Bobbie Harte
Madison Mayor Satya Rhodes-Conway
Rhodes-Conway: 'The annual budget crunches that confront the city are the result of two basic dynamics: a rapidly growing city and harsh restrictions on revenue enacted by the state Legislature and former Gov. Scott Walker.'
This past November, the Madison Common Council passed the city’s operating budget for 2024. It continues to support the skilled staff that sustain high-quality city services and keep Madison strong. But as with every budget, it required many hard decisions and the work of both the executive and legislative branches to get it done. We had to cut 1% across the board from all city departments, ask for steeper savings from our largest departments, and say no to many good ideas and needed programs, including additional staffing to meet increasing service demands, increased funding for community services, and new basic life support ambulances for our fire department.
There has been some debate recently, both in opinion columns in these pages and in the public, about the budget so I wanted to take this opportunity to clarify some apparent misconceptions. The annual budget crunches that confront the city are the result of two basic dynamics, neither of them within the control of city government: a rapidly growing city and harsh restrictions on revenue enacted by the state Legislature and former Gov. Scott Walker.
First, the growth: Our city continues to attract new residents at an ever-faster pace — this year we hit 286,000 residents, and we’re projecting 115,000 more arrivals by 2050. Madison is the fastest-growing city in Wisconsin, and that is in large part due to the high quality of life here. A growing populace means that continuing to provide the services our community expects requires more staff — more firefighters, more librarians, more snow plow drivers, more building and construction inspectors — and that in turn costs more money to pay competitive salaries and benefits.
Second, paying for these services is made exponentially more difficult by a state Legislature that provides minimal direct support and severely restricts Madison’s access to revenue sources. Unlike most major cities throughout the country, Madison is not permitted to have a local sales tax or a local income tax. The state is supposed to return a portion of the taxes collected here to Madison as “shared revenue,” but it has returned a smaller percentage each year.
On so many measures, we do not receive our fair share of state aid. Madison receives less aid than it did 40 years ago; if state aid had simply kept pace with inflation from year 2000 levels, Madison’s share would be $9 million higher than it is today. Instead, Madison receives the lowest per capita amount in the entire state. If Madison residents are wondering why their property tax bill looks the way it does, they need look no further than the state Legislature: According to the independent Wisconsin Policy Forum, “Wisconsin municipalities depend on the property tax more than their peers in any other Midwestern state.”
Finally, the COVID pandemic created a hole in the budget that the city has yet to recover from. Madison was fortunate to receive $47 million through the federal American Rescue Plan Act championed by President Biden, which helped protect our residents and avoid deep cuts to city services. However, Madison’s revenue is still nearly 10% below where it would have been absent COVID. While revenues linked to the economy (like income and sales tax) are up again, the city (unlike the state or Dane County) does not receive any of those revenues. Instead, the city is restricted by the Legislature to property taxes, which are only allowed to increase as much as “net new construction,” a measure that does not reflect inflation or population growth.
Thus, the city does find itself in a worse budget situation post-pandemic than we were in before, a fact we have been completely transparent about. We laid out the city’s budget situation in our capital and operating budget materials and public statements, and it is spelled out clearly in the recent letter explaining the tax bill that all households received.
To those who say that the city spends too much, I would point out that today we have 10% fewer city staff per capita than we did in 2011; the city is already doing more with relatively less and we will continue to innovate and seek efficiencies wherever we can. Thanks to responsible budgeting by both my administration and previous ones, the city enjoys the highest possible debt rating, triple A. And the city’s fund balance — or “rainy day fund” — remains above the 15% of operating expenditures that is considered a best practice by the Government Finance Officers Association.
The city’s options for dealing with the budget have not changed since 2011 — raising fees or property taxes, or cutting jobs and services. Every mayor has done some combination of this, while also balancing the need to maintain quality services. These are tough choices. Pretending that there is some magic budgeting formula that will avoid pain, or that delaying or cutting one or two big projects would solve the underlying structural funding issues in state law, does a disservice to city residents.
At the end of the day, Madison’s economy is fundamentally strong and, despite the best efforts of legislative Republicans, is driving Wisconsin’s economic growth. Our community expects, and deserves, high quality services and efficient government. We must — and will — meet these challenges to ensure that Madison remains a great place to live, work and play for all its residents.
Satya Rhodes-Conway has served as Madison mayor since 2019.
