Here’s how Superior, Douglas County will use state funding bump in 2024

SUPERIOR, Wis. (The Badger Project) — A raise is always nice.

The city of Superior and Douglas County both aim to use the bump to improve their communities, in ways both seen and not.

The city and county, like every local government in the state, got a big increase this year in a type of funding from the state called shared revenue. Superior received a boost of more than $1.7 million, an increase of 23%, to bring its 2024 shared revenue total to nearly $9.3 million.

Douglas County got a bump of more than $900,000, an increase of 44%, to bring its 2024 shared revenue total to more than $3 million.

“It’s the biggest increase in state support for local governments in a generation,” said Jerry Deschane, executive director of the League of Wisconsin Municipalities, an organization that lobbies on behalf of local governments. “It’s that significant.”

Revenue from the state makes up only a small part of how local governments fund themselves. The majority comes from property taxes.

In 2011, the Republican-controlled state Legislature removed the ability for local governments to raise property taxes on existing buildings without residents first voting their approval. Since the Legislature has held state funding flat for more than two decades, that meant municipalities’ only sure way to increase their tax revenues was through new construction. If a community didn’t have enough new construction to keep up with its rising costs, it could fall behind.

“Local governments’ only revenue source wasn’t able to keep up with inflation for years, and that just started to reach a critical point,” Deschane said. “And the Legislature heard them.”

In the most recent state budget, which covers 2024 and 2025, the Republican-controlled state Legislature and Gov. Tony Evers, a Democrat, used the state’s historic $7-billion surplus to increase the shared revenue payments to local governments.

Moving forward, those payments will now be tied to the state’s sales tax. As long as that pot of money continues to grow, local governments will see their share increase as well.

Though the increase was large in historical terms, it was modest in budgetary ones, Deschane noted, so the new spending across the state will mostly be used to cover “meat and potatoes” services, like public safety, plowing, potholes, etc.

“Not sexy,” said Deschane, “but critical.”

‘Improving the city’

The city of Superior is getting spruced up.

For the past two decades, the city received about $7.5 million annually from the state in shared revenue funding. In 2024, that total will increase by over 23% to more than $9 million.

The city plans to plant some of that cash into expanding the parks department, with a goal of enhancing public spaces with trees and other horticulture, said Superior Mayor Jim Paine.

“It’s a real investment and we get a huge return on it,” Paine said. “When we made an investment in a street that made it more walkable, that made it a more pleasant space, especially by bringing green and growing things into the public space. Business exploded. There was new construction, new businesses opening in empty storefronts. All of whom add to the tax base in spaces that weren’t paying anything in taxes.”

“These investments pay for themselves 10 times over,” he added.

The plantings will also help control stormwater.

“My biggest reason for doing this is because it looks nice,” Paine said. “That is why I do it.”

The fire department will be getting some of the funds as well. The city plans to renovate the East End fire station at a cost of about $1 million, at least some of which will come from the shared revenue increase.

The renovation, scheduled to start this year, will replace mechanical and electrical systems, upgrade communications systems, add a small training room, and make lighting upgrades, Fire Chief Camron Vollbrecht said.

The department will also increase the frequency its firefighters receive health checkups from once every two years to every year, Vollbrecht said. Cancer and cardiac events are the two biggest health issues facing firefighters, so the department hopes to catch health problems earlier with the investment.

And police won’t be left out either. The extra funding will also go toward hiring a second community response specialist in the police department to tackle chronic problems like homelessness, addiction and mental health, Paine said.

The city of Superior has received millions from Enbridge for its crude oil terminal, which has given the city more budget flexibility than other local governments, Paine noted.

County budget still tight

In 2024, Douglas County will get a bump of nearly $950,000 to bring its shared revenue total to nearly $3 million.

That’s an increase of more than 44% from the previous year.

The county will use that increase to give its employees a much-needed 5% raise, said Douglas County Board Chair Mark Liebaert.

But while the bump from the state was “well needed and a good start,” Liebaert said, “it’s like putting a Band-Aid on an arterial wound.”

Without the ability to raise property taxes above new construction, the county has had to borrow money to maintain its roads and pay its rising bills.

That’s not sustainable, Liebaert said.

The County Board chair has been lobbying the state Legislature to allow the county to raise its sales tax by half a percent, from 5.5% to 6%.

In the recent shared revenue bill, the Legislature and governor agreed to allow Milwaukee County to increase their sales tax by 0.4%, said Dale Knapp, research director for the Wisconsin Counties Association.

Increasing the sales tax in Douglas County would require action from both the state Legislature and the governor, Knapp said.

But noting that Republicans, who currently control the state Legislature, are generally averse to new taxes, the county chairman said the state could instead give the county another half percent back from the 5.5% sales tax generated in Douglas County. The county already gets half a percent back, so that move would bring the return to a full percent.

“We’ll take it either way!” Liebaert said. “Let us have that share so we can compete with Duluth.”

Unlike much of Wisconsin, Douglas County is in the unenviable position of being just across the bridge from that higher-tax city (8.88% sales tax) in the higher-tax county of St. Louis (7.38% sales tax) in the higher-tax state of Minnesota (6.88%), now run completely by more tax-friendly Democrats.

Wisconsin’s sales tax is 5.5% in almost every county.

The better-compensated public sector jobs in Duluth and St. Louis County make it hard for Douglas County to compete for employees and maintain its workforce, Liebaert said.

After getting no pay raises from 2010-2015, county employees have received small annual 1% and 2% bumps in recent years, generally below inflation.

Without more funding from somewhere, eventually the county will have to cut services, the board chair said.

That means reducing blacktopping and graveling roads and repairing potholes. Getting permits for things like zoning and construction may take longer. Jury trials could get delayed months.

“All these things affect the normal citizen. When they see those services start to slow down, they’ll probably really start complaining,” Liebaert said. “And they’ll look for someone to blame.”

Regarding taxes, the state has tied the county’s hands, he noted. So folks must look to the state Legislature.

After recent elections, Liebaert said he had some hope about making progress in Madison.

For the first time in decades, blue Douglas County is represented by three Republicans: state Sen. Romaine Quinn and state Reps. Angie Sapik and Chanz Green. Liebaert expressed some hope that having state legislators from the majority party could lead to some wins for Douglas County.

Previously, Democrats representing the area couldn’t get much accomplished in the capital because they have been in the minority since 2010. But now the new, more competitive political districts approved by the state Legislature and the governor may scramble that calculus, the County Board chair said.

Liebaert made his case again at Superior Days (April 8-11), when citizens and local government officials from Northwestern Wisconsin made their annual trek to Madison to lobby on behalf of the region.

This journalism was funded by a grant from the Wirtanen Fund of the Duluth Superior Area Community Foundation. The Badger Project is a nonpartisan, citizen-supported journalism nonprofit in Wisconsin.

The Badger Project is a nonpartisan, citizen-supported journalism nonprofit in Wisconsin.

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This article first appeared on The Badger Project and is republished here under a Creative Commons license.