legislation in 2021 don’t look better than they do this year. Republicans are expected to maintain control of the Legislature after the fall elections and have long opposed plans to raise the sales tax.
Goyke acknowledged ahead of Thursday’s hearing that the effort faces an uphill battle in Madison. But he said that was dwarfed by the importance of holding the hearing.
“If the bill does not pass in its exact form this session, then (the hearing) still has great value in having this public debate,” he said Wednesday.