Milwaukee's Common Council voted to increase the city's sales tax by 2% to prevent impending bankruptcy. The decision, reached after intense debate, aims to address a significant budget shortfall and maintain essential city services like police and fire departments.
City officials had warned of drastic cuts to vital services if the tax increase wasn't approved. These cuts could have included layoffs of hundreds of police officers, firefighters, and other city employees, alongside potential library closures and reduced sanitation services. The increased revenue, estimated at nearly $200 million annually, is earmarked for pension obligations and bolstering public safety personnel.
The state legislature recently granted Milwaukee the authority to raise its sales tax, a power it previously lacked. This move was part of a larger state aid package for local governments. However, the deal included stipulations that drew criticism, such as limitations on diversity, equity, and inclusion initiatives and mandated police presence in Milwaukee Public Schools. Despite these concerns, the council approved the tax hike with a 12-3 vote, exceeding the required two-thirds majority.
While proponents emphasized the necessity of the tax increase to avoid a Detroit-style bankruptcy, opponents voiced concerns about the burden on low-income residents. Alderwoman Andrea Pratt, while acknowledging the city's financial predicament, expressed reservations about the disproportionate impact on those with fixed incomes.
With the city's approval secured, the combined sales tax in Milwaukee could reach 7.9% if Milwaukee County follows suit and approves its own sales tax increase. The county board is expected to vote on this measure later this summer.
Milwaukee City Hall is seen Wednesday, June 14, 2023, in Milwaukee. The city's Common Council has voted to raise the sales tax by two cents in a bid to avoid bankruptcy. (AP Photo/Morry Gash)
