Wisconsin municipalities restrain spending

Municipal spending restraint was evident in a new study of 243 major cities and villages in Wisconsin.

After declining in 2009 for the first time in more than a decade, municipal spending rose just 1.3 percent in 2010, well below the 4.2 percent average annual increase during 2000-08.
Debt in the state’s most populous cities and villages (excluding Milwaukee and Madison) was up 3.5 percent, the second-smallest increase in a decade.
The findings are part of MunicipalFacts12, an exclusive new study from the Wisconsin Taxpayers Alliance (WISTAX) of municipal finance during 2006 through 2010. For 80 years, WISTAX has been devoted to nonpartisan public-policy research and citizen education.
About two-thirds of municipal spending for operations is concentrated in four areas: general government administration, street maintenance, law enforcement, and fire-ambulance services. On average, communities spent $560 per capita (person) in these “basic” spending areas, 1 percent more than the prior year.
Law enforcement continues to be the largest local expense, accounting for nearly 27 percent of operations (excluding capital expenditures). From 2006 through 2010, police spending rose from $579.4 million to $657.9 million, or an average of 3.2 percent annually. Law enforcement expenditures rose the fastest of the four basic spending areas during this time.
Fire-ambulance services are the second-largest local expenditure, accounting for nearly 17 percent of spending. Statewide spending in this area rose 12.9% during 2006-10, an annual average of 3.1 percent. Fire spending among small and large communities varies. Median spending in the 23 municipalities with populations between 30,000 and 150,000 was more than double the spending in communities with populations in the 2,000 to 3,000 range. According to WISTAX researchers, this reflects use of volunteers.
Although growing debt loads are a concern for municipal officials, general obligation (GO) debt among the state’s 243 largest cities and villages rose less in 2010 than it had in all but one year over the past decade. GO debt totaled $4.5 billion in 2010, up from 4.3 billion and $4.1 billion in 2009 and 2008, respectively.
Under state law, municipal GO debt is generally limited to 5 percent of total property value. As of 2010, 13 communities were at 80 percent or more of their debt limit. About 60 percent of the 243 communities studied had debt between 20 and 60 percent of the state limit, while only four reported no debt.
For more information visit http://www.wistax.org/.

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