Village Could See $200,000 Cut in State Aid

Gov. Scott Walker’s proposed budget would cut about $200,000 in state aid to the village, and without the ability to raise property taxes, officials may have to do some belt-tightening in the future.

Walker said he would cut about $96 million in shared revenue to local governments, plus another 10 percent cut in state transportation aids.

Interim Village Manager Matt Schuenke estimates the village stands to lose more than $200,000 in overall state aid. The loss in state aid cannot be made up with tax increases, as Walker’s budget also puts a freeze on county and municipal levy increases.

Under the proposed budget bill, the village would lose all $100,000 of its recycling grant funds, and its shared revenue would drop from $235,000 to just under $200,000 – a roughly $35,000 cut.

Schuenke said the village currently receives $750,000 in state transportation aid, and $75,000, or 10 percent, of that will be cut under Walker’s proposed budget.

“That can’t be made up in property taxes,” Schuenke said. “We will have to make that up in cuts in expenditures.”

In past years, state-imposed levy limits have penalized municipalities that raise taxes by more than 2 percent, but the levy limits never included new debt service incurred by the municipality.

That changes under Walker’s proposed budget. The village currently pays roughly $2 million in debt service and any increases would have to be paid while maintaining the original tax levy of about $10 million.

Schuenke said it is too early to know if the village will have to cut its municipal budget this year. He said capital improvement projects, such as streetlight, sidewalk and road construction work, may be affected.

He also said it will be difficult to pursue larger projects, such as infrastructure work that addresses flooding issues in the village.

“Our ability to borrow has significantly been limited by this state budget,” he said. “This makes it much more difficult for us to implement these projects in 2013-2014.”

Walker has said local governments will be able to make up for the reduced state aid cuts through personnel savings, as the budget repair bill strips non-public safety employees of the bulk of their collective bargaining rights. The governor is calling on public employees to pay a 5.8 percent pension contribution and 12.6 percent of their health insurance premiums.

Schuenke said the contracts for Public Works employees are approved through 2011, and the contracts for police and library employees are still being negotiated. Library employees voted to have a union more than one year ago, so they are currently bargaining their first contract.

Walker's budget would cut $834 million in state aid to local school districts over two years. It also would reduce the revenue limit - the  amount that the district can collect in state aid and property taxes- by 5.5 percent.

Whitefish Bay currently has a settled teachers contract for 2009-2011, but not 2011-2012.

Whitefish Bay School District Administrator Mary Gavigan said it is too early to tell what the governor's budget proposal means for Whitefish Bay Schools, and she said the school board will discuss the budget implications at a March 9 school board meeting.

The possibility of budget cuts is a source of concern for Joanne Desien, president of the education advocacy group Advocates For Education. She said the group hopes to set up a public hearing with the school board to allow the community to expess their educational priorities in the event of budget cuts.

“I think it’s going to be a really hard scenario for everyone, if we have to cut something,” she said.