New 2010 Spending Figures Illustrate Challenge of an All-Cuts Approach to Balancing the State Budget

October 19, 2010

Campaign season is upon us, and with it come calls by candidates to cut state spending significantly
in order to close the gap in the state budget, currently estimated at roughly $3 billion over the next
two years. As is typically the case, the proposals have not gotten very specific about where to cut. An
issue brief released today by the Wisconsin Budget Project analyzes the 2010 Fiscal Report released
last Friday by the Wisconsin Department of Administration. The brief examines key characteristics
of our state budget that make most candidates shy away from specific recommendations about where
to cut, and that make it harder still for elected officials to enact deep cuts.

The majority of state spending in Wisconsin actually goes to support local services rather than
services provided at the state level. That means that big cuts in state spending for local assistance
would lead to some combination of higher property taxes and reduced services. Residents would
need to be prepared for downgraded local services such as reduced maintenance on local roads, more
students per classroom, and cutbacks in services for the elderly and people with disabilities.
Meanwhile, user fees and property taxes would likely increase as local governments scramble to fill
the holes left by reduced state support. Read the full press release.