Unpacking the Rush: Why Voters Should Rethink the Referendum.
As Madison approaches the November 5 referendum to permanently increase property taxes, it’s crucial to evaluate more closely city hall’s PR campaign to approve this referendum, and the three compelling reasons why it’s premature. City hall claims that without this increase, basic services must be cut—a classic false dilemma designed to pressure voters. This blog post marks the first in a series of posts that will run until the vote, exploring in more depth city hall’s media blitz, and the three reasons why a referendum to permanently increase property taxes is premature.
1. Poor financial management. The administration has consistently demonstrated a lack of sound financial management. It doesn't make sense to give city leaders more money when they’re not effectively managing what they already have.
2. Inadequate effort to balance the budget. Despite recommendations from the Wisconsin Policy Forum, city leaders have not made their best effort to pursue their six budget-balancing strategies before implementing the seventh and easiest option—a permanent increase in property taxes.
3. A permanent tax increase may not be needed. Serious pursuit of the Wisconsin Policy Forum’s strategies will likely show that a permanent tax increase is unnecessary. In contrast, approval of a permanent increase now, takes the pressure off of city hall to pursue these other strategies.
Looking ahead, here are some of the significant issues with the administration’s management of the city’s finances that have led to my decision to vote “No” on the referendum, which I will explore in more depth in this series.
Failure to prioritize essential city services. The mayor’s request for a 5% across-the-board budget cut from all department and division heads fails to strategically align city services, including appropriate workforce adjustments, with the public’s needs and priorities.
Ineffective lobbying for state aid. The mayor’s recent enthusiasm and very public efforts to address this issue are a transparent effort to lobby voters to approve a permanent increase in property taxes; not a serious and legitimate effort to work with the Republican controlled legislature for more equitable state aid. After taking office in 2019, the mayor dramatically cut the city’s meager lobbying effort to the bone, and failed to make a serious and legitimate effort to work with state officials for more equitable state aid.
Inadequate financial information on spending. Although city ordinances and administrative policies require a fiscal note for all new legislation, they do not specify what information a fiscal note must include, contrary to prudent financial practices and informed decision making. In addition, when this important financial information is missing, council members fail to demand it before voting. For example, the $23.2 million men's homeless shelter and the $397.4 million BRT system were approved without operating budgets, including the sources of funds to operate them.
Lack of diversity on Finance Committee. The ideological hegemony on the Finance Committee creates an echo chamber for the mayor, fast tracking the mayor’s agenda and failing to adequately represent the voice of financially conservative and more fiscally responsible constituents.
Missing reports. There is no evidence of the annual municipal service fund report and the quarterly investment reports, which are required, hampering transparency and proper fiscal oversight. In addition, there is no evidence that city hall is using regular audits of city organizational units as a tool to improve financial management.
Stagnant park fees. Park fees, a significant revenue source for the Parks Division, are not adjusted to reflect the current market, many haven’t been raised in several years, and the staff’s recommendations are quickly rubber-stamped without justification or support by the committees responsible for their review and approval.
Inadequate oversight of human services grants. There is inadequate oversight of human services funding, with tens of millions of dollars disbursed to local providers each year without appropriate policies and sufficient monitoring of their use.
Mismanagement of city property. City hall has failed to use competitive bidding to award the long-term and exclusive management contract for the use of Breese Stevens Field, putting the taxpayers at a disadvantage in negotiations, and costing us tens of millions of dollars.
Ineffective oversight of Police Oversight Committee. The failure over multiple years to hold the Police Oversight Committee accountable for their performance has failed to deliver on city hall’s promise of more transparent and accountable police oversight, wasting taxpayer’s money, and eroding public trust.
Multi-million dollar subsidies of commercial use of city property. The city has spent millions subsidizing the exclusive use of Breese Stevens Field and Warner Park Stadium for commercial purposes, while failing to collect normal and customary revenues, such as a percentage of concession revenues and facility fees from ticket buyers, costing taxpayers tens of millions of dollars in lost revenue. In addition, earlier this year, the mayor revealed her intentions to spend an additional $30 million in public money to subsidize the exclusive use of Breese Stevens Field for commercial purposes.
Inequitable commercial property assessments. Large, multi-family commercial properties are consistently and significantly underassessed based on their sales price as a percentage of their assessment, inequitably shifting the tax burden to homeowners.
Perfunctory public engagement. It’s one thing to give the public an opportunity to speak on an issue; what’s important is how city leaders use this information. Alders ignored substantial and meaningful public input on how to balance the budget without a permanent increase in property taxes, and quickly aligned behind the mayor to take the easy route, rationalizing the creation of a false dilemma—the choice between a permanent increase in property taxes or cuts to basic services—and focused their efforts on aggressively lobbying taxpayers to approve higher property taxes.
Inefficient use of city real estate. The city opted to renovate the fleet services property on First Street into a public market, bypassing potential immediate gains of $6 to $9 million from the sale of development rights. This decision also overlooked the opportunity to develop over 300 housing units above the public market, forfeiting $86.8 million in property tax revenue over 50 years for the community, with $33.6 million of that going to the city.
City hall’s PR campaign to approve a permanent increase in property taxes, and the three reasons it is premature—city hall’s poor financial management, their inadequate effort to pursue the budget balancing strategies recommended by the Wisconsin Policy Forum, and the fact a permanent increase may not be necessary—build a compelling case for a “No” vote on the upcoming referendum.
Say No to Quick Fixes: Vote for Sustainable, Long-term Financial Health.
The purpose of these posts is to supplement the information provided by city hall in their PR campaign with important information they’re not providing, helping voters gain a better understanding of the city's finances. This will enable them to make a more informed decision on the referendum to permanently increase property taxes. I hope these insights encourage voters to join me in voting “No” on November 5, and demonstrate why it’s the fiscally responsible choice, as well as sending city hall a call to action for greater accountability and better financial management.
It's time for our elected officials to put on their big boy and big girl pants and do the hard work we elected them to do. By rejecting the permanent tax increase, we refuse to let city hall treat us like an ATM, opting instead for responsible governance and sustainable solutions. Let's stand together for a fiscally responsible future that ensures our city manages its finances wisely and transparently, while maintaining a high level of services that make Madison a great place to live, work, and play.
If you enjoy this content, please like and share. For questions and media inquiries, please comment below, send an email to asaloutos@tds.net or call (608) 345-9009. © Alex Saloutos 2024.