Does the governor’s fix for Milwaukee’s bus system truly reflect what Milwaukee voters want?
In June, when Gov. Jim Doyle vetoed a half-cent sales tax increase that would rescue the cash-strapped Milwaukee County Transit System (MCTS), many Milwaukee decision-makers were baffled.
Back in November 2008, Milwaukee County voters had approved a 1-cent sales tax increase that would fund transit, the parks, cultural assets and emergency medical services (EMS)which would have resulted in at least $67 million of property tax relief.
The county’s legislators fought hard to include the 1-cent increase in the state budget.
That proposal was eventually scuttled in favor of a half-cent sales tax that would fund transit only, a tax increase pushed by normally tax-averse Metropolitan Milwaukee Association of Commerce (MMAC), the Greater Milwaukee Committee (GMC) and other business groups. The business community did not support a half-cent sales tax increase for parks, culture and EMS.
But Doyle vetoed the half-cent sales tax from the budget, saying that it wasn’t a regional solution to southeastern Wisconsin’s transit problems. Instead, Doyle approved a framework to get the stalled Kenosha-Racine-Milwaukee commuter rail line off the ground, and he promised to develop a fix for the county’s under-funded transit system.
That fix was unveiled last week.
And it looks a lot like what Doyle vetoed a few months agoand what the business community wanted all along.
Harold Mester, spokesman for Milwaukee County Board Chair Lee Holloway, said, “The chairman is disappointed that the governor vetoed the earlier sales tax only to come forward with something that isn’t a whole lot different, except that it’s more complicated than the chairman feels it needs to be.”
Did the Voters Approve This?
Under the basic regional transit authority (RTA) structural principles Doyle released last weekwhich must be drafted, debated and approved by both houses of the state Legislaturea two-level RTA would be created in southeastern Wisconsin. The umbrella RTA for Milwaukee, Kenosha and Racine counties would continue to develop the KRM, while independent sub-RTAs would be responsible for local transit systems.
Milwaukee County could levy a half-cent sales tax to support the bus system, which the governor’s press release stated “has already been approved by referendum in that county.”
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But did the voters approve that half-cent sales tax for transit only?
“Yes,” said Doyle’s spokesman, Lee Sensenbrenner. “That was the vote. They approved the half-cent sales tax for transit, plus some funding for unrelated things.”
No, said Mester, Holloway’s spokesman. “The voters didn’t express their opinion on an RTA, but they did express their opinion on transit funding and parks and EMS,” Mester said. “Anything that the governor or Legislature can do to advance that as a package, as it was approved by the voters, would be appreciated.”
[For the record, here’s the actual advisory referendum question: “Shall the State of Wisconsin grant Milwaukee County the authority to provide property tax relief of at least sixty-seven million dollars ($67 million) by levying a one percent (1%) county sales and use tax to be used to remove the following three items from the property tax levy: parks recreation culture, transit and emergency medical services (EMS)?”]
Milwaukee County Supervisor Gerry Broderick, the chair of the Parks, Energy and Environment Committee, said that while the business community supported a transit-only sales tax, the voters clearly did not. He said the inclusion of funding for parks, museums and EMS was critical to building a broad base of support for the sales tax.
“Transit on its own would never have passed, I’m convinced,” Broderick said. “But they use [the referendum] as a rationale to provide a half-cent for transit and to hell with the parks and culture and what the people actually voted on.”
Is This Property Tax Relief?
Also missing from Doyle’s RTA principles is the requirement that transit be taken off of the property tax levy, although Sensenbrenner said that “it was something [the governor] wanted to see in the legislation.”
According to supporters of last fall’s referendum, the full-cent sales tax would generate about $130 million a year. Taking parks, recreation and culture, transit and EMS completely off the tax rolls would reduce the property tax levy by at least $67 million. That would reduce property taxes on a home valued at $150,000 by $165. It would also have covered the funding for all of those county assets and services.
Following this formula in the current proposal by the governor, the half-cent sales tax would raise about $65 million for transit only, which could allow MCTS to cover operations, restore cut routes and purchase new buses.
Supervisor Broderick surmised that the half-cent sales tax “is going to be an add-on,” and wouldn’t be taken off of the property tax rolls.
Holloway’s spokesman Mester said property tax relief was important to the chairman and a key point of the referendum. “Certainly if we could take transit, parks and EMS off of the property tax, that would be some real property tax relief that people would notice,” Mester said.
The Next Budget
Broderick predicted that, without a dedicated source of funding, the parks would take a major hit in the 2010 county budget to be presented by County Executive Scott Walker on Sept. 24. Walker has requested that the parks reduce its budget by $8.6 million.
“We’re going to get an awful hatchet job of a budget,” Broderick said. “And then it’s going to be, as usual, up to the county board to attempt to repair and remediate where possible. However, we don’t have the resources to do much, given all of the obligations we have to meet. So I assume our parks will take another significant hit this year.”
Roughly speaking, the parks use about $20 million of property tax funds and generate another $20 millionfrom golf courses, swimming pools, parking and other sourceswhich is put back into the park system’s coffers.
Milwaukee County Parks Director Sue Black said she leaves the issue of dedicated funding to the policy-makers, and works within whatever budget she’s given. “My hope is that the debate on where this goes in the future can actually leave the debate realm and actually go into action, however it turns out,” Black said.
In addition to funding the system through a sales tax, the formation of parks districts has been floated in the past and may be revived in this legislative session. Although it could be structured in a number of ways, a parks district would take the operation of the parks away from the county and put it into the hands of an elected or appointed board, which could have the power to levy a tax solely used for parks.
Broderick isn’t a fan of that remedy.
“That idea without accompanying funding is essentially a meaningless gesture because it doesn’t really matter who is running our parks if there isn’t money to improve or enhance them. [Without funding], our parks are doomed,” Broderick said.
Until or unless a new funding source is implemented, simply using the parks may be the best way to generate more revenue for them.
“We are the revenue generators,” Black said of the park system. “If people use the parks and support the parks, it’s good for everyone.”
