Madison Tax Referendum with Alderman Mike Verveer

Robin talks with Madison Alderman Mike Verveer about the city's deficit, the referendum, property taxes, and what's in store for the city.

Episode Transcript

(00:00):
Good morning. I Robin Colbert,and this is Madison Forum. I guess
this morning is long time veteran downtownAlder here in Madison, Mike Ververe District
for correct Mike, Good morning,Robin. You're absolutely correct. Thanks for
having me. How many years now? It will be an even thirty years
next April, so twenty nine yearsin counting currently. Boy, that's doing

(00:22):
your civic duty and then some anyany thoughts of stepping away or you're going
to keep going? You know,I haven't. I haven't quite decided yet.
I'm a bit torn. Obviously,thirty is a nice round number if
you want to retire from city hallservice. On the other hand, you

(00:43):
know, we have two year termson the Madison City Council and so every
by any them I have to doa personal gut check and figure out with
myself is this still rewarding? DoI think I'm still making a contribution?
And indeed I do so. It'sreally it's jocking that twenty nine years has
gone by so quickly. But Ido find the work to be as interesting

(01:08):
and fulfilling and rewarding as it wasin the beginning. So it's a good
question. Stay tuned I'll need todecide by the end of this year,
that's for sure, all right.Well, a lot of decisions to be
made this year city wise, budgetwise specifically, and that twenty seven million
dollar deficits that's hanging over over yourheads on the city council. This past

(01:34):
week the Finance Committee setting some keydates and a big date is going to
be coming up in August. Correctas far as a referendum, a property
tax referendum, something Madison's never had. Yeah, you're exactly right. This
will be the first ever property taxreferendum. Voters in the City of Madison

(01:56):
will be asked to weigh in onsay that the writing is on the wall,
so to speak, and that thecity Council will vote at a special
meeting, as you say, onAugust twentieth, And that's about our deadline
under state law, by the way, to play such a question on the
November fifth ballot. But I dothink that in talking with colleagues, the

(02:20):
majority of them, like myself,do support asking the voters to give us
the ability to tax them at alevel higher than state law currently allows in
terms of the relatively strict levey limitsthat have been in place for many years.
It's unfortunate that we're forced to dothis. We're not alone. I

(02:40):
think there's at least one handful Iknow of so far of Dane County cities
and villages that are planning to asktheir voters a similar question this fall.
Not to mention, the usual largenumber of school districts, including Madison Metropolitan
School District, will be going tothe voters this fall as well with similar

(03:02):
questions. So we do not knowthe specifics yet of what we will be
asking the voters. The city staffand policymakers will be developing options over the
coming weeks, but I think yes, your listeners should be prepared for having
this question asked of them if theyreside in the City of Madison in November.

(03:27):
It's unfortunate it's come to this.There's a variety of factors as to
why this has happened. I willsay one thing to it Dall said here,
and that is in the last severalweeks we were able to get that
gap down a little. Our cityfinance department has sharpened their pencils, received
numbers from the state in terms offunding that we receive, recalculated all revenue

(03:53):
projections, and expense projections, andso that twenty seven million dollar estimated ructural
deficit for twenty twenty five has comedown a little. It's now at twenty
two million dollars, so we atleast had some positive news, but it's
still a huge, huge number.And that twenty two million dollar gap assumes

(04:13):
that we would raise property taxes tothe maximum level next year that are currently
allowed by state law, and soit already assumes maxing out on all the
revenue we currently are allowed. Butit really is largely a cost to continue
for our expenses, including supplanting someof the federal American Rescue Plan Act money

(04:40):
that we received a few years agothat we now have. You know,
by the end of this year,we'll have spent all of it as required
by federal law, and we needto supplant some of that federal money that
we had been using to get usthrough the pandemic. Now, department heads
they know the mayor had had askedthat they come in with a five percent

(05:01):
cut, and when when do departmenthead submit? Yes, that's correct.
So so each agency, as isthe case every year, is required to
submit their operating budget requests to theFinance department and then those are onto the
mayor for development of the mayor's budget. So that the date that the agencies

(05:25):
are required to submit their budget andthose will be public information is actually in
two weeks, so so we'll havethat information relatively soon. You're exactly right
about the five cut agency requirements withintheir submittles, so it'll be interesting to

(05:46):
see what each and every agency isproposing for cuts. Some, i'm sure,
are ones that we've seen in prioryears where various you know, years,
whoever happens to be mayor does justone percent cuts or whatever amount to
be considered and then largely are ableto not have those cuts be part of

(06:09):
their budget proposal. But anyway,then the mayor, as it's been the
case in prior years, is scheduledto share her budget proposal with the city
Council formerly the first Tuesday in October, and then we have this marathon of
the month of October and November wherepolicymakers way in on the council and finalize

(06:35):
what will be wholly different this year. And not only will we never have
had a referendum, of course,but also it'll be the first year where
we are working on a budget notknowing if we'll have this infusion of money
potentially from the voters in Madison,and so we likely are going to be

(06:56):
developing dual budgets, doomsday budget scenario, assuming that a referendum is not successful,
and then a parallel budget that assumesa referendum is successful. So I
think one will have fairly draconian cutsthat would likely include layoffs of some city
employees, and then another version thatlikely would avoid any layoffs of city employees.

(07:24):
Just to give an advanced sneak peekto your listeners of what un likely
will be down the road here nowand with the department heads if they abide
by the mayor's request, you know, coming in five percent less. Does
that twenty two million dollar deficit.Does that take into account five percent across
the board cuts? No, itdoes not. It does not. So

(07:46):
the twenty two million dollars gap,and as you said, it was twenty
seven million only a few weeks ago. That gap is assuming again that we're
maximizing all revenue that currently available tous under the law, and then also
assuming that we are not making anymeaningful cuts, any real loss in city

(08:09):
services. It's really as they say, a cost to continue budget. So
yeah, so I've been saying formonths now and set it at city Council
briefings on the budget that we've hadearly overlier this year, that I think
we need to do a dual approachand ask the voters to sacrifice more if
they want to continue to enjoy thehigh level of city services at madisonians have

(08:33):
come to expect. But also wehave to tighten our belts. There's no
two ways around that. We arecertainly known as as not being a very
frugal, I think operation in manyrespects. On the other hand, one
would argue that with our population growingby leaps and bounds every year, we

(08:54):
haven't kept up in terms of thehiring of city staff, be it you
know, ups for firefighters or otherfrontline employees, or for that matter,
more administrative staffing. Most recently,example that we talked about just at our
City Finance Committee meeting this week isour Streets Division has not seen an increase

(09:18):
in city employees and they don't expect, of course, to receive any good
news in terms of an increase inemployee So as a result, our Streets
superintendent is proposing that we do awaywith so called large item collection that's like,
you know, furniture couches, mattresses, and so forth for any condominium
or apartment buildings in the city,which really would be a sea change,

(09:43):
especially for the downtown district that Irepresent, something that I'm not pleased with
at all. But his argument,first and foremost is that the city is
growing significantly. New subdivisions, newneighborhoods are being created on the for free
of the city all the time time, and he has to have a minimum

(10:03):
recycling and refuse collection for all thesenew single family homes being the one appropree
of the city, and he hasto cut somewhere and the efficient somewhere,
And so the low hanging fruit ishave the apartment buildings and kind of minium
buildings use private waste tauling, eventhough these folks pay property taxes as well.

(10:24):
So anyway, that's just an illustrationof kind of the sorts of service
reductions that are likely on the horizonin the new year. Yeah, I
know there's concerns, you know,some of the older residents just being taxed
out of the city. You gotthe city, you know. Madison here
looking at referendum school board school district, and my goodness, yes, you're

(10:45):
absolutely right, and we hear itall the time, and we receive emails
and hear testimony from our residents thatabsolutely are in fixed in comes in so
many cases and can't afford the reallyhigh property tax says. I think everyone
listening knows Wisconsin is one of thehighest has long historically had one of the
highest property tax rates in the nation, just based historically on how we fund

(11:11):
things under state law, and theproperty taxes I know can be oppressive for
folks, especially those that are retired, and I personally have don't individuals that
s head we have had to makethe difficult decision to sell their homes because
they can't afford the property taxes.I will say that the Wisconsin State Journal,

(11:33):
among others like Wisconsin Policy Forum,do routinely compare tax rates in jurisdictions
in our region, and Madison's taxrate municipal tax rate is generally on par
with our suburban neighbors and so forth. So I perhaps those that might think

(11:54):
that Madison City taxes are unreasonably highor higher than than the closer suburbs at
least are perhaps a bit of anurban legendar myth on that I can't.
I can't speak to the school districttaxes. You know that I'm not as
familiar with check out City of Middletonor want a Key Verona, just to

(12:15):
name those traditional I believe, Iguess I haven't done a side by side
comparison as of late past several years, but if I recall, I think
they're higher than Madison. Yeah,yeah, I think you're right. And
as I said earlier, Robin,my understanding is that many of the communities
you just mentioned are planning to goto referendum to increase their municipal taxes as

(12:39):
well this November. As I say, Madison is not alone. Now,
how did in this situation? Howdid how did we all get here?
Was it just getting too much stimulusmoney and spending on things that because you're
going to get this criticism that youspent on things you do need to and

(13:01):
now we're really deep in it.I think it's a variety of factors.
Certainly inflation is among them. SoI believe all governments have tried to keep
up with inflation and try to assistour employees and increase their take home pay
to keep up with the rising costsof inflation caused largely by the pandemic.

(13:24):
As you mentioned and we discussed brieflya few minutes ago, not only the
city of Madison, but every jurisdictionin Wisconsin received pandemic era assistance of significant
amounts of money. I mean,Madison received tens of millions of dollars and

(13:45):
pandemic aid from the federal government,and even some additional moneys that the federal
government sent to the state and thestate were then redistributed to us and to
other communities across the state. Andso that in Madison, by the way,
we tried to take a very reasonableapproach and not spend all of the
money on filling our budget gap,knowing that we would used to be sitting

(14:09):
us up for a huge failure downthe road, in a huge structural deficit
down the road. So we spentapproximately half of the federal money on one
time projects like capital projects and specificpandemic release that we knew would be coming
to an end at a date certain, and then the other half we did
indeed spend on closing our budget gapover the last gaps over the last few

(14:33):
years, because we absolutely as yourlisteners can appreciate and imagine received a loss
in revenue because of the pandemic roomtax being a huge one with hotels largely
shuttered, especially at the height ofCOVID, So that the fact that we

(14:54):
enjoyed this unprecedented federal money and it'snow no longer available and by law,
federal law, have to spend everypenny of it by the end of this
year is a reality. Now.We do have in a very healthy rainy
day fund in the City of Madison, an unprecedented amount of money and reserves,

(15:15):
and that's largely because of interest ratesbeing so high. We've made a
lot of money on investments, ourinvestments our savings. Then we also have,
historically, in part to keep ourtriple A bond rating to keep our
borrowing costs low, have had apolicy of at least fifteen percent of our

(15:39):
operating budget be held in our reservesor rainy day fund, and we're well
above fifteen percent now. So itis true that the city could use a
significant amount of its rainy day fundto balance the twenty twenty five budget,
but then that just sets us upfor more heartache can fail earlier in future

(16:00):
years, which is why we're goingto referendum, So I would say that
that it is a combination of factorshow we got where we are. And
again, Madison, as I'm stressing, is not a law. It's not
like this is a foreign a concept, because communities all over the country are

(16:21):
facing this dilemma, and certainly hereat home in our region and statewide are
facing this dilemma busity. Unprecedented numberof communities going to referend them asking to
exceed the state levy limits. AndI'd be remiss if I didn't mention that
that state law does severely limit howmuch financial assistance Madison receives from the state

(16:44):
government and so cultured revenue payments.So we are at absolute bottom of the
list in terms of how much revenuethe city of Madison receives per capita versus
our peers statewide. And it's clearthat the legislature lasts by anium as they
were reforming a shared revenue system reformI guess I'll say in quotes reforming reforming

(17:11):
the system inappropriate making appropriations for communities. And it's true they funded to an
unprecedented level in part enjoying the state'shuge budget surplus that they had the ability
to distribute. But anyway, theymost communities did very well. We received
more money ourselves in Madison, butcompared to our neighbors, we received a

(17:34):
very small amount of money, especiallyagain given that our population is growing so
significantly and before we know it,Madison will be at three hundred thousand population
in the coming years. So it'sbeen a big frustration for us, especially
you know in city Hall that theshared revenues that that so many other communities

(17:56):
have enjoyed an increase in Madison hasn'tbeen able to enjoy. And it seemed
like we were clearly singled out bythe leadership in the legislature. Shocking to
rather in terms of our relationships.But that's that's boy, That's been the
game for too long now. Butas far as just no compromise and just

(18:18):
the budding of heads, whether it'son the state or national level. So
in the Maryor's request, as faras the five percent department heads the budget
reductions, that includes police and fireas well. Correct, yes, she
did not exempt them in how correct? How do you feel about the police

(18:41):
having to scale back? I mean, we've seen this year. Boy,
we had a horrible June. Keepour fingers crossed that that was just kind
of h wasn't the norm of what'sgoing to be the summer. But you
know, crime is very very muchfront and center. Yes, I would
say that we are trending in theright direction, although with the three high

(19:04):
profile incidents, including one downtown withthat rooftop shooting at the Luxe apartments on
Wes Johnson Street, but with threehigh profile gun violence incidents last month,
it really is scary, including ofcourse one one being a tragic homicide on
Willy Street outside the Crystal Corner bar. Yeah, and again you know that

(19:30):
downtown better than anybody. But Imean, you know, you think of
yeah, they're shenanigans now and againon Willy Street, but for the most
part Crystal Corner, I mean,what in the heck, That's not something
I would have guessed, right,absolutely. I think it just goes to
show that guns and alcohol are nota good combination, and this sort of

(19:51):
thing could happen anywhere was I thinkit's been are reported to the media.
As I understand it, a disputebetween two individuals, and this part might
not have been mentioned, but Iunderstand it was over a female and the
apparent you know, thoughts that someonewas hitting on someone's girlfriend sort of and

(20:11):
then it ended in a horrific homicideout on the street there. But anyway,
the fact that no arrest have beenmade and that crime is disturbing.
In the case of the shooting morein the downtown, which was just shocking,
having two hundred and fifty people illegallypartying on a rooftop of an apartment
building in Madison. That was anew I don't want to say a new

(20:36):
high because it was definitely a newa new luw as far as these shootings
go, I mean, we wow, that's kind of a game changer when
you think of and again, hopefullythis is an extreme rare team we don't
see it again. But what couldhave happened. Very lucky nobody was critically
wounded. Oh yes, it's justsheer dumb luck that nobody was murdered that

(20:56):
night. And I do want toshare in case some of your listeners aren't
aware. MPD has made at leastone arrest of a seventeen year old from
Sun Prairie in that incident, andthey are looking for a second shooter because
they did recover a different caliber shellcasingsthat night, So there's at least one

(21:17):
more shooter at large. I knowdetectives are working very hard to apprehend and
I have faith and confidence that thatarrest will be forthcoming. But anyway,
I do want to share that thatcrime statistics are generally trending downward in Madison,
as they are nationwide. And Ihate to say that we're happy with

(21:41):
only a couple of homicides this year. And the word only is probably an
appropriate expression I've just used, butgiven a population or size they have only
again, I use that word onlyagain. But to have a couple of
homicides at this point halfway through theyear is something that, you know,

(22:02):
I think is fairly remarkable. Sowe are fortunate that through a lot of
efforts with the Madison Police Department firstand foremost, but violence reduction work that
we've funded and engaged in with communitypartners and so forth, that we have
been successful in bringing that homicide ratedown at least thus far this year from
prior years. And then other incidentsof major crimes are also down as well.

(22:26):
Now that's easy to say if you'renot a victim of crime, or
you don't receive the constant barrage ofyou know, not blaming the media here,
Robin, but anyway of reports ofevery incident of crime that scares people.
And obviously I know for a lotof longtime residents in Madison they were

(22:48):
used to not locking their car doorsor residences and now that's pretty much unthinkable
these days. But well, andit's not just a city problem, obviously,
And how you see it out inthe country, in the county and
in Columbus, I mean on MainStreet in Little Columbus. Yes, yes,
right, that was really an unfortunatehomicide there, only in the last

(23:11):
several days. So yes, itcan happen anywhere and everywhere, that's for
sure. I do think that,as always, the police department budget,
as is the case year in andyear out, will receive extra attention and
scrutiny. It is true that wedid reduce the MPD budget early on in

(23:32):
the early stages of the pandemic,and Madison was not immune from community activists
calling for defunding the police. Thatlargely didn't happen in Madison, but there
were some perhaps I could coin themas symbolic reductions to the police budget,
including moving some services out of thepolice budget. Which reduced their budget.

(23:55):
So, for example, the parkingenforcement function and school cross sing guard program,
we're both removed from MPD a fewyears ago and moved to our transportation
department. Michael, if I canto reduce the MPD budget, sorry to
step on your word there, butI see here it always goes so fast.

(24:15):
I'm talking with Mike rivera nearly thirtyyear veteran of Madison City Council,
twenty nine years serving District four inMadison. Mike, you've been talking about
crime and police department. You hadmentioned some of the cutbacks are redirecting.
Has there been any talk about bringingofficers back into the schools or has that

(24:37):
issue kind of been settled. Sothe decision is wholly up to the Manison
Metropolitan School Board. The balls completelyin their court. There are many of
us that thought that that decision perhapswas done in haste and shouldn't reconsidered.
Our police chief Sean Barnes and foremostwho believes it was a decision that needs

(25:03):
to be revisited, but they've gotto bring it. The reality is it's
always been a contract, a contractual, contractual relationship between the city and the
school district and So if the MadisonSchool Board decides they want to enter into
a contract and hire going back tohiring one education resource officer for each high

(25:27):
school, I think the city councilwould would go along with that certainly,
but it's up to the school boardsto decide that. I don't know what
the relatively new school superintendent if thatdecision might be revisited, but I have
not heard that it's on the agendaof the school board to revisit anytime soon.
And some of the responsibility, ofcourse, like what we saw with

(25:51):
the lux apartment shooting, lies withinthe security or lack thereof of these properties.
Yes, I will say that itwas a large part shocking also for
me that there could be such alax amount of security in such a highly

(26:11):
dense apartment building, especially one geartoward students, as was the case last
month downtown that building. That propertyis owned by an international student housing group
headquartered in London, and although theirmanagement up until that incident was horrifically poor,
apparently they did immediately meet with thepolice and agree to a number of

(26:36):
security measures that they quickly implemented,including having security guards working there and locking
down the rooftop pool and adding bobsystem, locking down the elevator and pretty
much the whole building, something thatis pretty standard for buildings downtown, and
it was just shocking again at thatsort of minimal investment was never made.

(27:00):
So I guess you could have calledit instead of the lux the lax.
There you go, exactly rabit allright. Well, so any other things,
Mike here you want to hit onbefore we've got about another minute here
before our time is up, Anybig, big new city wise, Yeah,

(27:22):
I guess the another major topic thatI know we will not even be
able to touch the surface of ina few minutes or I should say seconds
remaining, But just to allow meto acknowledge that affordable housing is by far,
I would argue, the most pressingissue in the city and the community
as it is nationwide, and thecity continues to try to prioritize through a

(27:45):
bunch of different initiatives trying to addressthat. The reality is that we are
fortunate that so many people want tolive in Madison, and the supply just
is not keeping up with the demand, and so we're working on different strategies.
You know, the most the mosteasy to articulate is that we have
been approving unprecedented amounts of new dwellingunits, especially apartments. Oh yeah,

(28:10):
I've been seen trying to meet thedemand, tons of apartments going up everywhere,
everywhere, well exactly. And thenthe thing was with that though,
it's just when we consider affordable andthen we hear what like the for renting
you know, just the average monthlyrents, and it's like, wow,
is that really affordable? But Iguess with inflation, and it's shocking that.

(28:33):
Yeah, when you hear what themedian rents monthly rents are in that
as sending you so many people havemore digital payments that are much less than
as those dollar figures. What arethey about like fifteen Oh yes, at
least at least yeah, yes,absolutely, so that anyway, that minimally,
what we're doing is approving an unprecedentedamount of new housing units that hopefully

(28:59):
will help stabilize rents by having thisimbalance addressed, because currently the vacancy rates
in Madison are at artificially low levelsand it's just it's just not competitive in
terms of trying to keep rents atreasonable levels. So right now it's absolutely
a landlord's market, and we're hopingthat that will, you know, subside

(29:26):
through the creation of all these additionalunits coming online, and that the rents
will stabilize, but it's a hugechallenge to be sure. Well, we'll
get more into that next time.Okay, sounds good. All right again
my guest this morning, downtown Madison. Alderman, Mike Ververe, you've been
listening to Madison Forum