Rough Waters Ahead for Local Governments

During his State of the State speech earlier this week, Scott Walker mentioned the need to "reform" public employees benefits. We all knew that was coming and we all know exactly what Walker means by it. He plans on financing his special interest bonanza (at least partially) on the backs of public employees. Given his hostile track record in Milwaukee County we could all see this coming a mile away. Walker also talked about "reforming entitlement programs". And by "reform" he naturally means to cut and otherwise reduce services for those most in need. Likewise this was certainly not a surprise given how Walker mismanaged and underfunded social services in Milwaukee County. But the one call for "reform" in Walker's speech that I wish drew more attention is his call for "reforming the state's relationship with local governments".

To find out what Scott Walker likely means by "reforming the state's relationship with local governments" we only need to look at some of his proposals when he last worked in Madison as a state legislator. In 1999 Scott Walker and Jeff Stone proposed "reforming" the state's relationship with local governments by doing away with a major portion of the state's shared revenue program. Their plan would allow local governments to raise their sales taxes to help make up for the lost state revenue. Needless to say, this plan didn't make it off the ground and was even panned in a Wisconsin State Journal editorial as "fraught with practical problems". Not the least of which was the possibility of it creating sales tax “islands” that change from town to town. [Wisconsin State Journal, 3/8/99]

The Wisconsin State Journal was certainly not alone in being critical of the Walker-Stone plan. The executive director of the Alliance of Cities said that the plan would "hurt small, poor communities that don't have the property wealth, income or retail base ..." Even a top Thompson deputy said that the plan could hurt areas of the state that don't generate enough taxes to pay for services. The plan would have not only been bad for smaller local governments because even Walker himself admitted that "Milwaukee might not fare as well, under a proposal like this..." [Milwaukee Journal Sentinel, 2/26/99]

I don't know exactly what Walker has in mind for "reforming the state's relationship with local governments" but I think that this track record might give us a few important signs. We already knew that Walker was going to target public employees and any programs that help those most in need, but it looks like local governments better batten down the hatches and prepare for some rough waters. After all, Walker listed them as an entity to be "reformed" and given what he has in mind for his other targets, it can't be a good thing.