County worries about services, cuts
Safety net programs are increasingly critical
Milwaukee County officials say a projected revenue loss of more than $100 million combined with millions of dollars in increased costs brought on by the coronavirus pandemic will hinder its ability to continue responding to the health crisis and providing critical services to residents.
Milwaukee County is on the front lines of the pandemic and was already contending with budget challenges before the health crisis, County Executive David Crowley said.
“Before COVID, we literally didn’t have any fat to trim from when you think about Milwaukee County,” he told the Milwaukee Journal Sentinel.
“We’re starting to file at the bone at this moment.”
He said the county has been doing what it can to find millions in cuts and savings, including through furloughs and freezes in non-pandemic hiring and spending, but that’s not sustainable.
The county’s services include a regional 911 system and coordinating emergency operations to respond to the pandemic. But they also include providing services in the realms of mental health, housing, child welfare and nutrition for seniors that officials say are increasingly critical as residents feel the effects of the pandemic on their health and bank accounts.
And county leaders are calling on the state and federal governments to provide greater financial assistance to Milwaukee County and other counties. Counties need more direct and flexible funding, Crowley said.
About half of Wisconsin’s deaths and 40% of the confirmed coronavirus cases have been in Milwaukee County, according to state data.
The county is projecting that the pandemic will result in a loss of more than $100 million in revenue this year, about $40 million from Mitchell International Airport and $60 million in nonairport losses.
At the same time, county officials say about $40 million is expected to be spent by the end of the quarter on direct pandemic-related costs, including on personal protective equipment, overtime, emergency operations centers, a temporary homeless shelter and cleaning, among other costs.
And that figure is expected to climb
substantially as the county moves into recovery and reopening efforts.
“Before COVID, we literally didn’t have any fat to trim from when you think about Milwaukee County. We’re starting to file at the bone at this moment.”
County Executive David Crowley
Revenue losses hit county budget
The county is currently projecting a $20 million less in sales tax revenue for the year than had been expected and $35 million in lost program revenues.
The projected loss in sales tax accounts for about a quarter of what the county would have expected to take in during the year. And that figure assumes that the state order that has closed businesses and forced residents to stay home is lifted, allowing business to return to a more normal level.
The loss in sales tax could be higher, County Budget Director Joe Lamers said.
“If the current circumstances were to remain throughout the year, we could be losing upwards of $30 million or more in sales tax,” he said.
Many of the county’s programs generate revenue to support their functions, and these operations are largely closed, Lamers said.
The largest losses in program revenue have come from the parks, Milwaukee County Zoo and the buses, which are not charging fares during the pandemic, he said.
The county is also anticipating a loss from uncollected property taxes if residents can’t afford to pay due to the economic circumstances in addition to lost revenue that the county collects from the Potawatomi Hotel & Casino.
But, Lamers said, there is some good news when it comes to the Milwaukee County Transit System and the airport because the county is expecting to receive federal funding that will help address those shortfalls. That funding would also be used for pandemicrelated costs in those areas, so the money would not erase the revenue losses.
The transit system is expected to receive $54.9 million in federal CARES Act funding while officials anticipate receiving $29 million for the airport.
And, unlike in other areas that have seen incoming cash drop off in the pandemic, the federal funding for the transit system and the airport can be used to fill the revenue gaps, Lamers said.
Furloughs, spending freezes in place among other measures
Between $20 million and $30 million has been saved through furloughs, reduction in employees’ work hours and a freeze on hiring and spending that is not directly related to responding to the pandemic, Lamers estimates.
Other measures are under consideration to get cost savings to $60 million.
About 775 county employees — or about 20% of it’s approximately 4,000person workforce — have been furloughed or had their hours reduced. Officials anticipate that number will increase to more than 1,000.
So far, the county has avoided impacting public health, public safety and emergency management but at some point it’s impossible to continue relying on areas not associated with pandemic response to bear the brunt of cost cuts, Lamers said.
“We know, based on the large deficit Milwaukee County is facing, budget cuts will be significant and eventually we will have to cut services,” Crowley’s chief of staff, Mary Jo Meyers, said in a statement. “We don’t have a crystal ball, and can’t say definitively right now what that will look like.”
But, she said, key services won’t be able to escape the budget reality.
“Currently, our frontline workers are doing as much as possible to provide the highest level of service to the residents of Milwaukee County. As much as we want to do everything in our power to continue services without interruption, we know without a doubt there will have to be future cuts,” Meyers said.
Crowley and Milwaukee County Board Chairwoman Marcelia Nicholson said they will be addressing budget shortfalls with racial equity top of mind.
People of color in Milwaukee County and Wisconsin have been disproportionately affected by the pandemic, exacerbating long-existing disparities.
“The coronavirus has impacted people of color at a disproportionate rate in terms of health, and now it’s also impacting them in terms of services,” Nicholson said.
County requests additional $103 million from state
The county doesn’t believe $62 million in additional CARES Act funding will be enough to cover its rising pandemic-related.
County leaders, in addition to leaders of its 19 municipalities, have asked Gov. Tony Evers to send to the county $103 million in CARES Act funding that the U.S. Treasury Department reallocated from the county to the state.
In an April 25 letter to Evers, before Crowley took office, former County Executive Chris Abele and Nicholson noted the county’s role in providing emergency management, public health and human services and infrastructure central to addressing the pandemic in the county’s municipalities.
“County governments across Wisconsin, regardless of population size are working tirelessly to advance the recovery of their communities — and each of us are struggling to meet the growing financial cost of this battle,” they wrote.
They said having necessary resources was critical to responding to the crisis and included in their request of Evers was to send to the county $103 million.
Nicholson called the $103 million “vitally important” but also said there’s a need to go beyond that sum.
“My current focus goes beyond asking the governor for that $103 million,” Nicholson said. “We also need our partners in Congress and the federal government to make additional direct, flexible aid available to every state and county government.”
A spokeswoman for Evers did not respond to a request for comment on the county’s funding request Friday afternoon.