Monday, February 27, 2017

Local governments continue to be defunded under "generous" Walker budget

One thing that should be pointed out with all of the handouts and increases in funding in Governor Walker's budget is an area that's not getting handouts- shared revenues to local governments. This is where tax dollars from throughout the state are redistributed throughout the state, and parceled out to various local governments. This has been a system that has been in place in Wisconsin for decades, and shared revenues is a key part of any local government's budget, with higher shared revenues taking pressure off of the property tax when it comes funding local services like roads, police, fire fighters, parks, and public health departments.

In looking at the proposed budget bill I notice that County and Municipal shared revenues actually decrease in each of the 2 years of the budget, before we even account for inflation.

County/municipal shared revenues 2016-2019
2016-17 $696,275.200
2017-18 (budgeted) $692,175,800
2018-19 (budgeted) $690,225,800

It is worth noting that $4 million of that shared revenue reduction is part of the Milwaukee Bucks arena bill that was signed into law in August 2015. As the Legislative Fiscal Bureau described, the state’s paying in $8 million a year to the Bucks arena for the next 20 years, but are offsetting half of that expense by lowering Milwaukee County’s shared revenue by $4 million a year over that time.

But this also means that the $4 million being cut in shared revenues for the Bucks arena aren’t being made up and redistributed to other communities in Wisconsin, so all communities will have less available to them than before (since Milwaukee County will still get SOME of those shared revenues). And the proposed two-year drop in shared revenues in this budget continues a trend of reduced aid to local communities throughout the Age of Fitzwalkerstan. Overall, County and municipal revenues in 2019 are slated to be nearly $118 million less than the dollar amount in 2011. I don't care how much money you think has been saved due to the "tools" of Act 10, you can't tell me that these communities are in a better spot after these cuts at the state level, especially when you realize that drop in shared revenues goes over $234 million when you account for inflation.

But it's not just general county and local aids that have been getting reduced in value since 2011. The state has also done nothing to increase the incentive payments given to communities for keeping their expenses in line with the rate of inflation. Known as the Expenditure Restraint Program, this figure hasn't been increased since 2011, and Walker's budget keeps it at that same level, meaning that the 2018-19 ERP budget of $58.1 million is $8.4 million below where it would be if this incentive payment had been raised for inflation.

There's another shared revenue program that earmarks money for police and fire fighting services. This has been paid for by charges that are part of your phone bill (it used to be general tax dollars that paid for this, but it was changed to the surcharge in 2009), and this amount has also decreased in recent years, down over $9 million in actual dollars since 2011, and nearly $18 million lower when you adjust for inflation.

So much for police and fire fighters being a protected class in the post-Act 10 World.

If you look at these three types of shared revenue payments and add up the differenes between the red and blue lines, it means that Walker and WisGOP have decided to cut $1.44 BILLION from local governments in these 3 areas alone. That's before we even account for the numerous cuts to K-12 public education or the UW System, and what have we gotten in return for this? Continual budget shortfalls still remain due to these "savings" being blown on tax cuts, which have led to the worst economy in the Midwest.

Sure, Walker's 2017-19 budget does add in a 9.55% increase in general transportation aids that hits in 2018. But that’s only earmarked for one specific item, and it can’t be used for any other services that has to be needed. In addition, that increase in 2018 comes after those transportation aids had been frozen for 3 years, so that one-year bump barely surpasses the rate of inflation over the course of 2015-19 (the Walker Administration not adjusting for inflation in roads? Where have we heard that before?).

In fact, Northern Wisconsin local officials say this increase in local road aids is "too little, far too late," and they are still calling for the ability for raise their own sales tax in order to pay for their roads.
The state should allow the county to at least ask voters if they would approve the tax to fix roads, said Douglas County Board Chairman Mark Liebaert.

“We need this ability on this half a percent sales tax because we’re not going to be able to bond our way out of this,” Liebaert said Tuesday during Superior Days at the state Capitol. “But, we bonded $5 million, and we plan on bonding for $26 million regardless of what happens with this half a percent sales tax.”

Douglas County is proposing to the Legislature insert language into the 2017-2019 budget for a pilot project that would allow only Douglas County to utilize the half-percent sales tax for road funding.

The county has more than 300 miles of road to maintain and has budgeted around $2 million each year to repair roads. At that rate, county officials claim it would take more than 50 years to repair its transportation infrastructure.
And the reason Douglas County and so many other places in Wisconsin are asking for this law to be changed is because Scott Walker and the Wisconsin GOP have broken their part of the bargain when it comes to adequately funding local government. So if the state is going to continue to defund these communities, why shouldn't they be given the freedom to raise taxes on tourists and consumers, if a community votes to do so? That seems a better option than making local services suffer and/or make the local property taxpayer have to pick up the slack for WisGOP's arrogance and failed tax policy.

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