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Madison budget boost favors construction

Paul Snyder
paul.snyder@dailyreporter.com

A multimillion-dollar construction spending boost to Madison’s 2010 capital budget is carving a line between an industry that wants work now and those who predict crushing debt.

“Frankly, we’ve got so many people not working right now that the promise of something next year would mean a lot if it meant a little less in the future,” said Gail Hohlstein, a laid-off worker with Carpenters Local 314 who last worked in the Madison area in March.

But Alderwoman Judy Compton said the city is selling its future to pay for the present. She said Madison is missing the message that it’s time to tighten belts.

“We’re spending money like we have it,” Compton said. “Either we’re not as poor as we let on or we were just paying lip service to being very frugal. I’m let down.”

The Madison Common Council next month will vote on a city budget with an additional $7.5 million to spend on projects. Most of that money would be borrowed and paid off in future budgets.

City borrowing is not a problem, said City Comptroller Dean Brasser. He said Madison’s estimated debt level in 2010 is 1.16 percent of the city’s equalized value, far below the state’s 5 percent limit.

Yet city debt payments are expected to increase by almost $8 million in 2011, which means future budgets will face spending cuts. Brasser said that means city departments, which dealt with mandatory cuts last year and this year, likely will continue to do so.

George Hank, director of the city’s Building Inspection Department, said he was fortunate this year to retain all 45 department employees. If the next city budget forces him to lay off workers, Hank said, builders and developers can expect slower rates of service, longer waits for plan reviews and longer response times to project or building complaints.

“In the last five years, we’ve never lost anybody,” he said. “When the day comes that we do have to lose somebody, you know it’s going to be pretty bad out there.”

In addition to increasing the capital budget proposal by $7.5 million, the city’s Board of Estimates on Monday preserved city financing for the estimated $100 million redevelopment of the Edgewater Hotel and the estimated $37 million Central Library project.

That may be the most reassuring news for builders, Hohlstein said.

“Any work is going to help,” she said, “but the length of the job is important because then you can talk about benefits.”
Yet the prospects for future projects are grim, Brasser said. If the city keeps borrowing money at the current rate, debt payments could increase by more than $25 million by 2016. That could be offset, he said, if federal and state revenues increase or the city generates more money.

But if the city’s economic landscape remains static, Brasser said, future budgets will be need bigger spending cuts.

It’s the possibility of barren budgets in years to come that bothers Compton.

“The money’s the money,” she said. “The taxpayer doesn’t care how it’s broken down. They pay one tax payment, and I’m absolutely blown away by how we’re spending.”

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