The City of Milwaukee is more unique than we knew.
It is the only city its size limited to using property taxes as the sole form of local taxation, a new report has found. The report also suggests the current revenue structure Milwaukee is required to operate under is ineffective and outdated.
“Milwaukee is in this unique situation because the handcuffs are so tight,” Mayor Tom Barrett said in an interview with the Milwaukee Journal Sentinel.
The report — “On The Money?” — will be released Sunday by the nonprofit Public Policy Forum.
Following an analysis of 39 similar-size cities, the forum found Wisconsin is the only state in the Midwest that limits municipalities to the property tax as the sole form of local taxation. And it’s the only state whose largest city has the same tax structure as all other municipalities.
The analysis also found that each of the cities studied in the report except Milwaukee has multiple taxes, and most have general or selective sales taxes, such as taxes on entertainment or food and liquor. Other findings include that state aid is typically a minor source of revenue for most of those cities, and cities with larger populations tend to draw more heavily on the sales tax and less on the property tax.
Essentially, Wisconsin does government funding a little differently than other states and Barrett wants his cake and to eat it too. Wisconsin does restrict local taxation somewhat, but does so in exchange for much higher state funding than other states. If fact, you’ll notice that the City of Milwaukee receives a huge sum of money from the state’s taxpayers:
You will also notice, that Barrett is very specific about talking about “taxation” since the City does rake in a tremendous amount of money through various fees like the Wheel Tax – er… Wheel Fee.
Barrett wants to continue to receive a tremendous amount of money from the state, but also wants to raise more local taxes to support his reckless spending. But it is really a matter of the philosophy behind how we want to fund out local governments. I have long been a critic of Wisconsin’s Shared Revenue structure. I would much prefer to scrap the entire framework, cut state taxes and spending, and let local people decide for themselves how much they want to fund their local governments. It has never made sense to filter so much tax money through the state and back to local governments. Except in the cases of some rural local governments that lack a sufficient tax base, the state shouldn’t be in the business of funding any local governments.
So I support Barrett’s effort to allow local governments to levy more and different kinds of taxes to fund themselves – as long as the rest of Wisconsin’s taxpayers can have back the $265 million per year that we send to Milwaukee. The state sends about a billion dollars a year to local governments. Let’s return that to the taxpayers and let local taxpayers decide how they want to fund their local governments.