Council Passes 2017 City Budget

It’s one of the most important things we do — and this year, it was perhaps the most difficult.

The South Milwaukee City Council unanimously voted to pass the 2017 city budget on Tuesday night. It’s a document that again shows our commitment to being responsible stewards of taxpayer dollars, your money.

I shared a lot of context in a previous post. Here are the final, updated details …

  • Expenditures increase 1 percent to $19.7 million.
  • Revenue falls 0.8 percent to $8.95 million.
  • The tax levy increases 2.3 percent to $10.76 million.
  • The city tax rate increases 3 percent from $8.82 per $1,000 of assessed valuation to $9.09 per $1,000. So, for my house (assessed at $160,000), that means the city portion of my tax bill will be $1,454.34, or $43.44 more than my 2015 bill.

The biggest change from the budget published last month is a 3 percent (or $88,000) increase in health insurance costs for the city — a figure that we brought down, with increased out-of-pocket costs and switching providers, from an initial 25 percent renewal. To fund the added cost, we cut from a number of areas, including $20,000 in seasonal help from the Street Department.

In the end, we found a way to work, once again, within the significant constraints put us on by the state and deliver maximum value for your tax dollar. This is getting harder and harder, and continue to make the case for legislative remedies.

Residents have come to expect a certain standard of city services, and it is my job as mayor to make sure we deliver on that expectation, while also driving innovation and efficiency around how we deliver those services. And we’re doing that.

This budget delivers on that promise.

13 Comments

Filed under South Milwaukee

13 responses to “Council Passes 2017 City Budget

  1. Robert

    It would be interesting to know what a city employee pays monthly for health insurance ( Previous and Proposed cost ) .
    I pay $627 / month for my wife and myself . I think the city employees should shoulder a bigger portion of the increases like most of us do.
    Its getting to the point where retirees can no longer afford a simple house due to the constant increase of expenses.
    Maybe employee wage increases and health care cost should be the same % that we see !!
    Start counting the four sale signs and then ask yourself why so many ?
    Why do they sit on the market so long ?………never used to be a problem selling you house in South Milwaukee .

    • Rick

      Questions to the Mayor regarding City Employee Health Insurance:
      1. Is there a two tier rate? One for non-smokers and one for smokers?
      2. Does the City prohibit employees who have spouses working at an employer that offers Health Insurance to cover that spouse with the City offered plan?
      3. If the City allows an employee to cover their working spouse whose company offers health insurance, does the City have the employee pay a “surcharge” like most companies to cover the spouse whose company also offers health insurance.
      4. Does the City provide FREE Health Insurance to city retiree’s?
      5. Does the City provide health and dental insurance to part-time Elected Officials (i.e. Alderpersons, Mayor, Economic Development Director)??

      • Melanie

        Crickets chirping

      • Answers follow … and there is a lot more context behind these that I’d be happy to discuss more. Simply put, deciding on plan options is a complex business with very few right and wrong answers, and they can often vary widely between public and private employers. Our goal is and will always be to offer a health plan that is competitive with other municipalities. We have to do that to remain an employer of choice.

        We have increased out-of-pocket expenses significantly in recent years, in various ways, and have taken other steps to reduce city health insurance costs. We will continue to look at ways keep costs increases as low as possible, within reason. We have to, our risk blowing a huge hole in our budget. (This year, for instance, we were faced with a 25% increase at one point.) Despite these difficult choices, our plan remains competitive. We make sure of this by benchmarking through our independent broker. To your answers …

        1. No. There is apparently significant debate in the insurance community on if you can do this legally, and how effective it is at delivering cost savings.
        2. No. Very few public employers apparently require this, and I’d have trouble supporting this for various reasons.
        3. No. I’m told many private companies do this, but fewer public entities. It doesn’t mean we shouldn’t look at it, and we might.
        4. We are working to get these costs and liabilities under control. We have eight retirees that we pay full health insurance premiums for until they reach Medicare eligibility based on old contract obligations. The other retirees and all future retirees pay a portion of the insurance premium. For all retirees and future retirees, the city’s obligation ends when they reach Medicare eligibility. Additionally, we are considering not offering retiree health coverage at all to certain new hires going forward, as part of changes to our benefits package being discussed at our council meeting next week.
        5. We do not provide health insurance to elected officials (including me). We do offer them dental coverage (I don’t take it). Our economic development coordinator is a part-time employee and not elected.

      • Robert

        Could you tell us what a city employee a) union b) non union paid for health insurance NOW and also what will they pay under the new budget ??

      • Monthly premium costs paid by employees in 2017: Family $213.60, Single $85.92. I believe that represents a small increase from current rates. Union and non-union employees pay the same. Again, I’m hesitant to compare health insurance plans (premiums, plan designs, etc.), especially public vs. private, because it’s almost never apples to apples, and this work is incredibly complex. We benchmark this, through a broker,and that work shows our plan is competitive. It’s not the best. It’s not the worst. Either way, employees are paying significantly more out of pocket than just several years ago, overall.

  2. Frank Gratke

    Rick, interesting questions. Some say, all of this, is tied to the problems with the state of national health insurance. I firmly believe, if they straighten the national plan, there would be no need to ask your very direct questions, it would all fall into place. I also believe the city does some unique money saving techniques on health care. However, with the state of national care it only has a limited effect.

  3. Melanie

    Thank God for the states significant restraints.

  4. Frank Gratke

    Congratulations Mayor, for giving answers to all those questions. I labeled them interesting questions for one reason, discrimination lawsuits can be made from them. Every question you ask an employee , can be used against you, in a discrimination suit. In my opinion, your answers did not give much for the lawyers to work with.

    • Robert

      Spend , Spend Spend ! Saw DPW has new John Deere tractor with miniplow for clearing downtown snow or what ever ?
      Looks like an expensive ( in my budget) toy that will seldom be used BUT city needs it .How about switching to Mercedes police cars ???
      They could be diesel !! City never tried clean burning CNG ( natural gas ) for its police vehicles . Re-Fueling station right at College and Pennsylvania if anyone is interested .

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