MILWAUKEE - Wisconsin's top legislative Republican, Assembly Speaker Robin Vos, suggests he may be open to a bailout of Milwaukee's ballooning pension problem. Without additional help, Milwaukee leaders warn drastic cuts could come to city services. The Wisconsin Policy Forum warns of an impending crisis by 2025, when federal COVID-19 money runs out.
Democratic Milwaukee Mayor Cavalier Johnson and Republican Wisconsin Assembly Speaker Robin Vos have been in talks about the city's looming fiscal crisis. The state's top legislative Republican told FOX6 News he is considering a bailout.
"We probably have to give them one-time relief to deal with this pension crisis, but that has to also be reformed," Vos said. "We can't allow this pension to run out again and have all kinds of issues, so I think it should probably be absorbed into the state pension system, where we have one of the best in the country. It's fully funded. I think everybody agrees that we were lucky 100 years ago that smart people really came together and put together quite a few of these ideas, so I fully support that idea."
As more property tax revenue covers the pension, it means less funding is available for the police department, fire department, libraries and streets. Johnson is also asking the Wisconsin Legislature to allow a county referendum that would raise the Milwaukee County sales tax.
"We need shared revenue, but we also need to have the opportunity to have a local sales tax," he said. "Milwaukee is the only large city in the United States that doesn't have the ability to raise its own revenue locally outside of a property tax."
Milwaukee City Hall
Right now, in Milwaukee County, if you spend $10, the sales tax is 55 cents – 50 cents for the state sales tax, plus 5 cents for the county. One proposal asks for a 1% county sales tax increase – or 10 cents more per $10.
"We have been meeting with legislators who represent Milwaukee and Milwaukee County. They have talked about the idea of having a sales tax, and I am skeptical that just adding more money to the equation without fundamental reform is going to do anything more than push the can down the road two, four, six more years – and we have the exact same problem," said Vos. "What I have asked the mayor and the county executive to do is to come back to us with ideas for reform: Where are there ways that you can actually reduce long-term costs? Where can you get privatized services? Where can you share another municipality?"
"The city of Milwaukee has been reforming and has had to reform over the course of the past 20 years. We've cut over 1,000 employees from the payroll. We've made the work environment safer, so that we cut down on workers compensation payments that come out of the city of Milwaukee. We've required our employees to pay more to their pensions. We've required our employees to pay more into their health care," Johnson said. "We've done a lot of reforms over the course of the past number of years in Milwaukee. We got shared services agreements with surrounding communities for fire and EMS service. We’ll continue to reform because we have to do that, we've had to do it, and we will continue to do this work."
Gov. Tony Evers, a Democrat, supports allowing counties to raise their sales tax.
Milwaukee Mayor Cavalier Johnson
"We need generational, transformative improvements as to how we invest in our local communities and keep them safe – and to ensure they can respond to basic and unique needs alike," said Evers. "Let’s keep working together on a plan. Because while one person alone cannot right the disinvestment local communities have seen over the last decade, together we will."
"Meeting with the governor was good, it was productive. Much like the meetings that we've been having with Republican leaders as well. They've all been productive," said Johnson. "I think we're all trying to head in the same sort of direction, which is working to make sure that we are in a position to provide basic quality services to the people.
"I am really enthused and optimistic about where we are and where we're headed. And when I talk about our partners in the state, I'm not just talking about Gov. Tony Evers. I'm also talking about speaker Robin Vos, and particularly members of the Wisconsin Legislature, especially those on the Republican side, who control both the Assembly as well as the Senate, so I'm very enthused by that."
Vos said the answer is not giving more money without reforms, but signaled an openness to paying city workers a raise to keep up with inflation.
The governor and legislature will spend months hammering out the state's next budget, with Milwaukee County leaders closely watching if more state resources will be coming.