Budget Blog – Tackling The Easy Stuff First

May 12, 2017

The Joint Committee on Finance chipped away at the budget this week, focusing on some of the least contentious items of Gov. Scott Walker’s proposal.

On Tuesday, it took up Secretary of State, WEDC, Military Affairs, Legislature, and Justice. Then on Thursday it addressed Financial Institutions, PSC, DSPS, VA, Legislature and DHS (MA Administration). The lack of controversy was evidenced by about three dozen items approved unanimously.

All week, everyone’s attention seemed focused on the Assembly Republican’s transportation and tax plan, which was released on May 4th. The plan would lower the gas tax and minimum markup rate, but then apply sales tax to gas purchases. It would also put the state on the path toward a 3.95 percent flat tax by 2028, eliminating several credits right away like the marriage credit, working families credit, first dollar credit, and rent credit.

Walker immediately dismissed the plan as a tax hike. On Wednesday, Senate Majority Leader Scott Fitzgerald said it was a non-starter. He suggested more bonding and toll roads as a more appropriate solution to transportation funding. The Assembly is sticking with its plan, but Rep. John Nygren said they were at an impasse.

Thursday morning, JFC co-chairs Sen. Alberta Darling and Nygren said they might take transportation out of the state budget and deal with it as a separate bill. That could be complicated because some options involve transferring money from the general fund to DOT. Both Walker and Fitzgerald said they do not support that idea.

In addition to transportation, there is also disagreement between the governor and the legislature on self-insurance. The governor says the state could save $60 million by switching to a self-insurance model for 225,000 state employees. JFC is opposed to that idea. There is talk lawmakers are working on a high-deductible state health care plan, including health savings accounts.

On Wednesday, the Legislative Fiscal Bureau reported that year-to-date tax collections match the estimates made in January. Nygren said he’s satisfied with that news and many states aren’t so lucky.

Next week JFC is scheduled to take up: Lower Wisconsin State Riverway Board, Kickapoo Reserve Management Board, State Fair Park, Elections Commission, Ethics Commission, Administration (General Agency Provisions), Health Services (Care and Treatment Services), and Children and Families, Labor and Industry Review Commission, Wisconsin Technical College System, Historical Society, and Shared Revenue.