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Wisconsin back in Top 10, this time for debt

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News River Falls,Wisconsin 54022
River Falls Journal
Wisconsin back in Top 10, this time for debt
River Falls Wisconsin 2815 Prairie Drive / P.O. Box 25 54022

Wisconsin is once again in the Top 10, but this time it isn't for taxes.

Instead it's for the amount of personal income state and local governments must devote to debt payments.


According to the nonpartisan watchdog group Wisconsin Taxpayer's Alliance, Wisconsin has traditionally been a low-debt state, but that's not the case anymore.

"In the late 1990s and in the early part of this decade at the local level you saw a lot of new schools being built, which increased the debt," said Dale Knapp, WisTax research director.

"At the state level the big reason for the increase in debt was the financial problems the state budget was facing and still faces," he added.

Knapp noted that rather than increase taxes or cut spending state legislators and the governor transferred money out of funds like the transportation fund and then borrowed money to complete transportation projects.

It wasn't always this way.

The Badger State has traditionally been a low-debt state, according to WisTax, but the climb into the Top 10 has been fast. In 2000 the state ranked 21st.

Based on figures from 2006, WisTax found that Wisconsin state government was ranked 13th in the amount of personal income spent on debt. Per person state debt amounted to $1,619.

Meanwhile, all local governments combined were ranked at No. 21 with per person debt at $1,439.

In their analysis, the group found that debt per student in the state's school districts varied widely, but overall it was $6,002.

"This is somewhat surprising," Todd Berry, WisTax president said. "State government here accounted for 57 percent of debt service, even though it did only 42 percent of all spending."

However, things are changing for school districts, according to Knapp.

"We have seen school debt level off and decrease because the number of students is decreasing, which means fewer schools are needed," Knapp said.

"Some school districts are also being more frugal," he added.

While things are changing for school districts, things remain the same for state government debt as the state continues to borrow in order to balance the budget, according to Knapp.

"We continue to do this with the latest budget and with the budget repair bill that was passed this spring," Knapp said.

More information is available on the WisTax Web site at