Report finds state aid, road conditions have declined in cities and villages in recent years

The study is the first of what is expected to be an annual report from the Wisconsin Taxpayers Alliance and League of Wisconsin Municipalities.

MICHELLE STOCKER, CAPITAL TIMES

Wisconsin’s cities and villages are scaling back road repairs in the face of state aid cuts, and smaller villages have struggled more than larger cities to recover from the Great Recession, according to a new study.

The study, prepared for the League of Wisconsin Municipalities by the Wisconsin Taxpayers Alliance, also found that controversial Act 10, which limited public worker collective bargaining, saved local governments about $100 million in 2012, based on the latest available data.

It is the first of what is expected to be annual reviews of municipal survey data. The league lobbies on behalf of the state’s 597 cities and villages.

According to the study:

Municipal property taxes have increased 5.2 percent from 2011 to 2014, while state aid decreased 7.5 percent. Adjusted for inflation, property taxes decreased 0.8 percent while state aid decreased 12.8 percent. During the same period, state revenues increased more than 8 percent.

Local road conditions have declined, with 68 percent of streets rated in good condition or better last year, down from 72 percent in 2011. Streets rated in fair or poor condition increased from 29 percent to 32 percent.

The state’s 2011 Act 10, which required public employees to make pension contributions and limited public union bargaining, making it easier for municipalities to shift health insurance costs to employees, saved up to $100 million, or 1.5 percent of total spending, in 2012. That’s based on the most recently available data and excludes public safety employees who weren’t affected by Act 10.

Municipal debt service in 2014 was 21.7 percent of spending, down from a peak of 25.7 percent in 2012, but still higher than at any point in the 2000s.

A survey of municipalities found somewhat faster response times for police and fire services over the past two years, but a reduction in the frequency of street repairs, snow plowing and lawn mowing.

More than half (53 percent) of responding municipalities said private sector jobs in their communities had increased in the past year, compared with 13 percent that said they had declined. However, there was a marked difference in responses between large cities and smaller municipalities since 2010. Nearly 70 percent of larger municipalities reported increased employment, compared with only 19 percent of smaller municipalities.

Nearly two-thirds of smaller municipalities, those with fewer than 15,000 residents, reported an average of one or fewer candidates running for village board per seat over the past three years. Only 21 percent of larger municipalities reported difficulty attracting candidates for public office. And only 4 percent of all municipalities reported averaging two or more candidates running per seat.

Gov. Scott Walker’s spokesman Tom Evenson said in response to the study that Wisconsin’s economy remains strong for communities across the state. He cited data released Wednesday showing unemployment dropped in 30 of 32 major cities over the past month.

“Act 10 was arguably the greatest reform for local governments in at least a generation, as they now have more freedom to manage their budgets,” Evenson said.

He added that Walker is committed to increasing funding for local roads in his 2017-19 biennial budget proposal due out early next year.

Jerry Deschane, executive director of the League of Wisconsin Municipalities, said in a statement the report reveals troubling trends for smaller municipalities, which are just as vital to the health of Wisconsin’s economy as the larger cities.

“While it’s not always obvious, Wisconsin’s cities and villages, large and small, are interconnected economically and socially,” Deschane said. “If one community is not succeeding, it has a negative impact on the others. This report shows that we still have work to do in corners of Wisconsin.”

The survey portion of the study included responses from 148 out of 497 municipal officials. There was a higher response rate among larger cities.

Four out of 10 municipalities said their budget conditions had improved since 2010, while 30 percent said it had worsened. Among larger cities, 45 percent reported better, and 21 reported worse, budget conditions. Among smaller villages, 40 percent said their budget situation was better while 32 percent said it was worse.

The survey also found that Act 10 had a significant impact on how much municipal employees pay for health insurance. In 2010, nearly half of municipalities (46 percent) said employees paid 5 percent or less of premiums and a quarter said employees paid more than 10 percent. By 2015, a quarter said employees paid less than 5 percent of premiums and more than half (57 percent) paid more than 10 percent.

But even by that measure, workforce size was a factor. Among larger cities, only 9 percent said employees paid more than 10 percent of health insurance premiums in 2010. Among smaller villages, 30 percent were already requiring higher contributions, which meant Act 10 provided less opportunity for savings.

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Matthew DeFour covers state government and politics for the Wisconsin State Journal.