New Report Shows Lower Deficit for 2025 Budget

Milwaukee County Courthouse. Photo by Graham Kilmer.

There was some good news and bad news for Milwaukee County Board members at the board’s Finance Committee last week.

The bad news: the Milwaukee County’s Comptroller Office has reported a projected budget deficit of $3.7 million for the 2025 budget.

The good news: that’s down from the last report, released in March, which predicted the county would have a $7.6 million deficit by the end of the 2025 budget, which runs through this calendar year.

Neither deficit would be such a big deal if it wasn’t for the fact that the comptroller has projected a $46.7 million budget deficit for 2026, largely due to the end of federal stimulus funding that has propped up the budget in recent years. Meaning the county can’t afford to add even more deficit to the one it is projected to face next year.

While the 2025 projected deficit has decreased from the last report it remains an issue mainly due to large deficits from the Milwaukee County Sheriff’s Office (MCSO) and the County Reintegration Center (CRC). The MCSO was clocked at $6.8 million over budget and CRC at $3.8 million.

MSCO’s deficit comes after the approval of wage increases last year, with the goal of reducing the high turnover rate of staff. MCSO officials reported at a previous Finance Committee meeting that the hike in pay helped prevent wages being cited as a reason for resignation.

The County Reintegration Center has been in hot water too, after a lawsuit was filed following the suicide of a man in the center’s custody. The lawsuit alleges the man in custody died because of county policies, training and staffing.

CJ Pahl, Financial Services Manager in the Office of the Comptroller, told the committee that two things have helped drive the $3.9 million improvement on the budget picture: the sales tax and fringe benefits.

The new report projected that the sales tax revenue would be $1.6 million higher for the year than projected in the last report, though it still remains $3 million under the amount included in the budget the county passed for the year. Joe Lamers, the Director of the county’s Office of Strategy, Budget, and Performance, added that the final figures for the sales tax in 2024 were “really poor” for the sales tax, lower than expected, and had to be taken into account in projecting the likely revenue in 2025.

Fringe benefits were also a help and are now projected to cost $2.5 million less than originally projected.

“It’s very early in the year and it’s hard to say at this point where some of these big items are going to go, like the sales tax, investment revenue and healthcare spending,” Lamers told the committee.

Considering there was still a gap of $3.7 million, Sup. Shawn Rolland said he was looking for something to “save the day,” eyeing the Department of Health and Human Services (DHHS), which has historically had a budget surplus of around $6 million at the end of the year.

Lamers responded that while there might be some surplus from DHHS this year, the number of juveniles placed at Lincoln Hills Correctional Facility has increased from 12 to 20 just by the start of 2025, which could increase overall costs for the department.

He added that while unfinished projects may have a surplus, that won’t be factored into the budget until it’s reported.

Meaning for now at least, nothing to save the day.