State, local government debt rises

The total debt owed by local governments in Wisconsin rose by 5.4% in 2020, according to a new report from Wisconsin Policy Forum. Debt levels reached the highest on record on Dec. 31, 2020, when cities, counties, and other local governments owed $11.04 billion. The amounts recorded mark an increase of $566 million over the prior year and the most ever even after adjusting for inflation and the growth in population in the state over time. Forces including low-interest rates, replacing aging infrastructure, and updating IT systems have pushed up local borrowing in recent years, particularly for cities. State law has also incentivized borrowing for local governments rather than paying for projects and capital purchases in cash.