Republican legislative leaders, Gov. Evers strike deal to avoid fiscal crisis in Milwaukee
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MADISON - Republican legislative leaders and Democratic Gov. Tony Evers have struck a tentative deal to prevent Milwaukee from dropping off a fiscal cliff that includes more funding for local governments while also sending more public dollars to public, charter and private voucher schools in a sweeping agreement that will allow area leaders to raise sales tax revenue without a referendum.
The agreement could take the form of more than one piece of legislation, according to Evers' spokeswoman Britt Cudaback, but requires GOP lawmakers to send the governor measures that will spend $1 billion for K-12 schools and raise payments for each student in private voucher schools and public charter schools.
Among the provisions Evers is requiring for his signature on the legislation is increasing state-imposed revenue limits by $325 per student over the next two years, spending $30 million over two years for mental health services, increasing special education funding and more money for school districts in rural areas.
The deal also provides a 20% increase in state funding for local governments known as shared revenue and meets a long-sought goal of Evers of having state funding cover two-thirds of school districts' costs. The agreement also achieves a key priority for Republicans by increasing payments to private voucher schools from $8,399 to $9,500 per K-8 student and from $9,045 to $12,000 per high school student.
The K-12 provisions are a compromise from Evers’ original budget proposal, which would have increased revenue limits by $350 per student for the next school year and an additional $650 per student for the following school year. Evers had also proposed state reimbursement for 60% of schools’ special education costs, but on Thursday agreed to 33.3%.
The agreement was announced Thursday afternoon by Evers and through a press conference held by Assembly Speaker Robin Vos and Senate Majority Leader Devin LeMahieu.
The deal is a "tentative agreement" that would bring "historic" increases in shared revenue support local communities across Wisconsin, Evers said in a statement announcing the deal.
“For too long, our communities have been asked to do more with less, and this agreement is critical to ensure our local partners have the resources they need to meet basic and unique needs alike," he added. “This compromise will be transformative for our communities and our state, and coming to an agreement in principle on major parts of this proposal is a significant milestone in my negotiations with Republican leaders over the past few months.”
Despite threatening on multiple occasions to walk away from negotiations, Vos said Thursday that additional taxpayer-funded payments to school choice programs secured his support for the deal.
"Today is one of those opportunities where each side brought their best ideas to the table," Vos told reporters. "If you are a conservative Republican in the state of Wisconsin today, you should be incredibly proud to work the Legislature has done on your behalf."
Republicans tout gains for police, fire and EMS services
GOP leaders said in a release that "Republicans won the argument" because the bill will guarantee that the new state revenue may only be used for police, fire, and EMS services."
"There are strict prohibitions on the use of funds for the Milwaukee sales tax funds, guaranteeing that they cannot spend on frivolous things such as street cars and woke diversity and equity initiatives," Vos said. "Instead, they will be required to use the money to defray the costs of their failing pension system and increase the number of police officers on the street keeping their community safe."
Deal allows sales tax with two-thirds votes of Common Council, County Board
The deal allows the governing bodies in the city and county to approve new sales taxes, with a two-thirds majority vote of the Milwaukee Common Council and Milwaukee County Board.
Mayor Cavalier Johnson said in a statement that even as a proposed remedy to the city's fiscal challenges is within reach, there are parts of the legislation he does not like.
"There are aspects to this legislation that I strongly object to," he said. "However, through the give-and-take, no party to these negotiations is completely satisfied with final product."
He said he would work with council members to address their concerns and encourage them to vote in favor of the sales tax.
Milwaukee County Executive David Crowley in a statement thanked Evers, Vos and LeMahieu and said the county’s dire finances must be addressed now.
“When you work on a bill as historic and far-reaching as this one not everyone will get everything on their wish list,” Crowley said. “Nevertheless, this deal helps our organization avoid the single biggest threat to achieving its goals and sets our region up for long-term success.”
He added: “Anyone who wants to see Milwaukee County avoid the reported service cuts or staff reductions and continue its journey to achieve race and health equity should support this deal.”
Common Council President José G. Pérez said the council looked forward to seeing the final details of the legislation when they are made available.
"As we have done throughout this process, the Milwaukee Common Council will continue to discuss the proposal with the community as we determine its impact on the future of the City of Milwaukee," he said.
And County Board Chairwoman Marcelia Nicholson said the deal presents a "generational opportunity" to address fiscal challenges and inequities.
The deal also boosts the amount Milwaukee County can add to its existing sales tax. Under the deal, Milwaukee County could raise its current 0.5% tax by 0.4%, for a total county sales tax of 0.9%. The legislation allows the City of Milwaukee to pursue a 2% tax.
That's a change from the legislation passed by the state Assembly that required voters in Milwaukee and Milwaukee County approve any new tax in a referendum. That provision had been a sticking point over concerns that voters would not approve such a tax, throwing the city and county governments into financial disaster and forcing them to cut deep into services on which residents rely.
The bill also still includes a requirement that 25 school resource officers be stationed in Milwaukee Public Schools.
Deal comes after intense negotiations
The new proposal is a product of a flurry of negotiations this week triggered by threats by Vos and LeMahieu to strip out the Milwaukee-related provisions aimed at saving the community from falling into a financial crisis.
The negotiation tactics were wielded after months of discussions between Milwaukee city and county officials, lawmakers and the governor that had devolved into a stalemate over the last month as Vos split from LeMahieu and Evers over whether to require Milwaukee voters’ approval for sales tax increases.
"Today we made our last, best offer to the Governor. If an agreement is not reached today, the Senate will pursue a shared revenue proposal that does not include an option for Milwaukee to raise additional sales tax revenue," LeMahieu said in a statement Wednesday evening.
In order to force a deal with Evers, Vos on Wednesday afternoon said he was halting work on the state budget and threatened to strip the Milwaukee-related proposals from the bill if a deal between legislative Republicans and Evers wasn’t struck this week.
By evening, LeMahieu went a step further and said if Evers did not immediately agree to support a version of the bill Assembly and Senate Republicans had agreed upon, he would move forward with a proposal that did not allow Milwaukee to raise additional sales tax revenue — a key provision for Milwaukee leaders.
Despite Thursday's agreement, Vos told reporters there's still "some heartburn" among Assembly Republicans. Both he and LeMahieu refused to say they had enough Republican votes to pass the deal without Democratic support.
"Democrats who are willing to step up and play — let's get in the room, have uncomfortable conversations and actually find consensus," Vos added.
Rory Linnane and Jessie Opoien of the Milwaukee Journal Sentinel contributed to this report.
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This article originally appeared on Milwaukee Journal Sentinel: Republican legislative leaders, Gov. Evers strike deal to avoid fiscal crisis in Milwaukee
