Janesville Street Funding Referendum Deserves Support
On November 4, 2014, Janesville voters were asked whether or not to allow the City of Janesville to raise property taxes by $1.2 million per year to fund a five year expansion of the city’s street rehabilitation program. While the proposal was defeated, Forward Janesville endorsed the referendum. Here are our reasons why:
The state has very strict limits on how much property taxes can go up annually, which gave the city two ways to pay for the proposed program: asking citizens to contribute more or borrowing the money. Forward Janesville thinks the city was wise to choose the referendum path, and we urge the citizens of Janesville to vote yes on November 4, 2014. Here’s why:
Wisconsin’s harsh winters take a heavy toll on our streets. The city maintains about 330 miles of streets. The average lifespan of a street is 25-30 years. To stay ahead of this deterioration cycle, the city should really be restoring 10 to 13 miles of streets every year. The city is doing half that much currently and it shows. Nearly ten percent of Janesville’s streets are rated as “poor” or “failed,” and that number is projected to reach 22.8 percent by 2016. It is in all of our best interests to fix a street before it gets this bad, as rehabilitating a “poor” or “failed” street costs twice as much as resurfacing a street in better condition.
According to the nonpartisan Wisconsin Taxpayers’ Alliance, Janesville is ranked second to last among peer cities in street maintenance spending per citizen: $50.53 in 2012. We trail only Kenosha, who spends $42.24 per person on street maintenance. Contrast this with the highest spending city (Manitowoc), who devotes over $150 per capita to their streets. It’s interesting to note that the midpoint on street maintenance among our peer communities is $97, meaning Janesville’s spending on this item is extremely low. In fact, the city ranked just ahead of us (New Berlin) spends $74.02 per capita on street repairs.
Some argue that the city council should just borrow the money for an expanded street repair program, and this point warrants some discussion. The Taxpayers’ Alliance figures cited above also show that Janesville has borrowed frugally and responsibly throughout its history. Our debt per capita is significantly smaller than other Rock County communities, and trails only Appleton among the state’s largest cities. Janesville has the capacity to borrow money for street repairs, but just because we can doesn’t mean we should.
Borrowing for street maintenance is a bad investment because it creates added cost (interest payments) with very little return on the investment. This is because we are borrowing to improve an existing asset. As the interest payments grow over time while other revenue sources decline (e.g., state and federal aid, gas tax revenues as people drive less, etc.), you are left with less money overall. As a result, the street maintenance program gets squeezed. When we borrow to cover these expenditures, the city is forced to do more with less year after year. Without a more permanent solution to this problem, Janesville’s street maintenance program will continue to fall behind.
The choice on November 4 really comes down to whether we’d like to pay for this now or later. Deciding to pay now will get us a first class street maintenance program that our city can be proud of. Choosing to pay later will get us a less robust and more expensive program, because we’ll be paying for it with borrowed money.