The Citizen's Guide to the Wisconsin Budget what you need to know about the 2017-2019 state budget

Welcome to the MacIver Institute's guide to the 2017-2019 state budget. This is your one-stop shop for all things related to the behemoth $76 billion taxing and spending budget bill.

Haven't read anything about the budget yet? Start at Budget 101. Looking for day-by-day updates or the latest Capitol intrigue? Keep scrolling to read our Budget Blog. Interested in research on a particular issue you care about? Use our navigation buttons below and choose where to go. When you are finished, please let us know what you think! We value your feedback and would love to hear from you.

May 2, 2017

Joint Finance to Finally Swing Into Action This Week

The Joint Finance Committee begins voting on the 2017-2019 state budget today by taking up some of the least contentious parts of Governor Scott Walker’s proposal. Some of the first items include funding for the courts, insurance, Administration, Division of Gaming, Board for People with Developmental Disabilities, Board on Aging and Long-Term Care, Environmental Improvement Fund, and the Employment Relations Commission.

That means the controversial issues and many points of friction that have materialized in the last few months will be voted on further down the road. Those issues include transportation funding, increased aid for K-12 schools, a variety of reforms for the UW System, and a proposal to switch state employees' health insurance to a self-funded model - all likely to gum up the process.

Earlier in April, JFC took the rare step of removing all 83 non-fiscal policy items from Walker's budget, just the second time in 25 years the committee completely stripped all policy items from a governor's budget. Each proposal stripped from the budget now needs to be drafted as separate legislation.

Several of the removed items are popular with conservatives, such as a full repeal of the state's antiquated prevailing wage law, a measure prohibiting government from requiring union-friendly project labor agreements on taxpayer funded projects, a proposal to allow UW students to opt-out of certain fees, and a requirement that UW campuses track faculty workloads.

Which raises the question: Will fiscal conservatives and budget hawks vote for the budget if these popular conservative items do not make their way back?

JFC also completely scrapped Walker's transportation budget, the first time in ten years the committee threw out an entire portion of a governor's budget. Even though the governor and leaders in the Assembly have been trading barbs over the transportation budget for months, many insiders were surprised that the Legislature would make such an audacious and aggressive move.

Transportation funding is sure to be the most contentious issue as the budget process unfolds. Walker has been steadfast in sticking by his pledge not to raise the gas tax or vehicle registration fee, while Assembly leaders say they want to keep all tax increase options open to bridge what they claim to be a billion-dollar funding shortfall and too much transportation bonding.

A MacIver Institute report in March debunked the billion dollar narrative and explained how "Madison math" was used to come up with the inflated figure.

And no one in the legislature has responded to MacIver's 2015 report on the Bridge Too Near, a $3.6 million dollar pedestrian bridge built unnecessarily less than a two-minute walk from an existing bridge.

One persistent rumor making its way around the Capitol is that Assembly Speaker Robin Vos believes he has fifty votes in his house for a 10-cent gas tax increase.

The hopes of some in the Assembly and special interests groups to raise the gas tax were dealt a blow earlier in the year when a Legislative Audit Bureau report found the Department of Transportation had been low-balling cost estimates to the legislature, failed to comply with state law and its own policies, and didn't adequately track cost overruns, among other problems.

Walker's proposal to cut UW tuition by 5 percent in the second year of the budget for in-state undergraduates has also hit a snag at JFC. After Walker's state of the state address, Assembly Speaker Robin Vos said the cut wasn't a priority, and JFC co-chair John Nygren has also thrown cold water on the idea, stating he prefers targeted financial aid to a tuition cut for all students.

Walker's budget increases K-12 funding by $648.2 million, a proposal many thought would get the same treatment as his transportation budget, but JFC decided to consider the proposal as-is. A sticking point for some is sure to be a caveat that ties the increased aid to Act 10 compliance.

In order to qualify for the increased aid, a district must demonstrate that its employees are contributing 12 percent to their health insurance. But some districts, including the Madison Metropolitan School District, protest that since they've shopped around for better deals on their insurance they should be given leeway.

Walker's K-12 increase relies partly on finding $60 million in savings on state employee health insurance. The governor proposes switching the state to a self-funded insurance system where the state would pay claims, rather than farming it out to a network of private insurance companies. The proposal has also met a chilly reception in the Legislature.

Later this week, state Rep. Dale Kooyenga, a leader of the Republican CPA caucus and a conservative thought leader, is expected to forward for consideration a comprehensive transportation and tax proposal that some believe may bring the politicians and the different warring special interests together to agree on a deal. As more details of the proposal become available, MacIver will bring you up-to-the-minute updates on this situation and any others that arise.

JFC will continue its executive sessions on the budget throughout the month of May. The Assembly and Senate could then potentially hold floor votes in June. The state's fiscal year ends on June 30th, which is the unofficial deadline for the budget. However, speculation abounds that this fierce budget debate could drag the process out to October. Stay tuned.

April 11, 2017

Vukmir, Hutton Re-Introduce Prevailing Wage Repeal

Days after a provision to repeal the state's prevailing wage law was yanked from Gov. Walker's 2017-19 budget by leaders of the Joint Finance Committee, Sen. Leah Vukmir and Rep. Rob Hutton have re-introduced the measure as standalone legislation. On Thursday, JFC co-chairs Sen. Alberta Darling and Rep. John Nygren removed prevailing wage repeal along with 82 other items in the budget identified by the Legislative Fiscal Bureau as non-fiscal policy items. The memo states those items need to be re-introduced as standalone legislation.

While removing some policy items from the budget is routine, this is just the second time in 25 years that JFC stripped all non-fiscal policy proposals from a governor's budget. Darling and Nygren said they were open to returning some of the items after they receive individual public hearings.

Vukmir said she was disappointed the repeal proposal was pulled. "I think it has a direct impact on the transportation budget. I don't think the budget gets passed without a full repeal," Vukmir told the Wheeler Report.

"As lawmakers, we have a responsibility to manage the transportation budget efficiently," Vukmir said in a joint statement with Hutton. "It's unrealistic to do so without the accessibility of all tools. Repealing this burdensome red tape will ensure the use of taxpayer dollars are maximized."

There's a chance the repeal could be returned to the budget, but Hutton was optimistic that prevailing wage repeal could pass as a standalone bill. "While I was encouraged that the Governor put complete repeal of prevailing wage in the budget, the fact that the legislature can now pass this as a standalone piece of legislation shows that we are taking our responsibility as legislators seriously," he told Wheeler.

"Two years ago we passed prevailing wage reform for local governments," Hutton said in the statement. "It is now time to finish what we started and pass full prevailing wage repeal. As we look at the transportation budget this spring, we must ensure taxpayers are receiving the best value for their tax dollars."

The prevailing wage law, which mandates artificially inflated wages and increases labor costs, was repealed for local projects in the last budget, but without full repeal, state projects remain on the hook.

April 6, 2017

JFC Dumps Governor's DOT Budget, UW Reforms, and Prevailing Wage Repeal

The Joint Committee on Finance released its budget procedures memo on Thursday outlining what items they will consider from the governor's budget and what items they are rejecting.

JFC stripped all 83 non-fiscal policy items out of Gov. Walker's budget proposal, including many proposals popular with conservatives like prevailing wage repeal and numerous reforms for the UW System and K-12 education.

While removing some policy items from the governor's budget is routine, this time JFC removed all of them - a rare move, especially with a governor of the same party. This is just the second time in 25 years that JFC stripped all non-fiscal policy proposals from a governor's budget.

In addition, JFC scrapped Walker's transportation budget entirely, choosing to ignore the agency request and the governor's proposal. Instead, the committee will start from scratch on the contentious question of how to fund the state's transportation system. This is the first time in ten years that JFC has scrapped an entire portion of the governor's budget.

JFC will be using a method called "base-year doubled" budgeting in building a transportation budget, which simply means taking this year's level of funding and doubling it to see what a cost-to-continue scenario would look like over the next biennium. This technique was used last summer (with other alterations) to create the illusion of a billion-dollar transportation deficit, which started the gas tax debate. MacIver's analysis of that dubious math can be found here.

The 83 non-fiscal policy items JFC stripped from the governor's budget will be drafted as individual bills separate from the budget. JFC co-chairs Rep. John Nygren and Sen. Alberta Darling both indicated some could be put back into the budget after each gets a public hearing. However, many of the conservative policy items were important to balancing out the governor's proposed spending increases - both fiscally and politically.

JFC will also remove 83 non-fiscal policy items from the governor's proposal, which will be drafted as individual bills separate from the budget. Some of the more notable items include:

  • DPI: Eliminate required hours of instruction for public schools
  • DPI: Eliminate requirement for monthly school board meetings
  • SPS: Create occupational license review council
  • UW: Segregated fees opt out
  • UW: Three-year degrees
  • UW: Credit transfer program
  • UW: Faculty workload reporting
  • UW: Freedom of expression
  • Repeal prevailing wage
  • Project labor agreements

For the rest of the budget, JFC will use the governor's proposal as its starting point, including Walker's K-12 education proposal. There had been concerns that the committee would also start from "base-year doubled" for K-12, which could have meant less aid compared to the governor's plan.

March 30, 2017

UPDATED: First Week Twists and Turns

On Thursday, JFC held the third and final day of agency briefs. It heard from the heads of the PSC, DNR, the Tech College System, UW, DPI, the Historical Society, DWD and the Labor and Industry Review Commission. That hearing wrapped up a week of twists, turns, and sparring over the governor's budget.

"Got a little punchy last night, because we're here a long time. But the Senator [Darling] did a good job trying to keep order," Rep. Nygren said at the start of the marathon 13-hour hearing on Thursday.

Democrat members of the committee continued to push the department heads, but with less ferocity than the day before. PSC talked about the governor's plan to invest $15.5 million into broadband expansion.

DNR Secretary Kathy Stepp talked about the decision to stop publishing Wisconsin Natural Resources magazine. She said 0.1 percent of Wisconsin residents choose to subscribe to the magazine, and that the internet is much more efficient in sharing the DNR's activities with the public.

"Every budget there's something typically that a lot of people see as a smaller issue that gets a lot of attention, and this year it's the magazine," Nygren commented.

Next up came the Wisconsin Tech College System. Administrators there testified against the proposed tuition freeze for the tech colleges, saying that they believed a freeze could jeopardize quality.

Multiple legislators expressed concerns about the provision to require the tech colleges to increase credit transferability from 30 to 60 credits. Sen. Luther Olsen (R-Ripon), Chair of the Senate Committee on Education, worried that the switch would contribute to the agency "mission creep" and effectively make the tech colleges the same as two-year UW campuses. (MacIver News covered this issue in a 2015 video report: Tech Colleges and the UW Colleges: Do We Need Both?)

Moving forward on education, next came the UW System. President Ray Cross expressed his support for the Governor's UW budget proposal, calling it "the best UW budget in a decade." President Cross agreed with several legislators, including Sen. Leah Vukmir (R-Brookfield), that he supports the intent of requiring students to attain internships before graduating, but wasn't sure how to make the provision mandatory.

President Cross spent several minutes fervently defending the importance of free speech on campus. He lamented the fact that college students with opposing views don't listen to each other anymore, but simply shout each other down. That's not what college is for, Cross stressed.

The Department of Public Instruction (DPI) testified after the UW System, with State Superintendent Tony Evers highlighting the massive increases to mental health funding in the budget, alongside the investments in rural schools and MPS summer school.

The Superintendent expressed his concerns about the provision requiring public school district employees to contribute an average of 12 percent to their healthcare costs. That provision is known as "Act 10 compliance," referring to the famous law that first required public employees to contribute those amounts.

One notable moment came when Sen. Vukmir asked the Legislative Fiscal Bureau about funding for public schools compared to the choice program, referencing one particularly confusing memo which showed that students in the choice program receive more state funding than public school students. LFB debunked that claim themselves, clarifying that when state and local levies are included, public school students receive nearly $5,000 more than choice students.

The Wisconsin Historical Society testified after DPI. Representatives discussed their move to a new office and artifact storage facility and the potential to preserve the Ringling Bros. circus after it announced it would no longer tour.

Following the Historical Society was the Department of Workforce Development (DWD). Secretary Ray Allen touted Wisconsin's low unemployment rate and high labor force participation rate, as well as the budget's investment in the Fast Forward program and other job training measures.

Sen. Olsen praised the agency and its work, but also expressed concern that the state's rock-bottom unemployment rate of 3.7 percent could indicate to employers that all Wisconsinites are already employed and push them away. Allen replied that one way to grow the workforce is to encourage people not in the labor force to enter it by making it as easy as possible to find a job.

Rep. Shankland also sparked some confusion when she tried grilling Allen over the proposed repeal of prevailing wage, which Allen said was the purview of the DOA, not his agency. The question was quickly resolved, and Shankland moved on to asking about Project Labor Agreement reform, which Allen said is also outside his agency's area of authority.

The night wrapped up with testimony from the Labor and Industry Review Commission (LIRC), which the budget dismantles and transfers its responsibilities to other departments. This generated controversy among some JFC members because there is a risk that complaints now filed with LIRC will be handled less efficiently in a not-yet-known process. The change may also have adverse consequences for victims, particularly of workplace discrimination, some JFC Democrats contended.

Overall, the week was filled with plenty of intrigue around the budget and other upcoming battles in the legislature. As Secretary Dave Ross answered hours of questions about the proposed DOT budget, Governor Walker reiterated his position on his K-12 education budget and opposition to a gas tax increase in a tweet.

In real time, Sen. Jon Erpenbach mentioned the governor's tweet during the day's marathon Joint Finance Committee hearing as committee members grilled Ross on the transportation budget.

Meanwhile, Senate Majority Leader Scott Fitzgerald announced the state Senate will not override a veto by the governor on a gas tax increase. That echoed Sen. Luther Olsen's comment at Joint Finance that the Senate does not have a hard-and-fast position on the idea of a gas tax increase. The Wisconsin State Journal said Fitzgerald's announcement "flatlined" any attempt to raise the gas tax.

At the same time, Assembly Speaker Robin Vos criticized DOT Secretary Dave Ross's position against a gas tax hike as "delusional" and said, "...to say it's only a spending problem is to ignore the reality of the governor's own three commissions that have all said it's a revenue problem and the audit that says we have some of the worst roads in the entire country," according to the Wisconsin State Journal.

Fitzgerald and Vos also found themselves at odds over a proposed Article V Constitutional Convention. Last week, a bill that would add Wisconsin to a list of states calling for a convention to amend the U.S. Constitution with a balanced budget amendment cleared a state Senate committee on party lines. Fitzgerald's support for the measure was tepid out of concern about the scope of such an unprecedented convention.

Vos, on the other hand, said that now is the time for such an amendment. If the bill passes, Wisconsin will become the 30th state to endorse a Constitutional convention. A call for convention must pass 34 states for convention to convene.

March 28, 2017

And We're Off - Legislature Takes Up 2017-2019 Budget

On Tuesday, the legislature began to hold hearings on Governor Scott Walker's 2017-2019 budget proposal, which spends approximately $76 billion over the biennium. The Joint Committee on Finance, the legislature's budget committee, will hold agency briefings in Madison this week on the proposal before heading out on the road to give the public another opportunity to voice their opinion.

One of the major debates was over the state's plan to switch to self-funded insurance. While Governor Walker and the Department of Administration say switching to a self-funded model for state employees' health insurance will save $60 million, members of JFC expressed their hesitation.

Walker's budget also boosts funding for K-12 education, but much of that funding is tied to mandatory Act 10 compliance. Committee members were confused over many of the requirement's details.

Of course, transportation was a topic of lengthy debate. DOA Secretary Scott Neitzel defended the budget's focus on safety and maintenance of the existing infrastructure, and Sen. Jon Erpenbach (D-Middleton) grilled him on whether the governor thinks Wisconsin's roads are safe.

The concept of shared services, where state agencies work together to perform functions like human resources and information technology - streamlining government operations and saving money - also generated its share of questions.

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