From the looks of things- the city's $9.1 million flub will cost taxpayers even more money. My guess is that the city will borrow the money.
MJS suggests they may be able to borrow the money "internally" from other departments. The problem with this is folks will be then question why these departments have an extra $9.1 million laying around that can be given to MPS. If they borrow the money internally, why didn't they do this in the first place and not charge the people in Milwaukee?
One possibility would be to borrow the money, but that would likely involve interest costs, unless it was done through "internal borrowing," that is, borrowing from a different city-controlled fund.
So, I think this plan is out of the question. This would open up a huge can of worms.
My guess is, the city will borrow the money "externally" forcing the taxpayers to pay interest on a $9.1 million on next year's taxes because of the city's mistake. Clearly the taxpayers will then pay well more than $9.1 million because they will have interest to pay on the loan.
By the way, what is lost in all of this the taxpayers still received a levy increase by the schools and they were charged this on their tax bills this year. In May of this year, the MPS already gave themselves a $7.4 million increase. The increase was on this year's tax bills passed on to the taxpayers. The problem came when MPS decided in October that they needed an extra $9.1 million- this additional increase did not get charged to the taxpayer's this year.(not yet anyway, but the bill is coming)
Check out the sweetheart deal that MPS gave themselves this year.
1. State aid to MPS is increasing this year. This means every taxpayer in Wisconsin is paying for this. MPS is receiving an extra $1.65 million in state aid, even as enrollment continues to fall in Milwaukee-
In her memo, Nate blamed MPS' small aid increase on a jump in per-student property valuation - the result of declining enrollment and increasing property values, which can cause a disadvantage for school districts in aid calculations - and a $7.6 million increase in its deduction for the Milwaukee Parental Choice Program.
2. In May this year, MPS gave themselves an additional $7.4 million in tax levy increases.
3. In October this year, MPS gave themselves an additional $9.1 million in tax levy increases.
If the revised budget is approved as proposed, it will bring a $16.5 million increase in property tax revenue for MPS, up from $213.8 million last year to $230.3 million this year. The 7.7% increase would be lower than a 13.2% increase two years ago, but higher than any other year since 1998-'99.
4. In October of this year, an extra $6.7 million was "found" in the budget and MPS decided to keep the money instead of passing this saving on to the taxpayer!
Millions of dollars that had been freed up within the $1.15 billion budget for the 2006-'07 school year could be used to hold down the tax increase. Or they could be used to increase spending by $78.90 per student across the MPS system - totaling almost $6.7 million.
So all in all, the MPS Board gave themselves an additional $25 million for the next school year even as enrollment continues to drop!!!
Better yet, the MPS still is not educating the students the way they should be. This year, it was announced that the MPS has one of the worst graduation rates in the NATION!
Milwaukee public high schools have one of the worst graduation rates in the country among large school districts, according to a new report that takes the unusual step of trying to make comparisons across large school districts as well as states.
So what we have here a dropping enrollment rate, an extremely poor performing school district, and a greedy school board. The taxpayers are then forced to give these folks an extra $25 million to squander.
Congratulations Taxpayers, you're getting pounded!