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Wednesday, Nov. 4, 2009

Milwaukee County Zoo Faces Privatization Study

Decision-makers promise it’s not a “done deal”

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Milwaukee County supervisors shot down a plan to go ahead and privatize the Milwaukee County Zoo last week, a plan that had been billed as merely a $60,000 “study” of potentially privatizing the zoo. But in fact it was much more.

That budget item actually contained about $40,000 for outside legal counsel to draw up documents to create a “not-for-profit corporation to assume operation and management of the Milwaukee County Zoo effective October 1, 2011,” as well as $20,000 for an outside consultant to study whether privatization was the best step for the county and the zoo.

The $60,000 amendment was rejected by the county’s Finance and Audit Committee last Monday.

Instead, the committee passed an amendment proposed by Supervisors Lynne De Bruin, Gerry Broderick and Jim (Luigi) Schmitt, which set aside $20,000 for a consultant to study privatization, then report back to the county board in early 2010 for further action.

“My amendment was designed to pull out all of the language that said it’s a done deal,” De Bruin said.

Zoo Director Chuck Wikenhauser confirmed De Bruin’s account.

“It’s a study,” Wikenhauser said. “It’s not a done deal.”

Wikenhauser said he’s studied privatization every few years, but the idea never went beyond that. This year, though, was different. The county’s severe budget crunch has made Wikenhauser wonder if the zoo will receive adequate funding from the county for its operations. County Executive Scott Walker had proposed a $2 million cut for 2010, from $5.4 million in 2009 to $3.4 million next year. In 2008, the zoo received $6.4 million from the county tax levy.

“The zoo is subject to whatever the [county’s] budget is each year,” Wikenhauser said.

Supervisor Broderick said the budget crunch was due in part to the unwillingness of the governor and both houses of the state Legislature to approve a 1-cent sales tax for the parks, transit, cultural assets, emergency medical services and property tax relief, which county voters supported last November. Part of that sales tax would have been directed to the zoo.

“We’d be in a very different place if that had gone through,” Broderick said. “The budget would be very, very different.”

Karen Peck Katz, the former chair of the Zoological Society of Milwaukee, said that organization favored studying privatization because donors would prefer to give to a nonprofit over a government-run entity.

“It should be explored, whether good or bad,” she said.

David Sikorski, vice president and chief steward of AFSCME Local 882, which represents zoo employees, said the real target of the privatization plan is the dedicated group of unionized zookeepers and zoo employees.

“I think that’s the ‘Phase II’ of this project—to dissolve the union positions there,” he said.

Is Privatization the Only Option?

Wikenhauser’s privatization vision is for the zoo to continue receiving some financial support from the county, which would still own the facilities and grounds. But a nonprofit entity would operate and manage the zoo, and raise funds from memberships, contributions and revenues.

Wikenhauser said that fund-raising during a recession does worry him, but that the Zoological Society’s ability to attract contributions shows that people are still willing to give to the zoo.

“It’s no doubt that there would be a couple of tough years, just getting it started,” Wikenhauser said.

He said that the study would look at a host of unanswered questions, such as union employee contracts and inefficiencies and redundancies in the budgets of the county and the Zoological Society. But he admitted that some things might be more expensive under a new nonprofit entity. For example, Wikenhauser explained, the county is self-insured, so if someone is hurt at the zoo grounds the county will cover it. But a nonprofit entity would have to purchase insurance, which most likely would be more expensive than the county’s umbrella coverage, he said.

De Bruin said privatization isn’t the only option. After analyzing the forthcoming study, the county could decide to keep the zoo under county control; create a public-private partnership; or make financial changes that don’t require a governance change.

“We may learn ways to reduce the cost of operating the zoo without privatizing it,” she said.
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