May 1997

In calendar year 1997, the Department of Transportation will provide more than $400 million in state and federal aid to help local governments fund costs associated with Wisconsin’s 97,144 miles of local roads. The General Transportation Aid program will provide $292.9 million of this amount to fund a percentage of the cost of local road maintenance and construction, as well as police, street lighting, storm sewer, and sidewalk costs.

Local officials have called for increases in state transportation aid of between $33 million and $183.9 million to reduce pressures on local property taxes, meet the need for rehabilitation of many local roads, and reverse declines in aid rates for many communities. Despite increases in state aid that exceeded inflation by 26.9 percent since fiscal year 1987-88, aid rates for counties and larger municipalities have declined in recent years because of the Legislature’s decision to direct most new aid toward smaller municipalities in an effort to better balance total state aid.

Some Local Costs Are Reimbursed by Special Assessments and Transportation Aid

In the general transportation aid calculation, special assessments for new road construction or rehabilitation are not subtracted from local costs, as are other local transportation revenues. As a result, 361 communities that in 1995 collected $16.8 million in special assessments for road projects will receive approximately $3.2 million in general transportation aid for costs already funded by adjacent property owners. If the Legislature chooses to exclude costs reimbursed by special assessments, it could modify s. 86.303(6)(e), Wis. Stats., to designate special assessments as an offsetting revenue under the general transportation aid formula.

Police Costs Are an Increasing Share of Aidable Costs

In recognition of the cost of patrolling roads, a percentage of police costs--ranging from 30 percent for large communities to 80 percent for small ones--is eligible for general transportation aid. Eligible police costs have increased 55.1 percent between 1988 and 1995, surpassing the rate of spending increases for local road maintenance (42.4 percent) and construction activities (47.3 percent). Growth in spending on law enforcement, which may be attributed in part to public concern about crime, has led to concerns that the general transportation aid formula may support a greater percentage of police costs than is necessary to assist local governments in patrolling roads. In addition, some communities receive nearly all of their transportation aid based on their spending on law enforcement. If the Legislature believes that a greater share of local transportation aid should be directed toward local road maintenance and construction activities on existing roads, eligible costs could be modified to include a lower percentage of police costs for some or all aid recipients.