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Wisconsin budget cuts include reduced transportaion aids to municipalities

Touting sweeping reforms to Wisconsin’s 2011-2013 biennial budget Governor Scott Walker proposes to slash spending for many state programs including the distribution of transportation aids to local governments.

According to a March 15, 2011 memorandum to the legislature by Bob Lang, the Director of the Legislative Fiscal Bureau, the budget bill (SB 27/ AB 40) reduces total funding for calendar year 2012 payments by $10,441,700 for counties and $32,850,700 for municipalities.

The bill establishes the mileage aid rate at $2,053 for calendar year 2012 and thereafter, a 3% reduction from the 2011 rate of $2,117 per mile.

Local governments will receive their share based upon a modified formula that will replace current law protections from a 2% reduction with as much as a 15% reduction.

Transportation aids are calculated on shared costs where villages and cities receive payments that target a percentage of average costs over six years. Counties receive a different percent of costs. And towns are paid a fixed cost through mileage aid based upon a statutorily set dollar amount per mile of road within their jurisdiction.

The formula was designed to prevent abnormal fluctuations by capping entitlements at 115% of prior year’s payment and guarantees Counties at least 98% of prior year’s payment while municipalities are protected with a 95% limit on aid reductions.

Lang’s memorandum indicates that the 10% reduction in funding under the bill sets the minimum payment guarantee at 85% of the prior year aid payment for both counties and municipalities.

Since aid payments under the share of costs aid formula make up a percentage of costs that is significantly lower than the 85% of three-year average cost maximum, this provision only affects municipalities, mostly towns, receiving mileage aid payments.

Lang provides an estimate for each county, city, village and town based upon a county's or a municipality's actual payment in any given year, relative to its six-year average costs change compared to those same costs for all other counties or municipalities. Annual changes in mileage can also impact a municipality's payment for those on mileage aid. For the purposes of this estimate, the cost and mileage data used to make the 2011 general transportation aid distribution was used. Actual payments to counties and municipalities will vary from this estimate depending on the actual, annual changes in costs and mileage submitted for the 2012 distribution.

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