Barrett Seeks State Okay for City Sales Tax
Says city budget “not sustainable,” big police cuts certain without new revenue source.
Faced with an ominous budget forecast in the year ahead, Mayor Tom Barrett and other municipal leaders this week are calling on state lawmakers to pave the way for a possible half-cent sales tax increase in Milwaukee.
If officials in Madison back the city’s request, and voters approve the plan in an upcoming referendum, Barrett said the tax would bring much-needed revenue to assist in municipal operations, though relief would not fully come until the 2019 budget — at the earliest.
Republican Gov. Scott Walker, a frequent political foe of Democrat Barrett, would have to ultimately sign off on the sales tax plan for it to even go to referendum.
Barrett and Mark Nicolini, the city’s budget and management director, laid out the rationale for the tax during an otherwise customary budget hearing Tuesday. Under state statutes, the city is required to present a rough outline of next year’s budget before the public each August.
“Local government is simply not a priority for state government,” Barrett said.
A recent Public Policy Forum study found annual state shared revenue to the city had plummeted by $151 million in real dollars since the mid-1990s and concluded the city’s revenue structure is “broken.”
Unlike cities that have other taxes they levy, Milwaukee largely depends on two revenue sources: state aid and property taxes. Barrett is proposing a $21.5 million hike, or an 8.1 percent increase, in next year’s property tax levy, bringing that income source to $285.2 million.
The half-cent sales tax plan would instantly infuse $35 million into the city’s police and fire department budgets, which have faced mounting costs on the expense side of the ledger in recent years.
“The Pac Man that’s eating everything is public safety,” Barrett said. “Unless we have some kind of relief valve, we are going to be very challenged.”
Based on current projections, Barrett said there could be a 84 full-time equivalency reduction in sworn personnel staffing within the Milwaukee Police Department — a figure, he said, that takes into account the proposed levy increase.
If the plan would move forward, MPD’s force across the city would stand at 1,804 officers.
But in a bigger picture sense, Barrett warned steeper cuts could impact the city as a whole if changes are not made in the future.
Several factors — including state limits on how much property taxes can be raised and a need to increase pension contributions — are bringing the budget challenges to a head.
“This is not a sustainable model,” Barrett said.
Several other areas of the municipal budget could face cuts as well, particularly as the city grapples with addressing lead-based service lines and other ongoing budget items.
Nicolini spent time combing through Milwaukee Public Library’s proposed budget during the hearing, which could face $1.1 million in cuts across the system if the proposal moves forward as presented.
“I think we’ll be able to avoid closing any of the neighborhood libraries,” Nicolini said.
But trims could come in the form of staff reductions, cutting operating hours and potentially removing such services as the Teacher in the Library Program, which has served as a mechanism for helping students with homework after school.
Barrett is due to give his official proposed executive budget to the Common Council on Sept. 26.
From there, several council-level committees will comb through the document, line item by line item, and several opportunities for public input will take place.
The full council is slated to act on what likely would be a marked up version of Barrett’s budget Nov. 12. From there, Barrett could veto changes, and a super-majority of the council could subsequently override any of those vetoes.
“We’ve got challenges ahead of us, but they’re challenges we can’t avoid,” Barrett said. “We’ll deal with them.”
Further information on the city’s 2018 budget is available here.
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