At about 5:00 pm today, as most Wisconsinites were starting the 3-day weekend, the budget committee co-chairs unveiled a “wrap-up” motion that is 24 pages long and stuffed with 67 different items – many of which are special interest measures that have nothing to do with the state budget. This omnibus motion is the culmination of more than a month of deliberations behind closed doors that included special interest groups, while excluding the general public. Read more
The timing of this motion – right before the holiday weekend and so close to the planned completion of the budget bill – makes it almost impossible for these complicated issues to get anything close to the public and legislative scrutiny that they deserve.
If you were planning to celebrate the fiscal New Year today, I hope you haven’t let your spirits be dampened by the fact that we don’t have a new budget yet. Although the budget process this year has been extremely disappointing, the failure to finish by July 1 isn’t a serious concern – thanks to a very sensible statute that allows spending to proceed at last year’s level until a new budget is enacted. Read more
The problem with this year’s budget process is the fact that it’s been more than a month since legislators have had an open meeting to debate the budget bill. For the entire month of June, which is when the biennial budget is generally debated on the floor of each house of the legislature (and sometimes also in open caucus meetings), all of the budget debates took place behind closed doors. That’s a problem not only because the public has been shut out of the process for over a month, but also because once we get to see the product of those private meetings there will be little or no time to review and react to the budget changes.
Compensation of CEOs at major U.S. firms continues to skyrocket, according to a new report by the Economic Policy Institute. To some extent that trend can probably be attributed to broad economic forces, but policy choices at the national and state level also contribute to the huge disparities in income and wealth.
The EPI report was interesting reading today – against the backdrop of Assembly GOP leaders announcing a plan for substantially reducing the prevailing wage law for public sector projects and releasing the details of a Bucks arena plan that will be a boon to the team’s very wealthy owners and players. Those two issue areas are great illustrations of how public policy decisions can exacerbate the widening income gap. And once the budget process resumes, we will learn whether legislative leaders plan to compound the problem by proceeding with a proposal to reduce taxes on very high income Wisconsinites by reducing or eliminating the alternative minimum tax – even as the budget makes cuts that will hurt low-income state residents Read more .
A Supreme Court decision expected within the next week could price health insurance out of reach for millions of Americans, including most of the 183,000 Wisconsinites insured through the federal Marketplace; however, state officials could head off that outcome. In Wisconsin it’s particularly important for state lawmakers to remedy the problem because they made our state more reliant on federal subsidies for the Marketplace when they ended BadgerCare eligibility for about 60,000 adults and 3,000 children. Read more
Wisconsin has more at stake than most other states when the U.S. Supreme Court issues a ruling in King v. Burwell, which will determine whether people can continue to get federal tax credits for health care coverage purchased through the federal health insurance marketplace. Read more
Wisconsin lawmakers on the legislature’s budget committee will probably meet this week to make decisions about a proposed income tax cut for high earners and other changes to Wisconsin’s tax system, among other issues. They should keep in mind that new evidence shows that no state that passed large income tax cuts in recent years has seen its economy grow faster than the national average. Read more
State lawmakers have learned how to manipulate the structural deficit/surplus calculations by making unrealistic assumptions about future spending and by moving debts further into the future.
Under Proposal to Eliminate the Alternative Minimum Tax, Only Highest Earners Would Receive a Significant Tax Cut
Lawmakers have proposed eliminating Wisconsin’s Alternative Minimum Tax, a change that would give a tax cut to some people with high incomes and exclude nearly all taxpayers with incomes under $100,000. The legislature’s budget committee is likely to vote on the proposal next week. Read more
The process of open deliberations on the state budget bill has ground to a halt, as leaders in the majority party negotiate behind closed doors in an effort to resolve some of the unsettled budget issues. The result of this strategy and the delayed timetable is likely to be substantially less opportunity for the public to weigh in with legislators regarding the numerous issues that emerge during the closing stages of the budget process. Read more
Legislators have taken a break from public debate on the budget as they meet privately to try to hammer out agreement on a few key issues, including how to pay for major highway construction projects. There is not nearly enough money in the state’s Transportation Fund to pay for the highway expansion and other planned transportation projects. But lawmakers are reluctant to increase the gas tax, which is the main source for financing highway projects, and which has declined considerably over the last decade. Read more