Milwaukee pension crisis, state help wanted with layoffs possible

The city of Milwaukee faces a pension crisis as its payments are projected to increase by $74 million come 2023. On Wednesday, Oct. 6, a task force presented the city's Finance and Personnel Committee options to move forward.

To save $74 million, the city could lay off an estimated 1,300 employees, which is 24% of the workforce, but no one at City Hall wants to do that. Instead, in the face of declining investment returns, increased public safety costs and more, they're hoping for help from the Wisconsin Legislature.

Four months after Mayor Tom Barrett convened the "Pension Crisis Task Force" in Milwaukee, Chair Joe'mar Hooper and members of Barrett's administration presented the task force findings before the Finance and Personnel Committee Wednesday.

"It's a problem that every Milwaukeean needs to understand and care about at this point in time," said Hooper.

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As they see it, the city has 12 options to avoid a fiscal cliff. They include transitioning new employees to the state pension plan, creating a new benefit structure for the city pension plan, or, at worst, laying off 1,300 employees.

"It would be somewhat draconian, and it would have really a material impact on the quality of life for the citizens of Milwaukee," said Alderman Michael Murphy.

Murphy chairs the Finance and Personnel Committee. He says the best path forward, included in those 12 options, is lobbying the Legislature for help on new revenue sources, like a local option sales tax.

"That additional revenue source would certainly help us in trying to not only address the pension issue but the issue of having more police officers, more essential services," said Murphy.

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It's something Hooper agrees with so the city doesn't lose pivotal employees in public safety, public works and more.

"We're one of the poorer cities in the country as far as income of our residents, so we need all the services we can get," said Hooper.

This pension problem has already impacted city services, like the cuts of 120 sworn police positions and five fire department units. The city has the next 12 months or so to find a solution before the Milwaukee Common Council determines the 2023 budget.

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