Why 2 Counties Need Each Other

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Prudence Terry
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1 Why 2 Counties Need Each Other Although Waukesha County and Milwaukee County differ in many ways, they have similar budgets for Each is a sound planning document that balances the competing interests of its own residents and taxpayers. Yet both documents are limited in their acknowledgement of a broader truth: The fortunes of both counties may well depend on their partnership. Do Waukesha and Milwaukee need each other? That depends on how aggressively the metro area hopes to compete in the dynamic global economy. Planning as reflected in each of the county budgets traditionally has focused more on parochial interests than on the interests of the region as a whole. Both governments have an opportunity to help each other, especially in areas where their needs are complementary. One example that is not being fully addressed: Waukesha County employers face productivity losses because of labor shortages; Milwaukee County has an abundance of potential workers. County Budget Proposals for 2001 Waukesha Milwaukee Population 358, ,248 Tax Base 2000 $28.8 billion $35.8 billion (Projected) $42.5 billion $41.0 billion County Budget $206 million $1,062 million County Tax Levy $71 million $205 million -Tax Rate $2.46 $5.73 -Tax Per Person $199 $226 County Employees 1,506 7,410 -Per 100, Spending Per Person $573 $1,172 -For Parks $38 $65 -For Public Works $66 $205 -Human Services $195 $429 -For Public Safety $73 $101 Volume 88, Number 14 November 3, 2000 Strategic Issues of Importance to Waukesha and Milwaukee Waukesha and Milwaukee may have their differences, but there are several principles upon which the leaders of both counties might be expected to agree. Some examples: Economic Development Business expansion and creation of new jobs in the metro area should be a common goal that looks beyond political boundaries for solutions, particularly if our region is to compete on a global basis in this century. A job in Milwaukee is good for Waukesha and vice versa. Recreation Regional coordination of government supported qualify-of-life functions, such as parks and cultural facilities would prevent duplication and enhance the atractiveness of the whole metro area. Transportation Both counties are likely to pay an economic price unless goods and services move as efficiently as possible. In addition, workers must be able to get to and from available jobs. Tourism The ability to attract visitors likely would improve if both counties worked together to promote a diversity of attractions, restaurants, hotels and other ammenities. Workforce If the metropolitan workforce is not trained for the emerging job market, many employers in both counties are likely to look elsewhere fore growth and expansion. A healthy workforce also must be ensured. Growth New housing and business developments, whether they take place in pastures or brownfields, must be sustainable; common public policies can insure that growth takes place in a way that provides long term benefit for the metropolitan area. Reproduction of this document in whole or in part for non-commercial purposes is encouraged, provided credit is given to the Public Policy Forum, Milwaukee, Wisconsin. Any information reproduced must include footnotes/endnotes that apply to such information. Commercial reproduction requires prior written permission from the Public Policy Forum.

2 The Implications of Waukesha s Taxing Capacity Tax base is the capacity to raise revenue from property taxes. It is another term for equalized property value, which is the most reliable measure of the aggregate value of taxable property in a municipality, county or other taxing district. At present growth rates, the tax base of Waukesha County will surpass that of Milwaukee County within seven years and quite likely by the year That is because property values are growing at a rate slightly above 8% each year as what once was farmland in Waukesha County becomes converted into residential and business property. In contrast, the more settled Milwaukee County is growing at a rate below 4% each year. The importance of this change is that Waukesha County soon will find itself in a dominant position in terms of taxing capacity. Like it or not, it will become the regional leader not in population but in property value. The question for Waukesha County becomes the question any leader faces: What will it choose to do with its position of strength? The answer to this question has important implications for the entire metropolitan area. Over the past century and a half, Milwaukee County dominated the region not only in size but also in terms of taxing capacity. What did it do with its position of leadership? Among other things, Milwaukee County served as a regional center for quality-of-life services, such as one of the nation s best zoos and museums, a strong mass transit system and a world class system of parks. In recent years, Milwaukee County s capacity to maintain these regional treasures has become strained, and its services have suffered. As Waukesha County grows into a position of leadership, both counties have a responsibility to help set the regional agenda. Projected Property Tax Base Based on Average Annual Growth Equalized Property Value in Billions of Dollars $65 $60 $55 $50 $45 $40 $35 $30 $25 $20 Milwaukee County Waukesha County

3 Two County Budgets for 2001 Is the Sum of Two Counties Greater Than its Parts? Waukesha and Milwaukee Counties have similar missions, objectives, budgets and challenges. The visions, as stated in the respective budgets, are somewhat parochial: Each envisons its county as Wisconsin s greatest. Neither mission statement embraces the concept that a rising tide lifts all ships, although Waukesha s mission statement says the county strives to be a model for governmental partnerships. Leaders on both sides of the New Berlin wall have experimented with partnerships between the two counties over the years. Even so, the regional history is dominated by division. Milwaukee County included both counties before Waukesha seceeded in 1846 over issues of taxation and local control. Examples of Cooperation Suggest Broader Possibilities The 2000 human services budgets of both Waukesha and Milwaukee Counties included $25,000 expenditures that were symbolic of cooperation. The counties contributed to a regional child care referral service for employers who sought to hire parents as employees. This is a modest effort to overcome one of the biggest challenges of the current strong ecomony in which there is a disconnect between jobs and potential employees. County officials also talk to each other regularly. The county executives, board chairmen and the heads of human services of the counties meet to discuss mutual concerns. Other potential areas of cooperation between The County of Milwaukee will be the premier county in the State of Wisconsin. The county will be a regional leader and the state s economic and cultural center because of its diverse, affordable, safe environment and its efficient and responsive government. Milwaukee County Mission Statement the counties include education and job-training initiatives, especially at the technical college level; greater coordination between the separate Private Industry Councils (which the Greater Milwaukee Committee has suggested be merged); broader regional recruitment of foster care and adoptive parents; a regional transportation authority and regional planning and funding for parks and culture. Cleaning up the Poisoned Waters From Bitter Disputes of the Past Observers in both counties acknowledge that regional trust was undermined in the past by two disputes: how suburbs should pay for metropolitan sewage services (the so-called sewer wars) and whether a light rail system should be built between Milwaukee and Waukesha. While those disputes may have poisoned the waters of collaboration, both counties face realities that have regional implications. Among them: The workforce is becoming more culturally and ethnically diverse. Soon Waukesha County will overtake Milwaukee County in aggregate property value. Increasing numbers of residents are being incarcerated instead of productively employed. Althouth aggregate wealth is growing, disparities are widening. There is a disconnect between workers and jobs in terms of geography and training. Waukesha County s economic vitality is unmatched in Wisconsin. While we are vigorous and dynamic, we still have many challenges facing us. We have to balance the needs of our...constituents while always being mindful of the taxpayers ability to pay...the county will remain the Star of Wisconsin. Waukesha County Executive s Vision 3

4 Milwaukee Technology, Quality of Life Promoted as Corrections Spending Slows Like most local governments, the county is challenged this year by rising fuel costs, rising health benefits and sagging state support. Even so, the County Executive s proposed budget for 2001, which calls for $1.062 billion in spending, sets a $205 million tax levy that will leave the tax rate essentially unchanged. That is possible partly because of higher fees for county services and a 5% anticipated increase in sales tax revenue to $56 million. Although the 1.5% spending increase is significantly below inflation, the number of potential county employees will grow by 72 positions. After many years of expansion in the public safety functions of county government, corrections spending has stabilized. As a result, the county is positioned to make some modest quality-of-life improvements. For example, the $120 million capital budget proposal includes the creation of a new Kohl Park and improvements in other parks, including Grant, Gordon, Whitnall, Mitchell and the Zoo. Performance Measures Show Promise of Outcome-based Budgeting The budget reflects an important change as all departments have started a planning process that ultimately is intended to link spending to measurable outcomes. As a first step, departments are measuring their outcomes. For outcome-based budgeting to realize its promise, the budget will need to show measurable goals and objectives for each department and show whether progress is being made year to year. The transit system is an example of a county service that has experience linking spending to measurable performance: If ridership drops below an acceptable level on a bus line, the route will be dropped. Measurable goals are more difficult to set for some departments, but more clarity is needed. For example, the Disadvantaged Business Development Department, whose work is critical as the county becomes more diverse, will need to develop more specific outcome targets than the vague increase in amount of participation. The Challenge to Upgrade Technology and Bring Government to the People The 2001 budget calls for more personnel in the information services divison of the county s administration department. In recent years, the county has been preoccupied with internal financial A Sample of Milwaukee County User Fees (Proposed) Zoo Admission (summer) $6.50 $7.50 Brown Deer golf (resident) $28.75 $29.00 Nonresident $68.00 $69.00 McKinley 35' boat slip (res.) $1,880 $1,935 Nonresident $1,995 $2,055 Bus fare $1.35 $1.50 Senior/Hand. ticket $6.50 $7.50 Birth record fee $12 $12 Proposed Milwaukee County Spending and Tax Levy by Purpose for 2001 Courts General Government Parks Debt Service Tax Levy Total Public Safety Capital Improvements Public Works Health/Human Services $0 $50,000,000 $100,000,000 $150,000,000 $200,000,000 $250,000,000 $300,000,000 $350,000,000 $400,000,000 $450,000,000 4

5 County County Government shows Signs of Growing Larger systems and Y2K compliance, relying heavily on high-priced consultants. Now that those tasks are completed, the county is challenged to use technology, especially the Internet, in ways that make the government more accessible and convenient to its users both within and outside the government and to do so efficiently. The county s information services need to serve the citizens and not just the government. The county proposes to do so in a potentially cost-effective but somewhat risky way: by beefing up internal capabilities and relying less on consultants. It may prove difficult to retain highquality technical employees in competiton with the private sector that can be alluring to government workers. Personnel Changes Continue To Reflect Shifting Priorities In recent years, Milwaukee County has reduced health and social services, with the closing of the former Doyne Hospital, the state takeover of child welfare and the deinstitutionalization of mental health patients. At the same time, the county s involvement in public safety and public works has increased. Overall, the 2001 budget calls for 72 more authorized positions even though health and human service workers will drop by 30 positions. The Milw. Co. Full-Time Equivalent Positions 2001 Change Legislative and Executive Information Management Other Administration Courts General Government Sheriff 1, House of Correction Medical Examiner District Attorney Public Works Health and Human Services 2, Parks 1, Total 7, ,000 2,500 2,000 1,500 1, Milwaukee County Inmate Population House of Correction Jail increases are primarily in the court system, including the district attorney s office, the sheriff and public works, including the airport. At the same time, the budget includes important health and human initiatives. One is expansion of services to the elderly. Another is an opportunity to provide more drug treatment services, whose county clients have been halved since 8,519 were treated in The budget also includes more than $700,000 for improvements in child care, including pre-school education. The results of these and other initiatives need to be measured. In future years, the County Board may want to examine the entire budget, asking each department to justify expenses in light of the county s own mission statement by providing measurements and focusing on results. An Investor s Perspective of Two Metro Area Counties Moody s Investors Service recently assigned Milwaukee County a Aa3 rating for purposes of a county bond sale. That rating, which is high but not the highest, reflects the county s relatively strong financial position that has improved in recent years despite fluctuating state aid payments and increased public safety spending. Waukesha County recently was assigned a rating of Aaa, the highest, based on the county s strong finances and operating flexibility. The report notes, however, that Waukesha s stability is threatened by a significant worker shortage for which the county needs more affordable housing, mass transportation and worker training.

6 Waukesha Waukesha a Model of Outcome-Based Spending, Budget Presentation Waukesha County government begins the new millennium in a strong financial position. Its debt is well under control, and its tax base has grown much faster than its tax levy, resulting in a steadily decreasing tax rate. While the county s growth accounts for part of this strength, inventive fiscal management also has contributed considerably. Waukesha County government runs on a businessoriented model that includes sophisticated strategic planning, outcome-based budgeting and clear links between performance and rewards. As with all governments that use business principles to reinvent themselves, the challenge for Waukesha County is to resist allowing politics to interfere with performance in making key decisions. For 2001, County Executive Daniel M. Finley has proposed spending $206 million, a 5% increase that would require a $71 million general tax levy, a 4% increase that is well below the county s 8% growth in tax base. The tax rate would decline as it has for each of the past 11 years. Health and Human Service Needs Grow With County Despite the county s affluence, its budget increasingly is driven by the same factors that have challenged Milwaukee County: public safety spending (especially on incarceration) and human service needs. The growth in these areas threaten to undermine quality-of-life improvements that affect the overall citizenry, such as parks, recreation and culture. More than 75% of added spending for Waukesha County government will go to public safety and human services, including increased child care and services for the aging population and children with special needs. Transit Services Expand To Meet Business Needs The 2001 budget also reflects a commitment to improving public transportation, primarily in response to the county s worker shortage. Spending on public buses will increase from $4.2 million to $4.8 million, partly with a 25% increase Waukesha County Tax Trends Indexed to 1991 = 100 Property Value Tax Levy Property Tax Rate in tax levy for transit. The budget anticipates a 50% increase in ridership on three routes that run between Waukesha and Milwaukee Counties. The budget also calls for an effort to streamline public works functions by merging the facilities management and transportation departments. Unlike Milwaukee County, however, the airport will continue to be managed independently. New Technology Initiatives Round Out Plans for The county s effort to embrace the information age will continue. One planned improvement is an Internet enhancement that will allow citizens to accomplish tasks online that in the past required a trip to the county courthouse, such as applying for a county job. Also, the county hopes to flatten bureaucrary by relying on computers to improve productivity. That may be difficult: Governments and businesses often find that adding technology leads to the need for more, not fewer, employees. 74 6

7 County Rising Public Safety, Incarceration Spending Displaces Other Priorities For more than a decade, criminal justice spending has had a profound effect on Milwaukee County. The growth of courts, the sheriff s department and incarceration in jail facilities and the House of Correction has led to relative cuts in spending for quality-of-life activities such as parks, culture and recreation. The 2001 Waukesha County budget underscores that no county is immune from public safety spending that could grow out of control. The Waukesha County 2001 budget reflects a long range effort to combat this problem with a balance of added jail capacity, creative alternatives to incarceration and preventive programs intended to reduce recidivism. In a year of less than 3% inflation and when total spending will increase 5%, the Waukesha County District Attorney s office proposes to increase spending by 11% and the Sheriff s Department 6.4%. In order to provide inmate security for an expanded population of Huber prisoners, spending will increase 16% with the addition of five corrections officers. These trends are the result of several developments. Among them are a growing and more diverse county population and expansive state laws that include mandatory sentencing and diminished discretion for local law enforcement. The county has a strategy to deal with the growing jail population. It includes plans for new jail construction that will add to the jail capacity by more than 300 inmates. Other plans reflected in the 140, , ,000 80,000 60,000 40,000 20, Waukesha County Inmate days Jail Inmate Days Huber Inmate Days Average Incarcerated Population Jail Huber 2001 budget include added funding for drug abuse treatment to reduce recidivism, an intensive supervision program for second-time drunk drivers and placement of Waukesha prisoners in out-ofcounty jails. In addition, a new Criminal Justice Coordinating Task Force will be headed by the Director of Health and Human Services to develop strategies to reduce jail population growth and future expansion needs. Proposed Waukesha County Spending and Tax Levy by Purpose for 2001 Libraries Transit services Court system Highways Other Public Works Parks Debt Service General Government Other Capital Projects Sheriff (inc. Jail) Human services Tax Levy Total $0 $10,000,000 $20,000,000 $30,000,000 $40,000,000 $50,000,000 $60,000,000 $70,000,000 $80,000,000 7

County Spending: $1.3 billion The Milwaukee and Waukesha County Executives propose to spend $1.3 billion in 2001. This analysis looks at what they intend to do with the money.

8 County Spending: $1.3 billion The Milwaukee and Waukesha County Executives propose to spend $1.3 billion in This analysis looks at what they intend to do with the money. It also explores how the counties might work together more on regional issues, such as: Business expansion and creation of new jobs. Quality of life services such as parks and cultural offerings. Transportation of goods, services and available workers in an era of labor shortages. Attracting visitors by providing a diversity of attractions, restaurants and hotels. Preparing the metropolitan workforce for the emerging job market. Growth and development that provides long term benefits for the metro area. President: David G. Meissner VP/Research Director: Jeffrey C. Browne Senior Researcher: Emily Van Dunk, Ph.D. Researcher: Anneliese M. Dickman, J.D. Research Intern: Amy Euer Office Manager: Catherine A. Crother

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