Budget Repair Bill Could Save Village $425,000

Menomonee Falls Village Manager Mark Fitzgerald isn’t one to speculate before he knows the hard numbers, and that’s the approach he is taking one day after Gov. Scott Walker presented his 2011-13 state budget.

Walker proposed cutting county and municipal state aid by $96 million in 2012, with aid to municipalities dropping by $59.5 million.  However, Fitzgerald said it is still too premature to guess what the impact will be in the village.

“We don’t have specific numbers, and I never speculate,” Fitzgerald said. “Until we know what this means specifically for the village, it’s just too preliminary.”

Walker’s proposal would prohibit municipalities from increasing the tax levy to patch the loss in state aid, but could use a tax levy increase if the tax base grows due to new construction.

Fitzgerald said the village has improved its financial situation over the past four years by implementing effective cost control measures. Despite a freeze on levy increases, Fitzgerald said the village is well prepared for a drop in aid due to their efforts.

Passage of the budget repair bill would soften some of the loss in state aid by requiring village employees, not including police or fire, to pay 5.8 percent into their pensions. General employees do not contribute toward their pension, and their contribution would free up $425,000 from the $780,000 tied to general employee pensions.

The village also employees 52 employees in fire and police protection who are exempt from paying into their pensions. The annual pension cost for these employees is about$969,000. When combined, pension costs for both groups of employees is about $1.75 million.

However, the number could change if concessions are made, or the budget repair bill is amended in other ways.

Fitzgerald said village employees are not part of the state health care plan, and contribute 10 percent for their health insurance from an independent provider.

Walker’s budget proposal also recommends lifting a mandate requiring municipalities to operate recycling programs. The state currently requires 25 percent of waste to be recycled.

Lifting the mandate would eliminate a $90,000 state subsidy to the village to operate its recycling program. Despite losing the mandate, Fitzgerald said they would continue the program.

“Menomonee Falls is a big recycling community. The mandate is for a 25 percent recycling ratio statewide, and we have about a 40 percent recycling ratio in the village,” Fitzgerald said.

Fitzgerald added that the village has a long-term contract with Waste Management that expires in 2019. The village pays Waste Management $1.6 million annually for both curbside recycling and garbage pickup.

Fitzgerald cautioned that all the figures and proposals outlined in Walker’s budget proposal are preliminary, and much can change before final approval.

“He gave a budget in brief message, and we won’t see the details for a long time,” Fitzgerald said.