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SB Friedman report shows State interference in residency law had devastating impact on Milwaukee

In 2013, the state legislature invalidated the City of Milwaukee’s 75-year-old residency requirement, and that action has led to a significant loss of revenue and community leaders in local neighborhoods.

Alderman Michael J. Murphy pointed to the study by SB Friedman as proof that the state’s interference into local affairs was once again having a negative impact on the City of Milwaukee.

“Employees spend a good 25% of their money on housing. That income is now supporting other communities and suburbs,” said Alderman Murphy. “This further demonstrates how the state is not looking out for the interest of its urban economic centers.”

Since the Wisconsin Supreme Court enforced the state legislature’s 2016 decision, 1,367 city employees have moved outside of Milwaukee to area suburbs and neighboring cities. That number means 0% of Milwaukee’s employees are now non-residents who are not invested in the day-to-day outcomes in the city.

According to the SB Friedman report shared by the Legislative Reference Bureau, because of the residency law change the projections could create an increased exodus to suburban locations, reductions in housing construction, and a decline in consumer expenditures and services in the city. By 2024, it is predicted 4,070 of employees will non-residents, nearly 2/3 of the City’s employees. The ultimate impacts found in the report include:

  • Reduced consumer expenditures on retail goods and services in the city of up to $57 million annually
  • Reduced tax base of approximately $649 million, $622 million attributed to land and improvement value and $27 million to commercial property

“The city never asked for the State Legislature to change state law. But that’s what happened and now we are seeing the effects of that action and it’s difficult to fathom,” said Alderman Cavalier ‘Chevy’ Johnson. “The State Legislature deserves to know the disastrous toll the residency law change has taken – and will continue to take – on the Wisconsin’s premier urban center and engine of the regional economy.”

The highest percentage of employees who live outside the city are sworn fire fighters and police officers, with fire department employees making up 37% of non-residents and 33% of Milwaukee’s sworn police force. Annually, non-resident employees earn $92.5 million, $47.6 million going to sworn police officer payroll.

“There are some very concerning trends that were outlined in the SB Friedman report. The state needs to answer for this situation,” added Alderman Murphy.

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