How to Crush Milwaukee
Ending the residency requirement will deal a devastating blow to Milwaukee’s property tax base.
Gov. Scott Walker has proposed ending the residency requirement for local employees statewide. This will have by far the biggest impact on Milwaukee, which has the most public employees. Walker directly addressed Milwaukee, suggesting that “to keep people in the city, you should have a great city.” Talk radio host Charlie Sykes has gone much further, actually comparing Milwaukee to Communist East Berlin, whose Berlin Wall kept people from leaving.
I live in the city, and have for most of my life. I think it’s great city, though it does have problems. But ending the residency requirement won’t help Milwaukee. It will cause massive harm.
In a column he wrote for RightWisconsin (which goes only to paid subscribers) Sykes claims Milwaukee is the only city in Wisconsin and the only major city nationally with a residency requirement. Even for a man who has in the past defended his factual errors as “entertainment,” this one is a whopper.
At least 127 other municipalities in the state have some form of residency requirement (though typically more limited than Milwaukee’s). Nationally, a number of big cities have residency requirements, including Boston, Chicago, New Orleans, Philadelphia and Pittsburgh, as a survey by the Milwaukee Legislative Reference Bureau found.
As for those cities who ended the requirement, the survey found, Minneapolis repealed the requirement in 1999 and 70 percent of its employees now live outside the city. Detroit did so in 1999 and 45 percent now live outside the city. Baltimore repealed in 1995 and 65 percent now live outside the city. Huge numbers of government employees also left St. Louis and Washington D.C. after residency rules were relaxed.
Based on these figures and the fact that in Milwaukee, 50 percent of its retired employees now now live outside the city, Milwaukee officials estimate that it would lose about half of its employees — some 8,700 middle class residents — to the suburbs. Compared to other residents, city employees are more likely to own their homes, homes that on average are worth 20 percent more in assessed value than those of other residents.
The city, in short, would lose a big chunk of its middle class. Housing values and the property tax base could tumble as a result, and spending in the city could decline, hurting businesses and the city’s overall economy. The exodus could transform neighborhoods like Jackson Park, where many police live, or the areas near the airport or far Northwest Side, where many city employees live.
Supporters of ending the residency requirement have argued this will enable the city to hire better employees. But city statistics show there are 42 applications for the average job. In its most recent recruitments, the city received 5,711 applications for the position of fire fighter and 3,569 for the position of police officer.
Walker in particular has argued that ending the residency requirement will help Milwaukee Public Schools to hire better teachers. But a 2006 study by the conservative Wisconsin Policy Research Institute found residency did not have a major impact: just five percent of the 4,699 teachers who had left MPS since 1992 did so because of the requirements. Even so, the Milwaukee School Board has passed a recent measure to address the issue, giving teachers hired for hard-to-fill positions up to two years to move into the city.
The ability of Wisconsin municipalities to tinker with such rules and determine their local affairs is spelled out in the state constitution. Milwaukee’s employees have been subject to a residency requirement since 1938. Is Walker suggesting Milwaukee hasn’t been a great city for the last 75 years? And why would Republicans who support local control change their stance in this instance?
Sykes and others have argue this is a matter of personal freedom. But these employees are free to seek other jobs at any time. And their unions have long had the option of taking less wage and benefits increases in return for ending residency, and declined. Twice in recent years the police and fire unions made a wage concession to end residency and the arbitrator (whom Republicans have often complained tend to favor unions) ruled that the offer was inadequate.
Police and fire workers often grumble about property taxes in Milwaukee, which are higher than many surrounding suburbs. But the major reason for that is the wages and benefits they are paid, which accounts for 60 percent of the entire city operating budget.
Police and fire workers may have the best retirement package of any employees in the state, allowing cops to retire as early as age 43 and fire workers as early as age 49. Needless to say, they have been unwilling to give this up in exchange for the city relaxing the residency rule. Yet they now want to circumvent the very collective bargaining system that gave them these rewards and which they fought successfully to retain, even as Walker eliminated collective bargaining protections for other employees.
It does not seem too much to ask police and fire workers who work in this city to be part of the community; it makes them more invested in its success. A police force made up of officers who all live outside the city might begin to seem like an occupying force. This could exacerbate the periodic problems that occur in the relationship between police and the community.
As for Walker’s suggestion that Milwaukee should turn itself into a great city, here’s a question: He served for Milwaukee County Executive for eight years. What did he do to make Milwaukee greater? The main thing was trying to freeze the budget, but the city wasn’t far behind. From 2002 to 2012 the county tax levy rose by seven-tenths of 1 percent while the city levy rose by one percent.
And prior to that, Mayor John Norquist was a fierce fiscal conservative, who kept annual spending increases under the rate of inflation while state spending rose more than twice as fast as inflation.
Milwaukee’s mayors might have done even better if not for the success of the Milwaukee Police Union, which constantly lobbied, often successfully, for special deals from the legislature that strengthened its bargaining power in Milwaukee. They were no doubt instrumental in pushing Walker to propose ending residency.
In the recall election last year, Walker actually ran against this city, warning voters that they don’t want the state “to become like Milwaukee.” Milwaukee has always been an easy target because it has more poor people and more minorities, as do big cities across the nation. But if not in the cities, where will these people live?
Most of Milwaukee’s newer suburbs have lot size requirements and other rules that make it impossible for lower class residents to afford a home. And most have resisted calls for public housing or affordable housing of any kind. Sykes has long lived in such suburbs. I’m sure he’d find it unfair to suggest he has lived behind a legal wall that keeps out poor people. But when you recklessly throw stones, they may get fired back.
Walker’s proposed an end to Milwaukee’s residency requirement in 2011 and the measure was defeated. This year, he has come up with an ingenious way to disguise this gift to the Milwaukee Police Union by proposing a statewide ban. But cities like Green Bay and La Crosse have more a limited residency requirement and may not find that hard to keep it. For Milwaukee, this is a life-and-death issue. As Mayor Tom Barrett put it, “If you want the tax base of Milwaukee to resemble the tax base of Detroit, this is the way to go about doing it. ”
-Milwaukee’s effort to restrain property taxes and build a great city has also been undermined by the state retreating on the century-old-arrangement whereby a share of the state income taxes went to aid to municipalities. Since 1995, shared revenue to Milwaukee has dropped a whopping 36 percent. And that decline has continued under Walker.
-The old Milwaukee Journal and Milwaukee Sentinel could both be counted on to fiercely defend the residency requirement, but the merged Journal Sentinel supported the proposal in an editorial last year. It will be interesting to see how it handles the issue this year.
-In response to this column, Sykes emailed me to concede he got it on wrong in suggesting only Milwaukee had a residency rule, but had corrected this. Here’s the link to that updated column for Right Wisconsin, but you have to be a paid subscriber to read it.