Milwaukee’s financial condition is on firmer ground than many of the nation’s largest cities. Mayor Barrett’s approach to fiscal management has led to the maintenance of critical services, continued investment in City infrastructure improvements, a well-funded pension plan, and unprecedented prudent commitments to financial reserves. Rating agencies reflect the City’s fiscal strength with highly rated credit.
Mayor Barrett's 2014 budget preserves critical service levels, continues to improve our essential infrastructure and supports economic development and employment growth.
The City's economic stability didn't result from ignoring Milwaukee's challenges. The City's progress is based on solid fundamentals: multi-year planning, careful priority setting, innovative operational improvements, effective fringe benefit restructuring and responsible financing of our long-term obligations.
Mayor Barrett works worked cooperatively with the Common Council to develop a responsible contribution plan to meet our pension fund obligations and preserve our capacity to fund the most critical services. The pension board has also carefully managed the assets in the pension fund. Because of these combined efforts, Milwaukee's pension system (the Employees’ Retirement System, or ERS) is recognized as one of the best in the nation. A 2013 Pew Charitable Trusts study noted Milwaukee has met its pension obligations in a sustainable and affordable way. Milwaukee The ERS had a surplus at the end of fiscal year 2009, with enough money to cover 113% of our liabilitiescurrently is close to being fully-funded on a market basis.
Mayor Barrett’s “bottom line” focus has remained on improving performance. As a result of the Mayor’s Accountability In Management (AIM) program, the City has experienced:
- Substantial improvements to replacement cycles for core infrastructure such as streets, street lighting, and sewers, while annual authority for new levy-supported general obligation borrowing has remained close to at the 2004 budget level. Mayor Barrett fought for a fair share of federal stimulus funding for Milwaukee’s major streets, and the Mayor’s 20122014-2017 2019 Capital Improvements Plan will achieve a 5060-year replacement cycle for local streets by 2014—compared to a cycle of more than 100 years that he inherited in 2004.
- Despite changes to the collective bargaining laws, we have achieved equitable treatment of all employee groups regarding cost-sharing for health care benefits. Our recent collective bargaining agreements with police and fire unions negotiated 0% wage increases for 2010 and 2011, and achieved the 12% employee health benefit premium share with public safety unions for 2012. These agreements have reduced the annual baseline costs of City services in 2013 by $24 million when compared to prior wage and benefit trends.
The Challenges Ahead
Since 2004, the City has responded responsibly to many financial challenges and Mayor Barrett understands, despite our fortunate position, we must remain vigilante. Under his leadership, the City will continue to innovate and provide essential services with a smaller, more productive workforce. When it comes to the City’s financial management, 2012 2014 is no time to coast. The impacts of State aid cuts, the Legislature’s two-tier collective bargaining system, and the state imposed levy limits will have serious implications for 2013 2014 and beyond.