Milwaukee Could Get $5 Million Citizen-Led Transformation Fund

Milwaukee City Hall. Photo by Jeramey Jannene.

Have an idea, big or small, to change Milwaukee?

The City of Milwaukee might soon have money to help you, provided city officials can agree on just how much they want to allocate to the effort.

Mayor Cavalier Johnson proposed to place $5 million in a “Citizen-Led Transformational Fund” as part of the 2024 city budget.

It’s poised to become a hot-button issue during the budget process because the funding represents the final piece remaining from the city’s $394.2 million American Rescue Plan Act (ARPA) grant.

Council members could increase the size of the program, or replace it with an entirely different altogether.

The administration’s vision is for the city’s ARPA Funding Allocation Task Force to direct how the money is spent after reviewing responses to a request for proposals. The task force, led by Alderwoman Milele A. Coggs, would forward its recommendations to the Common Council.

Council members, who began their public review of the proposed budget Friday, have plenty of questions about the idea.

“We feel like we have made some commitments to the public, so we are trying to honor those,” said Alderwoman Marina Dimitrijevic, the chair of the Finance & Personnel Committee.

She suggested the council would take a close look at removing some of the mayor’s proposed $36 million in cash-financed capital projects and reallocating to the fund.

Last week, budget director Nik Kovac called the cash-financing plan part of an “undeferring maintenance” strategy designed to address a backlog of needs. On Friday, capital projects manager Joshua Benson said using cash instead of borrowing would save between $11 million to $15 million.

Council members, in creating the ARPA task force in 2022, thought they could have far more money to work with.

The council struck a deal on what to do with the first half of the ARPA grant in 2021. Funds were allocated towards a number of projects including building a new Martin Luther King library branch, redeveloping Westlawn Gardens, training childcare providers, reckless driving interventions, seeding a modular housing factory, lead abatement, expanding the city’s violence interruption program, fixing up a number of failing street lights and rehabilitating 150 vacant homes.

But by the time all is said and done, administration officials confirmed Friday that more than half of the grant will have gone towards stabilizing the city’s finances and avoiding cuts.

“It seems that the only way we got to the $5 million was [it was] what people that came to the community meetings were requesting,” said Ald. Mark Chambers, Jr., who also repeatedly pushed for details on how the mayor decided that only $5 million was to be set aside and when the decision was made.

Kovac and ARPA director Andrea Fowler said their focus has been on ensuring the city doesn’t lose any of the grant. All ARPA funding must be allocated by the end of 2024 and spent by the end of 2026. The 2024 budget proposal includes reallocating millions and using the $92.7 million unallocated remainder to fund existing positions. The $5 million transformation fund itself is not actually ARPA funding directly, but funding freed up by using the ARPA-funding-staffing strategy.

“How much money is left was the most determinative factor,” said Kovac in responding to how the fund’s balance was decided.

Coggs was critical of the timing of the decision. She noted that administration officials requested to delay or cancel multiple task force meetings earlier this year while the sales tax debate was ongoing.

Council President José G. Pérez said he should have had the council allocate much of the remaining funding after the sales tax agreement was approved.

A component of the Wisconsin State Legislature’s sales tax legislation, Act 12, could impact what projects are ultimately selected from the fund. Coggs noted that authorizing new spending programs requires a 10-member vote instead of an eight-member simple majority and asked how that could impact the fund.

“[The City’s Attorney office] is working on it. There is some complexity there,” said Kovac. “Like many things in Act 12, it is unprecedented.”

“We are going to need that information very soon,” said Dimitrijevic.

She said the council would continue to look at the proposal.

“This is the proposal that is in front of us. We now have weeks to talk to the public,” said Dimitrijevic.

The public also has a chance to talk directly to the council and the mayor about the fund and the $1.92 billion budget.

The in-person joint public hearing on the 2024 budget is scheduled for Monday, Oct. 2 at 6:30 p.m. at Milwaukee City Hall.

A second virtual and in-person hearing before the Finance & Personnel Committee will take place on Oct. 16. at 9 a.m.