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Offer good thru Sept 30,1986 •••••••••••••••• Wednesday, September 3,1986 Hie UWM £ost Page 3 Tax reform to squeeze renters Rent hikes likely as investors lose loopholes "If a building takes in $30,000 ering alternative forms of invest­ by Joanne Kegal in income but expenses of heat, ment," Gerhardt said. electricity and maintenance also He added that the tax plan is partment dwellers may equal $30,000, and you can't de­ retroactive, so it will effect all ex­ face a hefty rent increase preciate, there is no tax advan­ isting investors, and that con­ A as a result of the sweeping tage to owning real estate," he struction of new rental units tax reform legislation pending in said. would probably also be curtailed, Congress, which seems likely to According to Gary Gerhardt, bringing up rents on existing pass in September. units as housing demand in­ The legislation, which is ex­ creases. pected to be approved by the "So-called experts feel that "So-called experts feel that House and Senate, will probably rents will increase anywhere mean a hidden tax on all who rents will increase 10-35 per­ from 10-35 percent on a nation­ rent, according to Kurt cent on' a nationwide basis." wide basis," Widmann said. Widmann, a Milwaukee real es­ "Usually, Milwaukee does not tate investor and owner of keep up with the national aver­ Widmann Realty. Kurt Widmann age. We may see rent increases One target of the new tax re­ of from 8 to 15 percent in com­ form effort are so-called "pas­ Widmann Realty ing years," Widmann said. sive" real estate investors who in­ Widmann noted, however, that vest in ventures designed to cre­ president of the Milwaukee the tax shelters affected by this ate losses on paper, or deprecia­ Board of Realtors and general legislation are usually utilized by tion, which allows investors to •manager of the Glendale office owners of larger, newer apart­ take an accelerated credit against of Federated Realty Group, Inc., ment buildings. ordinary income on their rental "The loss of tax advantages for Since much of the rental hous­ properties. real estate investors will cause in­ ing on the East Side around The legislation would elimi­ vestors to put their money else­ UWM consists of duplexes and nate these depreciation tax loop­ where." smaller apartment buildings of holes, Widmann said. "A lot of people will be consid- four to eight units, their owners may not be affected by the elimi­ nation of these tax loopholes, Enclosure cost overrun Widmann said. "If the housing is older, and people have owned it for a long —Post photo by Jeffrey Phelps to be paid by students UWM's new chancellor, Clifford Smith, stood in front of his new Turn to page 15 place of residence at 4430 N. Lake Dr. The UW System provides by Susan Boswell the home for the chancellor. (See story on page 5) WM students will be picking up the tab for almost $500,000 in cost overruns for the Union North Enclosure project. U The project, which began eight weeks behind schedule be­ Shaw sees little relief from tuition hikes cause of higher-than-expected construction bids, will cost students $2.5 million — $480,000 more than the original budget estimate. lem," in that it "conservatively" (UW) Madison is about $350 be­ The additional costs were approved by the State Building Commis­ by Michael Mathias receives $600 less in state low the average. It's not to say sion June 25. Construction started on Aug. 15 and is expected to be subsidies for the cost of educat­ that everybody has to have the completed by April 8,1987. Construction was originally scheduled to 'W System President ing each student than the nation­ same tuition, but it does suggest begin May 1. Kenneth "Buzz" Shaw al average. He said that of the that, when we look at the re­ Originally, about half of the project was funded by a General Obliga­ Uipredicte d that Wisconsin three methods available to the sources, we can't exclude tui­ tion Bond which is being paid off during a 30-year period since 1984 students will face higher tuition System to counter this prob­ tion." by using $7 a year, which was added to students' segregegated fee costs in the future and said that lem—increased GPR funding, in­ In June, the Regents approved bills. Students will now be paying off that bond for a longer period of one of his top priorities for the creased fees and enrollment re­ a 12.4 percent tuition hike, in­ time, according to Kirby Stanat, director of Associated Union Services, coming year would be preparing duction—a mixture of the three creasing the cost of a full-time who developed the project. to implement the recommenda­ would probably be required "if undergraduate tuition at UWM to Additional funds are expected to come from North Enclosure tions of the Future Studies Com­ we're going to improve the quali­ $813.15 per semester. revenues, and from a $1 million grant from the now-defunct Facility mittee of the Board of Regents. ty of what we're doing." Shaw said that his office would Reserve, composed of accumulated segregated fees. Shaw, who took office last be proposing several new initia­ If the North Enclosure doesn't make an estimated $ 85,000 a year February, said in a telephone in­ tives during September's meet­ needed for maintenance, the annual $194 segregated fee will be terview Aug. 25 that part of the ing of the Regents in Madison raised, Stanat said. recommendations of the Regent "I think tuition will be rising as dealing with the subject of tuition committee would be a plan to in­ Stanat also said that the Union stands to lose revenue during the everything else has. The ques­ increases. construction process. He said the Union lost $400,000 in summer crease tuition but that "at no time "How can we do it to avoid stu­ convention revenue because construction was expected to have begun in our discussion has the idea of tion, in my opinion, is to keep it dents being priced out of the in May and conferences cancelled. Most conferences making Wisconsin a high tuition down to the point where access market? We'll attempt to show are held in summer and Stanat said there would be additional losses state surfaced." how that can be done (raising tui­ next year itthe project wasn't completed in time. Food sales, which to­ "I think tuition will be rising as remains a high priority." tion) and we will also be advocat­ taled $3.6 million last year are also expected to drop. everything else has. The ques­ Kenneth Shaw ing particularly for low income Bookstore manager Douglas Arthur said he expected sales to be tion, in my opinion, is to keep it students a great deal more finan­ down 10 percent during construction. down to the point where access cial aid so they are not adversely Ronald Umhoeffer, acting director for the UWM Department of remains a high priority." affected." Planning and Construction, said that it would have been fruitless to The Future Studies Committee Shaw also said that UW Sys­ rebid the project because the budget reflects the lowest bids possible. was formed by the Regents last But Shaw reiterated earlier tem schools were withstanding "The city is in the middle of a (construction) business boom," Stanat year to explore how the UW Sys­ claims that Wisconsin is a "low recent budget cuts in the UW said. "I think that if we had bid this thing before they were going to bid tem would deal with university is­ tuition state." System to the best of their the Bradley Center, it probably would have been bid for less," sues into the 21st century. "(UWM) compared to its urban abilities. Shaw, 47, said the UW System research institution peers is "The universities are doing the Turn to page 9 is faced with a "funding prob­ about $200 below the average; best they can with diminished re­ sources," said Shaw. "They have tried through selective cuts to not Activists note similarities, differences cut at the heart of the academic Inside program, and I think we've been between '80s, '60s student protests pretty successful at that. But you can't cut that amount of money Meet the chancellor However active students on campuses out of the budget without feeling by Sharon Leslie across the nation have recently become, '60s its effects, particularly when you page 5 activist and writer Abbie Hoffman said in an are already underfunded per stu­ he more things change, the more they interview with the UWM Post that student ac­ dent." No piece of this rock remain the same.