Joint Finance Closes $54 Million Transportation Funding Deficit, Delays Southeast Wisconsin Interstate Projects

JFC Members Back Most of Governor Walker’s Recommendations and Add Multiple Earmarks

MacIver News Service | May 23, 2013

[Madison, Wisc…] The Joint Committee on Finance voted 16-0 on Thursday to reduce net spending for the Department of Transportation fund by almost $60 million to close a projected deficit and is now expected to end the biennium with a balance of about $5 million.

The Co-Chairs of the Committee, Sen. Alberta Darling (R-River Hills) and Rep. John Nygren (R-Marinette), introduced omnibus motion #431, which supported many of Governor Scott Walker’s recommendations.

The budget shortfall was originally expected to be $63.5 million but is now expected to be just over $54 million.

Omnibus Motion DOT.png

The politically expedient way to solve the deficit would have been to increase bonding or raise taxes and fees. The Transportation Finance and Policy Commission said in January that Wisconsin should raise the gas tax by five cents per gallon, increase the drivers license fee by $20, and hike up other fees as well.

Taxpayers saw a small victory on Thursday when JFC members voted to keep transportation bonding at the Governor’s recommended level, and refused to increase taxes and fees.

To close the gap, JFC members decided to delay two major road construction projects in southeast Wisconsin and cut funding to other programs. This motion would delay construction on the Ryan Interchange in Milwaukee, until a future budget, at a savings of $19 million.

The Committee also decided to delay a portion of the construction on the Zoo Interchange in Milwaukee by decreasing funding by $14 million. A majority of the Zoo Interchange project is being paid for by $200 million in transportation fund-supported bonding and $102 million in general fund-supported bonding, which was not changed.

The Hoan Bridge project will also see a cut of $10 million, but JFC will allow the Department to use other DOT funds to cover costs above $226 million. The Committee cut funding by $7.3 million to the Major Highway Development program as well.

While southeastern Wisconsin residents will labor the fact that some major projects are being delayed, counties and municipalities around the state will see increased general transportation aid. This includes an increase in the mileage aid rate to municipalities from $2,117 per mile to $2,167 per mile and an increase in county transportation aid from $94.6 million to $96.9 million per year starting in 2015, followed by a 2.4% increase thereafter.

A major spending initiative of Governor Walker’s budget was the creation of 180 new engineering positions at DOT at a cost of $27.4 million over the biennium. The administration claims this will save $5.5 million.

Fiscally conservative members of JFC, in an effort to provide a transparent view of the costs of private consultants, added a provision that would direct the Legislative Audit Bureau to conduct an analysis of private consultant work done for DOT to ensure taxpayer funds are spent wisely.

While JFC did not increase bonding, taxes, or fees, the Committee did adopt what seemed to be a few pet projects for individual members.

The largest spending increase was $3.6 million in discretionary grants for the relocation of the Sheboygan and Manitowoc Highway. The grant is to not exceed more than 50 percent of the project costs or more than $4.2 million.

In a bi-partisan amendment to the original motion, JFC voted unanimously to increase mass transit aid by 4 percent, to a total of $5.3 million. The amendment would also provide $250,000 in additional paratransit aid and delete the Governor’s provision that would have required the Transportation Projects Commission to recommend which road construction projects should be removed from the list of enumerated projects.

After nearly three hours of breaks, JFC finally returned to the table and voted 16-0 to pass the omnibus motion as amended without any debate.

In other business, JFC took up the UW System budget and passed an omnibus motion on a bipartisan 14-2 vote that will permanently reduce funding to the UW System and add more accountability to the universities.

Members voted on Thursday to reduce GPR funding to the UW System by $183.8 million and delete 13 GPR FTE positions. The motion requires the university system to pay for many economic development programs, the 13 FTE positions that GPR funding was deleted for, and reduces their base budget by $32.8 million annually.

On top of the many cuts in funding to the UW System, the omnibus motion will require the system to develop an appropriate methodology to calculate appropriation balances and report the balance limits to JFC by January 1, 2014.

Tuition is frozen for the 2013-2014 and 2014-2015 school years under the omnibus motion and all student segregated fees cannot exceed the amounts charged in 2012-2013. Along with freezing tuition and segregated fees, JFC voted to make mandatory refundable fees for inter-institutional student government organizations optional and not as a required addition to other student fees.

JFC will meet next Wednesday at 10am to discuss Sales and Excise Taxes, the Department of Health Services, and the Department of Public Instruction.