Review Gives Two Thumbs Down to State Film Production Subsidies

Friday, November 19, 2010 at 2:21 AM by

Lights, cameras, ….fraction!  As the cameras roll, costs climb for taxpayers in the many states that pick up the tab for a large fraction of film production expenses incurred in their states. That was true for a short time in Wisconsin, but Governor Doyle and a majority of state lawmakers yelled “cut” last year after a Department of Commerce analysis found the rapidly rising tax subsidies to be an ineffective form of economic development spending.

The issue is likely to emerge again next year because some of the newly elected lawmakers would like to give the film subsidies a new run. With that in mind, it’s worth noting that the Commerce Department’s study was buttressed this week by a report from the Center on Budget and Policy Priorities (CBPP), titled “State Film Subsidies: Not Much Bang for Too Many Bucks.”  The CBPP report begins with this introduction:

“Like a Hollywood fantasy, claims that tax subsidies for film and TV productions — which nearly every state has adopted in recent years — are cost-effective tools of job and income creation are more fiction than fact.

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WCCF Blog Examines Health Insurance Trends and Rebuts Misperceptions

Thursday, November 18, 2010 at 12:11 AM by

A new post on the WCCF blog examines the trends in private and public insurance in Wisconsin over the last decade and particularly during 2008 and 2009. It pulls together the findings from a report issued Tuesday by the Economic Policy Institute and other Census Bureau data, as well as a September Kaiser Commission report that drew attention to the very large increase in Medicaid participation in Wisconsin.

Notwithstanding the rapid growth in BadgerCare Plus since the end of 2007, our analysis shows that participation in Wisconsin’s Medicaid-related programs is not out of line with other states, and Wisconsin is still well above the national average in the portion of non-elderly residents with employer-sponsored insurance.

Read more here. Read more

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New Report Makes a Business Case for Letting High-End Tax Cuts Expire

Wednesday, November 17, 2010 at 2:11 AM by

A report released Tuesday finds that it makes good business sense to let the high-end Bush tax cuts expire on December 31. The report by Business for Shared Prosperity, says families should keep tax cuts on their income below $250,000, but well-off taxpayers should not get extra tax cuts that won’t create jobs and will cost $700 billion over the next decade.

The report, which is titled The Business Case for Letting High-End Tax Cuts Expire, contends that rather than extending the high-end tax cuts, Congress should build on constructive action like the Small Business Jobs Act and infrastructure investment needed to create jobs and be competitive in the global economy.

Rick Poore, Owner of Design Wear Inc. in Lincoln, Nebraska, made the case for stimulating demand rather than stimulating more production: “As a fellow businessman once told me, ‘Give me more customers and I’ll be forced to buy equipment and hire people to meet demand. Read more

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What is Next for Federal Unemployment Benefits?

Monday, November 15, 2010 at 10:40 PM by

Congress is in a state of flux right now, and some lawmakers are advocating holding off making any important decisions until after the newly-elected senators and representatives are seated. But there are several important issues that Congress is going to have to address before the end of the year, either by omission or commission.

One issue is whether to extend the Bush tax cuts, which expire at the end of the year. Before that though, Congress will have to consider whether to extended federal unemployment benefits for the long-term unemployed. If Congress takes no action, these benefits will run out at the end of November.

Some lawmakers in Congress are reluctant to continue unemployment benefits, but the need is unmistakable, both here in Wisconsin and nationally. The recession may officially be over, but the state unemployment rate has been inching downward at a frustratingly slow rate, as has the nation’s. In September 2010, the state unemployment rate (preliminary and seasonally adjusted) was 7.8 percent. Read more

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Voters Give Boost to Constitutional Protection for Transportation Dollars

Saturday, November 6, 2010 at 1:00 AM by

A proposed amendment to the Wisconsin Constitution got a boost Tuesday from the voters in all of the 53 counties that put the proposal to an advisory vote.  The measure would prevent state lawmakers from transferring dollars from the Transportation Fund to use for other purposes.  Governor Dole and the legislature used such transfers to help the state close holes in the General Fund budget, to the consternation of highway builders and other supporters of transportation spending. 

Advisory referendums often don’t have much impact, but in this case I think the proposal has an excellent chance of becoming part of the state constitution.

Support for the measure was strong in all 53 counties, ranging from 61.5 percent in Trempealeau County to 85 percent in Dodge County.  It is likely to be taken up by the legislature early in the session, but if it’s approved (which appears likely) it will need to be passed again during the 2013-14 legislative session, and then must be ratified in a statewide referendum. Read more

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Despite Conservative Mood of Voters, Many School Referendums Pass

Wednesday, November 3, 2010 at 7:47 PM by

Voters in Wisconsin yesterday were in a decidedly conservative mood when it came to choosing their governor, senator, attorney general, and other elected representatives. That would seem to spell defeat for the school referendums on the ballot, but in fact voters approved tax increases in more than half the districts that were seeking increased school spending.

Of the 21 school referendums on the ballot, 11 passed and 10 failed. In total, voters approved more than $55 million in school spending, the largest of which was in Pewaukee for $16.5 million to remodel existing facilities and add new classroom space. The Wisconsin Education Association Council has a complete list of the school referendums here, with specific information about each one.

In addition, voters in south central Wisconsin overwhelmingly approved a $133 million referendum by Madison Area Technical College to build new education centers for health sciences, protective services, and manufacturing, among other improvements. Read more

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New Estimate for Cost of Extending Bush Tax Cuts

Tuesday, November 2, 2010 at 10:58 PM by

There are only 58 days until the Bush tax cuts of 2001expire. There has already been considerable debate about whether and for whom the tax cuts should be extended. Now that the election season is over, we can expect to hear a lot more about the pros and cons of extending portions of the tax cuts. There’s fairly widespread agreement that the tax cuts for the middle class will be extended, but it’s less clear what will happen to the tax cuts for the wealthy.

Proponents of extending the cuts for the wealthy argue that such cuts will help bolster the economy and create jobs, while opponents point to the impact the cuts for the wealthy will have on the deficit. A new report by the Congressional Research Service estimates that extending all the tax cuts will cost $5.0 trillion over the next ten years, much higher than the $2.8 trillion figure the Congressional Budget Office has been using. Read more

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Could Liberals and Conservatives Agree to Reduce Special Tax Breaks?

Friday, October 29, 2010 at 1:25 AM by

There has been a great deal of political discussion this year about the state and federal deficits. Putting aside the matter of whether it’s good economic policy during a severe recession to incur more debt at the federal level, the fact of the matter is that a large portion of the electorate believes that deficits have gotten too high and need to be reduced.

In light of the increased concern about red ink, could the next session be a time when state and federal policymakers take a much closer look at “tax expenditures” (or special tax breaks)? Will those tax breaks be on the table along with other spending measures, as budget writers strive to bring revenue and spending into balance?

A short report issued this week by Citizens for Tax Justice (CTJ) outlines reforms that could serve as a useful starting point for curbing lawmakers’ addiction to tax expenditures. They make the case that procedural changes in state budget processes are the key to beginning to rein in tax expenditures. Read more

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Walker Recommends Eliminating Corporate Taxes

Wednesday, October 27, 2010 at 11:35 PM by

Wisconsin policymakers will have to grapple next year with a deficit of roughly $3 billion, and that number could grow higher in the months ahead. A deficit of that size would be a huge challenge even if some candidates weren’t promising to roll back tax increases adopted in the last budget.

The Milwaukee Journal Sentinel reported Monday that Scott Walker has now suggested going even further in making deep tax cuts, by eliminating corporate income taxes altogether. In response to a questionnaire from the Metropolitan Milwaukee Association of Commerce, Walker said he favors repealing corporate income taxes. Such a change would cost the state more than $800 million each year.

The article reports that Walker’s opponent in the Governor’s race, Tom Barrett, did not respond to that question in the survey; however, he said at a recent press conference that ending the corporate income tax would cause a tax shift to working families. Read more

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What Candidates Aren’t Saying About the State Budget

Tuesday, October 19, 2010 at 8:26 PM by

Campaign season is upon us, and that means calls by candidates to cut state spending significantly in order to close the gap in the state budget, currently estimated at $3 billion over the next two years. What these candidates don’t say is that trying to balance the budget through cuts alone will likely drive up property taxes and reduce services that are critical to well-functioning communities.

An issue brief released today by the Wisconsin Budget Project, based on new spending figures put out by the Wisconsin Department of Administration last week, examines two main characteristics of our state budget that make major spending cuts particularly painful.

First, most state spending in Wisconsin actually goes to support local services. State support for local services makes up 56.5 percent of state spending from the General Fund, as shown in Figure 1. This includes state spending on programs like K-12 education, shared revenue, and community aids. Read more

Categories: 2011-13 biennial budget, BadgerCare Plus, Blog, EDUCATION, Medicaid, property tax, spending | Comments Off on What Candidates Aren’t Saying About the State Budget