Bruce Murphy
Murphy’s Law

How to Crush Milwaukee

Ending the residency requirement will deal a devastating blow to Milwaukee’s property tax base.

By - Feb 21st, 2013 10:35 am
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City of Milwaukee Mayor Tom Barrett.

City of Milwaukee Mayor Tom Barrett.

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As for those cities who ended the requirement, the survey found, Minneapolis repealed the requirement in 1999 and 70 percent of its  employees now live outside the city.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 Baltimore repealed in 1995 and 65 percent now live outside the city.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. ”

Short Takes

-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.

29 thoughts on “Murphy’s Law: How to Crush Milwaukee”

  1. Jim says:

    1st Governor Walker cowardly exempted police and firefighters from Act 10. Essentially he created 2 classes of government employees. Now he prohibits their employer from using their bargaining tools. Governor Walker is just another big government conservative.

  2. Big Al says:

    How about the next time the police and firefighter contract comes up, slash the pay of everyone but pay a “bonus” to live in the city? If you live in the city you can stay at the same pay & benefit level, otherwise take the cut – you’ll be saving so much with the lower taxes that you should end up in the same place.

    Pretty sure there’s laws against public employee strikes, so let them have it – I’m sure Governor Walker will call in the National Guard just like he was planning on doing for the Act 10 protests if needed.

  3. Patty PT says:

    Governor Walker is doing anything and everything to suck the life out of Milwaukee. He hates this City so much, he will do anything to crush it. Why in the world would you try to destroy the most populous, tax-producing, cultural center of Wisconsin? What, so Appleton can take over?

  4. Matt says:

    Milwaukee has about 10 times as many people as that dump Walker lives in does, so if Milwaukee isn’t a great city what is Walker saying about his parenting skills if he sent his kids to public school in a dump town like Wauwatosa?

  5. Kurt says:

    So if you work at Roundys you can only shop there? Or Proctor and Gamble, better not wipe your butt with a competitors toilet paper. People should be free to choose where they live. Residency rules are archaic. I know, I’m a fire fighter in a city north of you that used to have strict residency rules but are now somewhat relaxed. I still choose to live in my city but some don’t and that’s their choice. Get into the 21st century.

  6. Wisconsin Conservative Digest says:

    Milwaukee is going to have a tough choice. either fix it’s schools, city, Milw. Cty, MMSD or go out of business and disappear like Detroit.

  7. Dave Reid says:

    @Kurt I’ll just point out that people who work for Roundy’s are not paid for with tax dollars.

  8. Gee says:

    Kurt, I am another public employee, and I always have been a supporter of my police and fire fellow workers — and fellow residents — in the city of Milwaukee.

    But: Bygones, Kurt. Go ahead and be gone, Kurt — and your job with you. I am your employer, and I am done supporting public employees who do not support me.

    Hang onto the savings from the raises I have been giving you, Kurt, while you find another job, because you will get no more from me I have not had a raise in six years, and your unions’ support of Walker and his Act 10 dropped my take-home pay down to what it was a decade ago.

    We stand together, or we stand alone, Kurt.

    You stand alone now.

  9. Steve says:

    If my company wants to move me to Appleton I have two choices, move to Appleton or quit my job. GE is constantly moving people around for business. If your employer want to transfer you to another city, state, country you have two choices, the same as the Milwaukee Police and Fire, follow your employers wishes or quit.

  10. John McAdams says:

    Typical liberal way of viewing policy. Let’s make places unlivable, and then when when people won’t live there voluntarily, force them to live with our dysfunctional policies.

    The right to “vote with your feet” is check on the abuse of government power. That’s why liberals don’t like it.

  11. Paul Sickel says:

    @Dr. McAdams, Ironic that an intellectual giant such as yourself would use an ad-hominen attack to justify the Sykes-Walker approach to urban development. I give you credit for using your full name however, as few who comment do.

  12. wisconsin Conservative Digest says:

    I have been in Milwaukee for 50 years and watched MP, city, MMSD, and the other groups all decline in that time. I really thought that this problem was going to be solved in 20 years by 1980, but the Libs have been in charge for that whole time, Doyle and dems were in charge for most the last decade and nothing has gotten better, except we got higher taxes. They have paid off their friends, leaving us with huge debts and only 30% of the kids in 10th grade can read the Journal. The only people that event care the least about the kids, are the Conservatives. Tommy wanted to take over the schools but that was stopped. The dems just want the votes and the dough, the kids can go to hell.
    If you take the kids that enter 9th grade, that eventually graduate, it is way below 50%, truancy rate is high.
    What has Tom Barrett ever done? He has spent most of the last 4 years trying to get out of the job. He cannot even get that silly choo-choo built. We have to arm ourselves to protect ourselves. Clarke says get a gun, Biden says get a shot gun. Milwaukee is the 8th poorest city in the country, way down from where Milwaukee used to be.
    The Left blames it all on the GOP, when they are in charge. WE have little society on the east side and aorund UWM, otherwise it is a disaster. The only way that Milwaukee can survive is to chain it’s employees to the firehydrants.would have

  13. Tony Tagliavia, Milwaukee Public Schools says:

    @wisconsin Conservative Digest: “If you take the kids that enter 9th grade, that eventually graduate, it is way below 50%,”

    False.

    MPS’ legacy graduation rate was 69% for the class of 2011, up 17 percentage points from 52% for the class of 2000. Even using the new federal graduation rate, which only counts students who graduate in four years, the rate is 63%, which is an increase from the prior year.

    No one would argue that the graduation rate is where it needs to be and no one would argue that much more improvement needs to be made in academic achievement. But grossly misstating facts does not help that cause.

  14. Wisconsin Conservative Digest says:

    Thanks, the only figures that I have seen are the one from the students that enter 12th grade then go on to graduate. Can you get me those official statistics??
    How do kids compare to the national average in 3rd, 6th, 10th and 12th in reading and math???

  15. Raul Vasquez says:

    It’s very simple. If you want a nice job with excellent benefits paid for by milwaukee municipal tax dollars, it’s perfectly fair that you should also live in the city. if you don’t want to live in milwaukee, fine, you can work for someone else and live wherever you please.

  16. Jamie says:

    “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.”

    I love how the argument is presented that people will just leave the city if the residency rule is lifted. Last I heard, unless you want to ruin your credit, you can’t just “leave” your house without selling it.

    If you “sell” it, that means there is a buyer. Pretty simple math.

    1 person leaving = 1 person moving in

    Even in a rental situation, the landlord will fill the vacancy as soon as possible.

  17. VIP J says:

    Great point, Jaime.
    While I agree on the math, you left out the main variable.

    quantity vs. quality

    Sure, there will be buyers and renters but will the quality remain the same?

  18. Mike Bark says:

    This whole issue gets overblown by both sides:

    - Lifting residency will do nothing to cure MPS’s ills. MPS has some flaws, but the district won’t achieve until the customers start to value education. Put it this way, we could swap out all the MPS teachers for all the White Fish Bay teachers or better yet, the Messmer teachers and MPS would post the same exact results. You could even put those MPS teachers in Messmer and there’d be no change in Messmers performance. Furthermore, most emergency workers in even the suburbs like police and fire have some sort of residency rule in place as it is where they may not have to live within the city, but they have to live in close proximity.

    - On the flip side, let’s assume every city worker wanted to leave the city. Could they realistically do so? They’d have to sell a home where the value has theoretically just dropped in value. They’d now have to move to a suburb where in theory prices would start to skyrocket because there’d be much more demand to live there. There already is a premium to live in a Milwauke County suburb and that premium would go up and may put it out of reach for someone with a middle class job. So in reality, could people really afford to make the move and would we see the amount of flight the Mayor worries about? And if the value of homes in Milwaukee steeply declined wouldn’t it open up opportunities for people to come in and take the place of the feeing city workers? Maybe a bunch of those overvalued young “creatives” would move in. Right now, some areas in Milwaukee are overvalued because city workers are forced to live there.

    A few other points:

    - The property taxes are just as high in the Milwaukee County suburbs. The rate might be lower but because the properties are assessed at much higher values the tax bills are higher.

    - Interesting that the Mayor who thinks residency is a necessity has his wife working for us taxpayers over here in Wauwatosa.

  19. W says:

    “Crush” Milwaukee? Having a debate on this should be logical, not hyperbole and exaggeration. The fact is that Milwaukee in general has not taken corrective action to improve quality of life which is desirable to middle income families. The Mayor and his overpaid managers can use residency as a way to avoid having to implement a comprehensive plan to improve neighborhoods. Property values will decrease whether or not they have a residency rule. Milwaukee is not a great place to live and until they admit that and start a plan to improve it slowly, they’re doing more harm tap has good.

    Chief Flynn relocated the police patrols from non violent areas. A non emergency call on the southwest side took 2 hours by the time I left. Calls for late night noise, drug use, drunk driving, these are considered non emergency. So when disrespectful people move into a home and annoy everyone around them, there is nothing that will be done. The police do not write tickets, there aren’t consequences for bad behavior. The grass can be 6″ tall, the house can look like garbage and have playsets and other junk in the front yard, legally. Tom Barrett has done nothing to address these problems. I lived in Milwaukee for 25 years and witnessed my neighborhood on the southwest side lose the city employees slowly.

    I hope residency is lifted so Barrett will have a nervous breakdown and allow a chance for a visionary, not a whiny career politician, to take over and lead. Tom Barrett if you’re reading this: piss off, jerk.

  20. Robert Bauman says:

    “How to crush Milwaukee” is an accurate description. Over the last two years the Walker Administration has instituted policies through the budget and legislative and administrative actions that they know with disproportionately harm Milwaukee. It is punitive and may satisfy a Republican desire to punish heavily Democratic Milwaukee, but ultimately short sighted and self defeating.

    Frist, Milwaukee will not become less Democratic as a result of these actions. Second, and more important, the economic and social well being of Milwaukee is key to the economic and social well being of southeast Wisconsin and the state.

    Study after study over the last several years have pointed out that a state and region’s major city is the engine of economic growth and job creation in the state and region. The big city has the workers, has the education institutions, has the infrastructure, and has the cultural and social amenities that drive economic growth and attract skilled and educated workers who in turn attract employers and investors. Crushing Milwaukee will harm Milwaukee (and I get the sense that many people applaud this) but it will also harm all of southeast Wisconsin. It is truly self defeating for a governor who has promised to create 250,000 jobs. This job growth cannot and will not occur without a strong Milwaukee.

  21. W says:

    Alderman Bauman we’ve heard your story. Please, explain what it is you plan to do to attract other middle class buyers to Milwaukee neighborhoods aside from city employees?

    Is it possible to attract middle class buyers without a residency rule?

    What sort of environments are middle class buyers looking for? Why can’t they be found in Milwaukee?

    Should you return the police to non-violent areas, to deter bad behavior such as loud partying, drug use, and drunk driving?

    Is late night partying a deterrent to property values?

    Should the allowable limit of tall grass and weeds be less than 9″?

  22. R. says:

    @Wisconsin Conservative Digest

    You realize a reason why things have been going down for Milwaukee in terms of education is because Milwaukee is always the city consistently on chopping block in this state right? Tommy Thompson’s whole campaign if you remember, was ‘sticking it to Milwaukee’.

  23. Kurt says:

    @Dave & @Gee, since you pay taxes you get to dictate where people live? I don’t think so. Since Roundy’s is private they can tell where there employee’s can shop? I think not there also. Because you pay taxes does not mean you own me. And to get another correction there for you Gee, my union did not endorse Walker. I’m with the PFFW and we fought the Act 10 changes leading the protests in Madison, Green Bay, Appleton and anywhere else protests were held. Milwaukee Fire and Police sold their souls to Walker to get this change. I just happen to think you should be able to live where you want. For example Madison and Appleton have no residency. Their fire fighters can live anywhere. Some live a couple of hours away. It’s their choice. And @Steve, if your company moves your job to another city that you could still commute to, why would you move?

  24. skip tracer says:

    A fair compromise that neither Barrett or Walker would consider: phase out residency. Workers with 15 or 20 years of service can go… that takes pressure off property values, and actually is an incentive to retain some employees (lets say with 8-10 years of service) with institutional knowledge. Barrett remains ‘flabbergasted’, Walker remains disingenous about his reasons.

    BTW Bruce check your own facts. Wally Morics put the kibosh on a lot of Noquist’s potentially ruinous ideas, and is the MAIN REASON miltown is somewhat stable from a fiscal standpoint. Don’t credit Norq or Tommy Trolley for that.

  25. Bill Sweeney says:

    One interesting aspect of this issue is what I thought was a fundamental conservative principle, the old rebel yell of “States Rights,” the idea that larger governmental entities should not be dictating to smaller governmental entities what is good for them or best for them. So the federal government should not be telling state governments what to do just as state governments should not be dictating to local governments about how to run things. I thought it was a conservative commandment that those elected officials who are closest to “the people” are best situated to implement policies that the electorate want.

    So shouldn’t it be up to the voters of the city of Milwaukee to decide whether or not to change the residency requirements for the employees of the city of Milwaukee??

  26. Kraig says:

    As a firefighter in another city, Milwaukee ffs are in a different pension than the rest of us Wisconsin firefighters. I for one am a firm believer in living and supporting the city in which you work for! Especially when taxpayers complain I can tell them I am taxpayer too! Out of at least 1006 ffs only a handful of us live in the city and some live almost an hour away!

  27. David Ciepluch says:

    The Milwaukee residency requirement should be maintained. Over the last five years my appraised value has dropped $50,000. Lifting residency harms my family financially, cripples property tax potential, sale value, and further undermines a neighborhood’s stability. It is truly a local issue. Politicians and residents outside the Milwaukee Metro boundaries have no financial investment to protect here and we have everything to lose.

    A comparison with Appleton is not valid since the demographics are completely different on racial makeup and family incomes. At least one half of Appleton’s physical boundary does not have an adjoining suburb. Milwaukee is surrounded.

    My ancestral family has lived and flourished in Milwaukee since arrival during the 1860s to 1880s, and has been a part of the nation’s industrial age and saw this area as the “Machine Shop” of the world. The City of Milwaukee along with Agriculture carried the state of Wisconsin’s economy on its back for over 125 years. Over the last 5-years, our state has seen the loss of two major auto plants and a number of paper mills with family supporting jobs that are not coming back. Milwaukee has seen this picture for decades since the 70s with similar declining industry and a transition to new types of businesses. Transition takes time and commitment and needs proactive assistance and steering. We do not need political meddling to drive an arbitrary and capricious stake into a local heart and interfere with the balance of ongoing tenuous progress. This is a local issue that should be left to local control and our locally elected decision makers. What happened to limited government interference espoused by some of our elected officials?

    I am satisfied with the current residency requirement. Now is not the time to tamper with it.

  28. David Ciepluch says:

    Employment conditions regarding residency are in place across the country. Many conditions apply to both private and public jobs like, passing a physical and drug test, holding a valid a drivers license, using a personal vehicle and keeping insurance levels to a standard, permit to carry a weapon or no weapons allowed, wearing a uniform, height and physical requirements, ability for emergency situations and call in to work during off hours in a limited amount of time, etc.

    Then there are the unofficial requirements that are not allowed and you will never know or be informed. Too fat, skinny, brown, short, ugly, you are a man or women, known religious and political beliefs through Facebook, too gay or straight, too old or young, you went to the right or wrong school, live in the right area of town, etc.

    Residency may be one of these many formal and informal job requirements.

  29. Johnny says:

    If the residency rules are lifted. MKE can pay nonresidents at a lower salary (west allis does this). MKE could also charge non-resident employees a parking fee of $150-200 a month to cover any lost revenues. 8,700 employees paying $150 a month for parking would raise over $15 million annually and help to ease project property tax revenue.

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