lawsuit to settle the dispute is pending. Wisconsin is sitting on
a $4 billion surplus. Some counties would like a bigger
piece of that pie through the state's shared revenue back in
2023, a much heralded bipartisan shared revenue plan for local
governments was passed, allowing Milwaukee to raise its sales tax
to shore up services, while at the same time boosting state
revenue. Coming to locals across the state. But now the richest
county in the state, Waukesha County, is looking at a $5
million budget shortfall in 2025 and is beseeching the state to
give more. Marquette University Professor of political Science
Philip Rocco is an expert in all of this, and he joins us now.
Thanks very much for being here. >> Good to be with you.
>> So I thought that this 2023 shared revenue plan was a great
deal for local governments. What happened?
>> Well, it was a big deal, right? It was the single largest
increase in shared revenue that local governments had received
since the early 2000. But the reality is that compared to what
cities, towns, villages and counties had lost since the
early 2000. Because the formula wasn't updated for inflation and
because there were several big cuts to shared revenue. It's
really a fraction of what local governments and county
governments had lost in inflation adjusted terms since
the early 2000. And at the same time, inflation has sort of
proceeded a pace that raises the cost of services for local
governments. And so while it was by no means a small thing, there
are still challenges that local governments around the state are
facing. >> Is it striking that a county
like Waukesha County, regarded as the wealthiest in Wisconsin,
would be in this position? >> No, I don't think it's
particularly surprising, in part because the shared revenue
formula is not necessarily designed to advantage counties
like Waukesha receives one of the largest or lowest shares in
per capita aid among counties in the state. At the same time, the
pressures that are on counties and municipalities around the
state are really pretty constant, regardless of their
wealth. So, for example, there are inflation pressures which
raise the cost of doing things like sidewalk repair and street
repair. But at the same time, the property tax levy limit that
the state sets has not been adjusted to sort of take account
of those inflationary pressures. And that really puts counties
and municipalities in a squeeze position.
>> Is it your expectation that the state would do something
around those levy limits? >> I think that's possible. I
think that that is, if you talk to local officials, both in
counties, municipalities, that's one of their key agenda items.
And so I would expect to see movement on that before. I would
expect to see movement on sort of increasing formula funding
under act 12. >> So other counties raised
their state sales tax to fund needs. And Waukesha wanted to.
What happened with that? >> I think that was one of the
things that helps explain the shortfall. And maybe why
Waukesha is in this position, which is like a lot of other
counties. There was a push to increase the sales tax by 0.5%,
but there was, unlike in Milwaukee, where the business
community was in favor of that measure, both for the county and
the city. In Waukesha County, the business community, the
Chamber of Commerce really opposed that. And so the
legislation was pulled sort of at the last minute to reevaluate
it. particular so strapped?
>> Counties are important because they really pulled
double duty in Wisconsin government. They're both local
governments in their own right that offer things on a
discretionary basis to their residents. But at the same time,
they are service providers and agencies of the state. And so
they have a lot of responsibilities that they can't
easily get out of. And a lot of their budget is sort of spoken
for by the state. And so that especially in in conditions
where there's sort of inflationary pressure that can
put an additional vice grip, I think, on county finances. And
so when you look at what counties are asking for in the
2025 to 27 budget, what they're asking for is not additional
shared revenue of the sort that that they got under act 12, but
the sorts of special revenue programs or aid programs that
help them to support the services that they provide on
behalf of the state. >> What are some examples of
those services that they provide on behalf of the state that are
different? >> So there's all sorts of
mental health services that counties are the sort of main
provider of. If you think about the state court system that
really operates through counties, jails as well, are
county functions. But mandated in a way by the state. And
there's really a host of additional kind of mandatory
programs that counties administer.
>> All right. Professor Phillip Rocco, thanks very much. We'll
be looking at that next state be looking at that next state