After more than 16 years, it is time for an increase.

Madison is and should be proud of Metro, and Metro is much improved since 2009. The route redesign has made Metro more efficient and made travel times via Metro much faster for many people, bus data is well integrated into modern digital apps making ridership a breeze, fares are finally tap-to-pay with your phone or card, and the East-West BRT is up and running, with the North-South route on the way, likely even if the Trump administration turns it into a longer construction project. Metro drivers are on the verge of getting a fair contract negotiated by their union, setting us up for the next few years of operations. Metro service extends into Sun Prairie, Monona, and Verona, on its way to being a truly regional system. This is all part of the leadership of the Metro team, but also past councils, our surrounding communities, past mayors, and especially Mayor Satya.

All through these improvements, Metro riders have paid the same amount per ride.

Budget-wise, the past 16 years have been very, very challenging, including an unprecedented referendum to raise property taxes. The 2026 budget also promises to be challenging because of the State Expenditure Restraint Program. We won’t get the official limits for another few days, but City finance staff projects that Madison’s “cost to continue” budget is only $1.6M under the overall limit of what we can spend in 2026. The “cost to continue” budget assumes we do nothing new in 2026, which means the “cost to continue” budget doesn’t fund fully staffing the new homeless shelter, or staffing the new library, both of which are under construction and will be completed later in 2026. The full list of “supplementals” is $1.7M in 2026, and that’s before any alders or the Mayor present their own new ideas.

Madison’s budget is at the limits, and we need new options on the table.

As it happens, Madison Metro fare revenue does NOT count against the expenditure restraint limit. Every dollar we raise through the fares allows us to offset dollars elsewhere, freeing up room to get under the ERP limit.

(I wrote about the expenditure restraint limits here, if you want read something more in-depth on what the program is and why it’s a poorly designed program, but sadly it is the law and we’re stuck with it until the Democrats take control of the legislature and eliminate it)

Madison taxpayers have invested enormous amounts of money into Metro’s operating budget the past few years*. Between the entirety of the wheel tax and other general fund money, local tax money supporting Metro was $22.9M in 2024, is budgeted to be $25.4M in 2025, and the 2026 request is for $32.3M. In 2024, between advertising and fares, Metro took in $10M in revenue and is budgeted to take in $12.5M in 2025.

For comparison, in 2010, Metro took in $10.7M in fares and received $7.1M in general fund revenue.

Percentage-wise, the change in Metro’s budget is even more stark.

In 2010, fares made up 21.3% of Metro’s overall budget, city general fund support made up 14.2%, and state, federal, and other government aid made up 61.3% of Metro’s budget.

In the 2026 budget request, fares make up 14.9% of Metro’s budget, city general fund+ support is 38.2%, and state, federal, and other government sources are 46.3%**.

The 2026 Metro budget request includes an increase of $6.5M in general fund support, I think largely to cover the new contract and increased electricity costs. It’s incorporated into the “cost to continue” budget and it’s a big part of why we’re up against the expenditure restraint limit in 2026. That’s a 35% increase in general fund support in just a single year.

I don’t want to cut Metro funding, but that’s simply too much of an increase to give to Metro in a single year, when it is crowding out so many other funding priorities.

In April of 2009, the base bus fare for Madison was $2. Adjusted for inflation, in August of 2025, that same $2 would now be $3.04.

Given the expenditure restraint limits, the length of time since the last increase, and the dramatically improved service over the past 16 years, it is time to ask Metro riders to cover more of the costs of the system.

A 25% fare increase - from $2 to $2.50 for the base adult fare, when fully implemented, would ballpark raise about $3M***, which could reduce the general fund support by the same amount and let the city fund other priorities such as the staffing the new Imagination Center library or the new homeless shelter.

A fare increase cannot just be implemented overnight. It would take several months of required studies, public hearings, and contract negotiations with some of the unlimited pass users such as UW-Madison, so it would not be fully implemented for the next few years. But, I optimistically would guess that it could raise an additional $1M in 2026, and hopefully be fully implemented by the end of 2027.

Using the 2025 budget numbers, if fares brought in an additional 25%, the percentage of Metro’s budget from fares would go from 15.6% to 19.5%, and the local tax and aid funding support would drop from 32.8% to 29%.

Realistically it’ll be next spring before a fare increase could start to go into effect, but a 17 year run of a steady price is remarkable. A fare increase to $2.50 is still much less than what the fare would be if adjusted for inflation. The BRT routes do not even take cash, and all of Metro has non-cash options, so the hassle of dealing with quarters to pay a fare is a quaint problem of the past.

A fare increase is reasonable and lets the City fund other important priorities. As the Council debates the 2026 budget, a fare increase must be on the table.

*Footnote 1: the general fund support for Metro is scheduled to drop by about $2.4M in 2027, because of some clever uses of federal COVID money in the 2023 budget. However, given the rapid increases in general fund support in 2024, 2025, and 2026 compared to 2022, I suspect this won’t be a “drop” so much as a “not as big of a rise.”

**Footnote 2: That State and Federal support is basically the same in 2025 as it was in 2010 despite inflation is also a problem but for another post.

***Footnote 3: The $3M is just a basic estimate assuming all fares rise by 25%, which may or may not be doable during different contract negotiations, but I feel good about it as a ‘ballpark’ number.

Appendix: What about Free Fares?

Many people who are reading this will be “A fare increase? Hell no, I think we should eliminate the bus fare”, and I get it. I’m actually somewhat sympathetic to that. If it weren’t for the Expenditure Restraint Limits, I’d probably not be so worried about the increase in general fund support to Metro this year and more comfortable leaving fares at $2, and I’ve never been that upset about using all of the wheel tax on Metro. The more people who ride Metro, the fewer cars on the road, and I view the wheel tax as a subsidy to bus riders that makes it easier for me to drive without fighting other traffic. (I live on the far east side that historically had poor bus service. With the redesign I do take the bus more often but I am still mostly a driver)

But for free fare advocates, the National Academy of Sciences published a great book from the Transportation Research Board titled “Fare-Free Transit Evaluation Framework” that does a nice job laying out “here are all of the issues you need to study before switching to a fare-free system” - it’s not quite as simple as “just find the money”. You can read a PDF of a pre-print version here or read the real report on the National Academy Press website here.

Here’s a nice summary graphic:

(One thing I’d like to note - this bullet point:

‘May increase presence of disruptive passengers and result in additional security costs and impacts’ - given the uptick in Metro drivers getting assaulted by passengers in the past few months, that’s going to be a sensitive subject.)

The biggest challenge, of course, is finding the money to replace the $12M Metro takes in from fares.

One obvious and straightforward way to (largely) solve the money problem is to go to referendum. I would bet that a referendum to raise the City of Madison levy in order to make buses free would pass. The 2024 referendum added $22M to the property tax levy, which was about $230 of taxes on the average home, using those same numbers (and assuming we need $15M annually to replace fare revenue) that would be a referendum for another $156 in property taxes on the average home. I think it’d be a close vote, but yeah, I think it’d pass.

There are three problems with just going to referendum:

1. Because Metro is more of a regional system now, and Madison gets payments from the cities of Monona, Sun Prairie, Verona, and I think Middleton to support Metro from those cities’ property tax revenues, we’d need to work out with those cities an increase in their support as well, to make up for what riders from their cities currently pay in fares.

(This would be a good point to say ‘Yes, a Regional Transit Authority could be handy here too if it had the power to tax.’ The last time we had an RTA the plan was that it would use a sales tax, but since we need the legislature to create the RTA, there’s no reason the next RTA couldn’t levy property taxes instead of a sales tax. It’s really a pick your poison situation, I’m sort of indifferent to which way is better)

2. The way the referendum laws work in Wisconsin right now is a referendum is for a fixed amount, so in order to keep up with inflation, you’d have to go to referendum again every few years. Not the worst, but it makes planning difficult and perilous.

3. Switching from the fare revenue to new money from property tax would run up against the expenditure restraint program limits the year we tried to do it, so we’d need to find a way to make up for a year when we don’t get the $7M from the state in ERP aid. This is yet another reason why the ERP is dumb.

Anyway, if you want to convince me on free fares, read the Transportation Research Board book and present a plan that addresses everything they say is important.

The ERP is a state program, and the headline of this blog post gave it away: I think it’s really, really dumb. Not quite “the levy limit is not adjusted for inflation” dumb, but it’s a close second. (Also, the state renamed the ERP to be the Expenditure Restraint Incentive Program, but I’m used to typing ERP and so I’m going to stick with that)

On the surface, it doesn’t sound that bad. The state says to municipalities, “If you don’t increase your budget too much each year, we’ll kick in some extra aid money.” Unfortunately everything after that is stupid.

The program’s been around since the 1990s, and it came about when municipal funding was very different in Wisconsin. Once upon a time, the state was on the hook to partially match whatever a city taxed and spent, and so the Expenditure Restraint Program was created as a carrot/incentive to “high tax” communities: slow down your budget growth and the state will kick in a little extra.

Of course, the state doesn’t fund cities like that any more and hasn’t for many years, but the ERP and its limits remain in place.

I wish I could blame the ERP on only the Republicans, but the Democrats have some blame here too. The ERP could have been reformed or eliminated when Democrats were in complete control for the 2009 budget, but they didn’t. The Republicans have certainly made municipal funding much worse with Act 10 in 2011 and subsequent changes during their full or partial control, and they’re still the main villains in this story, but when it comes to the ERP, a pox on both their houses.

Madison has qualified for an extra payment under the ERP since the beginning of the program. As for how much we get, I only went back to the 2011 budget, but we’ve gotten between $6M and $7M annually from it since then.

Here’s how it works.

On October 1st, the State will send a letter to every city telling them “Here is the limit to the growth in your city’s budget for next year if you want an ERP payment.” The formula is based on what inflation was from August to August, plus some portion of how much Net New Construction there had been in your city the previous year.

This makes it marginally better than the levy limits, which are strictly based on Net New Construction and that just pretend that inflation doesn’t happen and a city’s costs won’t go up from year to year. That’s still the dumbest thing in municipal finance. In fact, that’s one of the first dumb things about the ERP program. The ERP was originally created to help keep taxes under control, and today, the levy limits keep cities under a far tighter tax control than the incentives of the ERP.

But back to the process. Cities get their letters in the fall and know what their limit will be for the upcoming year, and put together their budget based on that limit. Cities submit their budget documents to the state in May of their current budget year, and from that, the state tells cities if they will get an ERP - in the subsequent year.

Just to be more clear on the timeline:

• October 2025: Find out ERP limit for 2026 budget growth

• November 2025: Write budget for 2026, aim to keep growth under ERP limit

• May 2026: Submit budget document to state, get preliminary qualification for 2027 ERP payment and estimated amount later that summer

• July 2027: After confirming actual 2026 spend, receive ERP payment.

So as the City of Madison is debating its 2026 budget, the ERP payment that will be part of the 2026 budget is not part of the debate. The 2026 payment is based on the 2025 budget, and so long as the city sticks to its 2025 budget through 12/31/2025, the City will get a payment in July of 2026. Whatever budget debate happens on the council floor in November of 2025, it will not affect the ERP dollars that will be part of the 2026 budget. Instead, the budget debate this year sets up the ERP payment for 2027.

And, some cities actually do debate “Do we want to get an ERP payment the following year?” Cities, especially smaller ones, will sometimes need to bump up their budget in a year, and for these smaller cities, the ERP payment may only be in the $100,000 range, so they might decide it’s more important to hire those 4 extra firefighters next year and skip a year of the ERP payment.

For Madison, however, the $7M we typically get is a big enough chunk of the budget that forgoing a payment in a year would be a challenge to make up.

With that background, let’s talk about why the ERP is dumb.

The ERP rewards cities that tax at a higher rate

The way the ERP payment is calculated works like this: The state sets out a pot of money each year - about $58M dollars. The ERP payment is only available to cities that are “high tax”, which for the ERP means that their “mill rate” is at least 5 mills. (A ‘mill’ is tax per thousand, but it’s sometimes easier just to think of it as a tax rate of 0.1%, so a 5 mill rate means you pay 0.5% of your home’s value per year in taxes, or $5 for every $1000 of your home’s value. Most people have no idea what the mill rate is for any given year, though they likely know how much they paid in total for property taxes last year.)

For the ERP, cities get more ERP aid the more their mill rate is over 5 - a city with a tax rate of 10 mills has an “excess mill” of 5, and a city with a mill rate of 6 has an “excess mill” of 1. The ERP then calculates how much of a city’s levy is because of the “excess mill” - if your city is only 1 mill over, you only get 20% of your levy as “excess levy”, if your “excess mill” was 5 because your original mill rate was 10 mills, you get to count 50% of your levy as “excess levy”

Then the ERP calculates the total of all “excess levy” in the state, and calculates what portion of the “excess levy” is because of your city, and your city gets the part of the ERP pot of money in that same proportion. So two cities might both put in $1M of “excess levy” to the statewide total but the city that did it with a rate of 6 mills gets half of what the city that did it at a mill rate of 7 (and hence had 1 ‘excess mills’ compared to 2 ‘excess mills’)

You can argue that providing tax relief to high tax communities is in fact a good thing, but for reasons we’ll get to later, the GOP has broken municipal finance so badly in Wisconsin that this formula is the wrong way to do it.

The ERP hasn’t been funded properly in a generation

The 2025-2027 state budget sets aside $58M for each year for the statewide ERP payment pot of money.

The 2003-2005 state budget also set aside $58M for each year of the statewide ERP payment pot of money.

That’s right, the ERP payment hasn’t been adjusted since before most players on the Badgers football team were born.

The actual amount that cities get per year from the ERP has been relatively stable, because budgets grow at about the same rate. In 2011, Madison got about $6M in ERP, and in 2025, Madison got about $6.9M from the ERP, down from $7.4M in 2023.

But, as a proportion of the overall City budget, the ERP in 2025 is only worth 65% of what it was in 2011 - the ERP payment was 2.5% of the 2011 budget, and the ERP payment is only about 1.6% of the 2025 budget.

The budget the ERP applies against counts nearly all funding sources, not just property taxes

The ERP looks at the increase of a city’s ‘General Fund’, not just property taxes. So if your city gets extra aid from the State for road construction, or more support from the Feds to support a homeless shelter, that gets counted against your budget for the expenditure restraint program. Thankfully it does not apply to debt service, but otherwise the list of exceptions to what doesn’t count towards the ERP limit is very small.

It also only applies to the ‘General fund’ and not to other funds. In Madison, that means things like the Wheel Tax don’t get counted against the ERP limit, because the Wheel Tax gets deposited into the Transportation Fund, along with other funding sources like Metro fare collections. Property taxes get counted no matter what fund they’re put into, however.

(And there’s a limitation on playing too many accounting games, you can’t just make up funds willy-nilly. So, we can’t put money into ‘Mayor Satya’s Pizza Party Fund’ and shield it from the ERP limits)

Governor Evers has proposed policy changes in his budgets that would fix this madness, and not penalize cities that get external funds for their budget, but the cranks in the GOP are not interested in good government and throw out anything he proposes automatically, so the broken system continues.

It did get so bad in 2022 and 2023, with so much Federal funding from COVID and changes to the State shared revenue funding that even the GOP realized that something needed to be done, but rather than fix it, they kicked the can down the road. The 2023 budget said “If you’re scheduled to get a 2024 payment, you automatically get a 2025 payment, same as you did in 2024. We’ll call that a ‘jubilee year’ and reset everyone’s budget to the new levels.”

So, besides screwing over any city that didn’t qualify for a 2024 payment but would have qualified for a 2025 payment, the budget didn’t try to fix the system, just papered it over for a cycle. It is just exasperating how little the GOP-controlled state legislature does to solve problems.

Act 10 will eventually drive growing and thriving cities out of the ERP program

Act 10 is crushing cities, ignoring inflation and limiting levy growth. If the GOP wanted to control municipal budgets, and make “government small enough to drown in the bathtub” as one particularly vile conservative is famous for saying, they couldn’t have done it better with Act 10. Act 10 really makes the ERP program obsolete. If the goal was to limit property tax growth, the sticks of Act 10 do that far harsher than carrots of the ERP.

However, despite the GOP’s best efforts, communities in Dane County are still growing and thriving, so much so that Madison and surrounding communities are in a housing crisis. One way the crisis is felt is sky-rocketing property valuations, pricing people who would like to move and live in Madison out of the area. Ideally we’d be building enough housing that our total property values would be growing because we’re adding more units, and not just making existing units more valuable, but at least rising values mean that people still want to live here.

Of course, the property tax side of the housing crisis is more nuanced, and rising property values do not translate directly into more funding for cities. If your home’s property value goes up, it does not mean that you will pay more in property taxes. The City levies a fixed amount for the entire city - $318M in 2025 - and the portion of that $318M you pay for property taxes depends on how much your home is worth compared to your neighbors. If their house went up more in value than yours did, you’ll pay a lower portion of the overall citywide taxes this year, even though you may still pay more overall than you did the year before.

Because Act 10 keeps a vice grip on the levy and city funding, and the housing crisis is driving property values up at a very high rate, the mill rate - the value of all property in the city divided by the levy - is dropping fast in Madison. In 2014, the mill rate was 9.5. In 2024, the mill rate was 7.1. Property taxes are up from 2014, of course, but the rate has gone down. That’s part of why nobody knows or really much cares what the mill rate is any given year, except for city finance staff.

But of course since the ERP is a dumb program, it’s built around the mill rate.

Cities only qualify for the ERP if the mill rate is above 5 mills. In Madison, I project that the mill rate will fall below that in 2036, and Madison will no longer qualify for the ERP.

(The chart below shows a line fitted to the mill rate from 2014 onwards. That’s cherry-picking the data a little bit, but housing and markets were very weird for a few years after the Great Financial Crisis, so I’m starting at 2014 to put all of that behind us. The mill rate went up in 2025 because of the one-time $22M jump in the levy after the 2024 operating referendum but I expect it to start going back down again. This is only the City portion of the levy and not the county, schools, and MATC)

So the ERP is likely to be irrelevant for Madison within about a decade. For other cities, it may be much faster. Fitchburg’s mill rate has been dropping fast, it was 7.93 in 2022, 6.73 in 2023, 6.72 in 2024, and 5.8 in 2025. Fitchburg’s operating referendum failed to pass so their levy growth was not as fast as Madison’s in 2025. Property assessment in Fitchburg is not as robust as Madison’s and tends to have bigger jumps every few years, so it may not be in 2026, but it seems likely that soon Fitchburg will no longer qualify for ERP payments just based on their mill rates. (Fitchburg is less dependent on the ERP payment than Madison is and should be in a better position to manage it)

Will the Democrats fix this?

It’s important to remember that the ERP is a program under the control of the Wisconsin Legislature, and hopefully there will be changes there starting in January of 2027. Should Democrats take back at least one house, and ideally both, the prospects for change get much better, and hopefully combined with a Democrat following Tony Evers, we will see a rethinking of how municipalities are funded in Wisconsin. The over-reliance of the property tax combined with the strict limits forced on cities with the levy limit have been a disaster, and the whole system needs to be thrown away and recreated, and the ERP should get tossed as well. Hopefully the new system will be more fair to the City of Madison.

The Common Council will create a budget for 2026, setting up an expected ERP payment for July of 2027. It is conceivable that the payment in July of 2027 never happens, because the legislature redesigns the ERP program before the payment goes out. Indeed, if the City wants to be bold and take a major risk, they can bet this will happen and ignore the ERP limit when putting together their budget, counting on the future legislature to provide replacement funds in the new system.

I would not advise that, of course, and I assume the Council will put together its 2026 budget assuming the 2027 ERP payment will work as it has in past years.

But among the many reasons I am voting for Democrats in 2026 is that I’m confident they’ll fix this nonsense, and finally close down the long-obsolete Expenditure Restraint Program.

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Data for graphs:

(Scroll it horizontally to see more years. Embedded thanks to the good folks at DataWrapper)

Further reading:

DOR report on the Expenditure Restraint Program:

https://www.revenue.wi.gov/DORReports/erp2024.pdf

Legislative Fiscal Bureau paper:

https://docs.legis.wisconsin.gov/misc/lfb/informational_papers/january_2025/0025_targeted_local_government_aid_programs_expenditure_restraint_utility_aid_and_exempt_property_aid_informational_paper_25.pdf

City of Madison 2026 budget outlook

https://madison.legistar.com/LegislationDetail.aspx?ID=7407550&GUID=082322E0-3EDD-4AB8-81BD-339915036400

This is the fourth and final post in a series. Catch up on the others here.

The system for funding local governments in Wisconsin is broken. The current majority in the legislature is not interested in fixing it. A future legislature may change that, but we do not know when or if that might happen. It will not happen in time to create the 2025 City of Madison budget.

The current broken state system means that Madison is not able to adequately fund its core government services. This is not the fault of any Mayor or Common Council since 2011, when the state legislature broke the funding system for good. 

The way forward is to go to referendum. It will not be the solution in the 2030s and 2040s, but we cannot cut our way to a solution. We need to put in place a plan that can get us through the rest of the 2020s, and a referendum is a necessary component of any such plan.

Calendar review: the 2026 budget calendar is awful

Under current state law, referenda for the budget can only happen on these dates:

August 13th 2024 (It’s already too late to get on the ballot)
November 5th 2024
February 18th 2025
April 1 2025
February 17th 2026
April 7th 2026
August 11th 2026
November 3rd 2026

We are cutting it close for 2025. With a referendum, the City will have to develop two versions of the 2025 budget, one if it passes and one if it doesn’t. 

Planning for the 2026 budget is harder. If the referendum on November 2024 doesn’t pass or doesn’t do enough to solve the projected gap for 2026, the only options for another referendum are in the spring of 2025, 8 months before the start of the 2026 budget and long before we’ll know what the state or even local numbers look like.

Will the new legislature help Madison?

Under the new maps, the Democrats could take control of the State Assembly starting in January of 2025, but there’s an equally good chance they won’t. Because only half the seats are up in the State Senate, it is unlikely that Democrats will control the State Senate in 2025-2026. Governor Evers will be in office through at least 2026. 

It is safe to say that the Democrats are more likely to increase shared revenue than Republicans. I am a Democrat and won’t hide my bias, but for whatever reason, the Republicans have not shown any interest in reforming shared revenue to help Madison. If Republicans maintain control of both houses, Madison should assume there will be no substantial change to shared revenue in the 2025-2027 state budget. 

If there is split control in the legislature, then there is a chance that shared revenue could increase for Madison, but it’s a big maybe. Split control means that there will have to be a deal with the Republican Senate, and Assembly Democrats will have multiple priorities - Medicaid expansion, reforming the school funding system, rolling back parts of Act 10. Who can say if the formula and money for municipal aid will be part of the final deal?

(Also, the budget won’t be done until July of 2025 at the earliest, and the last time there was a split legislature it took them until October to pass a budget. All of that is after the last referendum opportunity on April 1 2025)

Anything is possible with the state government, of course. Governor Evers could veto any budget that doesn’t increase shared revenue for cities. A split control legislature could not increase funding overall but could fix the distribution formula which would be big for Madison, or could just grant more flexibility on how cities manage their government or how they can use referenda. Republicans could have their hearts grow three sizes one day, and control both houses but still put in more money for shared revenue.

The referendum Madison puts out for 2025 has to assume there will be little shared revenue increase in 2025. If Madison wants to put an additional referendum on the ballot in the spring of 2025 for the 2026 budget, it will almost certainly be too early to know if there will be any shared revenue increase and so the referendum for 2026 will have to assume no increase as well.

2027 and 2028 are a different story, because there could be a change in control of the Senate, and we will have more opportunity to go to referendum before passing the 2027 budget. 

If the Democrats take back control of the State Senate, hold or take the Assembly, and a Democrat holds the governorship in November of 2026, then under a normal calendar, a Democratic trifecta could pass a budget in July of 2027 that would dramatically alter local government funding, most likely taking effect in time for the 2028 city budget. 

This was a long way of saying the future is hazy but there are reasons to hope, if we can hold on and get there. 

The referendum we should pass: $28M but use the rainy-day fund to help

We should close the budget gaps in 2025 and 2026 with a property tax boost of $28M. A reminder, the 2025 gap is now $22M (revised down from $27M) and the 2026 gap is an additional $6M, so $28M in for 2026. There is also a projected gap of an additional $8M for 2027, so a total gap of $36M in 2027.

We need the base levy to catch up. We have used too many one-time funding sources over the past decade and the $22M gap is too hard to keep up with. The extra $6M in the referendum gives us enough space to close the gap in 2026. We can reevaluate in 2027, but a $8-ish million gap is manageable, even if we did nothing else. 

However, we should have at least $24M of one-time money available between now and 2026. Adding $28M in property tax in a quick go is a bitter pill to vote for, so to help out, the Common Council should pass a resolution declaring its intention to use a combination of cuts, revenue increases, and part of the fund balance (the “rainy day fund”) in 2025 and 2026, and ease in the changes.

State law on budget referenda for cities is very prescriptive about how the language of the referendum question is worded. Cities can literally only fill in the blanks with a few numbers. Our question has to look exactly like this:

"Under state law, the increase in the levy of the City of _____ for the tax to be imposed for the next fiscal year, ___, is limited to ___%, which results in a levy of $__. Shall the City of Madison be allowed to exceed this limit and increase the levy for the next fiscal year, ___, for the purpose of __________, by a total of ____%, which results in a levy of $______, and on an ongoing basis, include the increase of $________ for each fiscal year going forward?"

(I filled in an example version at the bottom of the post)

That wording makes it impossible to do anything like having different amounts in different years or increasing each year by a percentage.

With these constraints, I think there are two ways to go forward

Option 1: More short term risk, more long term benefit

My preferred option, we should maximize the amount of revenue authority the city has and increase the levy by $28M in the November of 2024 referendum, which would close the budget gap for both 2025 and 2026, and leave a $8 million gap for 2027. 

To ease in the levy increase and to close the gap through 2027, the Common Council would commit to using $11M in one-time funds in 2025 and $5M in 2026 to reduce the levy impact. This means that for taxpayers, rather than a $28M extra increase landing all in 2025, there would be an extra $11M levy increase in 2025, an additional $12M increase in 2026, and an additional $5M increase in 2027. The remaining $8M in one-time funds can close the 2027 budget gap. 

(We can do this without impacting our future levy. I explain how and show the math of the overall increase at the bottom of this post in the “nerdy details” appendix)

This option has the obvious downsides of:

1. Having a big number ($28M) actually on the ballot, making it less likely to pass

2. Being very difficult to explain

Option 2: Less short-term risk, less long term benefit

We could put a $16M levy increase on the ballot in November of 2024. That would leave a $6M gap to fill in 2025, a $12M gap to fill in 2026, and a $20M gap in 2027. We could fill $24M of that with one-time funds, and so close the gap completely for 2025 and 2026 and leave a $14M gap for 2027. We will need a new plan for the $14M gap in 2027 but we can wait and see what happens in the legislature before then.

This option has the upsides of:

1. Being a much smaller number on the ballot

2. Being easy to explain

With the obvious downside of:

1. Leaving a big gap in 2027

Both of these options let us put another referendum on the ballot in the spring of 2025 if the November ballot fails or we want to re-strategize after the November legislature election.

The Madison political environment in 2024

Soon this will turn into a political campaign for the referendum question. I think there will be a group that tries to organize a “vote no” campaign, but I don’t think they’ll matter much. 

The real political problem the referendum will have on getting “yes” votes is that it has to carry out a campaign while there is a Presidential and Senate campaign happening at the same time, not to mention a Dane County Executive campaign and school referenda. Getting information to the public that can stand out will be very, very hard. 

This is why I think any ‘vote no’ group is going to be basically pointless - Madisonians are in their hearts open to passing this referendum if they can hear good reasons to do so and some will seek out that ‘Yes’ information. People aren’t going to look for ‘Vote No’ information. And proactively getting the word out - with this much other activity happening - is just not likely to stick. I don’t think any group of the groups that could fund anything big enough to cut through - the Chamber of Commerce, the Realtors, maybe the Unions - are interested in getting involved or would side with ‘no’. 

But getting ‘Yes’ information out is also going to be very hard, especially if you have to tell a complicated story. People are going to confuse the City referendum with the school referenda and the wording on the ballot is confusing. That’s part of why while I prefer option #1 of asking for $28M in one question, option #2 of only asking for $16M is safer. They actually both affect taxpayers about the same, but option #2 tells a much simpler story.

Speaking of school referenda, the Madison Metropolitan School District is likely to put two referenda on the ballot in November, and they are gigantic. The operating referendum they are discussing would add $100M to the levy by 2028. Whereas my plan is saying “let’s ease in $28M over a few years”, the MMSD referendum is “let’s ease in $100M over 4 years” - so an increase of $30M in 2025, $30M in 2026, $20M in 2027, and $20M in 2028. (In comparison, with the 2020 referendum, MMSD eased in $33M over 4 years - $6M year 1, $8M in year 2, $9M in year 3, and then $10M in year 4.) By 2028, this will be over $1000 more for taxes on the average home than what’s currently expected.

MMSD is also likely to propose a second capital referendum for $507M to rebuild 5 middle schools, Shabazz high school, and a couple of elementary schools. This will add another $326 a year starting in 2026 for the next 20 years. 

Frankly, I am not sure the MMSD referenda are going to pass, and I worry that they are going to take the City referendum down with them. In 2020, the school referenda passed with 76% of the vote, but MMSD has burned through a lot of goodwill since then - the school bus debacle, the school lunch debacle - it used to be a fringe opinion that MMSD can’t execute on basic operations, and now a lot more folks in town have that viewpoint. Combine that with sticker shock from the numbers - a $100M referendum, $1000 tax increase on the average home, a half a billion on new facilities - this is going to be a tough sell for the school district. Goodwill for Joe Gothard isn’t going to be enough.

One thing is that Madison won’t be alone in cities with a referendum on the ballot. Fitchburg and Monona are both heading towards a referendum this fall. Sun Prairie expects to need one in 2027. Middleton has already gone to referendum (2022), as has Shorewood Hills (2022), the Village of Cambridge (2021), and Maple Bluff (2020). 

(And those were all just cities. The list of school districts is much, much longer. The state legislature should be embarrassed by how badly they’ve bungled local funding in Wisconsin)

Cuts would help: let’s pause the Imagination Center

Alder Sabrina Madison is probably going to punch me so hard for saying this that she’ll knock me clear over to the west side, but the Imagination Center is about to finish the design phase. The city should pause it there and not go to bids, put the plans on the shelf for a few years, and claim a $16M cut.

To win a vote you just have to get to 50%+1, and Madison is a very referendum-friendly town. The 2020 school referenda passed with 76% of the vote, but there’s no way a full gap amount of $22M or $28M city referendum passes by that much in 2024. I think a full gap referendum probably passes this fall, but is that a good risk to take?

If the city can say “we’re pairing this funding increase with some cuts to make it easier” I think you sway a lot of voters securely into the ‘Yes’ column, especially if you use option #2 and have a smaller overall amount. 

(Folks will rightfully object that cutting the Imagination Center is mostly a capital project and not an operating expense for 2025, which means the $22M gap is still there, which is partially true. However, staffing a whole additional library is an enormous new operating expense, it’s going to be a $2M new increase in the 2026 budget and contribute to the gap. Pausing the Imagination Center also does cut down on the amount of new taxes to pay back that capital expense and would save about $2M on the overall levy in 2026 in addition to avoiding the $2M increase on the operating budget, even though that capital part of the savings doesn’t help on the budget gap. Anyway, that’s yet another reason why option #2 is probably better - the trouble with having had so many ‘$27M funding gap’ or ‘$22M funding gap’ stories is that it’s hard to say “Vote Yes, because the City has already made some cuts” and then see that same $22M or more on the ballot - voters are going to say “Wait, what?”)

Politically the better choice for a visible cut would be the Public Market, but since it’s in the middle of construction it’s no longer a practical choice. Cutting some of the John Nolen lakefront projects might be another “big enough” alternative. That said, the Imagination Center is at a good point, project-wise, to pause it, is a “big enough” project to be very visible, and is legitimately a painful cut to make. It is also easy for us to restart in 2028 or 2029, or maybe even earlier if a federal funding source comes along. It’ll be a ‘shovel ready’ project, with the plans on the shelf and property already acquired. This would be a pause, not a cancellation.

No one is excited to cut libraries, and there’s no guarantee that cutting it would ensure a referendum passage, but to help prevent laying off 10% of City staff, I’d support cutting the Imagination Center. 

This post is already long so briefly about a few other things

Trading fees for taxes

People hate the wheel tax. If property taxes had gone up by $40 no one would have batted an eye, but the wheel tax makes everyone mad. You could imagine a plan where the property tax went up even more than $28M but the wheel tax was abolished. It could work.

Let’s not raise Metro fares

At first glance, it might be a reasonable time to raise Metro fares. The base cash fare has been $2 since April of 2009, and other fares were last changed in 2016. We could raise another million or two from fares and reduce the general fund subsidy and close the gap a bit. However, we just went through a study on not changing them for BRT, so we’d have to repeat that study and it would almost certainly tell us that harm is going to disproportionally fall on a minority population. Best to leave the fares as they are for a while.

MadCAP is an excellent program but it misses people.

MadCAP, the program that gives low-income folks a break on their water and other city services bill, is a great program and provides a pathway to reducing the burden of any new property taxes. It’s a clunky way to do it, but you could also imagine a scenario where we increased the property tax by more than $28M but then used MadCAP to “hold harmless” low-income folks.

The drawback of MadCAP is that it only helps people who get the city services/water bill in their name. For many if not most renters, this isn’t true. This opens a whole can of worms, but if the City of Madison government had a billing relationship with all of the residents of the city and not all of the property owners of the city, then there could be a good path forward here, but that’s a major rethinking of municipal finance and isn’t likely anytime soon.

A sales tax

A sales tax option before 2027 seems incredibly unlikely. The Milwaukee sales tax was a combination of the Milwaukee financial situation being so bad that bankruptcy was a real possibility, and the prospect of the Republican National Convention happening in a city that was going bankrupt. If the RNC had gone somewhere else for 2024, I (and others) doubt Milwaukee would have gotten the sales tax. Also, Milwaukee is going to lose the power to use a sales tax once their pension system is fully transferred over to the State. 

A sales tax might be part of the solution in a few years but for now it’s a not an option.

And in conclusion (audience starts applauding)

If you’ve read all four posts, thanks for sticking with me. 

The way local governments are financed in Wisconsin does not work, and Madison has reached its breaking point. I believe there’s a good chance we’ll see a better system emerge in a few years with changes in the state legislature, but we have to hang on for a few more years before that happens. 

A referendum now is the part of the solution. Let’s do it.

I’m supporting Regina Vidaver for Dane County Executive and you should too! She’s a public health expert and has done big things on the Madison Common Council - CARES mental health response, the Building Energy Savings plan (which is a huge deal!) and Transportation Demand Management, among others. When I was on the Council with her she asked the best questions that always got at the heart of the issue, and I know she’ll be an excellent leader for Dane County!

www.reginafordane.com

APPENDIX: Additional Information

Using less than the full levy

The 2024 referendum could expand the levy limit by $28M but then not levy that much. Madison can do this because cities are allowed to levy less than their full amount without affecting their ability to fully levy the next year. Cities are limited in how much they can move between years: if the levy limit was $100 and never increased, we could levy $100 in 2025 and $100 in 2026, or we could levy $96 in 2025 and still be able to levy $100 in 2026. We could actually levy $98.5 in 2025 and then $101.5 in 2026, but there’s no way to be able to grow beyond $200 in 2 years, and cities can only “bank” 1.5%, so if we levied $96 in 2025, we could still only levy $101.5 in 2026, not $104.

What the actual referendum language would look like

Our question has to look exactly like this:

“Under state law, the increase in the levy of the City of Madison for the tax to be imposed for the next fiscal year, 2025, is limited to 2.2%, which results in a levy of $292,816,060. Shall the City of Madison be allowed to exceed this limit and increase the levy for the next fiscal year, 2025, for the purpose of continued support of municipal services, by a total of 10.85%, which results in a levy of $320,816,060, and on an ongoing basis, include the increase of $28,000,000 for each fiscal year going forward?”

(Actually I’m not sure if it’s the adjusted or unadjusted levy used, but whatever)

Maddeningly, you can’t say “$22M in the first year and $6M in the second year”. You can change one number only and you can only have the change start the next year. The language is also terribly confusing.

Doing the math on a $28M referendum

The original gap analysis that the City Finance staff did assumed that a $27M referendum would add $284 in taxes on the average home (TOAH), or about $10.51 a year on each home for every million dollars in the levy.

A $28M referendum would turn that into $294 on an average home.

If Madison passed a $28M levy increase referendum in 2024 and did not use any onetime money to offset it, it would look like this:

2025 $28M $294
2026 $28M $294
2027 $28M $294

In my “option #1” plan that expands the levy authority but doesn’t use the whole thing and instead offsets part of it one-time funds

A reminder the projected gaps are

2025 $22M
2026 $28M (22+6)
2027 $36M (28+8)
2028 $46M (36+10)

How the plan would look each year:

2025 $11M levy, $11M one-time, $22M total,  $0 gap
2026 $23M levy ($11M + $12M new), $5M one-time, $28M total, $0 gap
2027 $28M levy ($11M + $12M + $5M new),  $8M one-time, $36M total,  $0 gap
2028 $28M levy, $0 one-time, $28M total, $18M gap 

Additional taxes on average home (total)

2025 $115
2026 $241 ($115 + $126)
2027 $294 ($115 + $126 + $53)

My option number 2 is much simpler:

2025: $16M levy, $6M one-time funds, $22M total, $0 gap
2026: $16M levy, $12M one-time funds, $28M total, $0M gap
2027: $16M levy, $6M one-time funds, $22M total, $14M gap
2028: $16M levy, $0M one-time funds, $16M total, $30M gap

Additional taxes on average home

2025 $168
2026 $168
2027 $168

Miracle Workers

City Finance staff are a bit conservative. I mean that in the best possible way, and I certainly don’t mean it in the political sense. (I actually have no idea what their politics are.) By conservative I mean “the numbers we give you are accurate and if there is uncertainty we undershoot”, which I think is exactly what one would want in a Finance staff. You can trust them for numbers that won’t get you in trouble.

It’s so well known that as a city we just sort of roll with it. Here’s former Mayor Dave, writing back in November of 2023:  

Every Madison city budget follows the same script. In the spring the city finance director gives the mayor budget projections for the next year that always show a deficit. The mayor always issues dire warnings about this being the toughest budget ever. I did that eight years in a row and I believed it every time I said it. 

And then things work out. They just do. 

And, sure enough, several week ago we woke up to these headlines:

 Madison's finances came out a whopping $31.2M better than expected in 2023  

So the streak continues from the finance department.

Crisis averted? Maybe not.

Sticking with Mayor Dave, a few days later he wrote on his Isthmus blog a piece titled “City of Madison budget crisis averted?” and kicked it off with “You know that city of Madison budget crisis you’ve been hearing so much about? Yeah, well, maybe not so much. Last week we got a report that suggests things might be less dire than had been thought.”

I think we need to be clear. The Madison budget is still in crisis. The funding mechanisms are not sustainable.

Two “in fairness” disclaimers:

First, I think that Dave does recognize that structurally things are unsound and if you were to press him, he’d tell you he’s only focused on the possibility of a referendum in 2024.

Second, while I am going to tell you that this surplus is masking underlying bad news, I will say that if the alternative to a $31.2M overperformance as a $31M underperformance, I’m much happier to have the overperformance. 

But let’s talk about why this is bad news. Here’s the Finance Staff’s presentation to the Finance Committee if you want to read the details yourself: https://madison.legistar.com/View.ashx?M=F&ID=12897471&GUID=439C49A2-769C-48A3-923A-68788462F059

Problem #1: Much of the surplus came from high interest rates. We don’t want high interest rates.

Something that I bet most Madisonians don’t know is that the City has a lot of money. We talk a lot about the “rainy day fund”, but we also have other money. We have short-term money - money that comes in because many people pay their entire property tax before we need it. The City holds reserve funds that enterprises are building up for future use. We save away some parking money and golf course money each month to use in the future for repairs. Explaining all of the city’s fund balances and investment positions is both beyond the scope of this blog post and my ability to concisely explain it, but suffice it to say that we have a lot of money. The 2023 Financial Statements should be posted soon and you can read about it all here: https://www.cityofmadison.com/finance/accounting/financial-statements 

(One thing the City does not have is retirement savings. City employees are invested with the Wisconsin Retirement System, so all of that money is off the City’s books and on the State’s books.)

The city treasury is by necessity a conservative investor, and when interest rates were low, historically the City didn’t make a lot of money from its investments. But now that rates are high, we’re suddenly taking in a lot of easy money. 

In isolation, that’s great! I am not calling on the City to give back to the banks the $20.4M more than it was expecting to collect in 2023. 

There are two reasons why I think this is bad, one that is easy to deal with and one that is hard.

The easy reason is that well, this money was easy, and easy come, easy go. We should have some budget discipline and not expect that the easy money will continue. Take it while we can, but treat this as one-time money.

The hard reason is that for the City, high interest rates cut both ways, and it cuts harder in the bad way for us. The City’s other main exposure to high interest rates come when we issue bonds for capital projects. High interest rates mean that when we go out to sell bonds, we’re going to get high interest rates for those. Worse, our exposure to bond rates is long-term, not short term. When interest rates go back down, on the investment side, we’ll shrug and say “well that was fun”. On the borrowing side, however, we’re stuck with those high interest rates for a long time. Madison typically uses 10 year bonds - and unfortunately, unlike a house we can’t refinance them at will. Our bonds are usually locked in for 8 years, so if rates go back down, we might be stuck paying the higher rate bonds for a long time. 

Problem #2: We got a lot of savings from position vacancies. This is bad, very bad, and very very bad for Madison

In any organization that’s more than a handful of people, there is always some personnel churn. People retire or switch jobs and it takes a little while to hire their replacement. As a City we won’t ever be at 100% of authorized positions unless we fire everyone and make the Mayor do it all. Madison has over 3000 positions, so at any given instant in time, we have dozens of positions budgeted for but that we’re not spending any money on. 

That pool of authorized-but-unspent money is a large pot of money that really does need to be accounted for, but it’s hard to predict at an agency level how it plays out, so the way it has been budgeted has been somewhat blunt, but basically it was just assumed that there would be 2% salary savings across the city, and departments that went under transferred their excess to the central fund and departments that went over had money transferred to them, and it all came out in the wash. The 2024 budget does a better method of trying to estimate what departments will actually need so the unspent funds can be better estimated and accounted for, and the overall assumption is now 3% of salary will be unspent. 

Unfortunately in 2023 it seems that the position vacancy rate is much higher than 2%, and that is unequivocally bad. Here’s why:

Bad: There’s more work to do than staff to do it. If you spend any time with City staff you will quickly come to realize that they are all very busy because they are doing their own work plus covering for the empty positions. This means that our existing staff is very stressed and some things aren’t getting done. When I was an alder there were certainly projects that I wanted to see happen faster or happen at all, but we were blocked on not having the necessary positions filled. The City could be doing more, and has the money to do more, if only we had the people available to do it.

Very bad: A big part of the reason why we don’t have enough staff is because we don’t pay our staff enough. This gets us two ways. First, some of our staff leave for better paying jobs. Second, it is difficult to hire because we don’t pay enough, so jobs remain vacant for longer. Certainly some of this is part of the strong economy of Madison. We have a low unemployment rate in Madison so it is easier here to job seekers to switch jobs than elsewhere in Wisconsin and harder for employers to find people, but our staff salaries - even with recent adjustments - are often not competitive and city government jobs lose out. 

Very, very bad: When jobs remain vacant for too long, the stress on our staff increases. Combined with the low salaries, this makes it more likely that they will leave, which puts more stress on our remaining staff and eventually some of them leave too. This further increases the pressure on staff and the downward cycle continues. 

Ending the year with an excess in salary savings, when we know we have non-competitive salaries, signals that we have a serious budget problem. As we saw in the previous post, our budget gap is largely driven by growth in our personnel costs, but if even with that salary growth we are not able to keep up, salary-wise, it’s a sign that we need to invest even more in our salaries. But, we don’t have the budget revenues to do so.

This is a terrible predicament. What to an outsider looks like a positive sign in the budget - good news in city finances, we spent less than expected! - actually masks a serious budget problem. 

We have to find a better way to tell this story.

In the next post, we’ll wrap up this series and try to offer some ideas of how to move forward.

I’m supporting Regina Vidaver for Dane County Executive and you should too! She’s a public health expert and has done big things on the Madison Common Council - CARES mental health response, the Building Energy Savings plan (which is a huge deal!) and Transportation Demand Management, among others. When I was on the Council with her she asked the best questions that always got at the heart of the issue, and I know she’ll be an excellent leader for Dane County!

www.reginafordane.com

Norman Augustine was undersecretary of the Army in the Gerald Ford administration, and later CEO of Lockheed-Martin. An engineer by training, in the early 1980s he published a set of “laws” (often tongue-in-cheek) he had discovered over the years. The most famous is the 16th Law, apparently derived from when he plotted out the unit costs of military airplanes starting back in the 1910s, and extended the line out into the future. Then he plotted out the growth of the US Defense budget, and proclaimed this:

In an interview with the Economist Magazine 30 years later, Augustine said “we are right on target. Unfortunately nothing has changed.” And apparently not:

(though this post is not about to argue about the projected costs of the NGAD and the F/A-XX) 

Earlier this spring, as the community conversation around the City budget got underway, a thought came to me: what did the budget picture look like in the 2030s and beyond? I knew Augustine’s “Law” and I wondered, are we similarly doomed? 

Answering that question was the original motivation for what turned into this entire series of posts. I dug into the budget numbers and put together a model of how city revenues and expenditures might grow, and simulated things out for 35 years. The results are scary. In 2037, the structural deficit exceeds the cost of the entire police department. And, in what I assure you was pure coincidence, my model says that starting in 2054, the Madison structural deficit exceeds 50% of total general fund expenditures. Augustine’s Law strikes again.   

But this is where we leave the fighter jets behind. This post is only about the Madison budget. For those of you who were hoping for a post about F-35 noise, police reform, or maybe a wild story about how the police department was getting surplus military jets, I’m sorry to disappoint you. The opportunity to connect F-35s and the police budget was just too Madison clickbait for me to resist. 

For the second entry of my four part series, please stow your personal items, fasten your seatbelt, and prepare for take off into the wild blue yonder of budget numbers.

It’s not just 2025

Most of the headlines on the budget have focused on the $27M gap in the 2025 budget, but the challenge we’re facing continues into the future. Here’s the graphic from the Wisconsin Policy Forum’s report for future year projections:

The graphic shows that we get up to over $60M in 2029. To be a bit more precise, we’d only get to $60M in 2029 if we were to not solve any of the previous years gaps, that is, if we were to solve the $27M gap for 2025 using one-time money, we’d have a $34M gap in 2026, because we’d have to solve the 2025 gap again and then solve a new $7M gap as well. If we solve the $27M gap with a revenue solution that would continue on into 2026, then we only have to solve a $7M gap in 2026. Here’s how the Finance staff estimates the next 5 years will go:

Looking at that you might have the same question I did: what would change in 2029 that would mean 2030 wouldn’t also have a gap? And the answer is nothing, we’re going to have a gap in 2030 as well. So what does that look like?

In order to answer that, we need to make our own model of the city budget. 

Creating a model: “All models are wrong but some models are useful”

In this section I’ll briefly explain what I did to create the model - the data I used and the assumptions my model makes. If you don’t care about the details you can skip over this next section. If you want even more details, the Excel sheets I put together and the Python code for my model are available on Github.

The data: expenditure and revenue baselines

I went through the 2024 agency operating budget documents, and for each general fund agency, I copied out its total budget and general fund portion of its budget, and then the line items for salaries, benefits, supplies, and purchased services. For benefits, I further broke that down into health insurance and “other benefits.” For each agency, I also copied out the total number of full-time employees. 

From that, I made a couple of adjustments. First I removed a few one-time expenses, like the grant funding the clerk got to buy new election machines. More importantly, I tried to adjust the line items to better match what is funded from the general fund vs other funding. This is captured at the “service” level but unfortunately is not in the budget at the individual line-item level. To estimate it, I take the overall budget by the general fund portion of the budget and then scale each department’s line items and staff numbers by that ratio. So for agencies like the Assessor’s office, which is 100% funded by the general fund, the ratio is 100% and the scaling changes nothing. For other agencies like Streets, which gets about 11% of its funding from the Stormwater utility, I scaled down its numbers by 11% - so for my model, the baseline number of staff is 219 instead of the 245 authorized in the budget. (Streets is actually an oddball case because of the funding from the recycling and urban forestry fees)

For revenue, I used the funding summary document but removed the one-time funding items that we are using in 2024 - the federal COVID money, the use of reserves funding, etc. This way the baseline already starts with the $18M gap. I mostly summarize the funding, but I break out the room tax and investment income so I can adjust those numbers separately. 

The model isn’t rocket science. To make a projection for a year, the model just takes the previous year’s expenditures and revenues and multiplies them by some scale factor, and notes the differences. Those scale factors are a set of assumptions about how the future will unfold. I use mostly the same assumptions that City finance staff uses, which were detailed on slide 12 from this presentation by City finance staff: https://www.cityofmadison.com/finance/documents/budget/2025/Part2Powerpoint.pdf

The most important point is that we assume wages and benefits grow each year, and that the overall citywide headcount also grows, using numbers based on historic averages. 

For revenue, most of my revenue assumptions match the Finance staff’s assumptions, though I model interest rate growth from our investments a bit different than how they do it, and I assume that revenue from hotel room tax grows faster than they assume it will. 

My model leaves out debt service. For the most part this is OK, because the debt service expenditures are automatically matched by increases in property taxes to cover the debt, so it should cancel out. There are, however, some subtleties in debt service that can help the general fund but my model does not try to capture those, because I do not want to try to model the capital improvement plan. 

Overall, my model is I think a bit more conservative than the model the Finance staff has created because they’re better at this than I am but they also have more accurate breakdown of fund sources, but my model should be reasonably close. You can find more details of how my model works in the source code for the model.

Model projections

Indeed, my model is pretty close to the city’s model for the first 5 years. And to answer the question, what happens in 2030, well, the budget gap gets bigger (sorry these are hard to read on mobile)

But since we’ve got the model, let’s project forward a few more years. Here’s the 2030s.

Well that’s getting rough. Notice in the year 2037 the budget gap exceeds the entire size of the police department (which is already much bigger - the model projects the police department budget in 2037 is $152M, compared to $91M in 2024.) By 2040, the budget gap is one third of the entire general fund operating budget. 

Here’s the 2040s. It doesn’t look much better:

And here are the 2050s:

In 2054, the budget gap crosses the 50% mark of the general fund. At that point we can only afford police, fire, and some of public health - or we can afford everything but police, fire, and parts of public health. 

Here are the full numbers. There are like 40 columns so you might need to scroll over.

One of the big drivers: health care

So, this post isn’t a full analysis of the budget and the drivers behind the budget gap. At its core, as we covered in part 1, the main problem is that our primary revenue source (property tax) is so heavily constrained that it does not adjust for any cost-to-continue expenses. The way the system works in Wisconsin is that a city can pay for a new cop, but not give raises to any of its existing cops - or raises to snowplow drivers, or cover the increased costs of fuel or any of the other expenses that go up each year. It’s a totally stupid system and the Wisconsin Legislature ought to be embarrassed to have kept it in place. 

There is one driver of costs that I wanted to call out, which is another systemic funding failure of our society. Health care costs are the fastest-growing expense in Madison’s budget and hence in the model. Health care will account for 7.9% of the overall operating budget in 2025, and that grows to 9.6% in 2030. 

Importantly, health care increases are a huge part of each year’s budget growth. Here’s the cost to continue growth of each year, compared to the increase in health insurance for that year. Notice that health care cost growth was 14.4% of the 2025 growth, and is 17.2% of the growth in 2030.

We can skip over the 2030s and 2040s, so let’s just jump right to the 2050s and look again. In the 2050s, health care costs are basically 20% of Madison’s entire budget, and make up about a third of each year’s increase.

Health care funding in this country needs to be dramatically rethought, and something more sensible would be very helpful for Madison’s budget in the future.

Taking the budget model to the casino

One of the shortcomings of the model is that it makes one set of assumptions for what happens each year and uses those assumptions for every year between 2025 and 2059. Obviously every year will not be the same - some years will be in a recession, other years will be boom years, some years will just be average. The assumptions of the City’s model and the model I used above were that every year is an average year, and over time all the assumptions “even out” and so we can just use the same figures. 

An alternative to having a fixed set of assumptions  is to try to account for what happens if, based on some probability, some years we have a recession, and some years are booms, and so on. Rather than using a fixed set of growth figures for each year, you “roll the dice” before each year to see what kind of year you’ll have and use that for your simulation. 

I wrote a second version of the model that tries to account for this. Rather than using fixed assumptions, it sometimes decides that we’ll have a recession, or a boom year, or a year with high inflation. In a recession, the model adjusts the amount of new construction happening down, which limits how much new property tax we collect, and it assumes that because the state budget will also take a hit, the amount of state aid grows slower. But in a recession it also assumes that staff wages grow slower and interest rates go down. Similarly, in a boom year, the model assumes that net new construction goes up and state aid goes up and inflation and interest rates stay normal. In a high inflation year, the model cuts back on net new construction but increases state aid, increases wages, and cuts interest rates. 

We call these types of simulations “Monte Carlo” simulations, because each time you run the simulation it’s like playing a game of chance. When you have these sorts of simulations that depend on throwing virtual dice in the computer, you can’t just run the simulation once and use those numbers, because you don’t know if you just had good luck or bad luck in that particular try of the simulation. You need to run the simulation over and over again and see how it goes over time.

I ran my simulation 10,000 times, each time through calculating new budget gaps for every year between 2025 and 2059. Then I arranged them, best to worst, and 500th best, the 5000th best (the median, where half of all simulations were better and half were worse) and the 9500th best and compared them and this is what I got:

The 500th best outcome was a budget gap in 2059 of $723 million - that’s what happens if Madison gets really lucky. The 9500th best - if we get really unlucky between now and 2059 - was a budget gap of $1.28 billion with a b. The median outcome, if things just kind of go OK, was $921 million. 

Just to be upfront, I built this version of the simulation without spending a lot of time doing research. The numbers I used for what happens if things are “good” or “bad” I basically just pulled out of the air, and the probabilities of having a recession or a boom year are also just what I picked on vibes. This is all a polite way of saying my Monte Carlo simulations are probably total bullshit. If you and I were having a beer, I would feel comfortable defending my model. If you were an economics professor, I would probably try to sneak out of the room.

Wrapping up - is this all a little bit silly? 

OK, thinking about the 2059 budget gap in 2024 is very silly. For one thing, by law the Common Council can’t just ignore the budget gap in 2025 and the budget will have to be balanced for the year, and then again in 2026. It seems unlikely that every year for the next 35 years each Council will find a set of one-time funds to kick the can to the next year, 35 times in a row, so the budget gap is not likely to be pushing $1B in 2059 -something will have been done.

We also know that a few years can make a big difference. Here’s the budget outlook for 2016, created just a few months after Mayor Soglin was sworn in for his last term:

It projected a $2.8M gap in 2019, and a $1.8M gap in 2020. In reality, there was a $4.7M gap in 2019, and Mayor Satya inherited a $10.8M gap when putting together her first budget. 

So things change. Revenue or construction does better than we expect, state aid finally catches up, the Council and the Mayor have new priorities. I am going to have a good laugh at some of these numbers in 2040.

Making these sorts of far out projections reminds me of the AT&T ‘You Will’ ad campaign from 1993. It got a lot of things very wrong: “Have you ever…sent some a fax, from the beach? You will” or “Have you ever…made a video call, from a phone booth? You will”.

You watch the ads and you think “I can’t believe they thought that’s how it would work” as you watch the guy swipe his credit card in a payment machine built into the car to pay the EZ-Pass open road tolling. But, directionally, the ad got everything right: streaming movies, video calls, virtual learning, electronic medical records, ebooks. Sure, the details are all goofy, but the core of those ideas are right.

And so that’s what I want you to take away from my simulations. Will Madison have a $1B budget gap in 2059? Who knows. But, have you ever had a municipal financing system that wasn’t just a property tax levy that was indexed to increase at far less than cost to continue? You will.

Tomorrow in the next post in the series, we’ll dig into why the projected $31M surplus from 2023 is actually bad news.

I’m supporting Regina Vidaver for Dane County Executive and you should too! She’s a public health expert and has done big things on the Madison Common Council - CARES mental health response, the Building Energy Savings plan (which is a huge deal!) and Transportation Demand Management, among others. When I was on the Council with her she asked the best questions that always got at the heart of the issue, and I know she’ll be an excellent leader for Dane County!

www.reginafordane.com

Over the next four posts, I am going to dig into the Madison budget with an eye towards the 2025 budget challenge - the looming $27M structural deficit. This budget challenge is not unexpected - it has been clear for nearly 15 years that there would be a year where the structural deficit overtakes the budget, and the only thing that is a bit surprising is COVID pushed it back a few years. 

The 2025 budget is the most important issue facing the City of Madison at the moment. All of the other challenges we face - housing, equity, climate adaptation, public health and safety - how those will be addressed by the City Government in 2025 and beyond depend on how we as a City decide to handle the structural deficit in years to come.

For the first entry in the series, I want to tackle what seems like an easy question: What is the top-line number for the City of Madison’s 2024 operating budget? The answer actually depends on what you consider the top-line number, and we’ll take a look at a couple of different plausible numbers. 

The number I want to highlight is $170,062,113, which is the “before adjustments” payable-2024 property tax levy. This number has historically been so uninteresting that we don’t even have a spot for it in the budget documents the City prepares, but how that number changes year to year is the crux of the structural deficit, so it’s important that we know what it is and how it fits into the rest of the budget. 

The City’s Finance Department has been putting together an excellent “2025 Budget Outlook” website that I cannot say enough good things about. Over the past few months they’ve put out 4 deep-dives into the budget, held 2 briefings for the Common Council, and hosted a series of meetings around the City along with the Common Council for community members to learn more about the budget process. (There’s still one more - Wed June 5th at 6pm at Black Hawk Middle School)  City finance staff is doing an amazing job of helping educate Madison about the budget and I think once we get past our budget challenges, we’ll be better off as a city going forward with more people knowing more about how City government works.

This post digs a little deeper into ‘Budget Foundations’ material that the  https://www.cityofmadison.com/finance/documents/budget/2025/Part1Powerpoint.pdf. (Video) (memo) If you haven’t seen that material yet, you’ll want to take a look.

How much does the City of Madison actually spend?

I asked ChatGPT what the City of Madison’s operating budget is and here is what it told me:

But here’s the thing: that’s not really true. 

In fairness, ChatGPT isn’t hallucinating a totally made-up number, $405.4M is what most of the reporting says is Madison’s 2024 budget. However, the City of Madison’s 2024 adopted budget is 685 pages long and has a LOT of information in it. Much of that information is important to share but ultimately not needed for the community to share its priorities and the Mayor and Common Council to debate and set a direction for the next year. So, to keep the discussion relevant, the budget document and debate includes some numbers and leaves out others. Specifically, when most folks talk about Madison’s “operating budget”, what they’re describing is the “General Fund” plus the “Libraries Fund”, which comes up to $405.4M for 2024. Those two funds cover things like firefighters and snowplowing and zoning administrators and the Mayor and leaves out other things like the supplies of chicken we buy to resell as part of Monona Terrace wedding dinners. 

So no one is trying to pull a fast one in the budget, it’s just that a very sensible organization of the core budget is to focus on the general fund, which is where most of the policy decisions the Council could make will end up in the numbers. The general fund number  is a fair number to report as the ‘budget’, and probably the most useful number, but there are other important numbers for the overall budget that are important to understand.

What is in the budget but not in the “General Fund” budget?

It turns out, a lot. 

If you go through the budget and add up the different funds, you get a $775M operating budget, not $405M. This slide from the “Budget Foundations” presentation gets to the details:

There’s a lot of money flowing through the City, but much of it is self-contained: The City established the Water Utility because it met a civic need, but what it spends this year is largely determined by how much water people use and the utility bills customers directly to generate the revenue to cover what the utility spends.

(If you do go through the different funds and add them up, you have to be careful not to double-count, because money is moving in and out of different funds - which is yet another reason to just focus on the general fund)

Let’s dig into Madison Metro as an example. Metro Transit’s 2024 budget is $72M, which if the entire thing was part of our $405M budget it’d be 17% of the budget, but thankfully there is other funding for Metro. 

Metro’s main funding is a mix of federal and some bus-specific state aid ($28M), payments from other local governments and the UW for their share of the service ($9.5M), and then money it takes in from fares and other revenue like advertising (11.8M). All those sources together give Metro $49.5M.

(For the UW contributions, I think the ASM student bus pass is part of the Metro fare revenue line item, and the contract to run the route 80/81/82 buses is part of the local government share item. The UW wants to dump more of the 80 on UW students, by the way - via the Daily Cardinal)

Of the remaining $22.5M, $15.75M comes from the General Fund. (The last $6.8M comes from the “wheel tax”, all of which goes to Metro.) It doesn’t fund anything specifically, it’s just combined with the money from bus passes and state aid and the like, and is spent on driver salaries and fuel and other things to make Metro go. 

So, out of the “$405M operating budget”, only $15.75M goes to Metro. 

An aside about BRT and the structural deficit

You often see people in letters to the editor or commenting on social media that the cause of the budget deficit is Bus Rapid Transit, but that’s simply not true. In the 2019 budget, the last one passed in the Soglin Administration and before COVID blew everything up, Metro got $14.2M in support from the general fund. If you adjust that 2019 figure for inflation, you get $17.4M.

For comparison purposes, I think it’s fair to include the vehicle registration fee as though it was General Fund support, which means, inflation adjusted, with $22.5M the current budget supports Metro at only $5.1M more than the last Soglin/pre-COVID budget did. 

This $5.1M is an inconvenient number for people who want to blame the entire $27M structural deficit on Metro and BRT. Even if all of the increased subsidy was going to pay for BRT, it just does not get anywhere close to addressing the full structural deficit. 

You said $170M, let’s get to the point already.

The $405M general fund budget includes funding sources like state aid and building permit revenue, but the bulk of the funding - and what most residents are worried about when the Council passes a budget - is the $286M in the property tax levy. That’s what (nearly all) Madisonians pay - either directly if they own their home or indirectly through their rent. (There’s a small number of folks who don’t pay - UW dorm residents, people who rent from tax-exempt organizations, but it’s a small enough number that we can ignore it)

So it’d be sensible for newspapers to write headlines like “Madison Common Council passes $286M budget” since that tells me what my taxes are going to be, and in nearly all years up until now most budget nerds could stop looking there, but this year we have to look one level deeper.

Of that $286M, $116M is tied to debt service, either directly or indirectly. The details of debt service and the tax levy are for another post, but the takeaway for today is that any increase in that part of the levy is tied to issuing new debt, and as a policy choice and best budgeting practice, we want to avoid linking our operating costs like public health nurses and snow plow drivers to debt issuance.

So with our Matryoshka of a budget, going from $775M to $405M to $286M, we finally arrive at our innermost doll at $170M. This is the base property tax levy. 

And by state law, the base levy is very constrained by how much it can grow each year. For Madison, it only went up by about $3.6M between 2023 and 2024. The growth in that number is limited to “net new construction”, e.g. percentage-wise of the city, how much worth of new houses and hotels and shopping malls were built in Madison last year? If nothing new gets built, the base of the property tax levy from one year to the next doesn’t go up.

The State Legislature’s idea is that if you have new things built in your city, your city will need to spend more money next year to accommodate it. You’ll need more cops because there are more people, you’ll need more snowplow drivers because there are more miles of roads to plow etc. If your city doesn’t grow, you don’t need to expand any services, and so your city doesn’t need to increase its property tax levy.

Of course, anyone with half a brain cell (i.e., not the Legislature) will immediately see the problem: if any of your existing costs go up because of inflation, your city is screwed. If you have new construction in your city, your city is expected to pay for both increased existing costs and any new costs out of the same bucket of money. 

And that right there is the cause of Madison’s structural deficit. Wisconsin local governments are not allowed to increase their property tax to cover any cost-to-continue expenses. They are only allowed to increase their property tax to pay for new expenses.

It really is that simple, and that stupid.

In theory, state aid is supposed to help, but as is well documented, the legislature consistently screws Madison when it comes to state aid. As State representative Mike Bare points out, this is intentional by the legislature.  

As I mentioned at the beginning, historically the base levy has been so uninteresting that in many years it’s actually never mentioned in the full operating budget document. The full property tax levy of $286M (or the equivalent for that budget year) has been a good enough number, and it’s what’s projected on the screen on budget night as the budget is amended and each amendment moves the operating budget closer to that year’s levy limit. But everyone has always known that somewhere in the late 2010s or early 2020s, it was going to catch up to us. And here we are.

So, we’ll keep using $405M as the 2024 Madison operating budget. But as you read the next several posts, remember the $170M figure, and remember how much less that number is allowed to change relative to the rest of the budget.

Coming tomorrow, in the next post in the series, we’ll look in more detail at how the structural deficit hurts Madison badly in the 2020s, and absolutely destroys Madison in the 2030s and 2040s.

I’m supporting Regina Vidaver for Dane County Executive and you should too! She’s a public health expert and has done big things on the Madison Common Council - CARES mental health response, the Building Energy Savings plan (which is a huge deal!) and Transportation Demand Management, among others. When I was on the Council with her she asked the best questions that always got at the heart of the issue, and I know she’ll be an excellent leader for Dane County!

www.reginafordane.com

Over the next four posts, I am going to dig into the Madison budget with an eye towards the 2025 budget challenge - the looming $27M structural deficit. This budget challenge is not unexpected - it has been clear for nearly 15 years that there would be a year where the structural deficit overtakes the budget, and the only thing that is a bit surprising is COVID pushed it back a few years. 

The 2025 budget is the most important issue facing the City of Madison at the moment. All of the other challenges we face - housing, equity, climate adaptation, public health and safety - how those will be addressed by the City Government in 2025 and beyond depend on how we as a City decide to handle the structural deficit in years to come.

The City’s Finance Department has been putting together an excellent “2025 Budget Outlook” website that I cannot say enough good things about. Over the past few months they’ve put out 4 deep-dives into the budget, held 2 briefings for the Common Council, and have hosted a series of meetings around the City along with the Common Council for community members to learn more about the budget process. City finance staff is doing an amazing job of helping educate Madison about the budget and I think once we get past our budget challenges, we’ll be better off as a city going forward with more people knowing more about how City government works.

If you haven’t seen the City’s site yet, you’ll want to check it out: https://www.cityofmadison.com/finance/budget/2025/outlook

This post will be updated with links to the new posts as they’re released.

Madison’s Budget Challenge, Part 1: The most important budget number is not actually in the budget. 

Madison’s Budget Challenge, Part 2: Augustine’s 16th Law and future City budgets, or Clickbait: How F-35s and the Madison Police Department share the same doom

Madison’s Budget Challenge Part 3: How the 2023 $31M budget surplus is actually bad news

Madison’s Budget Challenge, Part 4: We should do a City of Madison budget referendum. Here’s how.

I’m supporting Regina Vidaver for Dane County Executive and you should too! She’s a public health expert and has done big things on the Madison Common Council - CARES mental health response, the Building Energy Savings plan (which is a huge deal!) and Transportation Demand Management, among others. When I was on the Council with her she asked the best questions that always got at the heart of the issue, and I know she’ll be an excellent leader for Dane County!

www.reginafordane.com

But maybe there is a deeper lesson, which is that for all of our debates about land use and housing policies, at the end of the day someone’s got to go out and build the damn things. And when it comes to actually deciding what to put on land that the City says can be used for single family housing, it’s almost fair to say that those decisions have been entirely made by Veridian.

First, the clicky stuff

I used data from the City’s open data portal to work out some numbers, but I realized that I wanted to better understand it in ways that were hard to do from just a spreadsheet, so I built a web map with some helpful UI tools to select groups of single family homes and look at them in bulk. When property developers take on new development projects, for many reasons they create new legal entities to actually transact properties. By my count, Veridian has used at least 49 different LLCs on projects in Madison. There’s nothing sketchy about this and I’m not accusing Veridian of anything. What it means is though is that sometimes when you look at clear visual clusters on the map, those clusters might not have been immediately obvious from just the spreadsheet view, so being able to look at and visually select a large set of properties and compare common business entities is a handy tool to discover the story behind a new development.

Here are some screenshots. Red dots are homes that I believe were built by Veridian, blue dots are things that I don’t know if Veridian had anything to do with. (There are a few places where it’s a Veridian development but data on that parcel is not available, so that’s why you’ll see the occasional blue dot in the a sea of red.)

The first screenshot is zoomed out and shows a clustered view without individual dots, the second screenshot zooms in on the Grandview Commons North neighborhood and shows individual homes with a number of them selected to compare common sellers.

You can access the app at https://epaulson.github.io/madison-new-single-family-homes/

Some Takeaways

Single Family Homes and Owner-Occupied Household Trends

We don’t build a lot of single family homes in Madison - only about 300 a year. That really shouldn’t be surprising because we are a well-established city (we have a total of 49,237 single family residences) but I admit that I still did a double-take when I saw the actual number and first checked to make sure I wrote my code correctly.

But no, that lines up with the data from the City’s Housing Snapshot Report:

How this turns into a real problem is we know the number of new “owner-occupied households” is growing at about 3.8% a year these days:

You can take a look at Table B25118 from the US Census - Madison has about 56,600 owner-occupied households. If that’s growing by 3.8% a year, that’s 2,150 new owner-occupied households a year, so where are they going? Alder Field has been out front on flagging this trend: We know these new households aren’t going into new condos because no one is building new condos. Instead, we’re seeing some formerly rented single-family homes turning into owner-occupied single family homes. From Alder Field’s summary of the Housing Snapshot:

On single-family home rentals (not owner-occupied), in 2020 there were more than 6,000 renter-occupied single-family homes; in 2023, there were around 5,000 single-family rentals. A net change of more than 1,000 single-family home rentals were purchased for owner occupancy over this period, leading to fewer rental options on the market.

Whether or not it’s important to be able to rent a single-family home is something that not everyone agrees on, but it’s worth knowing that the ability to do so is going down in Madison.

What does this have to do with Veridian?

As you can tell from the map, Veridian’s modus operandi is to acquire a large land area and redevelop the area into a new neighborhood. Forgive the outdated imagery, but Veridian is “expanding the frontier” of the City. Take the east side: Veridian built Grandview Commons, and then Grandview Commons North, and as that finishes up (they’re literally down to about the last 5 lots to finish out of the 350 or so in the project) I would guess that they’ll continue to move north and east and create new neighborhoods.

In a post like this normally this is where I’d talk about the tradeoffs with density and land use for single family homes and talk about sprawl and urban service areas, but if you’re reading this you’ve already read a million blog posts covering that so I’ll skip over the abstract details and get to the Veridian-specific bits.

First, I will note that Veridian’s neighborhoods are often “denser” than what most critics of single family housing developments rail against, and this is not new for them. You don’t hear the term “New Urbanism” as much these days, but when Veridian’s Grandview Commons neighborhood was getting started decades ago, its New Urbanism bonafides were talked up, even to the point of including it as a tour stop when the Congress for New Urbanism came to town for its annual conference, and the deviation from what some saw as that concept led to a hugely contentious debate over a grocery store on the edge of the neighborhood.

And it’s true, many of the homes here are packed in much tighter than other subdivisions, with smaller lots and much less space left to yards.

The cynic would say this is just Veridian cramming in as many units as they can while still building detached single family homes, but compared to alternatives it is definitely creating a denser environment and so many housing advocates would celebrate what Veridian is doing.

But if Veridian wanted to go denser, I think they could.

Let’s look at Veridian’s newest plans, the ‘Midpoint Meadows’ project. (See the State Journal’s coverage here.) Under the preliminary plat, the project will add a bit over 600 housing units - 363 apartments, 96 units in 48 duplexes, and 144 single family homes. (There will be a final plat so these numbers might move around a bit). Here’s how they’re laying this out:

Midpoint Meadows is proposing to use an interesting zoning district, the “TR-P” - “Traditional Residential - Planned”. A TR-P planned district is covered in the staff report but the gist is that it’s meant for areas that are created via a master plan that is submitted as part of the rezoning, and that the plan has to choose at least three different housing types off a menu of choices. The menu includes some variations on single family homes, duplexes, accessory dwelling units, and multi-family units.

There’s not a lot of requirements on what breakdown Veridian needed to pick for its mix of housing types, except that at least 10% of the units must be duplex or multifamily, which they easily hit with either of their multifamily sites. The rest of the mix that Veridian picked was 96 duplex units on 6.5 acres, so about 14.8 units an acre of duplexes, and 148 units of two different types of single family homes on about 20 acres, so about 7.4 units an acre of single family homes.

To finally pay off the headline, and my claim that Veridian holds the largest portion of the power here, is that Veridian could have varied that mix if they had wanted, but Veridian is building the number and types of homes that they want to build (or what they perceive as what the market wants to buy.)

Here’s the Comprehensive Plan Generalized Future Land Use map for the area:

Under the comprehensive plan, if Veridian had wanted to skip the duplexes and just build all single family homes, they could have done it - the ligher-orange is “Low-Medium Residential” which targets 7 to 30 units an acre. The lighter yellow is “Low Residential”, which targets no more than 15 units an acre, so under the Comprehensive Plan, if they had wanted to skip the single family homes and put duplexes everywhere, they could have done that, too.

(OK, technically this area is still under the Highpoint-Raymond Neighborhood Development Plan, which has different categorizations for land use and uses four types of “Housing Mixes” rather than the Comp Plan’s GFLU categories, and unfortunately the Housing Mixes that the NDPs use are historically more restrictive than the comp plan, and the lowest target is an average of 6 dwelling units per acre instead of up to 15, so maybe Veridian wouldn’t think about doing all duplexes. But I think Veridian could have gotten support from the Plan Commission and Common Council if they had gone to the Alder and said “The Comp Plan supports the denser use and the NDP is going to get retired next year with the new Southwest Area Plan, let’s plan in line with the future”, but I admit that this darn NDP is kinda arguing against my thesis, but I’m rolling with it anyway)

Wrapping Up

The housing debate in Madison has gotten unfortunately very heated, and if you listen to some quarters there are claims of almost dictatorial powers coming from City planners, some parts of the Common Council, and the Mayor. Some of it was offered originally as hyperbole but I think the line has started to blur and there are people participating who know longer know what was just loud voices and what is a very confused reality. This is unfortunate and it’s starting to affect our ability to address community challenges, and I hope we can cool things down.

To be sure there are some things that I wish the City could just dictate to Veridian or anyone creating new construction do in Madison. If cities weren’t preempted by the state legislature, we should require that all air conditioners be true heat pumps so they can be used for super-high efficiency heating in addition to cooling, and homes should be built to be EV-charging ready and solar panel ready so the wiring is all added when it’s cheap to do so and no one has to drill through concrete to run new wiring.

But on just land use, under current policies we’re pretty close to being able to build something other than non-single-family homes anywhere in the City. At the same time, it’s only a very small group of people who would advocate that we should prohibit new single family homes in Madison. So for at least the foreseeable future it’s going to be a mix, and that mix will be up to the market and not policy makers. And given Veridian’s size in the market, they have an incredibly outsized role in deciding what as a City our mix will be. As the saying goes past performance does not guarantee future results, and perhaps other developers will shrink Veridian’s market share, but at least for now I’m not betting against them.

Specifically, I’m going to explain what the dust-up over the vote on paragraph 8 of the 2024 Budget Resolution was all about. That clause reads as follows - which I think you’ll agree isn’t immediately obvious what’s happening here:

In order to be able to explain what that’s talking about and why anyone might object, I’m going to have to cover some background information, so this post will be in three parts. Part 1 will give some background on the capital and operating budgets that is important to know, and Part 2 will cover the levy limit, which is the real culprit in this complexity. Finally, with that covered, we’ll get to Part 3 and explain the general debt reserves, reoffering premiums, and hopefully finally pay off the point of this blog post. If I’ve written this post right, by the end of it you’ll know what Soglin is talking about and you can decide for yourself if it’s a problem that needs to be addressed or if it’s just the new normal of how the City needs to balance its budget.

Also, just to be clear, I’m not writing this post just because there were questions during the Common Council budget debate about debt reserves and capital funds when it came time to approve the budget resolution, that’s totally normal. There were questions at last year’s council debate, and the only reason I didn’t need to ask any during those meetings is because, years before I was alder and when I was just a city politics nerd, I had also looked at the rules here and had no idea what was going on, and so I asked city staff for help understanding it. The reason I’m writing about it this year is because it’s taken on a life outside of the budget process and showing up in Facebook groups and Nextdoor and Reddit and neighborhood email lists, and not everyone posting about it really understands it, which turns what could be a good debate into a confusing noisy anger session. So hopefully this will help turn some speculation into grounded facts and help raise the debate.

So, pour yourself a drink and let’s dig in.

Part I: The City of Madison’s Two Budgets

The world does not need another piece explaining capital budgets vs operating budgets, so we’ll try to cover only what’s necessary. One of my PhD advisors used to tell me that ‘teaching is the art of diminishing deception’ in that when you’re explaining something, you start out with a simplified but potentially wrong example, and then once you’ve satisfactorily covered it, you say “well, it’s actually a bit more complicated than that and what we just did isn’t how it really works, here is a new twist” and you add in the new details you need to explain the next part. So that’s what we’ll do in this post, and build up an example budget that has the parts we need to explain the reoffering premium technicalities. If you’d like a more in-depth overview of Madison’s budget, I’d point you to Allison Garfield’s “Madison's property taxes and its financial future, explained” or Alder Field’s summary of the Wisconsin Policy Forum’s review.

For our budget, let’s only concern ourselves with snow plowing. To plow snow, you need to put into your budget the salaries of the people who are going to drive the snowplow and the money to pay for fuel for the snowplows. Oh, and if you don’t already have a snowplow, you have to buy a snowplow.

For companies and governments, it’s best practice to break their budget down into ‘Capital expenses’ and ‘Operating expenses’. The general rule of thumb is things that are used once and then gone are operating expenses, and things that can be used over and over again are capital expenses. In our snow plowing case, the hours we pay to the snow plow driver and the fuel we put into the plows are used up after a plowing run, and the next time it snows we have to start all over again, but we can reuse the snowplow and don’t have to buy it again. So we put the salaries and fuel costs of plowing into the city’s ‘Operating Budget’ and we put the snowplow itself into the City’s ‘Capital Budget’

(As an aside, sometimes it’s hard to decide if things are capital or operating expenses. For example, take the salaries of the planners when they’re writing the City’s Comprehensive Plan. That plan is going to be a ‘thing’ that we’ll pull out and use over and over again for 10 years, in a sense just like the snowplow. In a private business that plan and hence the hours used to create it would absolutely be considered a capital project for tax reasons, so it’s not unreasonable for a government to consider it a capital cost and not an operating cost)

But back to our budget. Let’s pretend that fuel and salaries for snowplowing cost $60, and a snowplow costs $40. That gives us an overall budget of $100, broken down like this:

Now, what’s common is that for items in the capital budget, the City borrows the money to pay for it rather than spending cash on it. Of course, that means we have to pay it back over the next couple of years, and pay a bit more with interest. Debt service is accounted for in the operating budget, so we get something that looks like this:

(Individual images, because the image above will be hard to read on mobile otherwise:)

But of course, maybe we need to buy a snowplow a year to replace old ones, so our budget looks more like this:

(individual images:)

And finally, because we’ve probably bought snowplows in the past, our budget actually probably looks like this, with old debt service rolling off every year and new debt service coming into the budget:

(individual images:)

At this point you’re probably wondering “if every year we’re spending about as much or maybe even a bit more in debt service in any given year as we’re borrowing, why don’t we just stop borrowing money and instead buy things directly and save on the interest?” That’s actually a great question, and in fact some levels of government do that - the State government often just pays for some of its projects out of that year’s taxes and doesn’t borrow for them. The City sometimes does that too - for some things in the Capital budget, the City funds it with a ‘direct appropriation to capital’. For example, the 2024 budget funds new books for the library as a ‘direct appropriation to capital.’

We’ll come back to ‘direct appropriation to capital’ in part III - because that’s at the heart of the budget resolution.

The key takeaway from this section is that in our City simplified budget, in any given year the money the City uses to pay its bills that year are a combination of borrowed money and tax dollars, and part of the operating budget - using tax dollars - pays back the borrowed money from years past. Again, this is super-simplified and we’re leaving out all sorts of things like federal grants and money the city makes from charging fees to park in the parking ramps, but it’s good enough for this blog post.

Part II: The Levy Limit

Let’s go back to a single year’s budget. In our pretend 2024, we have to take in $104 in taxes: $60 to the base operating budget, to pay for salaries and fuel for snowplows, and $44 on debt service for past snowplow purchases (principal and interest.) The City doesn’t have an income or sales tax, so the main way the City taxes is the property tax. The property tax is a little weird - unlike an income tax where the IRS says “Pay us 24% of your income”, when the City sets its taxes it figures out how much money it needs to take in (in our example, $104) and then “levies” that amount on the entire City. Then that total amount gets split up proportionally on all of the property owners, based on the relative value of their property. So from here on out, when we say ‘the levy’, we mean “the total amount of money the City takes in.”

For all of our examples up until now, we’ve also been holding our base operating budget the same at $60 every year, but of course that’s not how the world works. In 2025, it’s likely that fuel will cost more and our snowplow drivers will need a raise, so our base operating budget is going to cost more. Let’s assume our costs have gone up by 5%, which is kind of high but not unusual for the City - the things the City spends money on, like fuel and health insurance, tend to grow faster than the main inflation numbers. Also, let’s assume we need to borrow a bit more in 2025- maybe we need to do some repairs to the snowplow garage. So let’s compare 2024 and 2025:

(individual images: )

So the levy needed to be 104 in 2024 and 107 in 2025 (our increased debt service for the 2025 borrowing doesn’t kick in until 2026 so we don’t have a big rise in debt service - yet). So, we need to raise taxes to cover the new operating costs. Yeah, no one likes taxes to go up but the alternative is to have the snow plow drivers quit, so all the Common Council has to do is vote for an increased levy and we’re done, right?

No, it’s not quite that simple. The State of Wisconsin puts a limit on how much a city can raise its levy in a given year.

Here’s the bonkers part: By default, a city’s levy is only allowed to be what the levy was last year. The default increase for a city’s level is $0.

Did your city’s costs go up because of inflation? Does fuel cost more, or does health insurance cost more? That’s too bad, because the levy limit increase by default is $0.

There are ways for a levy to increase, and the main way is to have ‘Net New Construction’, that is, to have new houses and office buildings and hotels constructed in your city. A city is allowed to raise its levy by the same percentage as there is ‘Net New Construction’. In 2023, there was about $865M worth of new construction, out of a total of about $39B worth of property, so Madison’s Net New Construction rate was 2.2%, which let the City grow its property tax levy, and use that money to pay for new staff and existing staff salary increases and fuel costs and all the other things the City has to pay for.

The City of Monona, by the way, had no net new construction in 2023 - nothing under construction was completed in time - and so its levy limit was not raised and they had to use one-time sources to fund the gap between what they could tax and what costs had gone up.

This whole system is terrible, especially for smaller cities, but Madison is lucky that we should continue to have ‘net new construction’ for quite a long time. However, we would be in real trouble if things stopped getting built in Madison, but that’s a post for another day.

But this post is about bonds and the Madison capital budget, and I’m not just complaining about the levy limit for no reason. This is a weird quirk to the levy limit that is very important.

Debt service does not count against a city’s levy limit.

The first time I learned that I could hardly believe it: the City could borrow as much money as it wanted and turn East Washington Ave into a waterpark with a 4 mile long lazy river, and that had no limit, but there would be a limit on the number of lifeguards we could hire for it. Former Alder Sue Ellingson explained it to me - if there was a limit on how much the city could levy to pay back debt, our interest rate would skyrocket, if anyone would lend to us at all. If there was a limit and the Common Council had to choose between paying the firefighters and paying debt service, it wouldn’t be close. So when Madison sold bonds this year it said:

So back to our diagram - of the $104 of our fake levy, $44 of that was exempt from the levy limit, so the only part that counted against our levy limit was the $60 to $63 increase. That’s more than we’re allowed to have, so we’ll limit it to the 2.2% increase and our maximum operating levy increase was only to $61.32 - if we need to actually get to $63, we’ll have to find other revenue. Let’s also look ahead to 2026, since we’ll pay the increased debt service from 2025 borrowing, and we’ll assume again a 2.2% Net New Construction increase.

(Individual images: )

Notice that the overall fake levy increased by 11.7% in 2026, from $105.32 to $117.66, because of the large increase in debt service, even though our state levy limit was still 2.2%. So that’s an important thing to remember - the debt service doesn’t apply to the levy limit, but it sure the heck applies to the levy, and an 11.7% increase would be a big increase for property owners. The real 2024 budget increased the overall levy by 4.6%

(The levy also isn’t directly what you pay in property taxes, because it’s proportionally spread across based on property values. So if your property went up a lot - relative to everyone elses - your property tax for the year goes up more. The 2024 City budget raised the levy by 4.6% but because the assessed value of my house went up percentage-wise less than that of other folks, my property tax only went up by 2.0%)

The takeaway from this section is you have to be very careful when talking about the levy and percentage increases from year over year, and that the levy limit and the actual levy are different numbers. The number that city property tax payers are directly affected by is the overall levy, but things like city staff pay has to fit in the levy limit.

Part III: The Budget Resolution, Bonds, and ‘Reoffering Premium’

We now have everything we need to get to the original motivation of this blog post - why is there a separate vote on one clause of the budget resolution. The actual budget resolution isn’t that important - it’s mostly a formality to bring everything into one place and to check off some state requirements.

A big part of what the resolution does, however, is give part of the go-ahead to actually borrow the money that will be needed to fund the budget. The City borrows money a bit differently than how you borrow money to buy a car or a house, though it’s not all that different. Instead of going to a single bank and saying “we would like a loan” the City sells bonds and multiple investors bid on those bonds. The City hires an underwriter to help sell the bonds, and the underwriter takes a cut. The investors who make the best offers - i.e. give us the lowest interest rate - get the bonds and pay us for something close to the principal of the bond up front, and then the City makes payments on those bonds for the life of the bond, like a regular loan.

That’s a super-simplified version of the story and isn’t quite how it works, but it’s a good enough story to build on.

There is a quirk in the municipal bond market in that many bond purchasers don’t want to give us the lowest possible interest rate, and so there is a little financial sleight of hand played: investors would rather get a bond that had a slightly higher interest rate, and they’re willing to pay us a bit more up-front to get it. In effect, investors are paying the City the principal and a little bit on top of that principal more to get a “premium” bond that has a higher interest rate.

Now, municipal governments don’t really like this and would generally prefer not to have to sell bonds as ‘premium’ bonds, but the trend in the bond market has been that some investors will only buy premium bonds - it’s easier for investors to resell the premium bonds so they prefer to hold them. So if a city tries to limit how much of a premium they’re willing to sell at, they might find that they have fewer buyers and don’t get as good of a price, so cities are sort of stuck with the practice.

This extra money we get from the investors to sell them a bond as a ‘premium’ bond is called the ‘reoffering premium’, and it can actually be substantial. In 2023, the City sold $116.3M worth of bonds and got $7.8M of reoffering premium.

So maybe you’re thinking all of this controversy is ‘what should the City do with its $7.8M of reoffering premium’, and it kind of is, but it’s not nearly that direct.

By state law, that $7.8M of reoffering premium has to go to pay debt service. So, it would seem easy come, easy go, what are we even still talking about?

Let’s go back to our fake budget. $44 of that was debt service so it didn’t count against our levy limit, so we can levy the full $104.

Let’s also pretend that for our $40 in borrowing, we got some reoffering premium. Let’s pretend that we got $2 in reoffering premium. That $2 hasn’t shown up on our graph before, let’s change the graph to put the extra $2 in the ‘Operating’’ category. By state law, we have to use that $2 for debt service - so in effect, that $44 of debt service is really only $42.

OK, finally the actual punchline: The way the levy is calculated, the city can still levy the $44, even though it only needs $42 to pay the debt service. Put another way, the reoffering premium ‘generated additional levy capacity’. So we can still levy $104, but we only need $42 for debt service, which means we can have $62 rather than $60 for other parts of our operating budget.

(And it kind of has to work this way, because we won’t know what the reoffering premium amounts are going to be until late in the process, after the state has already calculated the limits for each city.)

You might ask “why don’t we just borrow less and use the expected reoffering premium to cover some of what we were going to use the bond principal for?’ And the answer is you can’t, because by state law the reoffering premium has to go to debt service, and can’t directly be used to offset borrowing. So we couldn’t say try to borrow 95% of what a snowplow cost and count on getting 5% back in a reoffering premium and paying for an entire snowplow - in that case, that 5% has to go to debt service from past years and not the current year’s snowplow.

But we can try to find a way to borrow less and still comply with state law, and that’s what Madison General Ordinance 4.17 and the special clause in the debt resolution are all about.

The City can’t use the reoffering premium directly on capital projects, but it can use an equivalent amount of money from the levy and spend it on capital projects. That’s a ‘direct appropriation to capital’. So the City is still levying $104, still gets $2 in reoffering premium that it’s using for debt service, but now is using $2 of its non-debt-service levy to pay for some capital costs instead of borrowing everything for it. Importantly, that $2 of non-debt-service levy applies against the levy limit, so that’s $2 that can’t be used for salaries or fuel or other operating costs.

In 2012, MGO 4.17 was passed and required this sort of ‘direct appropriation of capital’ be done. (People who remember their history will note this was early in Soglin’s 3rd stint in office.)

The ordinance and budget resolution text that invokes it is a bit confusing because you sort of feel like you get lost in the double negatives. We’ll break the ordinance down real quick. The first part of the ordinance says ‘In any year when general debt reserves are applied to reduce general fund debt service,’ -- now, ‘general debt reserves’ is just the name of the fund that holds the reoffering premium dollars, so nothing special there. And the ordinance is weird because by state law you have to use the general debt reserves to reduce general fund debt service, so the ‘In any year’ bit is kind of silly, since it’s true every year. So we can just sort of ignore the first part since it’s always true.

If you just ignore the first part of 4.17 because it doesn’t matter, the second part is much more straightforward: ‘an amount at least equal to the general debt reserves applied must be directly appropriated from the general fund for capital projects, unless the Common Council, by a separate vote of two-thirds (⅔) of all members during approval of the budget, votes to do otherwise.’

So this is easy to explain: whatever money the City gets for reoffering premiums (which had to go to debt service) the same amount has to be spent from the levy on the capital budget, unless the Common Council decides not to do that.

And there’s good reason to decide not to take the money from the levy (that’s subject to the levy limit) and use it on capital projects that we could borrow for, and use that money on operating costs, which we can’t borrow for. To be clear, we’re not borrowing to pay for the snowplow driver’s salaries, but if our choice is borrow the full amount of the snowplow and pay the snowplow driver’s full salary and have more debt in the future, or borrow a bit less than the snowplow’s full cost and pay the snowplow driver less but have less debt in the future, which would you choose?

In the 2024 budget, the Common Council went part way: The City got $7.8M in reoffering premium, all of which went to debt service but which also generated an extra 7.8M in levy capacity. The Council used $1.2M of that levy capacity as direct appropriation to capital, and voted by more than the 2/3rds majority to set aside MGO 4.17 and used the remaining $6.6M of levy capacity to fund other priorities in the operating budget rather than funding more capital projects out of the levy.

Part IV So is this good or bad?

One of Soglin’s central claims is that the City is using borrowed funds in the operating budget. I hope that you’ve seen how, depending on your perspective, you can argue that Soglin’s claim is not true and the City is not using borrowed money to fund the operating budget, or how you could argue that Soglin’s claim is true and the City is using borrowed money in the operating budget.

Certainly a very strict reading of the Excel sheets that document the budget and bond term sheets would show that it is not true and the City is not using borrowed money in the operating budget: all of the borrowed money from the bond sales are going to capital projects, none of it is going to things that are clearly only operational. This is not up for debate and Soglin would agree with that.

The reoffering premium is also not going to the operating budget. You can see the money get deposited into the debt service account and then be taken out of the debt service account and applied to debt service. Again this is not up for debate.

The ‘generated levy capacity’ that the reoffering premium provided is just tax dollars, and is not borrowed money. You can’t really track levy dollars like you can the reoffering premium, so it’s hard to say exactly where this extra is being used: is it helping to fund the increase in police salaries? Is it being used to fund the new Equal Opportunity Investigator the Department of Civil rights added for 2024? Is it being used to pay for fuel for snowplows? Yes to all of that.

So to really narrow where Soglin’s claims are valid we get down to two places.

First, one good thing about the levy is that it’s generally stable and we know that next year’s levy will be at least this year’s levy, so when we make things like salary commitments we know the money will be there. And strictly speaking, we don’t know if we’re going to get any reoffering premium next year, so that extra levy capacity that we’re using this year might not show up next year. So in a sense the reoffering premium is a one-time fund, and it is dangerous to use one-time funds for ongoing expenses, unless you’re ready to cut those expenses. So maybe it’d be better to have a separate budget fund of ‘one-time operational expenses’ and explicitly use it for things like capacity building grants in the community or special events in parks. In a sense, that’s what the ‘direct appropriation to capital’ that was used to historically account for the reoffering premium levy capacity: you can go back to past budgets and see that we didn’t use that levy capacity for street reconstruction, we’ve used it for in the past for ‘MarketReady Program’ grants in Economic Development. Now we borrow for the money to support those grants.

We are scheduled to borrow less in future budget years, which could lead to less reoffering premium, so counting on using that generated levy capacity to pay for salaries could be a challenge.

The second place where Soglin’s claims can be true, and where you can argue his point with a straight face, is to make a slightly more subtle version of his argument. It’s not that the City is using borrowed money to fund the operating budget, it’s that the City is spending more in the operating budget because the City is borrowing more in the capital budget. That’s kind of a mouthful so you can kind of see why it’s faster, if less precise, to say ‘the City is using borrowed dollars to fund the operating budget’

It’s not that we could get lower interest rates on our borrowing if we borrowed less, we’re stuck with the higher premium rates on whatever we borrowed, it’s that if we just paid for things directly we would borrow less and have less to repay in the future. It wouldn’t help us with the levy limit in any given year but it would keep taxes on Madisonians down, which is not a bad goal.

But that gets back to a fundamental policy goal that all governments, companies, and individuals face: is it better to borrow and get something sooner, or to save up and wait?

Let’s go back to our hypothetical budget, and pretend that we didn’t quite have the money for a snowplow this year but if we saved our money we’d have enough for one next year. So rather than borrowing this year for the snowplow, let’s wait a year and then pay for it outright and not have to pay interest. That might mean we have one winter where in our fake Madison we don’t plow the snow, so sometimes our residents are stuck at home for a few days after a snowstorm. So the question becomes is it worth it to borrow the money for a snowplow a year earlier, so our residents can get out and go to work, do business, and enjoy life that winter? Is that increase in happiness and productivity in that winter worth more than the interest we’d have to pay to borrow to get the snowplow a year early?

This is the fundamental tradeoff that the Common Council has to solve with MGO 4.17. Is it better to keep borrowing down a bit so taxes don’t rise as fast, or is it better to borrow a bit more and keep paying for the services that the City wants to offer while still delivering the same capital projects?

I hope you see why this is a hard question to answer, and how the various state and local laws make the accounting of our funds a bit hard to follow, and how pithy arguments on social media don’t nearly capture all of the important details of what’s going to be a very loud, messy, and confused public debate for how we as a City want to address the budget challenges looming ahead.

Thanks to David Schmiedicke, the City of Madison’s finance director, for answering my questions about the City budget before, during, and after my time as alder. Any mistakes in this piece are purely my fault for not expanding on Dave’s answers correctly.

It turns out that I’m a little bit pro task force but I think it’ll be fine if we leave it with the existing committee. (Alas, sometimes writing projects don’t turn out to be as compelling as you’d hoped when you start them.)

Also just to manage expectations, this blog post is narrowly focused on the question of ‘should the city create a housing affordability task force’ and is not a ‘here’s how Madison should solve its affordable housing problem’ piece. Part of the reason this piece has turned out so wishy-washy is that I think we generally know what we need to do for housing affordability and it makes the case for a new task force less compelling - but it also makes it so I don’t feel like I have anything interesting to add in a broad blog post on what to do to increase affordable housing. (There is a conversation we’re not yet having about what affordable housing will mean for us as a city and that will be a future blog post, so subscribe to this blog today for when that comes out!)

Part I: How did we get here?

In this post we’re only talking about a task force and not Madison housing affordability and availability in general, but here we can point to a specific event. Core Spaces proposed a building focused towards students that would have required a rezoning, and the Common Council declined to make that zoning change, and then later reversed course. Setting aside all discussions as to whether or not that was a good or correct decision, much of the conversation around those two Council meetings was on the affordability of housing in new developments, which is bigger than just that single rezoning.  In early July in the run-up to the second vote, Alder Tag Evers raised the idea of a task force to drill into the issue of affordable housing, and Alder Juliana Bennett was quoted in local media around the same time as saying she too thought that a task force was appropriate.  

Alder Amani Latimer Burris got there first, legislatively, proposing a task force at the August council meeting, which is currently working its way through the legislative process and will be back before the Council in October. In parallel, alders Bennett and Evers, along with alders Derek Field, MGR Govindarajan, and Sabrina Madison have sponsored an alternative to alder Latimer Burris’ proposal, asking the Housing Strategy committee to bring more focus to some priority questions around housing and report back to the Council. Their proposal builds specifically off parts of a memo that Matt Wachter, the director of the Department of Planning & Community & Economic Development, wrote for the Council, in what he called  the ‘alternative framework.’

(Both proposals are in Legistar under file number 79226. Legistar is kind of a pain for these - they’re under ‘Version 1’ and ‘Version 2’, which you can flip with a drop-down on the site. Good luck with this link working if you’re reading this a couple of years in the future).

As it stands, the Plan Commission has recommended that the Bennett et al proposal be the one moved forward and the Housing Strategy committee take on the affordable housing work. The Housing Strategy committee will soon take the two proposals and recommend one to the Council, and the Council will make a decision about a week afterwards. 

For reference and to have them in one place, there were a couple of other good blog posts by alders on the Core Spaces building and what to do next:

• Alders Bennett and Govindarajan from immediately after the first vote: https://www.cityofmadison.com/council/district2/blog/a-win-for-student-housing

• Alder Evers right before the second vote, calling for the task force https://www.cityofmadison.com/council/district13/blog/core-spaces-vote-up-for-reconsideration 

• Alder Regina Vidaver on her vote to support Core Spaces and housing in Madison: https://www.cityofmadison.com/council/district5/blog/explaining-my-vote-for-housing 

• Alder Govidarajan on his thoughts after the second vote on Core Spaces: https://www.cityofmadison.com/council/district8/blog/my-thoughts-on-tuesday-nights-vote-on-student-housing 

• Alder Field on the Housing Snapshot report: https://www.cityofmadison.com/council/district3/blog/new-housing-market-snapshot-report-data-draft

• Alder Evers on Madison’s Housing Crisis: https://www.cityofmadison.com/council/district13/blog/madisons-housing-crisis 

• Alder Bennett on her support for the Housing Strategy Committee as the appropriate venue rather than a new task force: https://www.cityofmadison.com/council/district2/blog/9-18-9-24-updates

Part II: Director Wachter’s memo, and a quick comparison of the two proposals

The Wachter memo came out after Alder Latimer Burris’ proposal, and spends the bulk of its time detailing much of the work the City is already doing with housing. It is a must-read if you are interested in housing in Madison, and I’m not going to rehash most of it. However, it does make the case that the City staff should revamp their workplan to better support what this new-ish Council wants to do. Wachter calls it a ‘framework’ and I’m going to quote it all here:

The second was a desire to undertake a targeted strategy development process focused on:

• How can the City support the creation of more ownership housing types (e.g. condos, coops, land trust, townhomes, etc.)?

• How can the City help scale up the development of new affordable rental units beyond the current 400 per year pipeline (e.g. 4% tax credits, TIF, City/CDA led development)?

• How can the City support the creation of affordable student housing?

Based on input and questions from a number of alders, staff have identified an alternative framework to creating a new Housing Task Force that would utilize Community Development and Planning staff working through the Housing Strategy Committee to answer each of the three key questions above. This effort would entail:

• Conducting the research already planned in staff work plans, including:

  • Completing the 2023 Housing Snapshot Report

  • Completing an Analysis of the Impediments to Fair Housing Choice

  • Completing the 5-Year Consolidated Housing Plan

  • Updating the Housing Forward strategy

• Combining the experience and learnings of our existing efforts with additional research scans to answer questions about what has been done or tried to date, what best practices are elsewhere, and who are the key entities with a role to play in potential solutions.

• Inviting expert guests to provide input into key questions around opportunities and barriers, and potential solutions.

• Utilizing the above information to form recommendations that the Housing Strategy Committee could make to the Mayor and Common Council.

Now, let’s just take a quick look at the two proposals. To keep things simple I’m just going to call them the “Task Force” or “Housing Strategy” from here on out. All city resolutions follow the same structure - a bunch of background info in the ‘WHEREAS’ clauses, but then finally a “what do you actually want them to do” clauses in the RESOLVED parts. Both of them are simple enough that we can pull out the RESOLVED clauses and we can compare them directly.

The “Task Force” proposal broadly wants to:

BE IT FURTHER RESOLVED that the charge of this Housing Taskforce is to:

• Specifically examine ways the City may add to the cost of housing through fees (such as and specifically the Parks Fee)

• Review the process in relation to its lengthy reviews through committees, inclusivity and contemporary inclusive outreach

• Invite developers of all types of housing including apartments, subsidized housing, single family homes, and condominiums, upstarts, neighborhood groups, and community based organizations to testify before the Taskforce

• Explore and debate best practices and practical or tailored implications, proposed possibilities and solutions

BE IT FURTHER RESOLVED that the Taskforce invite the managers, developers and others of successful low/moderate income, affordable, workforce and starter housing entities to testify as to how they are successful in regards to both cost and management of their housing and challenges the face and potential unknowns and other issues of interest and effect on affordable housing.

BE IT FURTHER RESOLVED that the Housing Taskforce and City staff make inquiries with developers, major employers and other entities in Madison about a partnership where the employer leases units or the developer constructs units for the employer who can then provide  workforce housing at a reduced rental to the employees (as is done by New York University (NYU) for example)

(Everything else is either background, compositional for the task force, or directing the task force on timeline)

Now, the “Housing Strategy” proposal broadly wants to:

BE IT FURTHER RESOLVED that staff and the Housing Strategy Committee shall answer:

• How can the City support the creation of more ownership housing types?

• How can the City help scale up the development of new affordable rental units beyond the current 400 per year pipeline?

• How can the City support the creation of affordable student housing?

For each question, staff and the Housing Strategy Committee should consider:

• Recommendations that support increasing housing options that meet the needs of people at all income levels, particularly at >30% AMI and <80% AMI.

• Recommendations that support increasing housing options in every neighborhood and district in Madison to improve equitable access to city resources.

• Recommendations that account for higher need amongst hard-to-reach communities.

• Recommendations that lend guidance on how to optimize zoning, land use policy and approvals, and bonding authority to increase housing options.

BE IT FURTHER RESOLVED that staff and the Housing Strategy Committee shall engage subject matter experts and those directly impacted by the housing crisis through public hearings with Madison area residents and housing stakeholders, including, but not limited to, developers (market rate and affordable), nonprofits with specialized interests in housing, construction industry professionals, and housing policy experts.

(Everything else in the proposal is either background or directing the committee on timeline. There is no need to address the composition of the committee since that’s already set)

So two observations:

First, the research work that the staff proposes to do in the ‘framework’ I think would largely support the work that either proposal wants to do, so at least research-wise I don’t think one proposal is more burdensome on city staff than the other. 

Second, I think the questions that both proposals raise largely overlap. The Task Force touches maybe on some very specifics that the Housing Strategy proposal does not (park fees, institutional housing support e.g. NYU), and the Housing Strategy proposal explicitly includes student housing as a priority area, which is maybe more implicit in the Task Force proposal. I think this similarity is a good sign, and points to maybe a few quick tweaks to some RESOLVED clauses and then no matter which proposal moves forward, the Council can be sure that either proposal answers the questions that supporters of either proposal might have. 

Personally I suspect that modifying the Housing Strategy proposal to include a few missing things is the easier change to make so if the Council is looking to make an ‘everyone wins’ compromise and move quickly on the floor next week, that’s where I would start.

Part III: Pros and Cons of the Housing Strategy proposal

The Pros

There’s some really good reasons to ask the Housing Strategy committee to take on this work - first of all, because we already have it! And if the issues here are not what this committee is supposed to be working on, then what are we even doing?

There’s also precedent for sending these sorts of big issues to a committee and asking them to come back with recommendations. During the Edgewater saga, Mayor Dave Cieslewicz got it in his head that neighborhood associations ‘had too much say’ in our development processes, and charged the Economic Development Committee with a top-to-bottom review of how development projects went in Madison - a good deal of which are obviously housing projects. In fact, before we go too far with anything, it’s probably a good idea to go back and read the report from that process in 2011. The Planning Department made a helpful implementation guide to show how they were doing a couple of months in. (Lots of it happened, some of the tech upgrades got forced on us due to COVID, and alas a few things are still not as good as we’d like, and some of the suggestions turned out to be things we didn’t really want to do) The original work of the EDC is in Legistar 18121 and the adoption by the Council is in Legistar 21454. (I found my comments to the EDC in that process, I think they’ve held up pretty well)

At the time we didn’t have a Housing Strategy committee - that would be broken out of the larger ‘Housing Committee’ a year later (legistar 25837) , and Dave wanted to make a broader point about this being an economic issue rather than a housing issue, so Housing Strategy is probably a better committee to ask to review this work rather than EDC, but I hope the committee doesn’t spend a lot of time re-doing the work the EDC did in 2011. 

The Cons

Why not send this to the Housing Strategy Committee?

First, something that is hopefully easy to fix: the Housing Strategy Committee historically doesn’t meet all that often. Thankfully this isn’t an issue of them not being able to get quorum, which has plagued some of the housing committees in Madison in the past, but they just haven’t had much work sent to them. But this would be a big change for them and a lot more work, and maybe not what its members signed up for. 

Second, there’s a proposal to completely revamp the Housing Strategy committee in file 75926 - this would combine three city committees: the (joint) City-County Homeless Issues Committee, the city-only Landlord and Tenant Issues Committee, and the city-only Housing Strategy Committee, and merge them all into a single joint City-County Housing Policies and Procedures Committee.

Combining all three committee is a whole other discussion, and so in the interest of space I’ll just say that having a city and county wide perspective is important and having the Housing Strategy committee be greater than just the City of Madison is a good idea - however, the timeline for this revamp is that a decision would be made sometime in December, so realistically the combined committee is not going to get fully appointed and have its first meeting until February of 2024 at the earliest, and I don’t think you start a big project in a committee two months before it’s about to be completely rebuilt. 

Part IV: The Pros and Cons of the Task Force

The Pros

The good thing about a limited time task force is you can play with composition, and for this body, I think you’d like it to be somewhat large - much bigger than the 7 member Housing Strategy committee. You can imagine a task force where you’d want  2 or 3 members who are market rate developers and 2 or 3 affordable developers, and students, and people with lived experience with housing insecurity, and policy experts, and folks who have done non-traditional housing setups like intergenerational housing or co-ops, and many many other voices. This might be a good body to have like 15 members or even bigger. 

A time-limited task force might also help you bring in folks who would normally turn a Madison Board/Committee/Commission down - knowing you’re only on the hook for a year instead of our usual three year appointment.  

The Cons

So, why not create a task force? 

The main reason not to create a task force is that we’ve literally got a Housing Strategy committee, and if this isn’t in their bailiwick then what is?

Another body also eats a lot of staff time and committee member time. Now, while I think research-wise the workload is comparable, the logistics of another body are not to be underestimated. Scheduling, managing agendas, updating legistar, handling membership appointments and required filings like ethics trainings and financial disclosures, keeping up with communication for the body - it eats just a ton of staff time. And if we did make the task force bigger, then all that work gets harder. 

Beyond staff time, there’s an issue of committee member time. The task force as envisioned draws from other committees. Signing up for this task force while being a Plan Commission is asking a lot, and finding a timeslot that 4 alders can regularly meet at will not be easy. 

If this task force does move forward, there are some changes that are needed. The resolution really needs to specify how many people should be on the task force - is the goal to have one member from each of the named committees, or just that the membership should be drawn from those committees but maybe not every committee will be represented? I would also take a couple of those committees off - the task force doesn’t need Finance Committee representation, and despite the name, the City-County Liaison does not actually work on important City/County issues (they just set policy for the City-County Building and have only met once since 2019.) I also don’t think you need the Urban Design Commission nor the Board of Parks Commissioners to be represented for most of the work the task force would do.

Part V: What is the end-goal?

Alder Bennett’s blog post really touched on this and so I’d urge folks to be sure to read it if you haven’t yet. I don’t entirely agree that one proposal is more action-oriented than the other, but I think it’s important that the Council keeps a focus and gives very clear directions as to the expectations of what they’re looking for. 

At one extreme, the Council could literally tell Streets to bring a box of hammers down to the Council chambers, establish a task force and give each task force member a hammer and tell them to go out and build some housing. (I’m not sure you’d get many task force applicants)

Does the Council want a report, and if so, who is the audience for the report? The work that the EDC did in 2011 was aimed at the Council, the Mayor, and City staff with specific suggestions for process things we could do to make it easier to do development projects in Madison. Maybe it’s time to do an updated version of that report, with more focus on affordable and student housing. However, I don’t think we need that - I think we largely know what the menu of policy choices are. Maybe there are some things we haven’t thought of but I’d be surprised if any report brought back things we hadn’t considered. 

We could have the task force write a report that’s aimed at the broader community about what our choices are. I know not everyone would agree but the Race to Equity report ( https://kidsforward.org/race-to-equity/ )  made an impact when it came out and I think did help move some improvements forward. A similar report on housing could be helpful.

Rather than waiting for a big report with a whole host of options a year from now, is having a more proactive Housing Strategy Committee that offered up specific individual changes on a regular cadence more useful? So instead of waiting until August of 2024 for anything, is it better to get back a recommendation in March of 2024 of ‘the Park impact fee should be reduced, it will cost us $XXX over the next 10 years but will create #YYY housing units over that time period that might not have happened”, and then in May of 2024 send up another proposal that says “If we relax the owner-occupied requirement for ADUs there will be ZZZ new ADUs built per year based on this study” and just keep churning through ideas? I think this is what Alder Bennett is suggesting. 

Alder Evers often makes the case that in some of our most pressing city issues, we need deeper cooperation with the business community, and he’s made a good case that difficulty in finding housing should be a top concern of the business community because it’s directly impacting their workforces and their ability to recruit and retain talent in Madison. To be more blunt about it, I think he’d say it’s time for the Madison business community to partner with some developers and make more construction happen by directly investing in housing even if it’s not great for their bottom line in the short term, because not only is it good for their bottom line in the long term, it’s also their civic duty. And that’s part of what a task force could be doing. 

(That’s also the argument against having the task force be a city government organized entity. We may not always like to admit it, but sometimes things happen in town not because we got our committee act together, but because a couple of folks got together and just poured money on it and made it happen - be it the Madison Park and Pleasure Drive Association or the creation of the Overture Center. So there’s probably opportunity for civic-minded folks to get together in a (smoke-free) backroom over drinks after a Chamber meeting or in a suite at the Kohl Center or in the groupchat or something else that’s not subject to open records and step up)

Part VI: Conclusions and why are you still reading?

If you’ve read this far you’ve probably realized that I can’t make a good case for why a task force over using our existing Housing Strategy committee. I think the opportunity to have a larger body for this work might be helpful and so I lean towards the task force, especially if the Housing Strategy committee is about to be reorganized. However, I’m not sure that’s a good enough reason to put a big new burden on city staff to spin up and support an additional committee. 

I’m glad the Council is interested in taking this up so early in its term. I thought that perhaps after a somewhat contentious election earlier this year, where there was so much heartburn over what I thought were pretty modest changes in the Transit Oriented Development Overlay District and the Family Definition that there might be more interest in a year or two of focus away from housing. I hope this is just the start of more good things from the Council and the Mayor.

Apropos of nothing, here are a couple of ideas that could make life better for the less well-off in Madison. It is by no means exhaustive, nor is it meant to be a list that solves all problems. Not everyone is going to like all of them, so it’s worth reminding folks that Brenda is not the only person who blogs here, so don’t go blaming her for these.

1. Cancel the Garver Feed Mill stabilization project. The 2014 Capital Budget includes $1.825M to just keep part of the building standing, but its only projected use is as a storage shed for some snowplows. With our list of needs, that’s too much money for too little use.

So, take it off the landmarks list, and either spend nothing and just let nature reclaim it, or spend the minimal amount possible on demolition and get it over with and use the rest of the money for affordable housing. (The $1.825M figure was originally from demolition costs, with a reprieve given as “we’ll spend $1.825M demolishing Garver or as cost-sharing of a rehab”, but none of the Alders I asked could say if it we could do the demolition cheaper for $1.825M or not)

Garver is an example of throwing good money after bad. Could we build something great? Yeah, probably, but if we keep going down this path, sooner or later we’re going to be spending 10s of millions of public dollars to repurpose Garver. If we’re going to spend that much money it should be somewhere that’s a civic priority – East Washington or Park Street or the Southwest Side.

2. Cancel the undergrounding of utilities on East Johnson Street, and save $2.5M. There was already $1M in the 2014 budget to underground utilities from Butler to Blair. An additional $1.5M was added to the budget plans for 2015 and 2016.

Look, I’m all for undergrounding utilities, and it’s especially ugly on East Johnson Street, but borrowing $2.5M to pay for it is not where I’d spend that money. To cover that debt, we’ll be paying something like $325,000 a year for the next 10 years. Surely there are better uses for $325,000 a year.

3. Only elect people to credit union boards who are committed to and have a plan for using the credit union to build credit and gain access to services. It’s well-known that it’s expensive to be poor, and part of that expense is from being underbanked or banked with terrible services and high fees for small accounts. We should have a goal of every adult in Dane County having access to quality banking services, and the credit unions should be a part of that. So, when the UW Credit Union or Summit Credit Union have their elections in April, reach out and ask the candidates what they will do to expand banking access to the underserved.

4. Madison could put a referendum on its ballot and exceed the state revenue caps.  If we’re not able to provide all of the services we think are necessary, we can make the case the community and see if they agree. As some data points, for about an extra $27/year, we could have fully funded all $2.5M  that came in as a request to the City’s “Emerging Opportunities” fund, which only had a budget of $200,000. (Though I don’t think all the requests were worth funding.)

To perhaps make it a little easier to sell at the ballot box, making it about a specific program might be a more effective strategy. For example, that $2.5M/$27 a year in extra taxes on an average home would fund 25 public health nurses. A ballot question of “Should Madison exceed its revenue limits by $27 on the average house to put an extra public health nurse in the 25 poorest section of Madison” would pass in this town.

Raising property taxes is not ideal because they’re more regressive than anyone would like, but they’re the lever that we control now.

5. Lobby to equalize state aid. This one is more aspirational, as it doesn’t directly accomplish anything unless the legislature acts. It’s also something that Paul Soglin is quick to point out: if shared revenue for the City of Madison ($12.6M, or about $51/person) was funded just at the same level as shared revenue to the City of Milwaukee ($51.2M, or $85/person), our budget in Madison would not be cuts just to get to cost to continue of basic programs. Shared revenue is also more progressive, and isn’t as painful as the property tax for people living on fixed incomes.

This isn’t a call to slash aid to Milwaukee – Lord knows they need the money – it’s just a recognition that the way to reduce property taxes is to increase shared revenue payments.

6. Push pardons and expungement, and make them the norm. In this age of easy background checks and a tough on crime attitude, it’s gotten too hard on people with a record to reintegrate back into society. Again, this is aspirational as it’s not something the Madison Common Council or the Dane County Board can change.

On the whole, we would be better off if people who have not committed a crime after a sufficient period are given a clean background and were allowed to say “No” to “Have you ever been convicted of a crime”. Clearly you don’t want to grant this to everyone for every crime or every person, but the world could use some more forgiveness.

Things that we can do, besides lobbying and pushing the Dane County delegation to introduce legislation to bring this about, is to provide some assistance to Madison and Dane County residents to be sure that they’ve applied for anything and everything they’re eligible to apply for.

7. Require all background checks be reported. Related to criminal records, we should require every background check performed be reported to the Madison Division of Civil Rights, regardless if the person is hired or not. Make this reporting easy for businesses: don’t charge a fee to do it, and collect minimal information – probably just the name and social security number of everyone a business performed a background check on, and a hired/not-hired indicator. Make it available as a form that can be mailed in once a month, or a secure website that lets a business upload a spreadsheet every so often.

Having good data on the how background checks might affect hiring would be helpful in the large and to look at outcomes at specific employers, and the sheer fact that businesses know the data is being reported may reduce some discrimination.

8. Madison should buy some motels. There are a number of older motels around Madison, some of which are poorly managed or otherwise problems for their neighborhoods. Madison should use some landbanking funds and buy them. For the interim, we can use them for emergency shelters. Long-term, many of them are in blighted but prime locations for future redevelopment, often along transit corridors, and so land-banking them is appropriate.

On Wednesday, September 25th 2013 the City hosted a “Yahara River Corridor Public Meeting”. It wasn’t a very helpful agenda, so I pulled together some background information for myself. Here’s some of that info, and a bit of the flavor of the meeting.

First, the meeting agenda

Overview
The City of Madison’s Planning Division is hosting a meeting to discuss the planning vision for the Yahara River Corridor and environs. Seven plans in the last 19 years have made recommendations for the Yahara River Parkway and adjacent properties. The purpose of this meeting will be to review these plans and explore implementation strategies. The implementation of these recommendations will require a finer degree of planning and design. This meeting is intended to be a first step in that process.

The actual agenda itself:
1. Summary
2. Concept Approach
3. Current Plans and Regulations
4. Analysis Exercise
5. Report Out
6. Next Steps
7. Adjournment

It sounded like, and was, a typical Madison planning meeting of “We’re going to throw some information at you, then break you up into small groups to be sure that there are no spectacles, get you to react to some things and try to collect feedback”. I can’t say I love the format (I think it cuts off interesting ideas too early), but the old quote about democracy seems relevant here: ‘the worst form of government, except for all the others.”

One of the things that I found very frustrating about this meeting was there wasn’t any background information provided ahead of time. Nothing linked to in the agenda, nothing included in the press release or email notices from the Alders, and really not much in the news coverage of the meeting. This happens too frequently in Madison, and has two bad outcomes. First, there’s not an opportunity to study the material ahead of time and prepare good questions. Second, most of the feedback the city gets by meeting attendees is not done with deep reflection. Granted, the city can’t count on every attendee reading every document ahead of time, but providing some information ahead of time will help them at the meeting. What would be super-helpful, in addition to background documents, would be to create a 3 minute short Youtube overview of what’s going to be discussed at the meeting, and perhaps a 10 or 15 minute, longer version of it as well. Yes, they’ll have to repeat it all at the meeting, but seeing it twice might clarify things for initial viewers, and certainly they’ll get better questions and feedback with if the meeting attendees had some time to think about things before the meeting.

For this meeting, what was disappointing is that there actually was some great background material online in The Yahara Gateway and Parkway Summary and Overview. It’s a good document and was well-done, and I wish that it had been shared more widely beforehand. It’s dated January of 2013, but I must have missed it. I know that the Board of Parks Commissioners saw it at their meeting of July 10th 2013 but otherwise, I’m not sure what other commissions or meetings it may have discussed this document.

The document summaries the seven plans involved:

• City of Madison Comprehensive Plan – 2006

• East Washington Avenue Capitol Gateway Corridor Plan – 2008

• Tenney-Lapham Neighborhood Plan – 2008,

• East Rail Corridor Plan – 2004

• Yahara River Parkway and Environs Master Plan – 1998

• Emerson East–Eken Park Neighborhoods Plan – 1998

• Marquette-Shenk-Atwood Neighborhood Plan – 1994

It also gives an overview of Ossian Cole Simonds’s  plan from 1903, as best anyone can figure out, and tries to compare what was originally planned with what’s there. Finally, it concludes with a diagram with some ideas of where to go from here:

Some additional info that would have been helpful to know ahead of time: the area under discussion is the stretch between Johnson Street and Williamson Street. North of that is Tenney Park, which is pretty well settled (though there is a large vacant site where Sony had offices that should be part of the conversation), and south of that gets into residential structures that are too complicated to put together any sort of redevelopment effort, so there’s less of a sense of urgency.

Inside that zone are many opportunities for bringing the land up to a better use. Along the East Washington corridor, it’s been clear that after Breese Stevens, the next section that is begging to be made more interesting is the Yahara river, and this meeting and planning effort is a sign the city expects development to start happening along the Yahara soon. With the activity at Breese Stevens in the 700 and 800 blocks of East Washington – one project open, and at least three more hopefully moving forward soon, providing another “bookend” will help us fill in the rest of the East Washington corridor over the next 10 years and is very exciting.

The goal of this planning effort is not so much to create a brand-new plan, but to try to prepare more detail for the area following the parameters already established by the existing plans. As development proposals come forward, the idea is to be able to provide developers with a better sense of what the entire corridor should be, and to have them demonstrate what parts of that vision their project helps achieve. For example, if the new plan calls for increased recreational activities on the water, if a redevelopment project comes along, they can show that they contribute to that goal by including a canoe and kayak rental shop.

While the corridor seems like it should be the next happenin’ place, redevelopment proposals have had some tough goings on the Yahara river thus far. The most prominent site is the Marlin Lumber yard. I love Marlin Lumber as a business (Related, condolences to the Marlin family for the recent passing of William Marling ), but a lumber yard is a pretty terrible land use for a location so attractive to people. It’s one of the few businesses that being able to bike to is really not a useful attribute.

Here’s the site:

(Yes, that’s snow in the picture. I’ve been stewing on this blog post for a long, long time)

Five years ago, it looked like we were going to see some action – from the June 1st 2007 State Journal:

“MARLING LUMBER MOVING, WILL SELL E. WASHINGTON AVE. SITE Officials with the 103-year-old company, which has been at the location since 1920, say the move to T. Wall Properties’ The Center for Industry & Commerce along Highway 51 will provide room for growth.

The sale will also likely mean new life for the East Washington Avenue site and help create a gateway to the central city.

East Washington Avenue has been a hub of activity in recent years. The roadway is being reconstructed with wider lanes and improved lighting while developer Todd McGrath is building Union Corners, a more than $100 million, 15-acre mixed-use development near Milwaukee Street that is one of the largest redevelopment projects in city history.

McGrath, along with Joe Krupp, has also purchased the shopping center at First Street and East Washington Avenue, now called Washington Plaza. Krupp said Tuesday that the whole area has great potential.”

But it was not to be – from the April 1st 2008 State Journal:

“MARLIN LUMBER WON’T BE MOVING

One of Madison’s oldest businesses is staying put after all.

Marling Lumber Co. announced plans last spring to move from its location in the 1800 block of East Washington Avenue to a nine-acre site at T. Wall Properties ‘ The Center for Industry & Commerce along Highway 51 at Hoepker Road, northeast of the Dane County Regional Airport.

But now, 10 months after that announcement, general manager Tom Marling said he will redevelop his 3.8 acres with new buildings including a multilevel building for the company’s showroom, offices and a parking structure.

“It became apparent that given the downturn in the housing market, we stood a better chance of developing our property where we are,” Marling said.

Of course, just across the street from Marlin Lumber was what Madison considered the leading candidate for a “high-speed” rail station, and could have been much more. This piece by Joe Tarr in the Feb 11th, 2010 issue of the Isthmus “Mayor is sold on the virtues of a Yahara River site for Madison rail station” summed it up:

“My sense of it, from talking to the governor and the secretary, is they’re less focused on a particular location than making sure we get it done on time,” he says. “I don’t want to do anything that interferes with that goal.”

But Cieslewicz thinks there’s much to commend a station at Yahara, especially the possibility of spurring economic development along East Washington Avenue.

“That’s been ripe for a renaissance for many years, but we’ve been looking for a spark,” he says. “And I think this could be the spark.”

Of course, that didn’t work out  and a downtown station location was chosen, and then of course Scott Walker derailed the whole thing. Interest in the site remains high, and at the meeting on the 25th, there were calls for it to be remembered as a potential transit hub for the future. The strip mall is apparently for sale (for 1.6M over the assessed value!) and one hopes that if it is redeveloped, it’s for a considerably more interesting use than a one story strip mall.

Following the river downstream towards Lake Monona just a bit, a project moving forward is the state’s plan to build an archive preservation facility for the Wisconsin Historical Society and the Wisconsin Veterans Museum. In this Dean Mosiman piece in the State Journal titled “State seeking to build major archive preservation facility on the Near East Side” from August 8 2013,  we get these quotes:

“It’s a great project,” said Sen. Fred Risser, D-Madison, a member of both the Building Commission and board of curators at the Historical Society. “It upgrades the neighborhood. More importantly, it provides very, very needed storage space for the Historical Society and Veterans Museum.”

Mayor Paul Soglin applauded the decision, saying it’s appropriate to locate the archives on the Isthmus and that the specific site is close to public transportation and convenient for archivists and others who will work there.

The state has been working closely with the city on the conceptual design of the building and to make sure it fits with the city’s long-range plans for the Yahara River corridor, Soglin said.”

Ignoring the fact that the project is moving forward and we’re just now talking about the long-range plan for the corridor, Fred Risser and Paul Soglin are dead wrong. This is an awful project. At the intersection of a bike path and a river, and just steps from the most walkable neighborhood in Madison, they want to put…a storage facility? That’s absurd.

Sure, it will be a nice building, and sure, it will have a small museum component. But by and large, it’s shelves of stuff that is hardly ever looked at, and given digitization of the archives, will be looked at even less. It doesn’t bring any new jobs, and has negligible impact on increasing business patronage in the area. Outside of 9am to 5pm, it’s dead. It contributes little to the neighborhood. Even a cemetery would contribute more.

This corridor should be for people, not for musty old books. The Historical Society needs the storage space, but put it somewhere else. Find an empty big box store or something similar farther outside of the isthmus and locate it there. Don’t waste this amazing location where people really want to live. I was happy that this whenever this was mentioned at the meeting, there were lots of nods of agreement by the public, and I’m hopeful that the city will be less enthusiastic about the State’s plan.

Finally, the Mullins Group is a major property owner in the area, and have some doodles for what they may try to do with their sites, mostly on the West side of the Yahara. This image is from the February 16th, 2011 Capitol East District Stakeholder’s Meeting:

It’s attractive, but it didn’t blow me away. Certainly it’d be nice to get rid of eyesores like the Sparkle Auto Body shop:

and this little building (which for a while was a leading contender to be the Day Shelter, which would have been an awful outcome. I want there to be a day shelter, but I want to tear down that building and activate the Yahara, and if the County owned that building it would have complicated those plans)

I was interested in hearing more from Mullins at the meeting, but they didn’t have anything to share. As for their vision, I’m skeptical. No one has much confidence in the Mullins Group to actually move forward in a timely manner. I think our best bet is if they decide to sell.

Thinking forward, I think the plans need to address two things.

First, the height limits at these sites, especially on East Washington, are too low. Most of the plans talk about a 4 story max in the area.

What would be enormously helpful for the development of the area, to turn it into a true destination, is to amend the plans and allow for enough height to finance some truly signature buildings. Madison talks about exceptional architecture, but we rarely achieve it. The river, the bikepath, the lakes, Willy Street, easy access to downtown: it’s an amazing location. Relax the height limits and we’ll have buildings under construction in 9 months.

The other we need to address is just what we mean by enhancing the parkway. Marsha Rummel summed it up perfectly in the September 25th 2013 State Journal article by Dean Mosiman about tonight’s meeting, “City seeks public input for Yahara River corridor”

“Some areas of the corridor, especially around East Washington Avenue, might be appropriate for public uses such as canoe and kayak rentals, a bike or paddle shop, and cafes or restaurants, [City Planner Bill] Fruhling said.

“It will be a pretty popular place and a place people want to spend time, if it’s done correctly,” he said.

But there will be tension between those who want to keep the corridor natural and wild as opposed to a place full of amenities, Rummel said.”

Count me among those who want to see more amenities. Now, I’m not saying pave paradise and put up a parking lot or Walmarts on every block face, but I don’t want the whole thing to be a nature preserve, either. One of my all-time favorite places in the world is the Washington Harbour in DC, near the Kennedy Center and the Watergate hotel on the banks of the Potomac. Now, the Washington Harbour building is clearly far too massive for the Yahara, but that’s the sort of interaction I’d like to see on at least part of the corridor: to be able to have somewhere to go and a reason to linger. Walkers, joggers, and bikers pass right along the river, moving between an urban space and a forested space in a short span, both co-exist. Indeed, being able to move between them is one of my favorite parts.

(This image is from Wikimedia Commons)

 Photo by Mr T In DC

Admittedly, being that close to the water has some dangers: a massive flood in 2011 dealt it serious damage. It has floodgates, but they weren’t raised in time.

A while back, my boyfriend and I went to Florida for an escape from winter trip to the beach. One day we decided try lunch in Fort Lauderdale, and on our way to the crepe place (which was amazing) I saw this building and made him pull over and let me out:

They’re the Venezia Las Olas condos.

I loved that it was right on the little river, and it instantly made me think of how great this would be in Madison, on the Yahara, maybe at the Marlin Lumber site. My guess is that we couldn’t get support to get that near the river, and so it would need to set back a bit, but I think you could get very close and still have it work. I loved the variety of shapes, colors, and balconies. It’s probably too South Florida for Madison, but if it was in Madison, it would be one of our most exceptional buildings, and stand out much more than the usual boring boxes that come out of the Urban Design Commission. As the Yahara River Parkway is both a local landmark and listed on the National Register of Historic Places, I’m probably just going to have to accept that we’re going to get a prairie-style building not matter how blasé they have become.

A tall signature building, near East Washington and yet on the river, would I think be a welcome addition to the entire Capitol Gateway, while being the fastest way to get us towards something that can provide interesting programming and amenities on the Yahara. Set a 10 story interior height limit at either the Marlin Lumber, the WERC, or Sparkle Auto Body site, and I’ll bet some developer takes us up on it very, very quickly.

The entire project now has an online home with the Planning Department where they pledge to post updates, including the presentation from the other night. The second half of the meeting had us working in small groups of six people or so, with each group given large maps of the area. We were encouraged to write reactions straight on the map, so Planning department has many comments to sort out and analyze.

Moving forward, this is a mostly staff-driven effort for a while. This fall, they’ll work in the feedback they’re getting, and prepare a couple of different concepts, and invite people back for more public meetings. They’d like to finish up iterating on the ideas over the winter, and then start it through a city approval process and finish up by the summer.

They’re not planning on having an advisory committee for the process because they’re only going to make recommendations. So, for example, they wouldn’t actually try to change the height limits. Instead, they may recommend that the height limits be changed, which could then start a process that goes through and amends the relevant plans. This seems like an unfortunately slow way to go about it, so I hope they reconsider.

There’s a second “timeline” question, asking just how fast do we want to see these changes occur? In some ways, planning documents are timeless – if at the end of some arbitrary number of years the planned area looks like what the plan called for, it’s irrelevant if it took 1 year or 20 years to achieve it. On the flip side, if the goal of a plan is to effect some changes within a certain timeframe, the plan needs be sure that it has a theory of action to either directly make those changes or create an environment to induce those changes. The timeline to change was not addressed at the September 25th meeting.

One of the great treasures of Madison is our interaction with the water. There is perhaps no more iconic Madison location than the Memorial Union terrace, a key anchor of the lakeshore path along Mendota, though the John Nolen causeway along Monona is an awfully special place in Madison as well. The Yahara has the potential to be our Third Coast, and a momentum builder for the entire East Washington corridor. I hope we can come to a consensus for how it can be special to many people, all with different reasons for loving it.

The redevelopment of the Capitol East District has consumed considerable effort from neighborhood stakeholders, city staff, and elected officials for many years now. However, save for the redevelopment of the Buy/Sell Shop into the Brink Lounge and the High Noon Saloon, and the recent move of ShopBop.com to the Marquip building to join the UW Innovation Center, there has been precious little change along the sides of our newly-reconstructed street. That could change soon, with three proposals for the city-owned former Don Miller lot starting to advance.

Brenda has covered this over the past few months, and unfortunately, the process hasn’t been handled well. The process that initially vetted the proposals certainly violated the law,  and what came out of the process has been frustrating in that it came forward with a ‘this is it’ attitude of which developers were being invited to make proposals, with no sense of how or why these were the proposals advanced. The proposals were the subject of a Common Council discussion last week, and while we’re a ways from seeing ground broken, it’s time to start digging into what’s been proposed.

The 2012 budget includes $5.5M in potential TIF funds for projects on these sites. In order to get the money, developers would have to make specific proposals that the Common Council can approve along with the regular land use approvals, but this budget placeholder gives some sense of what the city expects to see in requests.

Before we begin, even though I think most of the readers of this blog are already well-informed of the background, the three projects are all taking place on the 700 and 800 blocks of East Washington Ave – the former Don Miller car lot. Last year, the city bought the property. It can be divided up into three sections, shown below (though, it’s worth noting that it doesn’t have to be divided into three. We’ll come back to that.)

It’s also worth quickly reviewing the building heights envisioned on along the corridor. This is from the Tenney-Lapham plan.

The proposal on the south side of East Washington, in the 2 acres of the 800 block, is from the Rifkin Group. It envisions a five-story tower fronting on to East Wash, with a parking structure behind that, and smaller buildings along Livingston and on East Main street. Here’s a sample render, and you can see many more of them in Rifkin’s proposal document on the city’s website.

On the whole, I like this proposal. I wish that it was taller, but I appreciate that they put as much as they could up-front on East Wash to present the feel of a larger building. I like how they’ve hidden the parking structure in the interior. If I have one concern that’s specific to this site, it’s that I think their retail on East Main is going to be a real challenge. Here’s what is there now, and here’s what they’ve got proposed:

Absolutely, it’s a huge improvement. But here’s what’s on the south side of East Main St:

That said, as much as East Main Street looks like something out of Detroit, it’s not all a wasteland. When I was walking down the street to take these photos, I stumbled across this:

It’s the Old Sugar Distillery. They’re mostly in the business of making spirits, but they have a bar on site that’s open a few nights a week. I went back later that night to do some research (oh, the things I do for the blog) and it was a great place. It was busy, and a crowd of mostly mid-20s to early-40s, not uncomfortably loud, and very good service (they noticed I didn’t really like my first drink, and replaced it with a different one on the house. They’re not kidding, the Honey Caps go down easy). They got a shout-out in the Frugal Traveler’s visit to Madison, and I’m definitely going back, too. I hope that as East Wash is developed, they’re just one of many new places to open in the corridor.

Bottom line, I’m pretty happy with the Rifkin proposal and would be pleased to see it advanced.

On the other side of the street and just up the block, on the north side of the 700 block, there is a proposal from Otto Gebhardt for a residential tower wrapped in some officespace/retail, along with some extra residential fronting on to East Mifflin street. The neighborhood is starting to get a look at the proposal, which now has a name – the ‘Constellation’

There are many more renderings and massing studies on the neighborhood’s website.

In the proposal to the city, Gebhardt lays out strong sustainability goals as a priority for the project, aiming for about a LEED Silver level. (Interestingly, “LEED Silver Equivalency”, which sounds like they’re not going to actually try to be certified). It’s a litany of enhancements, from green roofs to low flow water fixtures to solar-conscious designs and solar water heating.

It’s hard to have strong opinions about this project given how little has been fleshed out. It will apparently be 12 stories, based on what was presented to the Tenney-Lapham neighborhood in September. Gebhardt’s reasoning in choosing a 12-story target is to be able to ask for a smaller TIF subsidy.

Recall from the opening section that the height target this area was 8 stories, with permission to go to 10 stories if the design is “exceptional”. Now, I’m not really a fan of density bonuses (I’d rather see them automatically given, with exceptional design required) but going from 10 stories to 12 stories doesn’t bother me that much.

What does concern me is Gebhart’s track record of design. Behold the monstrosity that they have inflicted upon the city:

Awful colors, terrible form, crappy materials: the only thing exceptional about that design is how ugly it is. Even the guitar-shaped sign over the door manages to be excrucitaingly tacky. We can only hope that the UW does in fact move quickly and need to tear that building down 20 years from now. I do not want anything that bad in my neighborhood nor supported with my tax dollars. They’ve pledged to work with the neighborhoods as the design evolves, so perhaps it’s not hopeless. The stakeholders and decision-makers such as the Urban Design Commission must be vigilant and demand detailed information from Gebhardt, and actually ensure that something exceptional is built for exceeding the recommended height by 50%.

The final proposal is from Urban Land Interests, and takes up the entire 800 block on the north side of East Washington Avenue, right after Breese-Stevens field. Here are two images – one, a footprint, and the second, a small model to show massing ideas, and obviously not building designs.

Simply put, I hate it.

I’ll get into why I hate it shortly, but let me start with what I really like about it: it tries to respect Breese Stevens by including a Plaza on the corner of Patterson and East Wash – right across the street from the recently-rebuilt “plaza” in front of Breese-Stevens, and put some emphasis on this corner as a destination, and keystone of the corridor. The plaza is way too small, but it’s a start.

When I was in DC last year, I stayed in the Columbia Heights neighborhood, and was struck by how clear their redevelopment effort along 14th Street mirrored our aspirations for East Washington (seriously, if you click on only one link in this post, read this article in the Washington Post – “A Rapid Renaissance in Columbia Heights” ) If our city planning staff doesn’t know it or the people behind the Development Corporation of Columbia Heights, we should put them on a plane immediately and send them east.

Now, it’s not perfect model – much of the success has been in part to the creation of a large retail destination project, the DC USA Mall (with an urban Target!) and the opening of the Columbia Heights Metro (subway) stop there earlier. DC also has a population density that we’re a long way from matching. That said, they’ve created at the DC USA/Metro stop a feel of a town square and focal point. There’s a confluence of transit, a large anchor development, a historic renovation of the Tivoli Theater, and an urban park to tie it all together. When I was there, I saw families and shoppers just enjoying their time there, and as one blog noted, one indicator of how Columbia Heights has “made it” is how it is now a gathering site for protests. Another blog post is spot-on: they have enhanced DC’s Most Diverse Neighborhood, and part of that was because of bold planning and savvy decisions over the future of city-owned parcels.

(Image from the NewColumbiaHeights blog/DC DOT Facebook page)

And that’s the crux of my hatred for the ULI proposal: it doesn’t show any savvy nor fully acknowledge the importance and potential of the site. It is bland, and shows no creativity in addressing the challenges. ULI has it in them, I’m sure of it – they’re the ones who brought Block 89 to life on the Capitol Square, which is one of the few parts of Madison architecture that’s been built in the last generation that’s any good.

ULI’s proposal spends most of its time making the case that the economics of a large office tower on this site and at this moment in time are really bad. I don’t disagree with them, but I don’t think the answer is “so we’ll just do small office buildings instead.” There are other options that need to be explored.

First off is the site footprint – and this has implications for the Gebhardt proposal as well. It is incorrect to say that we, the City, only own the 800 block and part of the 700 block that border East Washington Avenue on the north. We actually own more than that – we own those parcels, Reynolds Park across the street, and the streets in between them. With the caveat that there are likely sewer/water/gas mains underneath those streets which could complicate plans, there’s no reason that we have to hold those streets involatile. Could we vacate the streets to explore different configurations? The neighborhood is at least open to the idea of closing part of the street; the Tenney Lapham plan proposes eliminating a block of Livingston if Reynolds park could ever be expanded. The neighborhood was also uncomfortable with Mifflin and Dayton street serving as de-facto replacements for Gorham during reconstruction – cutting off the straight shot through the Isthmus might be desirable. Mifflin’s status as a Bike Boulevard might be further cemented by replacing a portion of the street with a much narrower bike path to link the two segments.

By eliminating a street, you gain more than just 40-ish feet between the blocks, you also gain by being able to eliminate some of the required setbacks.

There’s lots consider if we’re willing to eliminate some streets. We don’t necessarily have to divide the parcels up exactly as-is – perhaps the Gebhardt proposal could expand a bit into the 800 block, and come down just a bit in height while still hitting its density and revenue targets. Or, by trading space that used to be part of Livingston St on the west end of the 800 block, could we build a larger plaza on the east end of the block, to really compliment Breese Stevens? By freeing up some of what used to be Mifflin, could we widen East Washington Avenue in this segment to add the turn lane that Traffic Engineering is struggling to fit in, or again, use it for a small park? (As a nice bonus, being able to condemn the front few feet of the parcel to turn it into a street might nicely solve the billboard easement issue.) Even if we’re just going to do small office buildings, we can be more creative on this site.

We should also think harder about the uses of the site. ULI hammers home that much of the difficultly is finding a way to make parking economical. To break it down just a little bit, rent in this location will be about $14,000 a year for every 1000 square feet. The rule of thumb is that will need about 3.5 parking stalls for that 1000 square feet of office space. If parking were priced alone, ULI is targeting $40 a stall a month, or a total of $1680 a year for parking rent, which they’re rolling in to the $14,000 office rent for a 1000 square feet. Parking stalls in a structure cost about $15,000 a stall to construct (which is optimistically low), which means the 3.5 stalls cost $52,500 to construct, or nearly 4 years of rent for the entire office space just to cover the parking. With some back of the envelope calculations, assuming with interest and taxes the payment on that $52K is about $350 a month, ULI would need to increase that $40 a month rate by 9% a year to just finally break even for a year (and only then, not until year 12) and to break even cumulatively by year 20. The takeaway is that you need either subsidize parking, or find a way to make the parking produce more revenue. Depending on how “nice” you want the ramp to be, and what sort of connections to the building you may give it, prices may vary by quite a bit. It’s also important to remember that you can’t build this incrementally – you buy them a floor at a time: the ULI plan is 430 stalls in the ramp. If you wanted more, you’re talking about having to build well over 500 stalls.

One way we could make the parking more valuable is to come back to that idea this location as a destination. True, it’s not an urban Target, but we can do something. We do not get nearly enough usage out of Breese Stevens field, and it should be one of our anchor tenants. The ULI PowerPoint acknowledges this as a goal, but doesn’t seem to do much in the way of building on it. Breese Stevens is almost always locked up and deserted, which is just a shame. Every night of the week and all weekend long we should have people on the field, playing soccer or ultimate or whatever. Yes, that might mean we have to change to some sort of artificial turf, but grass snobs will just have to get over it. That usage would be off-hours from an office use, which means the parking stalls will be in use more hours of the day.

Taken to the nearly impractical extreme, the residential component could embrace this idea of an active lifestyle. As an amenity, living across the field from your pick-up soccer league should be a great selling point, and as I’m sure Capital Fitness/Butler Plaza can attest, having a gym in the building is a good way to attract tenants, especially the Richard Florida “creative class” that are all the rage these days. Perhaps one way to achieve greater height is look into truly “mixed use” in the tower, and include a few stories of Princeton Club Downtown in the building and really make it a destination. You have to admit, the view from the track on the 10th floor would be pretty great.

Parking has been a theme in all of these projects, and came up at the August neighborhood meeting unveiling the initial concepts. One of the questions really struck me: Pat McDonnell (heavily paraphrased) asked “The BUILD plan said that we would work with each project to bring forward transit-oriented development. Please list specifics of what has been done with these projects to accomplish that.”

Yeah, no one had an answer at the meeting. City Economic Development director Aaron Olver squirmed uncomfortably for a few seconds and then suggested that perhaps an Alder would like to answer. Both Marsha Rummel and Satya Rhodes-Conway admitted that really nothing had been done, though that’s hardly their fault.

Pat’s point was that now that we’ve got projects coming forward in this corridor, if we haven’t done anything to make transit-oriented developments possible, we’re going to hear from the developers “We can only do this with lots of parking.” And, so long as we’re spending resources on implementing parking for this iteration of projects, the next developers who come forward will also be forced to say “we can only do this with lots of parking.” At some point, we have to do something to break the cycle or we need to be prepared to subsidize parking for everything that comes along.

And, while we’re speaking about parking, the Don Miller site used to be a car dealership, which means the city now owns a giant parking lot. Until we’re actually ready to use it for something, could we go ahead and park there? It’d be a nice park-and-ride for people working downtown and at the UW, and if the city would do some minimal plowing in the winter, it’d be a nice way for people to get their cars off the street in snow emergencies.

To build three large projects, all in an area that hasn’t seen any serious development in a lifetime is a momentous undertaking. This effort will be all the more challenging with the state of the economy: there will be difficultly getting financing for the developers to build these projects, and there will be difficulty in attracting potential tenants. We are not in an economy where we have many businesses and other enterprises seeking space; filling even one of these projects will be challenging enough, much less the market absorbing the new space and all three of them securing tenants. I would be surprised if all three were able to move forward.

In an ideal world, my suggestion would be to acknowledge that success is most likely if we phase this out and wait on some of the sites, and only cautiously advance. I’d probably move forward with the Rifkin proposal now: though it’s not as tall as I’d like, it’s not in a signature location nor are there as many options for alternatives to explore like there are across the street, and is an acceptable compromise with reality. I would delay indefinitely the ULI project on the 800 block. I do not believe it meets the vision we have for the corridor, though admittedly, we have been reining in our dreams over the past two years. Consider this sequence of illustrations:

There is going to be intense pressure to act as soon as possible. Soglin has made it a priority to reduce our debt service as fast as he can, and while the Alders I asked couldn’t tell me for sure, I’ll bet that the budget projections for future years assume that we’ve got these properties off the city’s books and the land bank loans paid off.

The question is going to be: how long will we stay in the pocket and take the pressure? Do we jump at the first opportunity to get out and build anything we can, or do we hold out and do everything we can to realize a better vision for this special part of the city? I hope that it is the latter.

A few months back, Paul Soglin linked to a piece about services for homeless people in Ann Arbor.

Paul wrote a few lines after the link, but they were a little cryptic. They were bullet-points of principles, but I couldn’t tell if they were meant as a warning to Madison or a general dispensation of wisdom. I was going to write basically this blog post wondering just what his point was and what prompted him to link to that article. And, as it was the start of a good run of posts from Soglin, it was going to close with “Maybe he’s thinking about getting into the Mayor’s race”.

Note to self: First, go with your gut more often. Second, always assume Soglin is thinking about getting back into the Mayor’s race.

One of the things I’m most excited about in 2011 are Mayoral and County Exec races where we can talk about how we can help people build a better life in Madison and Dane County. I’m looking forward to hearing more from Soglin and all of the candidates on how we can do better for everyone in the community.

I wish I could find it now, but there’s a thread in the Daily Page forum somewhere, talking about the same issue of people down on their luck moving to Madison to start over. The usual vitriol was there, complaining about “people from Chicago” moving here and being nothing but trouble, but there was a gem of a post that went something like this:

“Good. I’m proud to live in a city that is the sort of place that people want to come to build a better life, no matter what their circumstances are”

(If someone remembers that post, I’d be much obliged if you could point it out.)

I think there are people who spend their time thinking about ways to limit access to support services so only the “right” people can use them, and there are people who spend their time thinking about ways to help people build a better life. My New Year’s Resolution is to spend my time helping the latter.

From Nolen’s 1911 report Madison: A Model City:

What, then, are the general conclusions and recommendations that may be sorted out as of supreme importance for the future of Madison. They are:

1. To pass suitable laws for the protection of the environs of the State Capitol.

2. To acquire the property between Capitol Square and Lake Monona and adopt an appropriate plan for its development.

3. To widen and improve State Street from the Capitol to the University.

4. To establish, widen and improve the main thoroughfares in and near Madison.

5. To secure for public use the most important lake frontages with a view to the formation of a Four Lake District.

6. To inaugurate a plan for the redemption and use of all marsh land within or near the limits of Madison.

7. To forecast the future needs of the State University and more adequately provide for them.

8. To secure the improvement of the railroad approaches to the city and the gradual abolition of grade crossings.

9. To adopt a better method of locating and improving streets and making land subdivisions.

10. To remove from the public streets all wires, poles and other obstructions.

11. To pass a shade tree ordinance providing for the systematic public planting and maintenance of street trees.

12. To organize the park work of Madison under a new park law.

13. To take the existing parks of Madison as a nucleus and by supplementing them with small open spaces, larger parks and parkways, as already outlined, secure a well-balanced park system for the future.

14. To provide playgrounds and large school grounds in every residence section of the city.

15. To adopt reasonable regulations for the control of all buildings so as to differentiate neighborhoods and protect real estate values.

16. To consider methods of improving the housing of people of small means.

17. To investigate and report upon city finances for Madison as regards bond issues, current taxes, and relation to the State government.

99 years later, how are we doing?

1. The Capitol Height restriction is pretty good, and the Square is fairly well protected. I’ll say that one’s done. +1

2. Monona Terrace is done, but there’s more work to be done. Let’s call that half-done. +0.5

3. State St is in good shape. +1

4. The main thoroughfares are getting better – finish up University Ave and get started on 113 and the streets themselves are fine. Now, as for the buildings and neighborhoods on them, like East Wash, there is still lots to do. Let’s give it +0.5

5. Lake front access is still lacking, especially Mendota. +0

6. This is probably one we’d do differently today, and we’d restore some wetlands instead of draining them. +0.5

7. The UW seems to be set for the next 20 years, though I wish they’d be more explicit about what they’re going to do on the east end of campus, in the Bedford area. +1

8. Better railroad crossings. I guess check back in a year, especially on the east side. +0

9. Smarter growth. We’re still fighting sprawl, and worse, we’re hemmed in and we’re counting on our surrounding communities to fight the sprawl that Madison then has to live with. +0.

10. Eliminate overhead powerlines and telephone cables. After the criminal hackjob they did to the trees on my street, I want to give this one a -1, but I’ll hold stead at +0

11. A good tree planting ordinance. Dutch Elm and now Emerald Ash Bore has hurt us, and we’re not replacing those trees with full shade trees. +0.

12. Organize a park system. I think our parks staff is pretty good. +1

13. Create a well-balanced parkland for the future. Our fore-bearers did a good job here, and if we open Central Park we will honor their efforts by showing we can still think big in the parks. +0.5 now, +1.0 when Central Park opens.

14. Playgrounds and large school grounds in every neighborhoods. I’m honestly not sure, but I know nearly everywhere I’ve lived there’s been a playground within about 3 blocks, except for when I lived near W Mifflin. I’ll give it +1.

15. Reasonable regulations for buildings to protect neighborhoods. I suspect we’ll still be struggling with this in 2111. +0.5

16. Improve the housing of “people of small means”, ie, affordable housing. +0

17. Bond issues, taxes, and relation to state government. We got a AAA rating again, so let’s call it +1.

Total:  8.5/17 points, or 50%.  Still lots to do.