Council Overrides Mayor Johnson’s First Vetoes

Mayor Cavalier Johnson‘s first vetoes didn’t end in his favor.

On Tuesday, the Common Council unanimously overrode his attempt to save $4 million by reducing library hours and Milwaukee Fire Department staffing in 2023 to prepare for the city’s 2025 fiscal cliff.

Perez and finance committee chair Marina Dimitrijevic pledged Tuesday to fully engage the community on the city’s fiscal issues in 2023, with the latter saying it would be the dominant issue.

The council’s actions Tuesday conclude the process to adopt the City of Milwaukee’s $1.7 billion, 2023 budget. The budget keeps the city in a calm-before-the-storm position while Johnson publicly ramps up his lobbying for a new sales tax to replace declining state shared revenue.

“While there have been disagreements about certain budget provisions, it is important to note that both Mayor and the Council concur on a large majority of next year’s budget,” said the mayor’s office in a statement after Tuesday’s vote. “There are major fiscal challenges facing city government, and there is significant work ahead to fix those issues.”

“We disagreed on very little when you look at a billion-dollar budget,” said Dimitrijevic. She praised Johnson for working with the council on the budget. “It was kind of just moving some funds around to bide time. It won’t be that way next year.”

The alderwoman said the council was united in standing with the mayor on requesting the city receive its “fair share” of funding from the state. She said that took on special importance when the state is announcing a record $6.6 billion surplus. “We are not asking for anything that we don’t deserve. It’s that fair share,” said Dimitrijevic.

The mayor had asked city departments to prepare a cost-to-continue budget for 2023 and was going to exhaust the city’s American Rescue Plan Act grant over the next two years to temporarily fill the growing structural deficit. Budget director Nik Kovac previously said that even holding things as-is, cuts were needed because of costs growing faster than state-allowed revenue increases.

In issuing his veto, Johnson proposed a compromise that would have restored some of the proposed fire and library cuts using only approximately $700,000 in unexpected budgetary savings, but not the federal grant. In overriding the veto, the council did not formally consider Johnson’s compromise.

The council left in place an approximately 17-member cut to the sworn strength of the Milwaukee Police Department, triggered largely by rising salaries.

Ald. Michael Murphy, who was the lone council member to vote against the council’s original omnibus amendment, was excused from the meeting.

The budget includes a 2% raise for all general city employees (non-police and fire workers) and an additional, one-time 1% raise for employees who have been with the city for at least five years. Sworn police and fire employees are protected by collective bargaining and subject to labor agreements that have raised their wages faster than city workers since Act 10 was adopted.

Taxes and fees for the median single-family homeowner are expected to increase by approximately $48.58 under the council-adopted budget. That includes a 4% increase in fees for water and other city services ($20.76). The median residential property, now assessed for $144,900, would see the city share of its property tax bill rise by $27.82.

The actual city property tax rate (mill rate) is expected to fall by almost 10% from $10.16 per $1,000 in assessed value to $9.16. The figure is calculated from the cumulative assessed value of all properties in the city, which increased 13% in the past year. The median home value increased from $127,900 to $144,900 as a result. Individual assessment increases or decreases do not directly impact how much the city can collect in revenue, but instead change the percentage of the whole a specific property pays.

As a result of new construction and a small state-allowed increase in property tax revenue, the city expects to collect 2% more in property tax revenue in 2023. But adjusted for inflation, the actual property tax levy will have fallen by $6.3 million annually since 2013.

The average city homeowner would pay $542.64 in fees in 2023.

The city’s finances are being squeezed due to state prohibitions on enacting new taxes, state restrictions on raising property tax revenue, long-frozen state aid levels, the expiration of a COVID-era federal grant and an anticipated increase in costs to fully fund the pension system. The city’s annual structural deficit is expected to reach $150 million in 2025, approximately a quarter of the city’s general fund. Adjusted for inflation, the city now receives $155 million less annually than it did in 2000 in state-shared revenue. A task force identified 12 options to address the city’s pension-related issues in 2021, but as Johnson, Governor Tony Evers and others have increasingly argued, the state’s fiscal relationship with municipalities is broken and cities from Rhinelander to Brookfield face looming fiscal issues.

Building Permit Examiner Veto Sustained, But New Positions Maintained

One of the mayor’s vetoes was unanimously sustained, but only because it was a technical change. Murphy had proposed to fund two additional building permit examiner positions in the Department of Neighborhood Services with $125,744 in property tax levy funding. Murphy’s stated goal was to speed up permit approvals, which he said would grow the city’s property tax base.

Johnson vetoed the proposal, but only because his administration believes there is carryover funding available to fund the positions.

The council unanimously sustained Johnson’s veto, then at the mayor’s written suggestion adopted a budget amendment to maintain the positions.

Ald. Milele A. Coggs praised the administration’s work to make sure the new positions were established without tax levy funding.

Healthy Food Establishment Fund Veto Overriden

Only one of Johnson’s veto actions received a non-unanimous vote. Ald. Khalif Rainey moved to sustain Johnson’s veto of a $100,000 funding allocation to a program designed to provide grants to support organizations connecting city residents to healthy food. The council had included the funding as part of its omnibus amendment, which Johnson partially vetoed.

The fresh food fund, only a couple of years old, has been championed by Rainey. But Rainey said the administration had convinced him there would be $260,000 in funding available in 2023 by terminating all of the existing allocations and effectively rebooting the program.

“There is no stronger advocate for healthy food access than Alderman Rainey,” said Ald. Scott Spiker. “Given his bona fides, I am inclined to defer to him.”

But Rainey and Spiker were the only members to vote with the mayor. The council sustained the $100,000 allocation, overriding the mayor.

“We had quite a long debate about this at committee and during the public hearing,” said Dimitrijevic. She said advocates were requesting the program see greater funding. “Estimates show that in Milwaukee County we are at 11% food insecurity. What that means is that families, particularly children, might not know what their next meal is.”

The vote on overriding the mayor’s fresh food fund veto injected a moment of levity into the council’s proceedings. It was the first meeting for newly-elected council members Mark Chambers and Jonathan Brostoff, and, by virtue of their district numbers, they vote first in the council’s roll call. The oft-confusing veto vote ultimately had to be restarted after Chambers voted the opposite of his intention, with some chuckles on how to handle this.