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Friday, March 6, 2015 |  Madison, WI: 26.0° F  Mostly Cloudy
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Soglin: The debt ceiling is rising!
Former mayor sounds dubious alarm over city's fiscal health
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Cieslewicz (left) says the city should get 'bullish on borrowing.' Soglin asserts that it's actually becoming reckless.
Cieslewicz (left) says the city should get 'bullish on borrowing.' Soglin asserts that it's actually becoming reckless.

Paul Soglin calls it a huge problem. Under Madison Mayor Dave Cieslewicz, he alleges, the city's budget has become "structurally unsound." He compares it to (gasp!) the state's.

"The state of Wisconsin has enormous structural budget problems," says Soglin, who served two stints as Madison's mayor and now seeks a third. "The Cieslewicz administration is patterned after [state] practices: have an excess of borrowing and bad ratios; move capital budget items to the operating budget."

There is a basis for Soglin's critique - the city's debt load is rising - but his grasp of the policies he's criticizing is less than absolute.

First, the issue of debt. Soglin says Madison's debt per capita has "just about doubled since Dave became mayor," from $645 to $1,331. The latter figure, crunched for Soglin by former city comptroller Paul Reilly, is based on the city's projected borrowing through the end of 2011. But current comptroller Dean Brasser says the last reliable number is about $1,200, for 2010, and includes some growth from inflation (about $120, according to one calculator).

Cieslewicz, citing historically low interest rates, has called on the city to get "bullish on borrowing." But Soglin says it's actually becoming reckless.

"When I was mayor," he says, "we decided...our debt as a percentage of total city expenditures should be no greater than 12.5%. Dave Cieslewicz's administration has raised that level to 15%. When Dave came into office, [the actual] ratio was 10.7%; it's now 12.7%."

A chart (PDF) provided by Brasser confirms that the city's projected 2011 debt ratio is 12.71%. But this ratio, it also shows, was slightly higher in 2001, at 12.88%, under Mayor Sue Bauman; and 1996, at 12.73%, under Mayor Soglin.

Moreover, the city has not raised its debt target to 15%. Brasser says the ratio last rose in 2004, from 12% to 12.5%, where it remains.

Brasser affirms the obvious - that these thresholds are a target, "not a hard-and-fast rule." Another measure (PDF) shows Madison's ratio of debt to equalized value has hovered for two decades at around 1%, well within the 5% limit set by the state. Brasser: "We have all kinds of capacity to borrow more money."

But Soglin says even incremental increases in debt have major consequences, and points with alarm to a chart (PDF) on the city's website showing the projected debt ratio rising to more than 20% in 2015 through 2017.

The city pegs these projections as artificially high, as they assume all projected borrowing will occur, when generally only a portion does. Soglin responds that "even if you cut in half our actual borrowing, the trend line still would be over 15%."

Brasser demurs, saying the actual ratios in these "out years" are quite difficult to predict. A similar chart (PDF) from 2005 projected a ratio of 15.32% for 2010; the city's actual ratio that year was 12.28%.

Soglin also accuses Cieslewicz of moving hundreds of items from the operating budget to the capital budget, for which money is borrowed. He notes that past budgets itemized expenditures for things like desks and chairs in an operating budget category called "fixed assets," later "capital assets." In many cases, that's no longer happening.

"Here's engineering," says Soglin, reading city budget docs. "In 2003, there was $26,000 for capital items. In 2011, zero. In streets, it was $38,000; it's now zero. In parks, it was $76,000; it's now zero. In fire it was $317,000; it's [now] $32,000."

Again, Soglin's source for this observation is Reilly, who sees "a pattern where year after year there are fewer" of these items listed. Reilly says one of two things is happening: Either the city isn't buying these items anymore or else is doing so "some other way."

Asserts Soglin, "We're borrowing for them." He speculates the city is using money left from other capital project to "go shopping" for these items.

Brasser offers a different and more authoritative explanation. He says the city merely "updated our capitalization policies to be more in line with current standards." Smaller items are no longer individually listed, but are still purchased from operating budget funds, in the category of "minor objects."

Some larger-ticket items that used to be in the operating budget, Brasser concedes, are now purchased through the capital budget, for which money is borrowed. But he says the city has also shifted much spending from the capital to the operating budget.

"We're working to be accurate and honest with what our capital needs are," says Brasser.

Making a list

A few years back, Madison library director Barb Dimick predicted it was only a matter of time before federal agents showed up demanding to see patron lending records, as the 2001 USA Patriot Act allows (Watchdog, "'It's Going to Happen Here,'" 12/27/02).

The law bars librarians from revealing whether they've gotten such requests, so there's no point in asking if this has occurred. But back then Dimick noted that the library's record-keeping system tracked only what was currently on order or checked out; once an item is returned, no record of who borrowed it remains.

Flash forward to 2011.

Most libraries in the South Central Wisconsin Library System - encompassing a seven-county area, including Madison - are converting to a new LINKcat circulation management system that can record this information.

But Tana Elias, the Madison Library's web resource coordinator, says this function will be "turned off by default" for individual users. It will be available only on request - for those who want to track their library use or aren't worried that Uncle Sam could learn they've been reading Marx again. Only the borrowers themselves and library staff (and, of course, possibly the Feds) can access this information.

"As a public library, we're very concerned about customers' privacy," says Elias, "sometimes more than the customers are." She notes that people commonly share info about what they're reading on social networking sites. "People enjoy it. They like to see what others recommend."

The new system is in its final stages of testing with a planned February launch. Efforts will soon be made to inform users of its capabilities.

Not so Super

The local Rape Crisis Center and SlaveFree Madison are asking folks here to pause from cheering the Green and Gold this Super Bowl Sunday long enough to take a stand against the human trafficking that's part of this event.

It's estimated that nearly 10,000 prostitutes, including children, were sent to Miami last year to meet the Super Bowl demand. This year Texas Attorney General Greg Abbott has predicted similar numbers in Arlington, calling the Super Bowl "a magnet for prostitution and human trafficking."

And so the two Madison groups, in concert with similar efforts across the country, have created a website, to raise awareness of the problem. "If people want to get involved," says RCC executive director Kelly Anderson, "they will 'sign on' with name and community and share the information with others. We link to sites about human trafficking, particularly sex trafficking of children."

Other than that, enjoy the game.

Majority report

State Sen. Frank Lasee (R-De Pere), paired in a radio interview last Friday against the guy who writes Isthmus' popular "Watchdog" column, denied that the state GOP's actions to date, such as making it harder for state residents to sue those who injure them, represent "radical" moves. His message was: Just you wait.

"I think the changes are actually fairly mild, in a lot of ways," Lasee said. "I think we've got much larger changes in the next couple of months that are going to be proposed," especially with regard to public employees. Gulp.

Lasee also opined: "People on the left think money can be invented, and maybe if you pay people to go break windows, we'd create economic activity when they get repaired."

Paging Keith Olbermann....

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