Alliance Leads in Holding Down Taxes

City Leaders Use Summit to Advocate Reform

Utopia in Wisconsin? Bill Says 'No!'

In the Wisconsin Alliance of Cities (32 of our 38 members responded to our survey), levies are increasing 2.4% and budgets are up just 1.5% for the coming year. Many communities limited their levy increases to the amount of additional revenue produced by new construction in their communities — so no one’s tax bill will increase.

Had the so-called property tax freeze advocated by some members of the Legislature but vetoed by Gov. Jim Doyle become law, our members overall would have been allowed a 3.4% levy increase, according to state Department of Revenue estimates.

The more modest overall levy increase came despite $30 million in shared revenue cuts that those cities received.

Marinette, Menasha and Wisconsin Rapids reported reductions in their levies. Greenfield and Wauwatosa reported that they froze their levies, and Appleton, Beaver Dam, Merrill, Milwaukee, Superior and West Allis reported that they increased their levies 1% or less. Twelve cities held their levy increases to 2% or less.
	This is in the face of health insurance cost increases of 12%-15% in Marinette, 16% in Menasha, and 20% in Superior, to cite some of the examples we have handy.

Alliance Pushes Government Reform

If Gov. Jim Doyle's Dec. 10 Local Government Summit becomes the nursery for the next wave of government reform efforts, the Alliance of Cities was there to sow the seeds of governmental responsibility for the 21st Century.

“We live in a region. Our constituents live in a region,” Appleton Mayor Timothy Hanna told the summit. “That’s the way we live. That’s the way we should govern.” Hanna urged the state to move to regional shared revenue to eliminate competition among neighboring communities for new development.

Mayor Doug Oitzinger of Marinette said consolidation is tougher for Marinette, where the only neighboring city is in Michigan, than it is for communities in the Fox Valley. He asked the governor to improve the economic development tools of Wisconsin cities and he asked legislators to avoid passing legislation that divides cities, towns and villages rather than unites them.

"We have way too many local governments in the state," declared Menasha Mayor Joe Laux, who said more than 3,000 local units of government are able to levy property taxes.

But Gov. Doyle said he hasn't heard too many of them volunteer to be absorbed by other taxing entities in the name of government efficiency. He told the summit to seek real solutions to the problem of high property taxes rather than dwell on "gimmicks" like a constitutional amendment to impose statewide limits on state and local tax increases.

"I don't want to see Wisconsin become California," the governor said, an apparent reference to the devastating effect that state's Proposition 13 has had on California's educational system.

See the wispolitics.com story on the Summit here. The Appleton Post-Crescent story is here. The Marinette EagleHerald story is here.

In an editorial the same day as the summit, the Wisconsin State Journal embraced many of the proposals and concepts the Alliance has been advocating, and urged Gov.  Doyle and legislators to do the same at the Local Government Summit.

Among proposals the newspaper endorsed:

• Rep. Greg Huber's metropolitan service district bill (on which the Alliance is neutral).
• Rep. Bob Ziegelbauer's bill to allow local governments to combine police departments (Alliance endorsed).
• Rep. Mark Gottlieb's bill to level the playing field in municipal collective bargaining (Alliance endorsed with an amendment to make it apply statewide, which the State Journal also advocated.)
• Allowing local governments to levy more fees for services (Alliance endorsed).
• "Banking" spending authority under expenditure restraint (Alliance endorsed).
• Tightening definitions of "benevolent" and charitable" in the property-tax-exemption law (Alliance endorsed).

The editorial is here.

Surprise! They're encountering opposition from the telecommunications and cable companies that long for a return to the days when they had unchallenged monopoly powers.

In Wisconsin, a small, Virginia-based start-up company, iTown Communications, wants to partner with cities to extend ultra-high-speed broadband networks to smaller communities that risk being left in the dust as cable and telecommunications monopolies expand their networks. But SB 272, a bill that has passed the Senate, could discourage that.

The New York Times looked at "Utopia," the Utah Telecommunications Open Infrastructure Agency, and declared it a 21st Century version of the kinds of the public works projects that brought electricity to rural America and water to the parched West.

"A core role of local government is to provide the essential infrastructure necessary to support a vibrant business community," the mayors of two of the 18 cities in "Utopia" wrote in the Deseret News, Salt Lake City, Dec. 14. "Residents look to their cities to establish an environment that maintains or enhances their property values. Job creation and economic growth are absolutely dependent on basic infrastructure like roads, bridges, water systems, airports and power.

"Would it make economic sense for each airline to build its own airport? Obviously not," they wrote. "Nor does it make sense for each telecom service provider to dig up the streets. Airlines compete on price and customer service while sharing the airport infrastructure.
The airport is paid for by the passengers who use it. Similarly, UTOPIA's fiber-optic network will be paid for by those who use it."

The mayors' Op-Ed piece is here. The Winter Olympics drew the world's attention to Utah in 2002, but if Utopia lives up to its promise, it will draw the world's attention for much longer, noted an article in the Salt Lake Tribune here.

SB 272 "is not benign," Keith Montgomery, CEO of iTown Communications, told the Assembly Energy and Utilities Committee Dec. 9. "It does not just define a neutral process for local government. It effectively discourages their participation in broadband infrastructure development." See his testimony to the committee here.

The big guys on the telecommunications block remain hostile, however. "Why provide a Rolls-Royce when a Chevrolet will do?" asked Jerry Fenn, president of the Utah division of Qwest. One reason: Many Utah residents — like many of their counterparts in Wisconsin — are relegated to the Model T Ford of the information age, dial-up modems that operate at best at 56K. Actually, this is not a very good analogy: ultra-high-speed broadband is at least 2,000 times faster than that dial-up modem.

Neenah is refinancing its debt, saving taxpayers an estimated $255,000 in the process. During the process, Moody's Investors Service reaffirmed the city's “Aa2" bond rating, citing its growing tax base, sound finances, healthy reserves and zeal in retiring debt. Story here.

Despite a number of reforms in the past decade, federal rules remain stacked against transit, and funding highway projects is far easier, according to an analysis by Edward Beimborn of UWM and Robert Puentes of the Brookings Institution. They found that transit funding is arbitrary, capricious and stingy, while in comparison highway funding is Fat City. See a summary of their report, and a link to the complete document, here.