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April 28, 2005 e-newsletter

Let's Talk Economic Development

Shared Revenue Loses Buying Power

Solution to Property-Tax Blues

Colorado Not Out of Woods

Wisconsin Gets More Good Inc

News Briefs

Upcoming events

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Alliance Urges Regional Economic Development

By Rich Eggleston

We're asking city leaders to move regional economic development to the top of their agenda for discussions with legislators at the League-Alliance Legislative Luncheon in Madison, at 12:30 p.m. on May 19 at the Inn on the Park in Madison.

We're asking the state to be REDI for a burst of economic activity in the cities and villages of Wisconsin and to help make it happen by embracing a program we call REDI: our Regional Economic Development Incentive.

REDI is a new regional tax base growth-sharing program designed to support metropolitan and regional growth and cooperation.

It is based on the principles advocated by the Sheehy Task Force: "State policies should reflect the reality that Wisconsin’s economic strength begins in the communities and regions and that regions compete globally. Growth sharing tax policies have been successful in other states such as Minnesota and are easily applied to metropolitan areas. Growth sharing can also be tied to support for regional services or infrastructure and therefore encourage service sharing.

REDI will enable communities to make an investment in infrastructure that supports economic growth and cooperation. Investment in infrastructure to support economic development has been lagging due to state and local fiscal problems. A new commitment to this type of funding should improve the state’s overall economy and help the state overcome its fiscal problems. Failure to invest in this new approach will only delay recovery further.

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Our regions - based on economies.
(White counties are a "rest of state"
region.)

The idea is to peg shared revenues to growth in state general purpose revenues — essentially income and sales taxes — to give municipalities an incentive to grow their regional economies.  Otherwise economic growth only adds to the property tax burden.

t"Regionalism is a key to economic development," the La Crosse Tribune agreed after Alliance staff visited. "Giving money to regions is important because it recognizes that regions and metro areas are the real economic units in the state. Jobs can cross over municipal boundaries, but it is the economic regions that serve to attract growth and development." Editorial here.

RSVP to  Mary Malone at the League ( 608-267-2380) for the $12 per person legislative luncheon — you should have received an invitation —  and to the Alliance for the rest of our May 19-20 meetings. We'll send out an RSVP form and more details of our board and general membership meetings. Rooms at the Inn on the Park are blocked only until May 6 at the $62 government rate. For hotel reservation information and information on dinner Thursday night, look here. And, whether you are coming or not, don't forget to invite your legislators!

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Chart: Jennifer Gonda

Shared revenue loss adjusted for inflation

State shared revenues to cities, villages and towns in Wisconsin lost $232 million in buying power in the last decade, a 5.9% loss in unadjusted dollars combined with the toll inflation has taken on the dollar, as gauged by the Consumer Price Index.

It's another one of the subjects we hope city leaders and finance directors point out to legislators and their staff at the League of Wisconsin Municipalities and Wisconsin Alliance of Cities' biennial legislative luncheon, from   12:30 to 1:30 p.m., Thursday, May 19,  at the Inn on the Park, 22 S Carroll Street, Madison.

 

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Alliance outlines long-term solution to property tax woes

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Ed captured on video

In a videotaped interview on wispolitics.com, Alliance executive director Ed Huck outlined how the state could provide a long-term solution to the problem of high property taxes in Wisconsin — and why it must do so. Without a long-term strategy to control property taxes, levy limits would be a temporary fix, he told Jeff Mayers of wispolitics.com.

Ed said the long-term strategy must include:

  • non-property tax sources of revenue;
  • public employee labor law reform;
  • health-care reform;
  • K-12 education financing reform;
  • and campaign finance reform.
Ed said K-12 financing reform "is the gorilla in the room, along with health-care costs." He added that there have been "outrageous" arbitration awards recently that drive up local costs beyond local government's ability to pay.

He said all the above reforms are crucial to achieving property tax relief, and property tax relief in turn is crucial to retaining the middle-class homeowners on which healthy cities depend. Unfortunately, the political process too often loses sight of that goal, Ed said.

"The changes that state legislators have made over the last 20 years have been driven by special interests, not good public policy," Ed said in the interview. "What we (the Alliance of Cities) are going to try to do is inject policy, and we hope some of that sticks."

Ken Cole, executive director of the Wisconsin School Boards Association, said in a companion interview that K-12 financing reform is unnecessary, and Todd Berry of the Wisconsin Taxpayers Alliance suggested taking counties off the property tax. Neither suggested attacking any of the laws that drive property taxes.

To watch the video interview with Ed, go here. Note that you must use Internet Explorer — non Microsoft browsers won't work.

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TABOR Watch

A lot of folks are coalescing behind a five-year moratorium on Colorado's TABOR refund, but it's too early for public school advocates or others who rely on other public services to breathe a sigh of relief, Frankie Anhut of Impact on Education wrote in her final column in the Boulder (Colo.) Daily Camera.

"Today, Colorado is 49th in the country in K-12 spending relative to our state's wealth, so we have a long way to go before we can 'celebrate' being average. Hang on, it gets worse. This year, the state's inflation index increased by only one tenth of one percent, mainly due to lower prices for housing and cars — things school districts don't buy. On the other hand, the inflation index does not take into account real world costs facing school districts, such as the costs of gasoline for school buses, electricity to heat schools and health care insurance for teachers — which have experienced double-digit inflationary growth.

TABORbutton2.gif (32124 bytes)Button purchased on
State Street in Madison

"With rising transportation and energy costs, higher insurance premiums and salary increases negotiated with teachers — the district must figure out how to create a balanced budget that minimizes cuts that affect the classroom. Harry Houdini would be hard pressed to get out of this mess!" Column here.

Lucky for Wisconsin that we don't face rising transportation and energy costs, higher insurance premiums and salary increases negotiated with teachers!

It's people like Anhut that Rep. Frank Lasee (R-Bellevue) refers to as the "spending lobby" in his latest on TABOR here.

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Wisconsin gets more good Inc.

Green Bay ranked first and Madison ranked second among midsized cities in Inc. Magazine's rating of the top cities for doing business in America.

"With job bases from 150,000 to 450,000, the midsize cities include a strong showing from the Inland Empire, driven by escapees from the California coast," the small-business oriented magazine says in its May issue. The magazine cited Green Bay's quality of life, diversified economy, and  hardworking, skilled labor force.

incmag.jpg (4726 bytes) "It lacks the population-driven growth of Sunbelt cities such as Las Vegas or Atlanta, but it is an excellent place to start and expand a business," Inc. said. It said Madison is "peculiarly well suited for the service-driven economic expansion. As state capital and locale of one of the region's top universities, its population is exceptionally well educated."

The ranking focused heavily on a metro area's job-creation track record.

"The impact on business of a city's educational and training systems, housing and living costs, taxes, regulatory burdens, and quality of life--factors commonly measured by other 'hot lists' to identify strong economies--are all ultimately reflected by job growth," Inc. Magazine said. "Regions that consistently generate jobs in a broad range of industries rank at the top of the list."

The publication ranked La Crosse 17th among small cities. Story here.

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Alliance welcomes new mayors

The Alliance welcomes the following new mayors to our organization:

  • West Bend Mayor Doug Bade, 53. Story here. (second item in digest.)
  • LaCrosse Mayor Mark Johnsrud, 41. Story here.
  • Greenfield Mayor Mike Neitzke, 41. Story here.
  • Sheboygan Mayor Juan Perez, 51. Story here.

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Mayor Juan Perez

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News Briefs

Legislative obesity? Lawmakers who inserted a $95 million expansion project for Wisconsin 23 in Fond du Lac and Sheboygan counties into the state budget were unrepentant after the Milwaukee Journal Sentinel reported that the four-lane highway won't be needed for several decades. But the project may come unraveled as state transportation officials look for ways not to build a highway we don't need, the Journal Sentinel reported April 24. The story that the newspaper first broke is here. The follow-up is here. An editorial chastising lawmakers is here.

Perks cost money. The state budget and other legislation enacted last session brought the annual cost of special-interest perks to $1,358 for each Wisconsin taxpayer, the Wisconsin Democracy Campaign calculated. Seniors, college students and ordinary taxpayers also shouldered hundreds of dollars worth of increased taxes and fees to enable wealthy donors to avoid sharing the pain, the Democracy Campaign said in a news release here.

The casualty of business-as-usual at the Capitol is trust in government, the Wausau Daily Herald said in an editorial.

"Economic development, job creation, streamlining the regulatory process - all are important," the newspaper said. "But we respectfully would suggest that substantive discussions of any of those issues can't begin until another is resolved. That topic is trust, which is tainted by the stench of money that permeates state politics."

Editorial here.

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Top of the Legislature's
food pyramid?

Madison's minimum wage ordinance upheld. Circuit Judge Maryann Sumi upheld Madison's minimum wage ordinance — and by extension Milwaukee and LaCrosse's — April 21, ruling there was nothing in state law that prevents cities from establishing their own minimum wage. Story here. But there soon may be. "Friends" of local government in the Legislature, who for months have ignored labor-management recommendations that the state minimum wage be raised, put a bill to preempt local authority on the subject on the fast track, The Capital Times reported. Story here.

McNally: Voter ID bill doesn't do enough. "The attempt by Wisconsin Republicans to reduce voting by undesirables such as the elderly and the poor is laudable. But it doesn’t go nearly far enough," Joel McNally writes in his latest column in Milwaukee's Shepherd Express. "Frankly, Republicans aren’t thinking conservative enough. It’s time someone had the political courage to stand up and demand a return to voting as originally envisioned by our founding fathers.

"Voting in Wisconsin should be limited to wealthy, white, male property owners..."  Column, which also was printed in The Capital Times, where it's likely to hang around longer in cyberspace, is  here.

Incredible schools. For a backwoods Midwestern state, our schools ain't too shabby. Wisconsin's metropolitan areas snatched an incredible eight spots among the top 20 metropolitan areas in the country with the best public schools, in a ranking by Expansion Management magazine. The publication, aimed at corporate executives seeking places to relocate, rated metropolitan Sheboygan schools second best overall in the country, metro Madison schools third; Oshkosh and Neenah's schools sixth, Appleton's seventh, Eau Claire's 10th, Fond du Lac's 15th, Wausau's 18th and LaCrosse's 20th.

"It has become cliché to say that America’s economic future rests with its educated work force. However, just because it’s a cliché doesn’t mean that it is not true," the magazine said. Rankings here.

 

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Upcoming Events    (click on underlined text for more)

April 30 People's Legislature Milwaukee
May 3 Fighting Reactionary Politics Oshkosh
May 10 Mayor Mike Miller retirement party West Bend
May 11-13 State APWA spring conference Lake Delton
May 18-19 WAPA 2005 Planning Conference Sheboygan
May 19-20 Legislative Luncheon, Alliance meetings Madison
June 9 New Cities Project Chicago
June 28 water and sewer  rate analysis workshop Rockford, Ill.
July 21-22 Alliance meetings Racine
Sept. 15-16 Alliance meetings Whitewater
Nov. 10-11 Alliance meetings Neenah

(details of the latter Alliance meetings TBA)


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THE WISCONSIN ALLIANCE OF CITIES
14 West Mifflin Street Suite 206
Madison, Wisconsin 53703
(608) 257-5881