Our analysis of the Mayor’s proposed City of Milwaukee budget finds the city is able to convert an overestimated 2018 pension payment into stable departmental budgets and a re-stocked pension reserve. However, the pension savings are one-time in nature, and the annual structural deficits caused by the city’s faulty revenue structure and fierce expenditure pressures are almost certain to re-emerge in the years ahead.
- Public safety continues to consume much of the overall growth in general fund spending, with the Milwaukee Police Department receiving a proposed $5.9 million (2%) increase, and the Milwaukee Fire Department receiving an extra $773,000. All other general fund departments would see a combined increase of $4.4 million, which for some would not cover their “cost to continue.”
- Property tax levy-supported borrowing for capital projects would increase by $2.6 million. While exceeding the city’s policy goal for borrowing by $2 million, that amount would still cover less than two thirds of the total originally requested by departments to meet infrastructure needs.
- The City’s Tax Stabilization Fund withdrawal – which helps alleviate the need for property tax increases in annual budgets – would be reduced by $3 million to $16 million, reflecting a declining fund balance. Given the city’s increasingly tight year-end margins, withdrawals of TSF funds at this or an even further reduced level are likely to be the norm in future years.
This report is the second of two Milwaukee budget briefs we publish. Our Milwaukee County Budget Brief can be viewed here.