Shared revenue bill hits snag: Evers threatens veto, Milwaukee leaders call for changes
MADISON, Wis. (CBS 58) -- Disagreements over a Republican plan to revamp how the state funds local governments came into clearer focus Thursday during a public hearing at the state Capitol.
Before local officials could even address lawmakers, Democratic Governor Tony Evers issued a statement vowing to veto the Republican bill unless GOP leaders made changes to their shared revenue proposal.
One day after he told CBS 58 he still needed to review the bill, Evers said Thursday it didn't give enough of a funding boost to local governments, and it placed to many restrictions on how cities and counties could use their increased state aid.
"It’s why I can’t support the Republican plan as is," Evers said in a recorded video. "And frankly, I’ll veto it in its entirety."
The Republican bill dedicates 20% of all state sales tax revenue to local governments moving forward. Currently, shared revenue -- the amount of state dollars distributed to municipalities and counties -- is $753 million, a figure that's been frozen at that level since 2004.
The GOP proposal would increase that amount by about $527 million. Of that new funding, $300 million would go into a fund that rewards local governments that come up with ways to merge services and save money. The other $227 million is divided using a new formula that favors smaller communities.
Local officials, from Waukesha County Executive Paul Farrow to Wauwatosa Mayor Dennis McBride, have said the current bill does not provide enough funding for a state sitting on a $7 billion surplus.
During the hearing Thursday, local leaders and Democratic state lawmakers questioned provisions in the bill that require municipalities and counties to meet various conditions.
One such provision requires communities to either maintain current police and fire staffing levels or maintain the number of arrests they make and tickets they write. Failure to do so would lead to a 15% funding cut.
State Rep. Sue Conley (D-Janesville) questioned the bill's co-author, State Rep. Tony Kurtz (R-Wonewoc) about what she considered to be police quotas tucked into the bill.
"That is not the intent of the bill whatsoever," Kurtz said. "I know [Wednesday] some things were brought up to our office, and we're gonna look at that, and if there's some changes that need to be made, we'll be happy to make that."
Good morning from a packed hearing room at the top of the Capitol.
— A.J. Bayatpour (@AJBayatpour) May 4, 2023
Local officials are among those set to testify today on a bill that would revamp how Wisconsin funds its cities and counties. pic.twitter.com/cAKesreiuq
Milwaukee Mayor Cavalier Johnson testified at Thursday's hearing he was opposed to many of the restrictions that were specific to Milwaukee.
The GOP bill allows Milwaukee and Milwaukee County to hold a vote on raising local sales taxes. That money would be restricted to paying off pension debt and increasing public safety funding; those dollars would be dedicated to the court system, medical examiner's office, correctional officer pay and a new Milwaukee County juvenile jail facility.
The bill would also require Milwaukee Public Schools to bring back school resource officers, and the city's Fire and Police Commission would be banned from setting police department policy. The city would also be banned from using tax revenue to extend the streetcar route.
"When it comes to where police are deployed, to what transportation options may exist, or how civilian oversight of the police department is structured," Johnson said. "I ask that you leave those types of issues in the hands of Milwaukee."
MKE leaders: Don't give voters final word on sales tax
Another part of the bill Johnson asked lawmakers to change regarded the referendum for raising local sales taxes.
Under the GOP proposal, Milwaukee could pursue a 2% city sales tax. Currently, Milwaukee is the only U.S. city of its size without a municipal sales tax.
Counties currently can have a sales tax of up to 0.5%. The GOP bill lets Milwaukee County increase that tax rate to 0.875%.
In both cases, voters would have to approve the tax hikes. Johnson, as well as the region's chamber of commerce, have called on Republicans to instead give those votes to the Milwaukee Common Council and the Milwaukee County Board.
Johnson testified Thursday the stakes were too high to risk voters rejecting the referendum. He said they might not fully understand the city was on pace to become insolvent by 2025, which Johnson warned would lead to drastic cuts across all city services, including the police and fire departments.
"I don't want Milwaukee to be in the position where we leave all this to chance," Johnson said. "And it all unravels or falls apart."
GOP lawmakers on the local government committee holding Thursday's hearing sounded cool to Johnson's request. State Reps. Scott Krug (R-Nekoosa) and Scott Johnson (R-Jefferson) told the Milwaukee mayor they'd prefer if the city's residents directly decide whether to adopt a local sales tax.
At a press conference last week, Assembly Speaker Robin Vos said he was confident Johnson and Milwaukee County Executive David Crowley could convince residents to approve the tax hike.
"Having spent this much time with the county executive and the mayor, I have no doubt that their salesman abilities is going to come to full fruition," Vos said. "And that the voters are gonna see the wise decision that they're gonna make."
Johnson sounded less confident when asked Thursday about Vos' remarks.
"If I was such a great salesman, we wouldn't be in this situation, right?" Johnson said. "We would've already had a bill that had gotten Milwaukee what it needs in the way that I want it, and not me scrapping and fighting for it right now."
The bill still needs to be approved at the committee level, then would go before the full Assembly and Senate. Vos said last week he hoped those votes would happen later this month.