July 9, 2002 e-newsletter

Shared Revenue Plan
Worst-Case Scenario
Bleak for Alliance 

Alliance members collectively would lose $31.5 million in 2004 under a worse-case scenario we calculated for how the conference committee shared-revenue plan would affect the major cities of Wisconsin  — our members.

The analysis shows Milwaukee potentially losing $13.4 million, Racine losing $1.65 million and Madison losing nearly $1.5 million. The conference committee's budget repair bill was approved 17-16 by the Senate last week and 50-47 by the Assembly Monday. On a per capita basis, the potential cuts range from $25.51 per capita in Beloit to $6.35 per capita in Wauwatosa.

"These cuts don't have to be made," Mayor Mike Miller of West Bend, the Alliance's president, told the Milwaukee Journal Sentinel. "We are not the cause of the state's budget deficit, and to come after us — people who have been fiscally responsible — when legislators don't cut their own projects in Madison is just fiscally irresponsible."

There are two assumptions associated with our numbers: they assume that all $45 million in consolidation incentive payments will be spoken for in 2004 (an unlikely result but valid for the purpose of a worst-case calculation) and that none of the Alliance cities receive any. They are approximate because 2003 expenditure restraint payments haven't been determined. Those payments would be built into the 2004 base — and the ERP program would expire — under the bill.

Under the budget endorsed by the conference committee and passed by the Legislature, the $40 million cut in 2004 translates to $3.68 per capita. The consolidation incentive aids are drawn from shared revenues with every recipient's aid reduced 4.5% under our scenario.

The predictions are approximate because they assume every city gets the same amount in ERP (expenditure restraint payments) in 2003 as in 2002, plus 1%. For Dennis Chaptman's story on the budget, look here. For Amy Rinard's July 9 story on our numbers, look here. For our city-by-city breakdown, go here. For Amy Rinard's July 8 story about the plan, look here.

Sheehy Task Force
Alliance Accepts Invite

Lawmakers vote for 10-lane Freeway

The project might have to be undertaken with no federal money, but Mayor Norquest and Waukesha County Executive Dan Finley are asking that it be vetoed. For the Journal Sentinel story, look here.

Health plan described

The Wisconsin Public Employers Health Insurance Program enrolls 25,000 local government employees, dependents and retirees from 289 communities across the state, Rep. Terri McCormick's Task Force on Local Government Health Partnerships was told June 26.

The program is available to all  local employers who are members of the Wisconsin Retirement System.

Its lowest cost single plan for active employees is $265.50 and its highest cost family plan (the standard plan in Dane County and the Milwaukee area) is $1,224.90, the Department of Employee Trust Funds told the Alliance after the task force meeting.

Their premiums for the typical contract rose from $372 in 1998 to $607 in 2002. Their premium increases for a typical contract were 17.9% last year and 15.2% this year.

In contrast, a survey of 25 cities by  Stephen J. Gunty, administrative services director for the City of Waukesha, found single plan premiums as low as $236 for Racine's Wausau Benefits plan to $512 for a Humana self-funded indemnity plan offered by West Allis.

How the Shared Revenue Debate Shook Out