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One Year After John Doe Leak, DOJ Probe Continues

Thu, 09/28/2017 - 15:58

MacIver News Service | September 29, 2017

By M.D. Kittle

[Madison, Wis...] An anniversary of sorts passed this month with little notice.

Of course, the anniversary involved Wisconsin's politically driven John Doe investigation. One of Wisconsin's darkest chapters of government abuse, the John Doe probe has been mostly forgotten by the general public and many lawmakers and judges. But it's still very fresh in the minds of the people whose lives were turned upside down.

On Sept. 14, 2016, the Guardian published some 1,300 pages of court-sealed John Doe-related documents. The liberal British publication used the cherry-picked, leaked records in a story that arrived a couple of weeks before the U.S. Supreme Court decided it wouldn't weigh in on the Wisconsin matter.

The printed story, picked up by mainstream publications nationally, amped up the "John Doe II" prosecutors' widely rejected investigation into alleged illegal campaign coordination between Walker's campaign and conservative allies. It fed a faulty and debunked narrative of campaign corruption on the right, while generally ignoring the abuses committed by partisan prosecutors and investigators.

It's been nearly 10 months since the state Department of Justice opened an investigation into the illegal leaks.

A source close to the investigation in early August told MacIver News that the DOJ would likely have something to report by the end of the month.

It did not, and still has nothing new to report.

"We are still investigating the John Doe leaks. If/when there is something to report, I will be sure to let you know," DOJ spokesman Johnny Koremenos wrote in an email earlier this week.

Sources tell MacIver News that private attorney Samuel S. Hall is no longer representing the state Ethics Commission in the leaks case.

Hall did not return a request for comment.

In July, Katie Ignatowski, Walker's chief legal counsel, authorized the contract with Hall, of Milwaukee-based Crivello Carlson, according to the Wisconsin Ethics Commission legal contract obtained by MacIver.

The state paid Hall at a blended rate of $175 an hour.

On June 27, the Ethics Commission requested Ignatowski appoint a special counsel to "assist our agency in the Department of Justice investigation of the release of John Doe documents," a letter accompanying the contract states. "Because the Department of Justice is involved in the investigation, they have declined our request for representation and advised us to contact the Governor's office for assistance in obtaining counsel."

Walker had to remove himself from the matter. The governor's campaign was targeted along with dozens of conservative groups in the partisan campaign finance investigation. The state Government Accountability Board, the Ethics Commission's predecessor, was an integral partner in the probe that the state Supreme Court in 2015 ordered shut down.

"This request is submitted with the recommendation and approval of Ethics Commission Chairperson David Halbrooks and Vice Chairperson Katie McCallum," wrote commission administrator Brian Bell. "No litigation has been initiated at this point in time, but Wisconsin Department of Justice investigators have requested interviews with Ethics Commission staff regarding their involvement in collecting and preserving records related to the John Doe investigation conducted by the Government Accountability Board in coordination with five district attorneys."

The Wisconsin Supreme Court more than two years ago declared unconstitutional the politically charged investigation, launched by highly partisan Democrat Milwaukee County District Attorney John Chisholm and carried out by his prosecutors, the GAB and the agency's hand-picked special prosecutor, Francis Schmitz. The 4-2 decision found that Schmitz's position was invalid and that the special prosecutor had perpetrated a "perfect storm of wrongs" against innocent citizens whose First Amendment rights were trampled during the multi-year John Doe investigation.

But multiple court findings that prosecutors did not have probable cause for their free speech investigation meant little to The Guardian and the publications that pushed a "criminal scheme" narrative in painting Walker and right-of-center groups as campaign finance lawbreakers.

The documents leaked to The Guardian were sealed by the courts and strongly suggest that sources within or close to the investigation provided them to the newspaper.

As Wisconsin Watchdog has reported in its investigative series into the unconstitutional probe, experts say there is a small universe of people who had access to the documents, and that universe is almost exclusively populated by prosecutors, investigators and court officials.

"The records include handwritten notes on the motion of an unnamed movant (one of dozens of conservatives targeted in the probe), as well as an unsigned draft of an affidavit from John Doe special prosecutor Francis Schmitz," the publication reported.

Sources with knowledge of the leak have said there is other actionable intelligence - the time zone, date and exact time these documents were scanned. And the information includes the make and model of the copier used to scan them.

More Questions Surface About Shadowy Public Finance Authority

Thu, 09/28/2017 - 08:56

MacIver News Service | September 28, 2017

By M.D. Kittle

Madison, Wis...] In 2016, the University of Kansas bypassed the state Legislature in securing nearly $327 million in bonds for a slate of building projects.

Instead of seeking approval from lawmakers, the university appealed to the Wisconsin-based Public Finance Authority, the shadowy, quasi-public agency described as the "bonding house of last resort."

The PFA came under fire this month, in the closing days of Wisconsin's extended budget-writing process, when lawmakers slipped in a provision that would have expanded the authority's powers. Under the measure, the PFA would have been granted the ability to take private property through eminent domain.

Gov. Scott Walker vetoed the expanded powers provision, at the request of three conservative senators who threatened to vote against the overdue 2017-19 budget unless Walker removed the PFA language.

The Finance Authority was born in 2009 through state legislation. Its purpose: finding investors for tax-exempt and taxable "conduit bonds" for so-called "public benefit projects."

But for a Wisconsin-based financing agency, the PFA has done very little business in the Badger State. Instead, it has built a multi-billion dollar tax-exempt and taxable conduit bonds business by brokering deals like the one at the University of Kansas, or a $30 million bond deal for Planned Parenthood Federation of America's national headquarters in New York City, the latter being one of PFA's first projects.

The University of Kansas's end-around the Legislature and the Kansas Development Finance Authority didn't sit well with lawmakers, who blasted the arrangement as "circumventing legislative oversight and escaping the public view."

While KU officials insist they were only trying to save the state money while completing important projects, lawmakers weren't buying it.

"It seems to me KU is flying the starship Enterprise through our statutes, trying to avoid a transparent process that's accountable to taxpayers and students both," Rep. J.R. Claeys, R-Salina said during a legislative hearing into the financing controversy.

House Republicans were drafting legislation to prohibit such bonding deals in the future.

The PFA's heavy involvement in projects nationwide, and its limited involvement in the state that created it, is a big concern for one Wisconsin lawmaker in particular.

State Rep. Scott Allen (R-Waukesha) voted against the Assembly version of the state budget because it included the expanded powers for the PFA. He then called on the Legislature's audit committee to perform an audit of the agency.

Out of the numerous projects for which the Finance Authority has issued bonds, relatively few have been based in Wisconsin and only two have been located within the jurisdictions of the founding Wisconsin local governments, according to the lawmaker.

The bond broker was ostensibly formed by four Wisconsin counties and the City of Lancaster, and originally with unanimous legislative approval. But the antecedent to the PFA was created in California by municipal bond movers and shakers, Stephen Hamill and Gerald Burke. They are the brains behind HB Capital Resources, Ltd., HB Consulting, LLC, and US Communities.

The Los Angeles Times in 2011 wrote that Burke and Hamill "do jobs normally reserved for public employees. They just make a lot more money doing it."

"The former Alameda County public servants have made tens of millions of dollars for their private company by coming up with a novel method of issuing tax-free municipal bonds," the Times reported.

"By law, these bonds must be issued by government agencies to finance projects with a public benefit, such as highways and hospitals. Hamill and Burke have harnessed this process for profit by working with a little-known public agency they helped to create called the California Statewide Communities Development Authority."

According to the Times, a Los Angeles County staff report concluded in 2008 that CSCDA is a "shell entity operated solely by a private contractor."

HB Capital took its show on the road in 2010, launching the Public Finance Authority in Wisconsin, again, with the unanimous assistance of the state Legislature. Wisconsin gave the agency the "unusual power" to issue municipal bonds anywhere in the country.

It does all of this without a single employee in Wisconsin, PFA officials told Allen, the Waukesha lawmaker. Allen said the bond issuer contracts any of its required services. Administrators of the Finance Authority's sponsoring organizations - the Wisconsin Counties Association, and the League of Wisconsin Municipalities - did not respond to MacIver News Service's requests for comment.

Allen said PFA officials provided him a document showing that the founding members and the sponsoring organizations help promote the authority's economic development efforts. For those services, they receive compensation. PFA officials would not disclose how much.

In 2011, government officials in states such as Rhode Island were urging their legislatures to block the PFA from doing deals that are in the purview of state-created development agencies, according to the L.A. Times.

"This isn't what municipal finance is about," Robert Donovan, the head of one of Rhode Island's largest public-bond-issuing authorities, told the publication. "Pay to play is a dirty word. Now we're looking at pay to issue."

Allen says he wants to gather as much information on the PFA as possible to build a case for an audit. He says the most compelling reason for the Legislature to take a closer look at the PFA is because it has not done so since the agency's launch seven years ago.

"When it was suggested that less than 2 percent of their work is being done in Wisconsin, I have to question why the Legislature created it in first place. It wasn't to do work in Kansas or Idaho or Nevada or elsewhere," Allen said.

School Choice Students Outperform Their Peers Again

Thu, 09/28/2017 - 06:00

Students saw small increases in proficiency on the Forward Exam, but decreases on ACT Plus Writing Exam

MacIver News Service | September 28, 2017

By Ola Lisowski

[Madison, Wis...] A new data release from Wisconsin's Department of Public Instruction shows that 44.4 percent of 3rd to 8th grade students are proficient in English language arts, and 42.8 percent are proficient in math. The results are slightly better than last year's outcomes, which showed that 42.7 percent of students are proficient in English, while 42.5 fared the same in math.

The results come from the Forward Exam, administered during the 2016-17 school year. This is the second straight year of the Forward Exam which is important because it is the first time in many years we can directly compare test results to the prior year.
Students fared slightly worse than the year prior in both science and social studies. Fewer than 50 percent of students scored proficient in both subjects.

School Choice Students Do Better In Every Category
Students enrolled in Wisconsin's parental choice programs outperformed their public school peers in every category.

When compared to similar MPS students, parental choice students did much better. Students in all three major parental choice programs - statewide, Milwaukee, and Racine - outperformed their peers in every single subject on the Forward exam. On the ACT, choice students fared better than even their full-income peers.

Jim Bender, President of School Choice Wisconsin, celebrated the results.

"All three Parental Choice Programs, comprised predominately of low-income students, outscored their full-income, public school counterparts across the entire state on the ACT for the second year in a row. Combined with the Forward Exam, these results highlight the continued success of the program," Bender said.

In its press release, DPI compared all public school students to choice students - but this is a flawed comparison. Given the income limitations for entrance into the school choice programs, much larger percentages of those students are economically disadvantaged. As a result, it is more accurate to compare choice school students with economically disadvantaged public school students.

State Superintendent Tony Evers focused on the overall positive aspects of the data release.

"We're seeing some positive student gains in the Forward Exam in English language arts," Evers said. "Our educators and students are growing more comfortable with the test and have begun to use the information it provides to drive student improvement."

While the results were in general worrisome, students at a few of the state's most troubled districts showed small but promising growth. At Milwaukee Public Schools (MPS), 20.1 percent of students were proficient in English language arts, compared to 19.4 percent the year before. In math, 15.4 percent of students were proficient, up from 14.8 percent.

Those are small improvements, but improvements nonetheless. The math achievement gap among black and white students at MPS shrank slightly, from a 29.3 point gap last year to a 28.9 gap today. Still, just 8.4 percent of black students were proficient in math. The troubled district continues to underserve its students.

Statewide, the achievement gap between white and black students grew in English language arts and stayed stagnant in math. As Wisconsin's minority population grows, achievement gaps between white and historically underserved populations will continue to be a big issue. Students, and schools, have their work cut out for them.

ACT Plus Writing
On the ACT Plus Writing exam, results were more clearly negative. While nearly 2.75 percent more students took the exam, they also fared worse in every subject compared to the prior year. In the 2015-16 school year, students scored an average composite score of 20.1 out of 36 on the ACT Plus Writing. A year later, the average composite score was a 20.0.

The scores are gleaned from students who participated in the Spring statewide ACT administration. This was the second year that the state picked up the tab to allow all high schoolers to take the ACT.

The average English language arts score fell from 18.6 to 18.3, while the average math score fell from 20.1 to 20.0. Students scored the highest average score on science at 20.4, down from 20.5 last year.

The ACT also includes its own benchmarks for proficiency which aim to translate the composite score into levels of readiness for college. Those benchmarks show that 39.3 percent of students scored proficient in English language arts, while 31.5 percent were proficient in science.

Perhaps the single bright spot in the entire ACT release - other than the increase in student participation - was that the percent of students proficient in math grew slightly. While the overall math score had fallen, 35.4 percent of test takers were dubbed proficient, up from 34.8 percent the prior year.

That a mere 0.6 percent increase in proficiency in a single subject was the highlight in this data release shows just how serious the situation is. Students in minority groups, as well as English learners and economically disadvantaged students fared consistently worse on this year's ACT compared to last year. Among black students, the average composite score was just 15.5 of 36, compared to 15.8 last year.

The same day as Wisconsin's data release, another study showed strong results for students who participated in Florida's tax credit scholarship program. Individuals who received that scholarship - known as the country's largest private school choice program - were shown to attend college and attain degrees at higher rates.

The longer that students participated in Florida's school choice program, the better their outcomes were. The scholarship increased college attendance among recipients by an average of 15 percent compared to public school peers. Students who participated in the school choice program for more than four years saw a 43 percent increase of college attendance compared to their peers.

In a statement to MacIver News, Bender said that the findings "mirrored those from Milwaukee."

"Higher graduation rates, college acceptance and college retention rates were all identified for the Milwaukee Parental Choice Program," Bender said. "Hopefully, education policy will focus on replicating the success in Florida and create more pathways for success."

The data comes just over a month ahead of the release of Wisconsin's new school report cards, which are expected in November.

Elections Expert Questions Controversial Voter ID Study

Wed, 09/27/2017 - 06:00

Study author defends methodology, but tells MacIver election result would be the same

MacIver News Service | September 27, 2017

By M.D. Kittle

[Madison, Wis...] A new study suggests Wisconsin's voter ID law dissuaded thousands of potential Wisconsin voters in the liberal bastions of Dane and Milwaukee counties from casting ballots in the November presidential election.

But perhaps the study's most troubling number is its minuscule response rate, according to nationally renowned elections expert Hans von Spakovsky.

University of Wisconsin-Madison political scientist Ken Mayer's analysis, released this week, asserts at least 16,800 voting-age residents in the two counties did not vote because of the law.

What's buried at the bottom of the mainstream media's screaming voter disenfranchisement stories is the extrapolation game Mayer plays with the numbers.

The political science professor sent out 2,400 surveys to residents registered to vote but identified as not having cast ballots in November. Mayer received 293 responses. A total of nine respondents claimed voter ID exclusively kept them from voting.

"That's not sufficient for a ballot poll. That's too small a sample to give you any validity," said von Spakovsky, manager of the Election Law Reform Initiative and senior legal fellow of the Meese Center for Legal and Judicial Studies at the Heritage Foundation.

Asked if the sample is representative enough, Mayer said the short answer is yes. The study examines nonvoters. The pollsters estimate that population is about 160,000 people total within the two counties.

"In polling terms, that's a small number," Mayer told MacIver News Service. "With a population of 160,000, 293 (respondents) is enough to give you a reasonable margin of error." Had the study involved all Wisconsin nonvoters, the number of responses would have significantly driven up the margin of error, impacting the study's validity, the professor said.

But there's still a whole lot of extrapolating going on with the numbers as-is.

Von Spakovsky, a former member of the Federal Elections Commission, said the study appears to be another flawed attempt to show what myriad studies have shown: voter ID laws do not suppress voter turnout.

One of those studies, published in 2016 by the Heritage Foundation, examined the "faulty data" that have fueled the anti-voter ID movement.

"Policymakers and the public deserve the truth about the relatively small universe of affected voters, not inflammatory assertions that hundreds of thousands or millions of voters are going to be negatively affected by such laws," the Heritage study stated. The overview further notes press accounts have not accurately reported on the statistics.

"For example, even though both the data and reasoning used by a Wisconsin district court judge were later criticized as 'questionable' by the Seventh Circuit (Court of Appeals), the statistics cited by that judge are sill widely circulated by ID opponents and by media outlets such as MSNBC in reports about photo ID in Wisconsin," wrote Don Palmer, former secretary of the Virginia State Board of Elections and Director of Elections in Florida. Palmer also has served as an attorney in the Voting Section of the U.S. Department of Justice.

Liberal politicians particularly like to massage the numbers. Exhibit A: U.S. Sen. Tammy Baldwin (D-Madison), who has made the audacious claim that first-time use of photo ID in Wisconsin elections caused a 200,000 voter drop in turnout. The Milwaukee Journal Sentinel's Politifact, generally gentle on liberal pols, gave Baldwin a "Mostly False" for that claim. The Washington Post's fact-checker department gave the senator three Pinocchios.

The biggest problem with studies such as the UW-Madison's survey is that they lack context. As the Post noted in its Fact Checker piece, voter ID studies should include an important caveat: "Many factors - including even weather on Election Day - affect turnout. It's difficult to isolate specific reasons for increased or decreased turnout. So readers should be skeptical of politicians who attribute one specific factor to turnout."

Many of the respondents in Mayer's study said the law had nothing to do with why they didn't vote. Some said they were sick on Election Day. Others felt discouraged by politics and politicians in general. And more didn't like the candidates on the ballot.

The latter reason drives home what Gov. Scott Walker said after the Presidential election.

"People didn't turn out in Milwaukee because Hillary Clinton was not an aspirational candidate for them. It's that simple," the Republican governor said.

Here's another caveat tied to Mayer's study: It was commissioned by Dane County Clerk Scott McDonell, a liberal and outspoken critic of the state's voter ID law.

"There has been a lot of legislation that has passed that has made it harder to vote, and instead of just working with anecdotal evidence or assumptions, we will see who has been most affected," McDonell told the Sun Prairie Star in October, weeks before winning another term.

Mayer also served as an expert witness for anti-voter ID plaintiffs in a lawsuit against the state.

He said he knows "Republicans" will read what they will into the background, but he approached the study purely in the interest of science.

"What I can say is, I would go into federal court, be sworn under oath, and say I did not conduct this study looking for results," he said, adding that McDonell had no input in how the study was conducted. Both, Mayer said, were seeking answers to an "empirical question."

"If the numbers had come out and they said the number is zero (respondents saying they were deterred by voter ID), that's what we would have reported," the political scientist contends.

Von Spakovsky isn't so sure. While courts across the country, including the U.S. Supreme Court, have found voter ID laws constitutional, the left isn't giving up one of its key political talking points - no matter the facts.

"Voter ID has been upheld in state courts across the country because those courts have found there was no evidence that it suppressed turnout," the elections expert said.

A total of 34 states have laws requesting or requiring voters to show some form of identification at the polls, according to the National Conference of State Legislatures. Thirty-two of the voter ID laws are in force in 2017.

Wisconsin's Republican-controlled Legislature passed the state's voter ID law in 2011, but it remained blocked for years through a series of challenges by progressive groups.

Proponents say the laws provide a critical voter integrity check at the polls, preventing and discouraging voter fraud. While critics, like Mayer, insist voter fraud is nearly non-existent, an array of studies shows a more widespread problem than the left cares to acknowledge.

Mayer asserts there is a good deal of confusion about Wisconsin's law, serving as another barrier to voters, particularly in African-American communities.

Last year, the Legislature's budget-writing committee approved $250,000 for a voter ID education campaign. And the state's system allows provisional ballots.

For those looking to draw conclusions on the outcome of the presidential election in Wisconsin, don't. Mayer said his extrapolated numbers of "deterred" voters would not have changed the election results. In short, Hillary Clinton still lost long-blue Wisconsin to Donald Trump.

Walker: Recently Signed Budget Filled With 'Good Conservative Reforms'

Mon, 09/25/2017 - 06:00

MacIver News Service | September 25, 2017

By M.D. Kittle

[Madison, Wis...] Gov. Scott Walker says he had no doubts that he would sign a state budget by the end of summer.

The Republican governor made the pledge several weeks ago, as lawmakers appeared to be ending a budget deliberation stalemate.

It was close. Walker signed the $75.7 billion (not including bonding) 2017-19 budget on the last day of summer, some 2 1/2 months after it was technically due.

Walker said all the talk in the press about budget impasses among Republican leadership was really much ado about nothing.

"We all agreed we were going to spend more on property tax relief, we're going to spend more on schools, and we're going to put more into transportation. The question is, just how much. It was like there were these gigantic differences out there," the governor told MacIver News Service Friday during an interview on the Vicki McKenna Show, on NewsTalk 1310 WIBA in Madison.

Well, there was at least one significant difference: How to fund transportation.

In the end, the Republican-controlled Legislature passed a version of the transportation budget that was very close to what Walker first proposed in February.

"There were differences for sure, but I believed in the end we'd get to a budget," he said. "And the good news is we've got a budget that puts more money into schools than ever before and still cuts property taxes in 2017 and again in 2018. It eliminates an entire tax - the state property tax is gone now. It chips away at the personal property tax, freezes tuition now for the sixth year in a row and does plenty of other goods things as well."

The cumulative impact of the Walker era budgets - from 2011 to the end of the current biennium - will be more than $8 billion in tax relief, according to the administration. Who would have thought in December 2010 (a month before Walker began his first term as governor) that taxpayers would realize $8 billion in tax relief, the Republican governor said.

"I think even my most ardent supporters would have doubted it," Walker said.

While the budget includes too much spending and too much pork for the tastes of fiscal hawks, the governor said this is a "reform dividend" budget filled with limited-government reforms.

"We've done all sorts of really good conservative reforms in this budget, but they don't get a lot of attention because those weren't the things we were largely disputing at the tail end" of the budget process, Walker said.

Listen to the entire interview here:

Read MacIver Institute's in-depth analysis of the 2017-19 budget.

ANALYSIS: The 2017-19 Wisconsin State Budget

Sun, 09/24/2017 - 18:33

MacIver Institute | September 25, 2017

Read the MacIver Institute's complete analysis of the 2017-2019 budget here.

EXECUTIVE SUMMARY

It was 2 1/2 months overdue, but the 2017-19 Wisconsin state budget (2017 Act 59) is now in the books.

While the process was delayed and, at times, not pretty, the 2017-19 budget is a good budget. Not a great budget, but a good budget.

Any time a government votes to eliminate a tax, that is a significant taxpayer victory. Significant because it happens so rarely. If we eliminate a tax, it makes it more difficult for our government to take our hard-earned money from us in the first place. The only way we taxpayers are ever going to make headway in our effort to limit the size and scope of our government is if we restrain and then reduce the amount of tax dollars going to fund our government. Wiping a tax completely off the books is a positive step towards getting the government we want.

The 2017-19 budget signed by Gov. Scott Walker last week eliminates not just one tax but two taxes. Gone, too, is an entire big-government program - the Local Government Property Insurance Fund - that has been a part of state government since the 1900s. The 1900s. We would, at this point, give you some example of what life was like back in the 1900s to drive our point home, but it is so long ago we can't.

While spending increases in this budget, the final document cuts government positions. The Joint Finance Committee deserves kudos for that. It trimmed 432 more positions than Walker's original budget plan. Ultimately, the budget eliminates 16 jobs total from all funding sources compared to the 2015-17 spending plan, but to get there it cuts 175 positions from General Purpose Revenue (GPR) and moves 498 state posts to Program Revenue-funded positions. That's important. GPR is drawn from the general tax base, reliant on taxpayers. Program Revenue funded specifically by those who use a particular government service.

And we would be remiss if we didn't remind taxpayers just how truly spoiled we are today here in Wisconsin. It wasn't that long ago that we, as taxpayers, were constantly under siege from Madison, bombarded with one new tax after another, followed by another tax increase. At times we may be frustrated with some of the ideas coming out of Madison, but we must remember how much better taxpayers have it today compared to just seven years ago.

So we need to take a second to celebrate the fact that, once again, Gov. Scott Walker kept his pledge to not raise taxes. No individual income tax increase, no corporate tax increase, no sales tax increase. No gas tax increase or general vehicle registration fee increase. Another statewide property tax freeze on top of all that to boot. Thank you, Gov. Walker.

And thank you Republican-controlled Legislature for trimming nearly a half-billion dollars out of the original budget proposal.

That is NOT to say that this is a perfect budget. Far from it. The spending increase in this budget is too big. We hope the governor and legislators next time will put the time and effort into writing a state budget that fundamentally reorganizes state government, shrinks the footprint of the bureaucracy and actually spends less of our taxpayer money to provide only the vital services everyone needs.

We can't help but feel that the $636 million increase in state aid to K-12 education was a missed opportunity to drive further reform of our education system and push our schools to do a better job of educating all of our children. It is morally reprehensible that we allow more than 52,000 children to be trapped in failing schools and that we would choose to give failing educrats a reprieve rather than give the students stuck in bad schools immediate access to a school of their choosing.

Thankfully, the governor did make this budget significantly better with the use of his veto pen. Gone is the troublesome language that would have given the tyrannical power of eminent domain to the non-elected quasi-government agency called the Public Financing Authority. Gone is the new bureaucracy at the Transportation Projects Commission. Gone is the unnecessary prevailing wage repeal start date delay, so taxpayers will soon begin to see significantly lower costs for government building projects. Also gone is $2.5 million to once again study and pursue tolling for our road system. Enough with the studies. If you think tolling is the right thing to do and the answer to our so-called transportation funding problems, introduce a bill and vote on the idea. Everyone knows what tolling is, no need to waste more money analyzing the concept.

Technically due on July 1 (the beginning of the state fiscal year), Walker made it official and signed the budget document on September 21st.

Reform Dividend

Walker rolled out his budget blueprint in February, heralding a budget plan built on the "Reform Dividend." Six-and-a-half years of "common sense conservative reforms," the governor said, have cleaned up the fiscal mess Republicans inherited in 2011, put the state back on the path to prosperity, and eased the tax burden on overtaxed Wisconsinites.

So Walker tapped into those dividends in laying out his $76.1 billion spending plan, $34.5 billion of that from General Purpose Revenue (GPR). That was an increase of 2.6 percent (base year doubled) and 1.3 percent (base spending) over the 2015-17 budget. The governor's proposal called for $37.5 billion in spending in 2018 and $38.6 billion in 2019, including GPR, federal revenue, segregated funds and program revenue.


While mostly warmly received by Republican lawmakers, some fiscal hawks expressed concerns about the increased spending in Walker's plan: $375 million in the first year, and $1.18 billion in the second year. Using Madison math, or the base year doubled method, that equates to a 2.6 percent increase compared to the last budget.

Education

As promised, the governor came through with a generous increase in education spending. So generous, in fact, Department of Public Instruction Superintendent and potential 2018 gubernatorial challenger, Tony Evers, praised Walker's plan as a "pro-kid budget."

The 12-member Republican majority on the Joint Finance Committee approved an education spending plan that would have spent $639 million over the base, just $9 million less than what Walker had sought. Democrats said the massive increase wasn't enough, but the final product boosts per-pupil aid by $200 in the first year of the budget and $204 in the final year. In the end, the final budget increases state aids by over $636 million compared to current spending. At more than $11.5 billion over two years, the K-12 budget represents the largest state education investment in actual dollars ever.


Walker's budget originally tied some of the additional per-pupil aid to schools with the requirement that school districts certify compliance with Wisconsin's Act 10. The governor's proposal would have required districts to show that school employees are paying at least 12 percent of their health insurance costs and 6 percent of their public pensions. The Legislature removed the requirement, but school districts will have to report to the state the details of their employee health plans. That's a big win for taxpayers. For the first time, the state will begin systematically tracking Act 10 savings.

School choice picked up some big wins in this budget. The finance committee upped open parental choice program enrollment by increasing the eligibility level to 220 percent of the poverty level, or about $53,460 for a family of four. Including the public school open enrollment program, about 95,000 students participate in school choice in Wisconsin, with the majority in the southeastern corner of the state.

The budget also removes barriers to the Special Needs Scholarship Program, a new program that allows children with special needs to participate in school choice. The spending plan increases the number of independent charter school authorizers - any UW chancellor and any technical college board will now be allowed to authorize new charter schools. More authorizers should translate to more charter school offerings, which is a victory for parents and students alike.

Walker excised a big education expenditure with his veto pen. The Joint Finance Committee budget called for increases in local property tax funding for low-spending school districts through the low revenue adjustment. Once implemented, that could've raised statewide property taxes by up to $23.2 million. The districts have long argued that since property tax limits were implemented in 1993, they have been at a disadvantage because they are locked into their low spending ways forever.

"I am vetoing this section entirely because the result is a substantial increase in property tax capacity that school districts may exercise without voter input," the governor wrote in his veto message. "In several school districts that would be eligible to raise taxes under these sections, referenda to exceed revenue limits already failed within the past two years. An increase in revenue authority from the state in these districts would circumvent purposeful, local actions."

Walker used his veto pen to remove legislative language that watered down his change to rules for school districts using the energy efficiency adjustment. This program, established in the 2009-11 budget, allows school districts to increase their revenue limits by the amount they spend on energy efficiency projects. The Milwaukee Journal Sentinel noted that this exemption, the only exemption to property tax controls, has allowed schools to spend over $200 million without voter approval. In February, Walker proposed changing the rules so that school districts would first need to hold a referendum if they wanted to spend over their revenue limits.

Transportation

GOP legislative leadership called the governor's blueprint a good starting point, and then proceeded to tinker with and try to reshape the budget proposal, particularly on transportation.

Most Assembly Republicans continue to be unhappy with the level of borrowing used to pay for our transportation needs. When Walker did not propose a gas tax increase or any new transportation funding streams in his budget, Assembly Republicans objected loudly.

In stressing that every funding idea must be on the table in addressing Wisconsin's disputed $1 billion transportation budget shortfall, Assembly Republicans backed gas tax increases and vehicle fee bumps to generate an enhanced and sustainable flow of revenue. The budget process ground to a halt for over two months.

Let's be clear. I don't support spending less on K-12 education than what's in my budget and I will veto a gas tax increase.

— Governor Walker (@GovWalker) March 30, 2017

In the end, the Joint Finance Committee approved $400 million in bonding, much closer to the original half-billion in borrowing the governor first proposed. The final bonding number got buy-in from a reluctant Assembly in large part because about $252 million of the money would go to the Interstate-94 north-south project, tied to the Foxconn Technology Group incentives package. Lest we forget, the budget was constructed amid a "once-in-a-century" economic development proposal, Foxconn's plan for a $10 billion high-tech manufacturing campus in southeast Wisconsin projected to eventually create 13,000 family-supporting jobs.

To the dismay of southeast Wisconsin lawmakers, the funding package includes no new money for Milwaukee area super projects, reconstruction of I-94 between the Marquette and Zoo interchanges and finishing off the north leg of the zoo.

Republicans on a party-line vote did away with what remained of Wisconsin's Great Depression-era prevailing wage law. Finishing the unfinished business of the last session when the Legislature eliminated prevailing wage for all but state projects, the Joint Finance Committee has saved taxpayers from a system that artificially inflates wages on government building and highway projects. A previous study from the Wisconsin Taxpayers Alliance found that taxpayers could have saved as much as $300 million on 2015 construction projects had the reforms been in place then.

The budget also eliminates 252 Department of Transportation positions, a move that thins a bloated state agency that has wasted so much taxpayer money.

When all was said it done, Walker won the great 2017 transportation battle, holding firm on no gas tax increases or general vehicle fee hikes.

Healthcare

Despite the ever-escalating cost of healthcare in this country, taxpayers here in Wisconsin received some good news earlier this year. Actual Medical Assistance program expenditures during 2015-17 came in at $325 million less than what was included in the previous budget because of lower-than-expected enrollment. Fewer Wisconsinites on MA is a good thing.


In a new round of reforms intended to help transition Medicaid recipients to employment and off government assistance, Walker's Department of Health Services submitted a broad request to the federal Centers for Medicaid Services in June, asking the Trump administration for permission to implement a variety of reforms to the state's Medicaid program - also known BadgerCare - including a drug screening requirement.

If approved, it will allow Wisconsin to screen those who apply for BadgerCare for drugs and, if necessary, require participants to submit to a drug test. If a recipient fails, he or she would have to enter a state-funded treatment program. If they refuse, they would be ineligible for BadgerCare benefits until they agree to enter treatment.

Welfare Reform

Walker has made welfare reform a priority throughout his tenure, and this state budget was no different. Pending final approval from the federal government, Wisconsin will become the first state in the nation to screen and drug test participants in the welfare-to-work program. Under this budget, the state will also expand work requirements for benefits programs to ensure that individuals receiving state benefits are building their own skills towards independence.

Drug Testing MA recipients is not cruel as @SenTaylor stated; leaving them dependent on govt without assistance to get off drugs IS cruel.

— Governor Walker (@GovWalker) May 26, 2017

This budget also eliminates a significant benefit cliff in Wisconsin's child care tax credit program that creates a disincentive for career growth. Under past law, if a recipient of Wisconsin Shares made just $1 more than the income limit, they would be automatically cut off from the program's benefits. The budget reforms the program, creating a "ramp" to slowly reduce benefits over a certain point. Participants can now take gradual raises or promotions without the fear of losing child care benefits overnight if they make just a penny too much. That's true reform, and it'll make a positive impact on peoples' lives.

Tax Relief

This budget eliminates a tax. Let that sink in. The Badger State, which has long worn the Scarlet T of a high-tax state, has eliminated the state property tax, or the forestry mill tax. Taxpayers will save $180.5 million over the next two years, not enough that anyone will be able to retire tomorrow but the powerful symbolism cannot be denied.

"Here in Wisconsin we are not only reducing taxes, we're eliminating taxes altogether," Rep. Dale Kooyenga (R-Brookfield), a member of the Legislature's powerful budget-writing committee said. "You want to talk about history? We're making history right here."

Kooyenga also celebrated the end of the Alternative Minimum Tax, a kind of separate income tax that is taking a bigger bite out of middle-income filers. While its impact is smaller, north of $7 million a year beginning in 2019, the principle is powerful: lawmakers really can wipe a tax off the books.

An omnibus tax relief package authored by Kooyenga and Sen. Howard Marklein (R-Spring Green) takes a big bite out of Wisconsin's antiquated and unfair personal property tax law. Small businesses have long had to pay local government a tax on the value of their equipment. The JFC bill exempts non-manufacturing machinery, tools and patterns from the property tax, unburdening business by a combined $74.4 million annually. Democrats criticized the measure as ultimately drawing tax revenue away from local governments that will be forced to do the "same or more with less resources." The partial repeal initiative, however, will be paid for through the creation of a state aid program administered by the state Department of Revenue.

Property taxes, for another two years, are expected to be lower for the typical homeowner in Wisconsin than they were when the governor took office in 2010. That amounts to $3,000 in savings for the owner of a median-priced home in the Badger State compared to the trend prior to 2010, according to the Walker administration.

And by the end of the newly signed budget in 2019, Wisconsin taxpayers will have received some $8 billion in cumulative tax relief over Walker's tenure in office.

But small business' gain, in part, was a loss to income taxpayers. Walker's budget proposal called for $203 million in income tax cuts. He did so by reducing the lowest income tax bracket from 4 percent to 3.9 percent and second-lowest bracket from 5.84 percent to 5.74 percent, while also widening the second-lowest bracket. The tax break would ultimately have benefited all Wisconsin taxpayers, who, regardless of income, pay those rates on at least a portion of their income.

As budget negotiations progressed it became increasingly clear that income tax cuts would have to be sacrificed for other priorities, not the least of which was the personal property tax.

The budget saves money for Wisconsin's higher education students, too. It extends the University of Wisconsin System instate tuition freeze into its fifth and sixth years. Walker initially had proposed a 5 percent tuition cut, but the Legislature decided the $35 million price tag was too heavy. Instead, they put some of the money into need-based financial assistance.

Walker's 99 vetoes are expected to save taxpayers a combined $87.5 million over the next two budgets. More important, the governor removed some very unconservative provisions, many of which slipped into the budget at the last minute.

Global Perspective - Is Wisconsin Heading In The Right Direction?

Setting aside the specifics of the state budget for a second, we need to take a step back and ask if Wisconsin is heading in the right direction?

Wisconsin unemployment rate in May and June hit levels not seen since the latter part of the roaring 1990s.

At 3.1 percent, the state's jobless rate was at its lowest level in 17 years. While it edged up slightly in July and August, Wisconsin's unemployment rate was a full percentage point below the national number, which climbed to 4.4 percent. Wisconsin's labor force participation rate continues to climb, at 68.8 percent in August. That's nearly six percentage points above the US. rate of 62.9 percent.

The Badger State's unemployment numbers have dramatically improved in recent years, from a post-Great Recession peak of 9.2 percent in January 2010, the last year of Democrat Gov. Jim Doyle's tenure.

Initial Unemployment Insurance claims ended 2016 at their lowest level in 30 years, and all signs point to the same this year, according to data from Wisconsin Workforce Development. Continuing unemployment claims ended 2016 at their lowest level since 1973.

While the jobless rate is an important gauge of the economy's health, it is but one of many. And many of the leading economic indicators have continued to point up through Walker's two terms in office.

State agricultural exports rose nearly 9 percent in the first half of 2017, tallying $1.8 billion in products shipped to 134 countries, according to the Walker administration. Wisconsin businesses shipped a total of $11.2 billion in goods and services worldwide in the first six months of the year, an 8.2 percent increase over the same period in 2016.

When Walker first took the oath of office in January 2011, he and the new Republican-controlled Legislature faced a $3.6 billion state budget shortfall. Through a series of limited-government reforms and much-needed fiscal constraint, the state's financial health is in a much improved position. Instead of deficits, the Walker era has been a time of budget surpluses.

The state's Rainy Day Fund, or budget stabilization fund, stands at nearly $282 million, 165 times larger than it was when Walker first took office.

State Rep. John Nygren (R-Marinette) and Sen. Alberta Darling (R-River Hills), co-chairs of the Legislature's budget-writing committee assert conservative reforms in recent years have put the state in a strong fiscal position.

"The budget we just passed will continue those reforms and help shield taxpayers from economic uncertainty," the lawmakers said in a statement. "With $280 million in our rainy day fund, an additional $14 million in increased revenue, and setting aside nearly $200 million in ending balance of the budget, our careful budgeting will help ensure our great state continues to prosper and succeed."

Wisconsin's fully funded public pension system helped push the state to the fourth best nationwide in overall long term debt obligations, according to a report last year by the Pew Charitable Trusts. About 4.8 percent of combined annual income earned by Wisconsinites would cover the obligations the state owes to creditors. Compare that to the national average of 14.8 percent, or Illinois, at 31.7 percent.

Last month, Moody's upgraded Wisconsin's long-term debt to its highest level since 1973.

Wisconsin's General Obligation rating is now Aa1 - the second highest rating, just below Aaa.

"The bottom line is, that is good for every taxpayer because it means our financial house is in better shape, and it means long term, it actually costs us less to borrow," Walker told MacIver News Service.

"That's just a sign that what we've done over the last six years is working," Walker said. "We've shown that common sense conservative reforms work."

A steadily growing economy, prudent budget management, and a fully funded pension system were key reasons for the upgrade.

"The upgrade to Aa1 reflects the proven fiscal benefits of the state's approach to granting and funding pension obligations when many other states are experiencing stress from rising costs and heavy liabilities; an economy that delivers steady but moderate growth; conservatively managed budgets; and adequate liquidity," according to Moody's report.

Walker critics point to job creation numbers in the governor's tenure, keying in on his pledge that Wisconsin's economy would create 250,000 jobs in his first term in office. That didn't happen, for a variety of reasons, not the least of which was the record slow rate of U.S. economic recovery from the recession late last decade.

The bigger problem of late is not a lack of job opportunities, but the region-wide challenge of finding skilled workers.

"The problem six, seven years ago was we didn't have any jobs," the governor told reporters in May. "The challenge we have today is, we have so many jobs, we don't have enough people to fill those."

As Walker likes to say, Wisconsin is open for business. And businesses have taken note.

Chief Executive magazine rates Wisconsin as a top 10 state to do business. Not long before Wisconsin's conservative revolution in 2010, the nation's top chief executives ranked Wisconsin as one of the worst states for business, a state ladened with high taxes and stifling regulation.

One Fortune 50 company in particular has taken notice.

In late July, Walker joined President Trump, Speaker Paul Ryan (R-Janesville), and Sen. Ron Johnson (R-Oshkosh) for a White House announcement that Foxconn Technology Group planned a massive investment in southeast Wisconsin. The Taiwanese tech giant rolled out a proposal to build a Liquid Crystal Display production campus, a city unto itself, that would eventually create 13,000 manufacturing jobs paying on average $53,000-plus per year. Officials say the $10 billion investment would spur 10,000 construction jobs and many thousand more spin-off jobs to serve this "once-in-a-century" economic development project. Wisconsin beat at least six other states bidding on the project, with the Republican-controlled Legislature this month signing off on a $3 billion incentives package. Foxconn expects to break ground in spring.

"This is a truly transformational step for our state, our people and our economy, and Wisconsin is ready," Walker said in signing the Foxconn legislation.

This is a good budget. In the main, it's good for conservatives. It's good for taxpayers. It's good for Wisconsin.

Property taxes, on a median home value basis, are lower. Two taxes are gone altogether. The burden of government has been lifted in part off the backs of business and taxpayers. By the measures of limiting government and making life better for the Wisconsin taxpayer, this budget gets the job done.

Read the MacIver Institute's complete analysis of the 2017-2019 budget here.

COMPLETE ANALYSIS: The 2017-19 Wisconsin State Budget

Thu, 09/21/2017 - 13:46

A MacIver Institute Analysis

September 25, 2017

EXECUTIVE SUMMARY

It was 2 1/2 months overdue, but the 2017-19 Wisconsin state budget (2017 Act 59) is now in the books.

While the process was delayed and, at times, not pretty, the biennial budget is a good budget. Not a great budget, but a good budget.

Any time a government votes to eliminate a tax, that is a significant taxpayer victory. Significant because it happens so rarely. If we eliminate a tax, it makes it more difficult for our government to take our hard-earned money from us in the first place. The only way we taxpayers are ever going to make headway in our effort to limit the size and scope of our government is if we restrain and then reduce the amount of tax dollars going to fund our government. Wiping a tax completely off the books is a positive step towards getting the government we want.

The 2017-19 budget signed by Gov. Scott Walker last week eliminates not just one tax but two taxes. Gone, too, is an entire big-government program - the Local Government Property Insurance Fund - that has been a part of state government since the 1900s. The 1900s. We would, at this point, give you some example of what life was like back in the 1900s to drive our point home, but it is so long ago that we can't.

While spending increases in this budget, the final document cuts government positions. The Joint Finance Committee deserves kudos for that. It trimmed 432 more positions than Walker's original budget plan. Ultimately, the budget eliminates 16 jobs total from all funding sources compared to the 2015-17 spending plan, but to get there it cuts 175 positions from General Purpose Revenue (GPR) and moves 498 state posts to Program Revenue-funded positions. That's important. GPR is drawn from the general tax base, reliant on taxpayers. Program Revenue is funded specifically by those who use a particular government service.

And we would be remiss if we didn't remind taxpayers just how truly spoiled we are today here in Wisconsin. It wasn't that long ago that we, as taxpayers, were constantly under siege from Madison, bombarded with one new tax after another, followed by another tax increase. At times we may be frustrated with some of the ideas coming out of Madison, but we must remember how much better taxpayers have it today compared to just seven years ago.

So we need to take a second to celebrate the fact that, once again, Gov. Walker kept his pledge to not raise taxes. No individual income tax increase, no corporate tax increase, no sales tax increase. No gas tax increase or general vehicle registration fee increase. Another statewide property tax freeze on top of all that to boot. Thank you, Gov. Walker.

And thank you, Republican-controlled Legislature for trimming nearly a half-billion dollars out of the original budget proposal.

That is NOT to say that this is a perfect budget. Far from it. The spending increase in this budget is too big. Next time, we hope the governor and legislators will put the time and effort into writing a state budget that fundamentally reorganizes state government, shrinks the footprint of the bureaucracy and actually spends less of our taxpayer money to provide only the vital services everyone needs.

We can't help but feel that the $636 million increase in state aid to K-12 education was a missed opportunity to drive further reform of our education system and push our schools to do a better job of educating all of our children. It is morally reprehensible that we allow more than 52,000 children to be trapped in failing schools and that we would choose to give failing educrats a reprieve rather than give the students stuck in bad schools immediate access to a school of their choosing.

Thankfully, the governor made this budget significantly better with the use of his veto pen. Gone is the troublesome language that would have given the tyrannical power of eminent domain to the non-elected quasi-government agency called the Public Finance Authority. Gone is the new bureaucracy at the Transportation Projects Commission. Gone is the unnecessary prevailing wage repeal start date delay, so taxpayers will soon begin to see significantly lower costs for government building projects. Also gone is $2.5 million to once again study and pursue tolling for our road system. Enough with the studies. If you think tolling is the right thing to do and the answer to our so-called transportation funding problems, introduce a bill and vote on the idea. Everyone knows what tolling is, no need to waste more money analyzing the concept.

Technically due on July 1 (the beginning of the state fiscal year), Walker made it official and signed the budget document on September 21st.

Reform Dividend

Walker rolled out his budget blueprint in February, heralding a budget plan built on the "Reform Dividend." Six-and-a-half years of "common sense conservative reforms," the governor said, have cleaned up the fiscal mess Republicans inherited in 2011, put the state back on the path to prosperity, and eased the tax burden on overtaxed Wisconsinites.

So Walker tapped into those dividends in laying out his $76.1 billion spending plan, $34.5 billion of that from General Purpose Revenue (GPR). That was an increase of 2.6 percent (base year doubled) and 1.3 percent (base spending) over the 2015-17 budget. The governor's proposal called for $37.5 billion in spending in 2018 and $38.6 billion in 2019, including GPR, federal revenue, segregated funds and program revenue.


While mostly warmly received by Republican lawmakers, some fiscal hawks expressed concerns about the increased spending in Walker's plan: $375 million in the first year, and $1.18 billion in the second year. Using Madison math, or the base year doubled method, that equates to a 2.6 percent increase compared to the last budget.

Education

As promised, the governor came through with a generous increase in education spending. So generous, in fact, Department of Public Instruction Superintendent and potential 2018 gubernatorial challenger, Tony Evers, praised Walker's plan as a "pro-kid budget."

The 12-member Republican majority on the Joint Finance Committee approved an education spending plan that would have spent $639 million over the base, just $9 million less than what Walker had sought. Democrats said the massive increase wasn't enough, but the final product boosts per pupil aid by $200 in the first year of the budget and $204 in the final year. In the end, the final budget increases state aids by over $636 million compared to current spending. At more than $11.5 billion over two years, the K-12 budget represents the largest state education investment in actual dollars ever.


Walker's budget originally tied some of the additional per pupil aid to schools with the requirement that school districts certify compliance with Wisconsin's Act 10. The governor's proposal would have required districts to show that school employees are paying at least 12 percent of their health insurance costs and 6 percent of their public pensions. The Legislature removed the requirement, but school districts will have to report to the state the details of their employee health plans. That's a big win for taxpayers. For the first time, the state will begin systematically tracking Act 10 savings.

School choice picked up some big wins in this budget. The finance committee upped open parental choice program enrollment by increasing the eligibility level to 220 percent of the poverty level, or about $53,460 for a family of four. Including the public school open enrollment program, about 95,000 students participate in school choice in Wisconsin, with the majority in the southeastern corner of the state.

The budget also removes barriers to the Special Needs Scholarship Program, a new program that allows children with special needs to participate in school choice. The spending plan increases the number of independent charter school authorizers - any UW chancellor and any technical college board will now be allowed to authorize new charter schools. More authorizers should translate to more charter school offerings, which is a victory for parents and students alike.

Walker excised a big education expenditure with his veto pen. The Joint Finance Committee budget called for increases in local property tax funding for low-spending school districts through the low revenue adjustment. Once implemented, that could've raised statewide property taxes by up to $23.2 million. The districts have long argued that since property tax limits were implemented in 1993, they have been at a disadvantage because they are now locked into their low spending ways forever.

"I am vetoing this section entirely because the result is a substantial increase in property tax capacity that school districts may exercise without voter input," the governor wrote in his veto message. "In several school districts that would be eligible to raise taxes under these sections, referenda to exceed revenue limits already failed within the past two years. An increase in revenue authority from the state in these districts would circumvent purposeful, local actions."

Walker used his veto pen to remove legislative language that watered down his change to rules for school districts using the energy efficiency adjustment. This program, established in the 2009-11 budget, allows school districts to increase their revenue limits by the amount they spend on energy efficiency projects. The Milwaukee Journal Sentinel noted that this exemption, the only exemption to property tax controls, has allowed schools to spend over $200 million without voter approval. In February, Walker proposed changing the rules so that school districts would first need to hold a referendum if they wanted to spend over their revenue limits.

Transportation

GOP legislative leadership called the governor's blueprint a good starting point, and then proceeded to tinker with and try to reshape the budget proposal, particularly on transportation.

Most Assembly Republicans continue to be unhappy with the level of borrowing used to pay for our transportation needs. When Walker did not propose a gas tax increase or any new transportation funding streams in his budget, Assembly Republicans objected loudly.

In stressing that every funding idea must be on the table in addressing Wisconsin's disputed $1 billion transportation budget shortfall, Assembly Republicans backed gas tax increases and vehicle fee bumps to generate an enhanced and sustainable flow of revenue. The budget process ground to a halt for over two months.

Let's be clear. I don't support spending less on K-12 education than what's in my budget and I will veto a gas tax increase.

— Governor Walker (@GovWalker) March 30, 2017

In the end, the Joint Finance Committee approved $400 million in bonding, much closer to the original half-billion in borrowing the governor first proposed. The final bonding number got buy-in from a reluctant Assembly in large part because about $252 million of the money would go to the Interstate-94 north-south project, tied to the Foxconn Technology Group incentives package. Lest we forget, the budget was constructed amid a "once-in-a-century" economic development proposal, Foxconn's plan for a $10 billion high-tech manufacturing campus in southeast Wisconsin projected to eventually create at least 13,000 family-supporting jobs.

To the dismay of southeast Wisconsin lawmakers, the funding package includes no new money for Milwaukee area super projects, reconstruction of I-94 between the Marquette and Zoo interchanges and finishing off the north leg of the Zoo.

Republicans on a party-line vote did away with what remained of Wisconsin's Great Depression-era prevailing wage law. Finishing the unfinished business of the last session when the Legislature eliminated prevailing wage for all but state projects, the Joint Finance Committee has saved taxpayers from a system that artificially inflates wages on government building and highway projects. A previous study from the Wisconsin Taxpayers Alliance found that taxpayers could have saved as much as $300 million on construction projects in 2015 had the reforms been in place then.

The budget also eliminates 252 Department of Transportation positions, a move that thins a bloated state agency that has wasted so much taxpayer money.

When all was said and done, Walker won the great 2017 transportation battle, holding firm on no gas tax increases or general vehicle fee hikes.

Healthcare

Despite the ever-escalating cost of healthcare in this country, taxpayers here in Wisconsin received some good news earlier this year. Actual Medical Assistance program expenditures during 2015-17 came in at $325 million less than what was included in the previous budget because of lower-than-expected enrollment. Fewer Wisconsinites on MA is a good thing.


In a new round of reforms intended to help transition Medicaid recipients to employment and off government assistance, Walker's Department of Health Services submitted a broad request to the federal Centers for Medicaid Services in June, asking the Trump administration for permission to implement a variety of reforms to the state's Medicaid program - also known BadgerCare - including a drug screening requirement.

If approved, it will allow Wisconsin to screen those who apply for BadgerCare for drugs and, if necessary, require participants to submit to a drug test. If a recipient fails, he or she would have to enter a state-funded treatment program. If they refuse, they would be ineligible for BadgerCare benefits until they agree to enter treatment.

Welfare Reform

Walker has made welfare reform a priority throughout his tenure, and this state budget was no different. Pending final approval from the federal government, Wisconsin will become the first state in the nation to screen and drug test participants in the welfare-to-work program. Under this budget, the state will also expand work requirements for benefits programs to ensure that individuals receiving state benefits are building their own skills towards independence.

Drug Testing MA recipients is not cruel as @SenTaylor stated; leaving them dependent on govt without assistance to get off drugs IS cruel.

— Governor Walker (@GovWalker) May 26, 2017

This budget also eliminates a significant benefits cliff in Wisconsin's child care tax credit program that creates a disincentive for career growth. Under past law, if a recipient of Wisconsin Shares made just $1 more than the income limit, they would be automatically cut off from the program's benefits. The budget reforms the program, creating a "ramp" to slowly reduce benefits over a certain point. Participants can now take gradual raises or promotions without the fear of losing child care benefits overnight if they make just a penny too much. That's true reform, and it'll make a positive impact on peoples' lives.

Tax Relief

This budget eliminates a tax. Let that sink in. The Badger State, which has long worn the Scarlet T of a high-tax state, has eliminated the state property tax, also known as the forestry mill tax. Taxpayers will save $180.5 million over the next two years - not enough that anyone will be able to retire tomorrow, but the powerful symbolism cannot be denied.

"Here in Wisconsin we are not only reducing taxes, we're eliminating taxes altogether," Rep. Dale Kooyenga (R-Brookfield), a member of the Legislature's powerful budget-writing committee said. "You want to talk about history? We're making history right here."

Kooyenga also celebrated the end of the Alternative Minimum Tax, a kind of separate income tax that is taking a bigger bite out of middle-income filers. While its impact is smaller, north of $7 million a year beginning in 2019, the principle is powerful: lawmakers really can wipe a tax off the books.

An omnibus tax relief package authored by Kooyenga and Sen. Howard Marklein (R-Spring Green) takes a big bite out of Wisconsin's antiquated and unfair personal property tax law. Small businesses have long had to pay local government a tax on the value of their equipment. The JFC bill exempts non-manufacturing machinery, tools and patterns from the property tax, unburdening business by a combined $74.4 million over the biennium. Democrats criticized the measure as ultimately drawing tax revenue away from local governments that will be forced to do the "same or more with less resources." The partial repeal initiative, however, will be paid for through the creation of a state aid program administered by the state Department of Revenue.

Property taxes, for another two years, are expected to be lower for the typical homeowner in Wisconsin than they were when the governor took office in 2010. That amounts to $3,000 in savings for the owner of a median-priced home in the Badger State compared to the trend prior to 2010, according to the Walker administration.

And by the end of the newly signed budget in 2019, Wisconsin taxpayers will have received some $8 billion in cumulative tax relief over Walker's tenure in office.

But small businesses' gain, in part, was a loss to income taxpayers. Walker's budget proposal called for $203 million in income tax cuts. He did so by reducing the lowest income tax bracket from 4 percent to 3.9 percent and the second-lowest bracket from 5.84 percent to 5.74 percent, while also widening the second-lowest bracket. The tax break would ultimately have benefited all Wisconsin taxpayers, who, regardless of income, pay those rates on at least a portion of their income.

As budget negotiations progressed it became increasingly clear that income tax cuts would have to be sacrificed for other priorities, not the least of which was the personal property tax.

The budget saves money for Wisconsin's higher education students, too. It extends the University of Wisconsin System instate tuition freeze into its fifth and sixth years. Walker initially had proposed a 5 percent tuition cut, but the Legislature decided the $35 million price tag was too heavy. Instead, they put some of the money into need-based financial assistance.

Walker's 99 vetoes are expected to save taxpayers a combined $87.5 million over the next two budgets. More important, the governor removed some very unconservative provisions, many of which slipped into the budget at the last minute.

Global Perspective - Is Wisconsin Heading In The Right Direction?

Setting aside the specifics of the state budget for a second, we need to take a step back and ask whether Wisconsin is heading in the right direction.

In May and June, Wisconsin's unemployment rate hit levels not seen since the latter part of the roaring 1990s.

At 3.1 percent, the state's jobless rate was at its lowest level in 17 years. While it edged up slightly in July and August, Wisconsin's unemployment rate was a full percentage point below the national number, which climbed to 4.4 percent. Wisconsin's labor force participation rate continues to climb, at 68.8 percent in August. That's nearly six percentage points above the U.S. rate of 62.9 percent.

The Badger State's unemployment numbers have dramatically improved in recent years, from a post-Great Recession peak of 9.2 percent in January 2010, the last year of Democrat Gov. Jim Doyle's tenure.

Initial Unemployment Insurance claims ended 2016 at their lowest level in 30 years, and all signs point to the same this year, according to data from the Wisconsin Department of Workforce Development. Continuing unemployment claims ended 2016 at their lowest level since 1973.

While the jobless rate is an important gauge of the economy's health, it is but one of many. And many of the leading economic indicators have continued to point up through Walker's two terms in office.

State agricultural exports rose nearly 9 percent in the first half of 2017, tallying $1.8 billion in products shipped to 134 countries, according to the Walker administration. Wisconsin businesses shipped a total of $11.2 billion in goods and services worldwide in the first six months of the year, an 8.2 percent increase over the same period in 2016.

When Walker first took the oath of office in January 2011, he and the new Republican-controlled Legislature faced a $3.6 billion state budget shortfall. Through a series of limited-government reforms and much-needed fiscal restraint, the state's financial health is in a much improved position. Instead of deficits, the Walker era has been a time of budget surpluses.

The state's Rainy Day Fund, or budget stabilization fund, stands at nearly $282 million, over 165 times larger than it was when Walker first took office.

Rep. John Nygren (R-Marinette) and Sen. Alberta Darling (R-River Hills), co-chairs of the Legislature's budget-writing committee, assert that conservative reforms in recent years have put the state in a strong fiscal position.

"The budget we just passed will continue those reforms and help shield taxpayers from economic uncertainty," the lawmakers said in a statement. "With $280 million in our rainy day fund, an additional $14 million in increased revenue, and setting aside nearly $200 million in ending balance of the budget, our careful budgeting will help ensure our great state continues to prosper and succeed."

Wisconsin's fully funded public pension system helped push the state to the fourth best nationwide spot in overall long term debt obligations, according to a report last year by the Pew Charitable Trusts. About 4.8 percent of combined annual income earned by Wisconsinites would cover the obligations the state owes to creditors. Compare that to the national average of 14.8 percent, or in Illinois' case, 31.7 percent.

Last month, Moody's upgraded Wisconsin's long-term debt to its highest level since 1973. Wisconsin's General Obligation rating is now Aa1 - the second highest rating, just below Aaa.

"The bottom line is, that is good for every taxpayer because it means our financial house is in better shape, and it means long term, it actually costs us less to borrow," Walker told MacIver News Service.

"That's just a sign that what we've done over the last six years is working," Walker said. "We've shown that common sense conservative reforms work."

A steadily growing economy, prudent budget management, and a fully funded pension system were key reasons for the upgrade.

"The upgrade to Aa1 reflects the proven fiscal benefits of the state's approach to granting and funding pension obligations when many other states are experiencing stress from rising costs and heavy liabilities; an economy that delivers steady but moderate growth; conservatively managed budgets; and adequate liquidity," according to Moody's report.

Walker's critics point to job creation numbers in the governor's tenure, keying in on his pledge that Wisconsin's economy would create 250,000 jobs in his first term in office. That didn't happen, for a variety of reasons, not the least of which was the record slow rate of U.S. economic recovery from the recession late last decade.

The bigger problem of late is not a lack of job opportunities, but the region-wide challenge of finding skilled workers.

"The problem six, seven years ago was we didn't have any jobs," the governor told reporters in May. "The challenge we have today is, we have so many jobs, we don't have enough people to fill those."

As Walker likes to say, Wisconsin is open for business. And businesses have taken note.

Chief Executive magazine rates Wisconsin as a top 10 state to do business. Not long before Wisconsin's conservative revolution in 2010, the nation's top chief executives ranked Wisconsin as one of the worst states for business, a state laden with high taxes and stifling regulation.

One Fortune 50 company in particular has taken notice.

In late July, Walker joined President Trump, Speaker Paul Ryan (R-Janesville), and Sen. Ron Johnson (R-Oshkosh) for a White House announcement that Foxconn Technology Group planned a massive investment in southeast Wisconsin. The Taiwanese tech giant rolled out a proposal to build a Liquid Crystal Display production campus, a city unto itself, that would eventually create 13,000 manufacturing jobs paying on average $53,000-plus per year. Officials say the $10 billion investment would spur 10,000 construction jobs and many thousands more spin-off jobs to serve this "once-in-a-century" economic development project. Wisconsin beat at least six other states bidding on the project, with the Legislature officially signing off on a $3 billion incentives package this month. Foxconn expects to break ground in spring.

"This is a truly transformational step for our state, our people and our economy, and Wisconsin is ready," Walker said in signing the Foxconn legislation.

This is a good budget. In the main, it's good for conservatives. It's good for taxpayers. It's good for Wisconsin.

Property taxes, on a median home value basis, are lower. Two taxes are gone altogether. The burden of government has been lifted in part off the backs of businesses and taxpayers. By the measures of limiting government and making life better for the Wisconsin taxpayer, this budget gets the job done.

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FULL ANALYSIS: K-12 EDUCATION

In February, Walker proposed a generous K-12 funding plan that would have sent $649 million more than base-level funding to the Department of Public Instruction (DPI). Over the summer, proposals from the Assembly and the Senate Republican caucuses kept the conversation going. The JFC Democrats also threw their hats in the ring with a plan that would have spent nearly $730 million more than Walker's proposal, earning comparisons to "kids at Christmas."

JFC agreed to spend $639.3 million more than current funding, finding areas of compromise throughout the plan. After Walker's vetoes, that overall spending went down a hair to $636 million. The budget committee kept Walker's levels of per pupil categorical aid, totaling $507.8 million in funding, which was the bulk of the increase. Per pupil categorical aid is sent to nearly all schools, provided certain requirements are met. Funding levels will increase by $200 per pupil in 2017, and by another $204 in 2018. When all is said and done, the total per pupil aid from this program alone will be $654 per pupil.

Walker's original proposal tied some of the increased funding to compliance with Act 10, the 2011 law that reformed public sector collective bargaining in Wisconsin. The governor's plan would have required school districts to certify to the state that employees are paying at least 6 percent toward pension plans and at least 12 percent toward healthcare plans.

The final budget waters that plan down, instead requiring school districts to annually report employee contribution levels to the Department of Administration. While some will certainly be disappointed that compliance will not be linked to additional state aid, the reporting requirement is still significant. The state will, for the first time, have a clearer picture of the amount of money that Act 10 has saved taxpayers.

Taxpayers and parents will also see heightened transparency thanks to new additions to annual school report cards. Schools will begin reporting data on how many students participate in AP classes, early college credits, and apprenticeships, among other important information.

One area where the budget committee was more reform-minded than Walker: school choice. JFC's budget increases the statewide income limits to 220 percent of the federal poverty level, up from 185 percent. Families of four earning just under $54,000 will now be able to apply, and an estimated 550 more students will now be able participate in the statewide program. Walker had proposed keeping the income limit at 185 percent, and school choice advocates fought for an increase to 300 percent, the same limit as the Milwaukee and Racine programs.

The finance committee also removed barriers to the Special Needs Scholarship Program, a new program that allows children with special needs to receive scholarships and participate in school choice. Students will no longer need to have been denied from public school open enrollment before applying, nor will they need to have attended a public school in Wisconsin for the entire previous year. Together, those changes are expected to increase enrollment by about 250 kids, effectively doubling the size of the program.

Other changes to choice and charter schools include an increase in the number of independent charter school authorizers. Any UW chancellor and any technical college board will be allowed to authorize new charter schools. For the first time, charters will be allowed to open anywhere in the state - not just in Madison or Milwaukee. That's good news, and will hopefully provide more options for the 50,000+ students currently trapped in failing public schools.

Charter schools will be able to seek reimbursement for summer school costs, and parental choice schools see a funding "fix" allowing them to pro-rate reimbursements. Public school open enrollment will see a reimbursement increase of $100 more per pupil.

The plan makes changes to the Opportunity Schools Partnership Program (OSPP) established in the last budget. Those changes were written with an eye on Racine Unified School District (RUSD), which was designated as failing on last year's report cards. Without a change in law, if November's new report cards again find RUSD to be failing, OSPP would go into effect - allowing certain schools to become part of a special turnaround district.

RUSD gets 120 days to demonstrate Act 10 compliance to DOA. If RUSD meets compliance and is indeed declared failing in November's data release, the district will get a year-long "pass" before OSPP's requirements go into effect. The villages within RUSD will also get the option to hold a referendum on whether or not to split off and become a new school district. JFC's budget plan includes funding to study the idea of creating a new school district.

Property tax payers faced some potentially bad news through a change in a policy called low revenue adjustment. This would have allowed "low spending districts" to raise property taxes to bring their spending up closer to the state average without going to referendum. The issue was particularly important to the Assembly, which proposed allowing some districts to raise property taxes by up to $92.2 million statewide. The Senate followed suit with a scaled-back version that increased the adjustment more slowly. The budget committee adopted the same plan.

The issue of revenue limits has long been a priority for school officials. When the limits were set in 1993, frugal districts were locked into low rates. According to proponents of the plans to increase the low revenue adjustment, those districts have since struggled to provide equitable services for their students.

In the Senate and final JFC plan, certain school districts would have been able to raise property taxes by up to $23.2 million statewide. On the flip side, the budget also allocates $87 million more in each year to the school levy tax credit, which acts as property tax relief for homeowners.

Walker vetoed the low revenue adjustment changes, citing potential property tax increases.

Also included in JFC's education budget is $9.2 million for laptops for high school freshmen, regardless of family income. We would have hoped that the committee could have found a better way to spend our money or cut spending, but alas. The new entitlement program will begin in the 2018-19 school year, and school districts will have to match $125 per device to receive money.

The budget makes changes to teacher licensure, creating "lifetime licenses" for teachers who successfully complete six semesters. School district referenda are also limited to regularly-scheduled election years.

Other changes to K-12 funding would have increased incentives for school districts to commit to shared services and whole-grade sharing, but Walker vetoed both new appropriations, reducing the final spending by $2.75 million.

Mental health services and transportation funds will receive greater investments, as well. Sparsity aid, meant for rural districts, is expanded to allow more districts to receive funding. While Walker's plan would have increased per pupil funding and created another level of sparsity aid, JFC's plan allows districts to receive 50 percent of the prior year's award if they grow too big to receive aid under that program.

Walker also used his veto pen to restore his original proposals for the energy efficiency program. In his original budget proposal, Walker had recommended altering rules for school districts using the energy efficiency adjustment. This program, established in the 2009-11 budget, allows school districts to increase their revenue limits by the amount they spend on energy efficiency projects. Since 2009, school districts have spent more than $217 million using the adjustment, according to a Journal Sentinel report. In February, Walker proposed changing those rules so that school districts would no longer be able to spend over their revenue limits without first holding a referendum.

The Joint Finance Committee's final budget motion on education would have reopened that door, prohibiting districts from using the adjustment in 2018, but not altering the rules moving forward. In a speech prior to the finance committee's vote, Sen. Leah Vukmir (R-Brookfield) slammed the decision, referencing a recent case in her own district. "The voters of the West Allis-West Milwaukee School District rejected a referendum of $12.5 million. Four months later, the school district utilized this loophole for $12.8 million on what they called 'energy efficient projects,'" Vukmir said. "This was an end-run around the taxpayers."

Walker's veto restores his original proposal.


FULL ANALYSIS: HIGHER EDUCATION

While UW-System reforms proposed by Walker were mostly watered down by JFC, the state's higher education system still see an increase in state dollars in this budget. Rather than a $77 million increase as Walker had proposed, the UW will see a nearly-$30 million increase in GPR and a continuation of the in-state tuition freeze that students have enjoyed since 2013.

Current law also ends an old provision that would have the UW lapse money back into the general fund, effectively giving the system $50 million more in spendable cash this biennium. As a result, the UW will see an increase of more than $100 million compared to the last budget, primarily made up of performance-based funding, the Innovation Fund, and employee raises.

Walker had proposed cutting tuition by 5 percent, but the committee balked at the idea, which proved to be contentious within the Legislature. Students still win with the plan, enjoying their fifth and sixth years of tuition flat tuition rates. Instead of spending $35 million on the tuition cut alone, JFC will send the money toward other initiatives, including need-based financial aid, a new engineering campus at UW-Green Bay, and $3 million for the Tommy G. Thompson Center at UW-Madison.

Some of the governor's more innovative new proposals for UW were part of a group of items that JFC tossed out of the budget as "non-fiscal policy items" in March. Most notably, one provision would have required UW institutions to create pathways to three-year degrees for 10 percent of undergraduate programs by 2018 and for 60 percent of programs by 2020.

That was an innovative idea and could have helped students get through college faster. At the very least, it could have showed that undergraduate degrees don't need to take four (or more) years to complete. We hope to see the idea come up again.

The budget committee also scaled back Walker's performance-based funding plan, sending $25.3 million instead of $42.5 million - but Walker's veto pen again adjusted that plan. Rather than let UW institutions choose their own metrics by which to be judged, Walker's veto appears to give that power back to the Board of Regents.

Another area of reform that JFC cut back was a Walker plan to let students opt out of paying certain segregated fees. Instead, JFC put in a plan that would standardize different kinds of segregated fees across campuses and would not let any board increase fees without the budget committee's approval.

In the all-important area of taxpayer transparency, the budget requires an independent audit of the entire system in 2017 and 2018, a landmark feat. The Board of Regents will be prohibited from transferring funds to the UW-Oshkosh Foundation without explicit approval from JFC and the full Legislature, following a scandal in which administrators funneled millions of dollars into the financially-troubled foundation.

Also along the lines of transparency, the final budget includes Walker's plan to begin tracking and reporting UW faculty workloads. Under the budget, the Board of Regents is charged with creating a system to monitor the workloads of faculty and instructional academic staff. Those who teach more than the standard academic amount will be rewarded. All of the data on teaching hours will be made public, offering greater accountability for taxpayers.

A new competitive campus Innovation Fund and the UW Carbone Cancer Center both see significant investments in the budget, though Walker's veto slightly changed the rules for the Innovation Fund. The plan also creates tuition remission and non-residency exemptions for veterans and certain family members, granting them in-state tuition as well as credit for military training.

The budget allocates $10 million for the UW System to review and refine campus academic freedom policies. That proposal was included in Walker's original budget blueprint, and similar bills have been championed by legislative leaders including Assembly Speaker Robin Vos.

Walker's plan would have required all UW campuses to publish one-page "performance funding report cards" at the end of each semester. Those report cards would describe how each institute fared on performance measures laid out by the state, including affordability and attainability, work readiness, and others. JFC changed that proposal, instead requiring the Board of Regents to publish an annual report describing how performance-based funding was distributed that year, and why. Each campus will have to post the report on their websites, but this change is still a far cry from the transparency Walker had proposed.

Many of Walker's strongest ideas for the UW System budget were non-fiscal policy items that were tossed out by JFC early on in the process. One included greater credit transferability and a new credit transfer report. Another would have required all undergraduate students to obtain a job or internship before graduating. Our education analyst wrote on that issue here. Perhaps needless to say, we think students are more than capable of realizing the value of work without the government forcing them to do so.

While every Democrat on the finance committee voted against the final UW System package - deriding it as "not enough" for higher education - UW officials celebrated the plan and thanked the committee.

Later in the summer, officials testifying at a hearing on the Foxconn incentives package called for an even greater investment in UW both in the near future and perhaps still in this current budget. Foxconn CEO Terry Gou has shown a strong interest in cancer research, sparking hopes for a potential future partnership between the parties.

As always, "On Wisconsin."


FULL ANALYSIS: TRANSPORTATION

GOP legislative leadership called the governor's blueprint a good starting point, and then proceeded to tinker with and try to reshape the budget proposal, particularly on transportation.

Most Assembly Republicans continue to be unhappy with the level of borrowing used to pay for our transportation needs. When Walker did not propose a gas tax increase or any new transportation funding streams in his budget, Assembly Republicans objected loudly.

In stressing that every funding idea must be on the table in addressing Wisconsin's disputed $1 billion transportation budget shortfall, Assembly Republicans backed gas tax increases and vehicle fee bumps to generate an enhanced and sustainable flow of revenue. The budget process ground to a halt for over two months.

Let's be clear. I don't support spending less on K-12 education than what's in my budget and I will veto a gas tax increase.

— Governor Walker (@GovWalker) March 30, 2017

In the end, the Joint Finance Committee approved $400 million in bonding, much closer to the original half-billion in borrowing the governor first proposed. The final bonding number got buy-in from a reluctant Assembly in large part because about $252 million of the money would go to the Interstate-94 north-south project, tied to the Foxconn Technology Group incentives package. Lest we forget, the budget was constructed amid a "once-in-a-century" economic development proposal, Foxconn's plan for a $10 billion high-tech manufacturing campus in southeast Wisconsin projected to eventually create 13,000 family-supporting jobs.

To the dismay of southeast Wisconsin lawmakers, the funding package includes no new money for Milwaukee area megaprojects, reconstruction of I-94 between the Marquette and Zoo interchanges and finishing off the north leg of the Zoo.

Republicans on a party-line vote did away with what remained of Wisconsin's Great Depression-era prevailing wage law. Finishing the unfinished business of the last session when the Legislature eliminated prevailing wage for all but state projects, the Joint Finance Committee has saved taxpayers from a system that artificially inflates wages on government building and highway projects. A previous study from the Wisconsin Taxpayers Alliance found that taxpayers could have saved as much as $300 million construction projects in 2015 had the reforms been in place then.


The budget also eliminates 252 Department of Transportation positions, a move that thins a bloated state agency that has wasted so much taxpayer money.

When all was said and done, Walker won the great 2017 transportation battle, holding firm on no gas tax increases or general vehicle fee hikes.


FULL ANALYSIS: HEALTH CARE

Health care is perhaps the most challenging policy area for Wisconsin's lawmakers. Like any government entitlement, Wisconsin's health care programs for the poor are complicated and expensive. An extra $182.3 million of precious GPR had to be added to the state's Medical Assistance (MA) budget - composed mostly of the entitlement juggernaut Medicaid - just to keep up with projected costs of existing programs and services over the 2017-19 biennium.

Importantly, actual MA program expenditures over 2015-17 came in at $325 million less than what was included in the previous budget due to lower-than-expected enrollment. While the cost of Medicaid, MA's largest program, continues increasing, the rate of increase has slowed during the Walker years. The previous three biennial budgets increased GPR spending on Medicaid by $1.6 billion, $685 million, and $650 million just to maintain services, respectively.

The 2017-19 budget spends a total of just over $20 billion on the state's MA program. Of that total, $6.1 billion is GPR spending - a 2.3 percent increase in the first year of the budget and a 6.6 percent increase in the second year. Total enrollment in all MA programs is projected to increase by 1,969 in the budget's first year and 9,979 in the second year. That means total MA enrollment by the end of the biennium would reach 1,129,144.

For the state's SeniorCare program, the budget increases total spending by about $900,000, but reduces GPR spending by $5.1 million. This is a significant departure from the governor's recommendation to increase spending by $54 million, but was possible because the projected costs of providing SeniorCare benefits in the 2017-19 biennium were significantly reduced.

The budget also increases nursing home funding by $48.8 million over the biennium - $20 million of that coming from GPR funds. Childrens' long-term support services is also increased $39.3 million, with $16.3 million coming from GPR.

Medicaid Reforms
In a new round of reforms intended to help transition Medicaid recipients towards employment and off of government assistance, Walker's Department of Health Services (DHS) submitted a broad request to the federal Centers for Medicare and Medicaid Services (CMS) in June, asking the Trump administration for permission to implement a variety of reforms to the state's Medicaid program - also known BadgerCare - including a drug screening requirement.

If approved, it will allow Wisconsin to screen those who apply for BadgerCare for drugs and, if necessary, require participants to submit to a drug test. If a recipient fails, he or she would have to enter a state-funded treatment program. If they refuse, they would be ineligible for BadgerCare benefits until they agree to enter treatment.

The DHS also requested to establish a two-tier requirement for monthly premiums and copayments for emergency room visits. Childless adults with household incomes from 51 to 100 percent of the federal poverty level would have to pay $8 per month for their benefits and an additional $8 for each emergency department visit.

Childless adults below 50 percent of the federal poverty level would not have to pay the nominal premiums or out-of-pocket copayments.

The DHS request also seeks permission to implement work requirements in BadgerCare mirroring those successfully implemented in the state's FoodShare program. Recipients would have to either work 80 hours per month or take part in job skills training. BadgerCare benefits would be limited to four years for anyone not meeting the work requirements under the request.

Walker's welfare-to-work initiatives make Wisconsin a welfare reform leader once again by making the Badger State the first state to require drug screening, and by trying to abolish the "benefits cliff" that causes BadgerCare recipients to lose all benefits when they make one dollar too much in income.

By requiring recipients to pitch in for their coverage, the groundwork will be in place to turn the cliff into a ramp to encourage recipients to work more hours, take promotions, and advance their careers.

The Department of Health Services is currently in negotiations with the CMS over the waiver requests.

Much has been accomplished to reform health care in Wisconsin during Walker's tenure, including an innovative BadgerCare plan implemented in 2013 that makes sure every Wisconsinite living at or below the poverty level has access to health care. As a result, Wisconsin has one of the highest rates of coverage in the country. However, lawmakers will need to continue their efforts to deal with the rising costs to taxpayers that spiraling health care costs and an aging population will inevitably bring. We hope that the drive for reform continues in future budgets.

No Self-Insurance Reform, But Taxpayers Still Come Out Ahead
In his initial budget, Walker proposed changing the way the state insures its employees from a fully-insured model to a self-funded model, where the state would directly pay for the health insurance claims of state employees instead of farming out the business to a network of private companies around the state.

The governor estimated the reform would save $60 million over the biennium, in part thanks to Obamacare's complicated web of new health insurance taxes.

In late May, Walker administration officials announced that revised estimates put the savings by switching to a self-insured model at $103 million over the 2017-19 budget.

Joint Finance co-chairs Sen. Alberta Darling (R-River Hills) and Rep. John Nygren (R-Marinette) weren't interested in the self-insurance switch, a position they made clear early in the budget process. The committee rejected the idea in a meeting shortly before budget talks collapsed in June.

Instead, Joint Finance directed the state's Group Insurance Board (GIB) to find equivalent savings within the current system. In late July, the GIB came through, announcing a zero percent increase in premiums for state employees for 2018. But that came at the cost of two major insurers, Humana and UnitedHealth, which announced plans to withdraw from the state's health insurance program in 2018.

The zero percent increase negotiated by the GIB is undoubtedly good news for taxpayers. It will save taxpayers $15.4 million in the first year of the budget and $23 million in the second year.

Governor Walker vetoed budget language that would've launched an audit of GIB's reserve funding, as well as an attempt by Joint Finance to require the GIB to make regular reports directly to the committee. "I do not believe that [JFC] should micromanage plan design, contract negotiations and the financial and programmatic management of the program," Walker wrote in his veto message. Walker also vetoed a JFC measure that would've increased the number of plan tiers available to state employees from three to five.

The experts at the GIB have demonstrated for 58 years that they can handle their own affairs, Walker said.

While the GIB managed to hold the line on insurance increases for state employees, many questions remain. If a zero percent increase for state employees is possible amid skyrocketing premiums for everyone else, how much padding are taxpayers providing for the bottom lines of these private insurance companies? How is it possible that government workers can enjoy no increase in their premiums while the general public is projected to endure rate increases of 12 percent or more next year?

The state pays out about $1.4 billion annually in premiums for its 250,000 employees and their dependents. That astounding figure means that the way the state provides health insurance for state employees is a prime opportunity to save taxpayers some substantial cash.

While JFC did a good job of saving taxpayer money this time around, we hope the debate over self-insurance is renewed in the next budget cycle.


FULL ANALYSIS: WELFARE REFORM

Welfare reform - which Walker has prioritized throughout his tenure - found its own place within the state budget, as well. JFC agreed to take up Walker's proposal to begin drug testing participants in the state's welfare-to-work program. Wisconsin will become the first state in the nation to do so.

The state will also begin requiring able-bodied adults with children over the age of six to seek job training in order to receive FoodShare benefits. Eligible training plans include the state's Foodshare Employment Training program, also known as FSET.

This summer, the administration released a new report summarizing Year 2 of the FSET program. The report itself focuses on FSET's success stories - these are real people with real struggles, working to get on their own feet and move away from government dependence. Besides quotes from participants that really ground the program, such as the effervescent, "I'm finally doing what I love and it makes me so happy," the hard data shows solid results.

Individuals who stick with the program tend to receive wages well above the minimum wage of $7.25 per hour. Monthly average wages and weekly hours have also slowly grown over time.

As the administration released its "Year 2" report focusing on success stories and the growth of the program, a new dataset was not far behind. FSET participants through June of 2017 made, on average, higher wages and worked more hours than just months prior. In eight of 11 FSET regions, wages had increased between April-June of 2016 and the same quarter one year later.

The state will also create a $25,000 liquid asset limit for those who would want to participate in FoodShare, ensuring that the program is not used by those who may not need the state's help. Another reform will expunge unused balances on inactive accounts.

Walker's plan to eliminate the so-called "benefits cliff" in the Wisconsin Shares child care subsidy program received unanimous approval from the committee and proved to be one of the most popular ideas in the governor's budget.

The cliff automatically cuts off child care subsidies for families with incomes over 200 percent of the federal poverty level. Joint Finance Committee Co-Chair Sen. Alberta Darling, (R-River HIlls) said the current setup is a disincentive to breaking the welfare chains.

Walker's plan provides a sliding scale, allowing child care program participants to receive $1 for every $3 earned in excess of the eligibility limit. Benefits end once income hits 85 percent of the state's median income. The cost is projected at $4 million over two years, funded through federal cash.

The governor had originally proposed reforming the homestead tax credit and earned income tax credit, but all of those changes were stripped out by the Legislature.

The budget committee also passed a Walker initiative that would trim W-2 benefits for families of children who are habitually truant and who do not cooperate with case management services to improve attendance. Currently, state law cuts benefits for families of children not enrolled in school.


FULL ANALYSIS: GOVERNMENT REFORMS

Prevailing Wage Repealed
In the final stages of the budget debate, JFC's transportation budget included one very important item the committee had initially thrown out of Walker's proposal: full prevailing wage repeal. Finally, the millstone of this antiquated law will be removed from the necks of taxpayers.

While the prevailing wage was repealed for local projects in the last state budget, all state projects still must pay inflated wages based on arbitrary calculations under the (also antiquated) federal Davis-Bacon Act.

How much will Wisconsin taxpayers save? One study from the Wisconsin Taxpayers Alliance showed that Wisconsinites could have saved $200-$300 million on vertical construction projects alone in 2014 in the absence of prevailing wage. That estimate doesn't even consider all other public construction that goes on in the state, including billions of dollars on road construction projects.

Examples abound of cost overruns thanks to the prevailing wage law. One six-mile ATV trail in Vilas County was initially going to cost $30,000 per mile, but after prevailing wage was factored in, the price shot up to $55,000 per mile. In the Village of Grafton, an already-completed water tower maintenance project exploded in price from $597,000 to $861,000. Even though the project was already complete, local taxpayers had to come up with an extra $260,000.


If prevailing wage was costing taxpayers so much extra money for local projects alone, imagine how much will be saved now that prevailing wage will finally be thrown into the circular file of old, outdated laws. In the years to come, taxpayers will no longer have to imagine. Thanks to last-minute negotiations between a set of conservative senators and the governor, the state prevailing wage was repealed as soon as the signed budget was published, rather than in September of 2018.

Local Government Property Insurance Fund Phased Out
Prevailing wage isn't the only outdated policy that meddles with the private sector in Wisconsin. Did you know the state government offers property insurance to local units of government? Well, it does - but not for long. The state's Local Government Property Insurance Fund (LGPIF) dates back to 1911 when private insurance was literally in the horse and buggy days and local governments couldn't find the right insurance policies in the private market.

Recognizing those days are long gone and the LGPIF isn't needed anymore, the JFC budget calls for an end to the struggling program, an effort pushed by JFC Co-Chair Rep. John Nygren (R-Marinette).

Gov. Walker proposed eliminating the fund in the last state budget, but the Legislature balked at the proposal. Considering that in today's world you can buy insurance policies in just minutes, many local governments have since found insurance elsewhere. As a result, the fund has shrunk considerably and had been in danger of becoming a bigger and more expensive liability for all state taxpayers.

As part of its 2017-19 budget, the Office of Commissioner of Insurance (OCI) proposed stopping the issuance of new property insurance policies and not renewing existing ones in an effort to phase the fund out. Under this budget, the state government will nearly be out of the insurance business. Nearly...

The state still offers life insurance via the State Life Insurance Fund. Nygren has also called for an audit of this 116-year-old program. Maybe in the next budget, the state will also jettison this relic of days gone by and let the private sector take over.

Referendum Reform
This budget also includes significant reform for referenda - in particular, those held by school districts. The occurrence of referenda has increased in recent years, with voters approving millions of dollars in spending and bonding. Now, referenda will be limited to primary and general election days. Final negotiations between a group of conservative senators and the governor resulted in this provision being strengthened even further, no longer allowing school district referenda to be held in Novembers of odd-numbered years. This change will go into effect on Jan. 1, 2018, to ensure that already-scheduled referenda for this fall are not affected.

Off-cycle elections result in notoriously low voter turnout. With these reforms, a greater portion of each voting population is likely to weigh in on questions of massive spending.


FULL ANALYSIS: PROBLEMS AND MISSED OPPORTUNITIES

One overarching issue with the 2017-19 state budget that simply cannot be ignored is an increase in overall spending. At $34.6 billion in GPR for the biennium, the budget spends nearly $1.30 billion more in GPR than the previous budget, or 3.89 percent. That continues a worrying trend of ever-growing government.

The spending increase caused several legislators, including Sen. David Craig (R-Town of Vernon) and Rep. Adam Jarchow (R-Balsam Lake), to vote against the budget on the floor. Both lawmakers agreed that there were plenty of good reforms, but said that they simply couldn't agree with its levels of spending.

One major missed opportunity for taxpayer savings - switching to a self-insurance model for state employee healthcare plans - occurred early on in the budget process. Stating that there were too many questions, JFC's co-chairs announced that they would reject the reform for now. Instead, the Group Insurance Board was directed to find savings within the current system.

The Legislature also rejected Walker's proposed income tax cuts, instead opting for a partial repeal of the personal property tax. Taxpayers, especially small business owners, will still win. However, any efforts toward gradually lowering and flattening Wisconsin's progressive income tax code would be meaningful.

In the last budget, a major scandal broke out when lawmakers made a last-minute attempt to overhaul the state's open records law. That attempt came in the final motion of the budget - known as the "999" or "wrap-up" motion. Naturally, all eyes were on the final few motions this year. While there weren't any radical policy overhauls this time, some concerning eleventh-hour additions did indeed make their way into the process.

Perhaps most notably, changes to the shadowy Public Finance Authority included in a final JFC motion would have given it much more authority. The agency, which issues high-risk bonds on behalf of the state, would have been given the power of eminent domain. Just a week prior, the organization was largely unknown, even to legislators. One representative voted against the entire $76.5 billion document because of the PFA changes alone.

Final negotiations between Walker and a handful of conservative senators resulted in a veto stripping the PFA's proposed new powers.

Even after the governor's vetoes, unfortunately plenty of pork still made it through. The budget sets aside $100,000 for an Arts Center in Monroe, Wisconsin. It also allocates $900,000 to tobacco distributors for the tax stamp on packs of cigarettes.

Back in February, Walker had proposed eliminating the Department of Natural Resources magazine, published six times a year. Instead, JFC cut back his proposal and agreed to publish the magazine four times a year. Publishing a magazine shouldn't be a function of government, and the conservatives on the budget committee would have been better served going along with Walker's plan and eliminating the magazine altogether.

In a similar vein, the budget maintains the state's Knowles-Nelson Stewardship program. Walker had proposed reforms to the program in the previous budget, but the Legislature decided to keep the program as-is, letting the state buy more public lands (and acquire more debt).

One provision that made it through to the final budget requires users of Airbnb who rent out their home for more than ten nights a year to get a license from DATCP. Several new sales tax exemptions are created for various industries, including beekeeping. Those who enter competitive tournaments and leagues and submit fees for prize money will also see a sales tax exemption. And if you manufacture dairy products containing more than 50 percent yogurt, but sell it in a separate retail store, you're also off the hook for paying the sales tax.

Walker had also proposed creating a new back-to-school sales tax holiday in August. That could have helped middle class families save money on their school shopping, but the proposal was cut by JFC in favor of other reforms. Another reform that could help those middle-class shoppers: a repeal of the minimum markup. That reform wasn't included in the budget either, a significant missed opportunity for taxpayers.

This back-to-school season alone, Wisconsin shoppers saw prices that were 12 to 146 percent higher than in neighboring states for the basics, like crayons and folders. Minimum markup repeal, or a sales tax holiday, would have helped.

The realm of education had several missed opportunities. Walker's plan for the UW to create more pathways for three-year undergraduate degrees would've helped break ground and create transparency for students, as would one-page report cards for each school in the system. Neither idea is included in the final document.

While the Legislature rejected some of Walker's education reforms, it added plenty of its own. The budget includes $9.2 million for laptops for high school freshmen, regardless of income, beginning in the 2018-19 school year. That'll be a new entitlement moving forward, and we were surprised to see both houses of the Legislature include versions of the idea in differing education proposals.

Finally, Walker's proposed changes to the sparsity aid program were rejected. When districts grow too big to qualify for the aptly-named pot of money that is sparsity aid, school districts will be able to receive 50 percent of however much they received in the last year they qualified. That blurring of lines will likely grow spending in the program over time.


FULL ANALYSIS: FISCAL POLICY - TAXES AND SPENDING OVERVIEW

As the smoke clears on the 2017 budget battle, the Republican-controlled Legislature is responsible for a two-year state spending plan that comes in at $76.5 billion, which includes $771 million in bonding. That's $1.5 billion more than the 2015-17 budget. Bonding aside, this budget amounts to a 2.1 percent increase in spending.

In the General Purpose Revenue (GPR) category - which is the precious state tax money that mainly comes from income taxes, sales taxes, and corporate taxes - this budget spends $34.6 billion, an increase of $1.3 billion compared with the 2015-17 budget, a 3.9 percent increase.

The final budget, after the Joint Finance Committee made a number of changes to Walker's original proposal, reduces overall state full-time equivalent positions (FTE) by a modest 16 positions. The spending plan reduces the number of positions funded by GPR by 175 FTEs and reduces segregated revenue-funded positions by 304, but it also adds nearly 500 positions funded through program revenue.

Madison uses its own kind of math called "base-year doubled" to track its spending. Under the base-year doubled scenario, spending levels in the second year of a budget are doubled to measure the amount of increase in the next biennial budget.

Base-year doubled makes spending increases look smaller than reality. Here's a look at overall spending and GPR spending in the last 14 years.

Even though Walker and the Legislature acted responsibly and passed a balanced budget that matches spending with revenues the state will take in over the next two years, it is disappointing to see such large increases in spending, particularly in the budget's second year. During the next budget debate, that large increase in the 2019 fiscal year will be used as the base year, practically guaranteeing lawmakers will be pressured to increase spending even more.

On the positive note, This budget eliminates two taxes. Let that sink in. Wisconsin, which had long worn the Scarlet T of a high-tax state, has eliminated the state property tax - also known as the Forestry Mill Tax - as well as the Alternative Minimum Tax (AMT).

The budget also eliminates the Forestry Mill Tax, which "costs" $180 million in revenue over the next two years. The end of the tax will save the average homeowner $27 per year. Though the amount of the savings has been criticized as not enough, the powerful symbolism of deleting the last remaining portion of the state property tax cannot be denied.

"Here in Wisconsin we are not only reducing taxes, we're eliminating taxes altogether," Rep. Dale Kooyenga (R-Brookfield), a member of the Legislature's powerful budget-writing committee said. "You want to talk about history? We're making history right here."

Kooyenga also took the lead in eliminating Wisconsin's AMT, saving taxpayers $6.7 million per year. While the tax was intended as a "wealth tax" aimed at higher-income earners, Kooyenga said it has increasingly been hitting middle-income tax filers and added unnecessary complexity to the tax code. Until Gov. Walker's signature officially did away with the AMT, Wisconsin was one of just six states with this second income tax.

Standard income taxpayers won't get a break this time around, however. Walker's budget blueprint, released in February, called for nearly $600 million in income tax and fee reductions. But the Republican governor's plan to ease income taxes by a combined $203 million was gobbled up by other priorities - not the least of which was Wisconsin's disputed $1 billion transportation budget shortfall.

The budget also reduces the state's burdensome personal property tax, which forces businesses to pay an extra tax on property they've already bought. The budget exempts machinery, tools, and patterns, saving taxpayers $74 million.

The budget lowers overall borrowing by nearly 28 percent compared to the last budget, appropriating $771 million that will mainly be used on transportation projects. That number is nearly $300 million less than the $1.1 million in overall bonding in the last budget.

Walker has held the line on tax hikes in each of his previous three budgets, and his latest was no different. The Republican-controlled Legislature's final bill cuts property taxes by $5 in the first year, and $29 in the second budget year on a median-valued home.

Police Officers Beheaded in UW-Madison Student Film

Thu, 09/21/2017 - 09:50

MacIver News Service | September 21, 2017

[Madison, Wisc...] The UW-Madison removed an incredibly violent student video from its website this morning after controversy erupted throughout Wisconsin media Wednesday afternoon.

The video resembles an ISIS propaganda film. It begins with two actors portraying police officers wearing pig masks lynching an African American. The police officers are then seen fleeing from a masked African-American mob carrying an ax. The next scene shows one of the men holding the bloody pig mask (still wearing the police officer cap) and a machete in the other hand. The audio from a President Trump speech and protest chants plays over the video.

Sen. Steve Nass (R-Whitewater) reposted the video to his website, and is demanding the UW take action.

"This vile and racist anti-police video is clearly a direct threat to the brave men and women that serve behind the badge. UW-Madison must immediately hold these students accountable and that should include an investigation by the local police and the Wisconsin Department of Justice," Nass said in a press release.

UW-Madison responded to the video Thursday morning, ""UW-Madison strives to provide a welcoming and inclusive campus environment, while allowing everyone to share ideas and political views in exercise of their free speech rights. However, the university strongly condemns the glorification of violence such as that contained in the promotion of a student-produced clothing line."

The credits name Ekene Ikegwuani, Nyairy Daniels, Nesha Ruther, Ricardo De La Cruz II, Thomas Valtin-Erwin, Garrett Pauli, and Karon Sims as the cast.

The video was uploaded to a UW's collaborative cloud intended for academic projects. Its terms of service read, "The University of Wisconsin-Madison expects that you will respect the rights of faculty and other students as you participate in the educational process. Participating in the UW Madison Box Service means that you may have access to personal information and academic work produced by other students and faculty members. Federal and state law and UW-Madison policy require that you must not reveal any information about classmates, course work content, or its authors."

UW-Madison explained in a press release, "The individual in this situation is engaging in a private business activity, unrelated to his status as a UW-Madison student. The clothing in question is not produced, nor endorsed by UW-Madison."

Budget Blog: Walker Releases List Of 99 Budget Vetoes

Wed, 09/20/2017 - 17:15

MacIver News Service | September 20, 2017

By M.D. Kittle

[Madison, Wis...] Gov. Scott Walker on Wednesday released the full list of the budget items he intends to excise with his powerful veto pen, and made the case why the provisions shouldn't be in the state's recently passed 2017-19 spending plan.

In all, the Republican governor announced he will veto or partially veto 99 sections from the budget including several items he committed to nix in a closing budget battle.

Walker took the unprecedented step of publicly declaring a partial list of vetoes immediately following party-line passage of the budget Friday night in the GOP-controlled Senate. Four conservative senators - Sens. Robert Cowles (R-Green Bay), Chris Kapenga (R-Delafield), Steve Nass (R-Whitewater), and Duey Stroebel (R-Saukville) - declared they would cast no votes without veto assurances from Walker.

The governor stayed true to his word and vetoed the budget provisions the reluctant Republican senators had asked to be deleted. He did so even after hearing an earful from Assembly Speaker Robin Vos (R-Rochester) who was clearly frustrated by the veto pledges and what he described as "renegade" senators taking the budget process "hostage."

Walker's vetoes cover the alphabet of state agencies, from DATCP (the Department of Agriculture, Trade and Consumer Protection) to DPI (the Department of Public Instruction).

Many of Walker's vetoes deliver relatively minor deletions to the budget, removing an "additional mandated report" here and or a process requirement there.

The more controversial vetoes involve provisions tucked into the $76.5 billion, two-year spending plan at the end of an elongated budget-writing session.

Public Finance Authority

With a stroke of his pen, the governor swept away a last-minute measure that would have expanded the authority of a shadowy Public Finance Authority. The provision, among other things, would have granted the tax-free, risky bond peddler the force of eminent domain. Walker said he vetoed the provision because the nonfiscal policy should be vetted as separate legislation.

Rep. Scott Allen (R-Waukesha) said he voted against the budget specifically because of the PFA provision. Allen has called for a legislative audit of the quasi-public Finance Authority, created by unanimous approval of the Legislature in 2009. He notes the Wisconsin-based agency has done very little investment in the Badger State, while doing billions of dollars in business nationwide. The JFC measure also would have opened the door for the Finance Authority to do overseas investment.

Education

Low Revenue Adjustment
One of the most significant vetoes, by far, involved changes to the low revenue adjustment for low-spending school districts. Walker's original budget kept that adjustment where it was - $9,100 per pupil - without changes. With his veto pen, the governor maintains the original level, writing that a change to the low revenue adjustment results in "a substantial increase in property tax capacity that school districts may exercise without voter input." 
 
School district revenue limits were set in 1993 to prevent massive increases in local property taxes. Over the summer, it became clear that increasing the adjustment was a major priority for both houses of the Legislature. An education plan introduced by the Assembly Republican Caucus would have increased the limit to $9,800 in 2018. This would give low-spending school districts the ability to spend more per pupil, but would have increased their statewide levy authority - and property taxes - by $92.2 million. 

Proponents of the plan said it would have sent more spendable money into the classroom while addressing a long-standing concern of school officials. However, immediate concerns about a property tax increase arose, especially considering Walker's pledge to hold the line on taxes. 

The Senate Republican Caucus followed up with a different plan that also increased the low revenue adjustment, but more gradually than the Assembly plan. That plan would have had the adjustment increase to $9,300 in 2017, to $9,400 in 2018, followed by annual $100 per pupil increases until 2022, when it would hit $9,800. That change would have limited potential property tax increases to $23.2 million statewide - concerning to many, but less than the Assembly's proposal. JFC approved the Senate plan. 

In a statement, Walker wrote that "school districts could pursue an increase in their revenue limit through a referendum, as is the case under current law."

JFC Assembly Chair Rep. John Nygren (R-Marinette) tweeted about his disappointment in Walker's veto list, and took special care to highlight the changes to the low revenue adjustment championed by the Assembly.

I am severely disappointed in Governor Walker's decision to reject an opportunity to correct a long-term inequity in our K12 funding system.

— John Nygren (@rep89) September 20, 2017

As a result, over 200 school districts across the state will lose over $90 million in funding over the next 6 years.

— John Nygren (@rep89) September 20, 2017

The veto will continue this funding imbalance and have lasting impacts on the quality of education available to some of our children.

— John Nygren (@rep89) September 20, 2017

This is a funding inequity that has existed for over 20 years and under this budget will continue to do so.

— John Nygren (@rep89) September 20, 2017

For his part, Walker focused on the lowering of property taxes while putting more money into classrooms.

Love this mini-billboard: lower property taxes and more money for schools. It's possible. And it's in the budget I will sign tomorrow! pic.twitter.com/u8znHI1P73

— Scott Walker (@ScottWalker) September 20, 2017  

Budget will include largest amount invested in K-12 edu. in state history. Veto ensures attempts to raise property taxes go before voters

— Governor Walker (@GovWalker) September 20, 2017

Shared Services and Whole Grade Sharing
The budget allocates $2.75 million for several programs that would incentivize school districts to consolidate different services - namely, shared services aid and whole grade sharing aid. 

The purpose of the initiatives is to provide grants to school districts that participate in whole grade sharing or shared services such as combined district administrators or human resources directors. Both would be new continuing appropriations to reward school districts that participate in such arrangements to save taxpayer dollars. 

Walker vetoed both programs, asserting that the costly incentives defeat the purpose of savings.

"Sharing services will create savings for school districts; therefore, providing state grants would nullify savings to taxpayers that would result from local actions." 

Referenda Reform
This budget includes significant reform for referenda - in particular, those held by school districts. The occurrence of referenda has increased in recent years, with voters approving millions of dollars in spending and bonding outside of regular revenue limits each election. In many communities, the trend has raised property taxes.

There has been a lot of interest among legislators in reforming referenda, especially from Sen. Duey Stroebel. This session, he introduced eight separate bills that would address potential referenda abuse. The budget includes a few of those ideas, and Walker's vetoes made them even stronger.

Referenda will be limited to primary or general election days. Final negotiations between the Senate and governor resulted in a further veto that will no longer allow school district referenda to be held in November of odd-numbered years. School districts will now be limited to holding referenda on two dates per year. This change will go into effect on Jan. 1, 2018, to ensure that already-scheduled referenda for this fall are not affected.

Off-cycle elections result in notoriously low voter turnout. With these reforms, a greater portion of each voting population is likely to weigh in on questions of massive spending and property tax increases.

Energy Efficiency Measures
In his original budget proposal, Walker had recommended altering rules for school districts using the energy efficiency adjustment. This program, established in the 2009-11 budget, allows school districts to increase their revenue limits by the amount they spend on energy efficiency projects. In February, Walker proposed changing those rules so that school districts would no longer be able to spend over their revenue limits without first holding a referendum.

The Joint Finance Committee's final budget motion on education would have reopened that door, prohibiting districts from using the adjustment in 2018, but not altering the rules moving forward.

In a speech before the finance committee's vote, Sen. Leah Vukmir (R-Brookfield) slammed the decision, saying that "it seems counterproductive to modify the governor's recommendation" and that the provision "has been abused, and the governor was right when he eliminated it."

Referencing a recent case in her own district, Vukmir went on to describe that "the voters of the West Allis-West Milwaukee School District rejected a referendum of $12.5 million. Four months later, the school district utilized this loophole for $12.8 million on what they called 'energy efficient projects.'"

"This was an end-run around the taxpayers," Vukmir continued. "The voters had said no. What is the point of having restrictions on referenda while at the same time providing a loophole for dodging the process?"

Walker seemed to agree, using his veto pen to restore his original plan.

Transportation

Prevailing Wage
Getting rid of Wisconsin's prevailing wage law has been a conservative priority for some time, but the Legislature has been reluctant to do so. The 2015-17 budget eliminated prevailing wage on local projects, but that provision didn't go into effect until Jan. 1, 2017. For the 2017-19 budget, lawmakers approved Walker's proposal to repeal prevailing wage for state building and road projects, but they wanted to push off its effective date until Sept. 1, 2018. Walker's veto puts prevailing wage changes in effect almost immediately, as three of the hold-out senators had requested.

"I am vetoing this section because I object to making the taxpayers of Wisconsin wait for nearly a year before they can begin to benefit from the cost savings to be created by the repeal of the state's prevailing wage laws," Walker explained.

Federal Swap
Even though Wisconsin will soon be rid of its prevailing wage laws, it is still subject to the federal prevailing wage laws under the Davis-Bacon Act. Any state project that includes more than $2,000 in federal funding must pay prevailing wage.

In 2015, Stroebel proposed limiting the number of projects affected by Davis-Bacon through a process called "Fed Swap." Under his plan, the state would replace federal funding going to local projects with state funding. The Wisconsin Transportation Finance and Policy Commission Report in January 2013 found that this would save 25 percent on those projects.

There are other requirements associated with federally funded projects that inflate project costs. Rep. Dale Kooyenga (R-Brookfield) points to Waukesha County, where there were two identical projects involving 1.2 miles of road. One was locally funded and the other was federally funded. The local leg cost $6.28 million. The federal portion cost $8.2 million. That extra $2 million was due to oversight, relocation rates, labor, and over-construction.

Walker's veto gets rid of a Joint Finance Committee provision calling for a Fed Swap study and gives the Department of Transportation more leeway in implementing the cost-savings measures. It delivers on the promise to the senators.

"The limitations placed on the amounts provided for the southeast megaprojects and the major highway projects, in particular, will inhibit the department's ability to allocate funds in the most advantageous manner especially in light of the I-94 north-south corridor project funding provided for in separate legislation," Walker wrote in his veto message. The latter project, I-94 north-south, is funded in the budget through bonding, contingent on a federal award.

"As a result of my partial vetoes of these sections, the department will be able to make dollar for dollar reallocations among all state and local road and highway projects - including the southeast megaprojects," Walker wrote. "My veto will ensure that the state can maximize the use of federal matching dollars and begin to implement state efforts to reduce local government's costs immediately."

Tolling
Fed Swap wasn't the only transportation item that JFC wanted to study. It also wanted to know how Wisconsin might be able to set up toll roads. It's an idea that frequently comes up during transportation funding debates. The state of Wisconsin can't just create its own toll road, however. It needs permission from the feds, and that's a lengthy process. JFC wanted to get the ball rolling on it by conducting a study of potential traffic, revenue, and environmental issues all at a cost of $2.5 million. The problem is, they've been down that road before. Walker said further study is unnecessary.

Transportation Projects Commission
There is no escaping politics when it comes to picking road projects. Lawmakers are always going to advocate for projects in their own districts. The Transportation Projects Commission is supposed to limit the impact of politics on these projects and focus more on the state's actual transportation needs.

A last-minute provision, critics argue, would insert more political influence into the commission. It certainly would create another layer of bureaucracy.

The TPC includes the governor, five senators, five representatives, three members of the public appointed by the governor, and the DOT secretary. The Legislature wanted to change the commission's membership to the governor, three senators, three representatives, two governor appointees, four members of the public appointed by the legislative leadership, and the DOT secretary. Naturally this would reduce the governor's influence on the TPC, making it immediate veto-fodder. The budget item would also create a new bureaucratic office to support the TPC. That office would include a four-person full-time staff and conduct reviews and evaluations of DOT projects. The three reluctant Republican senators wanted this provision nixed. Walker seems to whole-heartedly agree.

Other Items

Quarry Protections
Carve-outs and special protections have a way of making their way into budgets in the fierce pace at the end of the budget-writing process. That's the case with a measure that would have prohibited local governments from issuing onerous restrictions on quarries. Conservative critics like the idea of ending onerous regulations for every business, but offering protections to one industry could leave others unprotected. Wisconsin's sand mining trade was particularly worried about the language of the legislation.

Walker said he vetoed the provisions because he objects to inserting a major policy item into the budget without sufficient time to debate its merits.

"While I support the need to address quarry regulations and the ability to provide materials for public works projects in a timely manner, changes of this magnitude should be addressed as separate legislation where implications can be more carefully explored," the governor wrote in his veto message.

$1 Million Capitol Basement Upgrade
The Legislature did not escape the governor's veto pen. Walker vetoed $1 million in General Purpose Revenue-supported bonding for unspecified "State Capitol Basement Renovations." The set-aside became the object of ridicule during an Aug. 28 committee debate, with Sen. Jon Erpenbach (D-Middleton) mocking the fact that no one could say what the money would specifically be used for. Walker's veto leaves it to the State Capitol and Executive Residence Board to examine the funding proposal and decide whether the renovations are the best use of taxpayer money.

And Walker removed legislative funding for events celebrating the 100th anniversary of the State Capitol. The State Capitol and Executive Residence Board already has authorized money from the Capitol Restoration Fund, the governor said.

Pork and Other Problems

While the PFA and TPC changes were nixed, plenty of pork still made it through. In fact, almost all of the earmarks survived the veto pen.

Laptops For All
Walker didn't touch a new entitlement that provides $9.2 million for laptops for high school freshmen beginning in 2018. The Assembly Republican caucus had first proposed spending $18.4 million for the electronic devices, which would be provided to students regardless of family income. Both the Senate and Joint Finance Committee cut the provision in half, beginning the initiative one year later. Once an entitlement is established, its hard to remove, putting taxpayers on the hook indefinitely for this feel-good initiative.

And Walker kept the DNR magazine. The Joint Finance Committee relented to some public pressure and voted to maintain the magazine's publication, something Walker proposed ending. He didn't veto the JFC's act of salvation. Subscribers cover the cost of the magazine, but its production does take DNR employees away from their core duties.

Special Tax Exemptions
A measure that would have provided a sales and use tax exemption for broadcast equipment is history. Walker vetoed the provision because it "does not have any clear tax equity or economic purpose." Vetoing the provision increases annual revenue collections by $928,000, beginning in fiscal year 2019-20.

Several new sales tax exemptions are also created for various industries, including beekeeping. Those who enter competitive tournaments and leagues and submit fees for prize money will also see a sales tax exemption. And if you manufacture dairy products containing more than 50 percent yogurt, but sell it in a separate retail store, you're also off the hook for paying the sales tax. Walker did not veto these specialized tax breaks.

Airbnb
One provision gets the government more involved with emerging services like Airbnb. While the state would bar local governments from prohibiting short-term rentals of residences for seven consecutive days or more, it also adds many more onerous regulations on the independent hospitality trade.

Those who rent out their home for more than 10 nights a year would now need to get a "tourist rooming house" license from the state. They'd have to get a license from their local government, if the locals require it. The state would also begin collecting room tax dollars on those exchanges, as well as sales tax.

Regulations like these muddy up markets and without increasing public safety. Services like Airbnb are often effective at self-regulating, namely through user reviews. In fact, in the eyes of most users, the "riskiest" rooms to book on Airbnb are those with no reviews. These proposed new regulations would discourage serious Airbnb renters by forcing them to get a license.

Railroad Condemnation
The governor did delete at least one provision that strikes at a key conservative principle. No. 99 on the veto list is a challenge to property rights.

Walker vetoed a provision that would have restricted railroad corporation condemnation authority. In his veto message, he explains that the limitation "may be deemed an unreasonable interference with railroad transportation, which is prohibited under federal law."

"In addition, I am vetoing these sections because the requirement that the Legislature must enact a law prior to the acquisition of property through condemnation may cause excessive delays in railroad projects necessary for economic growth in the state," the governor wrote.

Sparsity Aid
The governor also maintained the Legislature's changes to the sparsity aid program, which is meant to serve rural districts with low student populations that are highly spread out. Walker had proposed creating a new level of sparsity aid and increasing reimbursements for those already in the program, but the Legislature came up with a new plan that made it through to the final budget.

Now, when they grow too big to qualify for the aptly-named pot of money that is sparsity aid, school districts will be able to receive 50 percent of however much they received in the last year they qualified. That blurring of lines will likely grow spending in the program over time.

Ola Lisowski, Bill Osmulski, and Chris Rochester also contributed to this report.

Dems Replace Barca, Who Chose Constituents Over Party

Tue, 09/19/2017 - 15:42

MacIver News Service | September 19, 2017

By Bill Osmulski

[Madison, Wisc...] Peter Barca couldn't win.

Since he became the Assembly Minority Leader in 2011, Barca's directive has been clear: oppose Gov. Scott Walker. In fact, The Democratic Party of Wisconsin's unofficial position is: when Walker wins - Dems lose.

And so, when Walker announced he had convinced Foxconn to build a $10 billion factory in southeastern Wisconsin that would create 13,000 family-supporting jobs, Democrats naturally had to oppose it. "Unfortunately" for Barca, the factory would be built right in his district.

The situation pitted the interests of his party squarely against the interests of his constituents. As a party leader, Barca was expected to rally opposition against the deal, but as a representative of the area that would benefit from the development, that just wasn't realistic.

"I would never put my party before my home community. Obviously, people in my area strongly want this development and at the end of the day, those are the people who elected me. As much as I care deeply about my party, I believe in my party, at the end of the day you have to represent the people that sent you there," Barca told Joy Cardin Tuesday on Wisconsin Public Radio.

The Foxconn deal was contingent on the Legislature passing a $3 billion incentives package by the end of September. According to a Legislative Fiscal Bureau analysis of the package, the state won't start making money directly from Foxconn taxes until 2042. However, Wisconsin won't exactly be handing $3 billion in cash to the company either.

Republicans point out $1.5 billion of the $3 billion incentives package is in the form of tax credits, and Foxconn would only be eligible to claim them on jobs paying between $30,000 and $100,000 a year. Another $1.35 billion are tax credits tied to capital expenditures. The last $150 million is money the company will save through a sales and use tax exemption.

Republicans call this "pay-as-you-grow," because Foxconn only benefits from the tax savings if it creates the tax liability in the first place. Democrats simply branded it a "corporate giveaway" that included "$2.85 billion in cash payments." Their messaging efforts were frustrated by the fact that some of their members crossed the aisle to support the deal.

In all, four Assembly Democrats would ultimately vote for the incentives package. All of them are from southeastern Wisconsin. In addition to Barca, Reps. Todd Ohnstad (D-Kenosha), Cory Mason (D-Racine), and Jason Fields (D-Milwaukee) all have an interest in seeing the company come to the area.

Three of them, Barca, Ohnstad, and Mason, voted for it on Aug. 17. However, that vote proved pointless, because the Senate decided to amend the bill and the Assembly would have to vote again. However, for Barca, the damage with his party was already done. After several hours in caucus on Sept. 7, Barca announced he would step down as minority leader at the end of the month.

A week later, on Sept. 14, the bill was back on the Assembly floor, and four Democrats voted for it. Fields switched his vote because the new bill included promises of job training for minorities.

"If I don't take the opportunity to fight for African American men, what the hell am I doing?" @jmfields7 on his vote for Foxconn- #wiright

— MacIver Institute (@MacIverWisc) September 14, 2017

However, for most Assembly Democrats, there was nothing to cheer about.

"This deal reeks of desperation, by a desperate Governor as he runs for re-election and tries to hide behind the false promises of Foxconn to avoid facing the reality that he's failed to create an economy that works for everyone, not just those at the top," Rep. Chris Taylor (D-Madison) said in a press release after the vote.

Rep. Lisa Subeck (D-Madison) said, "The fix is in: Republicans are rigging the system against ordinary Wisconsinites and in favor of a single foreign corporation. The Foxconn corporate welfare giveaway doubles down on yesterday's vote by Republicans for a budget rigged against the people of Wisconsin."

Back in July, Subeck had accused Barca of making comments about Foxconn that "have not been consistent with the majority position of the caucus and have served counter to our interest."

Rep. JoCasta Zamarripa's (D-Milwaukee) press release stated, "With the passage of this bill, Assembly Republicans proved they were willing to gamble with the future of Wisconsin's families, children, and small businesses."

After the final Foxconn vote, Assembly Democrats quietly moved their timeline up on picking a new leader.

They met on Sept. 19, and quickly selected Rep. Gordon Hintz (D-Oshkosh) as the new minority leader. That result wasn't surprising since Hintz was the only one to step forward and run for the position. What was surprising was that Democrats did not consider anyone else, especially in light of Hintz's checkered past. In 2011 he threatened a fellow representative's life on the Assembly floor, and was arrested for sexual misconduct at a "massage parlor."

Clearly the most important issue for Assembly Democrats was that, unlike his predecessor, Hintz is no fan of Foxconn. He has staked out his position on the incentives package as a "costly economic trickle-down fantasy."

Hintz made it clear that he expects the Foxconn development to ultimately fail. He wrote in a Sept. 15 column, "Walker has left the state fiscally unprepared for slower economic times. Now he is betting it all on the Foxconn package, which, under the best-case scenario, would not break even for a quarter-century. And knowing Walker's and Foxconn's history of 'overpromising and underperforming,' this best case is not likely to happen."

Hintz's selection as minority leader was essentially a validation of that position for the entire Assembly Democrat Caucus.

Meanwhile, Barca seems satisfied to refocus his attention on his district.

"It has been my honor to work as their leader in the fight for family-supporting jobs and an economy that works for everyone. Assembly Democrats have always fought to do what is right for Wisconsin families and workers," Barca wrote in a Sept. 7 statement. "I will continue this effort but will be able to put much more focus on my district, which will have more challenges than ever in the months ahead."

And by casting his vote in the pursuit of that goal, Peter Barca couldn't lose.

Unions Lose Again In Wisconsin Right To Work Case

Tue, 09/19/2017 - 14:02

MacIver News Service | September 19, 2017

By M.D. Kittle

[Madison, Wis...] Another court has upheld Wisconsin's Right to Work law, stinging organized labor with yet another legal defeat.

The Wisconsin 3rd District Court of Appeals ruled to reverse, remand and dismiss a lower court ruling striking down the state's 2015 law prohibiting unions from taking dues from workers who do not want to be union members.

AFL-CIO's Wisconsin chapter, Machinists Local Lodge 1061 and United Steelworkers District 2 filed the lawsuit, arguing Wisconsin's law protecting non-union workers from compulsory dues was unconstitutional.

Dane County Circuit Court Judge C. William Foust agreed, striking down the law in April 2016 and asserting that it's not fair that unions should have to provide the same services to workers who opt out of union membership.

The appeals court cited previous court decisions declaring right-to-work laws like the one in Wisconsin constitutional. In its decision, the three-judge appeals panel wrote that Wisconsin's law simply does not allow unions from "conditioning a person's employment on the payment of monies designed to cover the costs of performing that duty of fair representation."

Mark Mix, president of the National Right to Work Legal Defense Foundation, said, going back to 1947, no right-to-work law in the U.S. has been struck down for being unconstitutional or because it was an "illegal taking," as the Wisconsin unions have claimed. Mix's nonprofit filed a friend-of-the court brief in support of Wisconsin's law.

"It's good for Wisconsin workers, and it's good for Wisconsin, that desperate attempts by union officials to continue their forced dues collections are going to end," Mix added.

The 7th Circuit Court of Appeals earlier this summer upheld Wisconsin's law.

The state appeals court decision follows on the heels of the West Virginia Supreme Court of Appeals rejection and withering criticism of a lower court's preliminary injunction against that state's right-to-work law.

West Virginia Chief Justice Allen H. Loughry II in the majority opinion wrote that the circuit court's ruling was "imprudent and "profoundly legally incorrect."

"The respondents have demonstrated no likelihood of success and their failure was abetted by the circuit court's use of an overruled, effectively meaningless standard for issuance of a preliminary injunction," the justice wrote in the 3-1 decision. "This monumental failure of legal reasoning was compounded by extraordinary and baseless delay occasioned by the circuit court."

The labor groups that sued West Virginia, like the Wisconsin unions, maintain that the right-to-work law violates West Virginia's constitutional prohibition on the taking of property "without just compensation or due process."

Mix said the courts repeatedly have ruled unions cannot claim a taking of property that doesn't belong to them in the first place.

Gov. Scott Walker, who with his signature in March of 2015 made Wisconsin the nation's 25th right-to-work state, applauded the appeals court's decision.

"The purchase of any service should be voluntary and not coerced. Wisconsin's right-to-work law protects freedom, not special interests," Walker said in a statement. "I applaud the court in affirming the constitutional right of all Wisconsin workers to be free to choose whether they want to join a union or financially support a union."

Twenty-eight states have passed right-to-work laws.

Missouri's law remains in legal limbo, although Mix expects court action in that union-challenged case sometime next week.

The three Wisconsin labor unions could next appeal their case to the state Supreme Court. Success before the 5-2 conservative majority is considered highly unlikely. Indiana's Supreme Court in 2014 upheld the state's right-to-work law, which is similar to Wisconsin's.

Enough is enough, right-to-work proponents say.

"Union officials ought to stop spending their members' money and taxpayer funds to litigate what is a futile effort to overturn Wisconsin's right-to-work law," Mix said.

Walker Signs Foxconn Bill

Tue, 09/19/2017 - 10:27

[Sturtevant, Wisc...] Gov. Scott Walker signed the "Wisconn Valley Special Session Bill" at Gateway Tech in Sturtevant on Monday.

This incentives package was one of the requirements of the Memorandum of Understanding with Foxconn, which was signed in July. Now, the Wisconsin Economic Development Corporation will negotiate and finalize a contract between Foxconn and the state.

Foxconn will be building its $10 billion manufacturing facility in Mount Pleasant, according to Rep. Peter Barca (D-Kenosha). It is expected to be operational in 2020.

UW-Platteville Whistleblower Professor Testifies To Save Her Job

Mon, 09/18/2017 - 23:04

MacIver News Service | September 19, 2017

By M.D. Kittle

[Madison, Wis...] Sabina Burton testifies this afternoon in her own defense - and for her livelihood - before a jury of her faculty peers.

The University of Wisconsin-Platteville Criminal Justice professor who blew the whistle on allegations of misconduct by administrators faces dismissal following an administration-launched investigation into her conduct.

Today's faculty committee hearing is scheduled to take place from 4 p.m. to 7 p.m. in Room 300 of the university's Ullsvik Hall.

Burton originally was slated to face her accusers in May during a full-day examination of her appeal and the administration's effort to fire the highly respected tenured professor. She asked for a postponement before that hearing after a debilitating bout of chronic stomach pain. Burton says she has had two surgeries this summer to treat ongoing complications caused by ulcers that her doctors blame on work-related stress.

At the May hearing, officials asked whether there were any objections to continuing the proceedings. The question was raised to Burton's empty seat as she remained hospitalized with ulcers.

After negotiations, the committee agreed to schedule a partial day to allow Burton to testify in person, and to schedule witnesses to testify on her behalf.

Burton has been ex-communicated from the UW-P campus since January, when Chancellor Dennis Shields ordered her to clean out her office and informed her that she was no longer permitted on campus.

At the time, Shields had launched an investigation into Burton's conduct in the wake of a complaint filed against her by two university administrators. In April, the chancellor informed Burton that he had "found just cause" to dismiss her.

The chancellor, one of several administrators and faculty members named as defendants in an unsuccessful civil rights lawsuit brought by Burton, alleges the professor behaved "unprofessionally," including "involving students into your personal concerns." Burton disputes the charges and has provided evidence countering the claims she got her students involved in her legal battles.

As Wisconsin Watchdog originally reported in its series, "Troubled Campus," court depositions and other communications also show administrators making conflicting statements about her case.

In his dismissal letter, Shields claimed the investigation, conducted by UW System administrator Petra Roter, determined Burton engaged in "disrespectful, harassing and intimidating behavior" toward colleagues "in an attempt to undermine them professionally and damage their reputation and careers."

Burton disputes the allegations, countering that university administration engaged in a years-long campaign of intimidation and retaliation against her after she stood up for a female student who claimed she had been sexually harassed by a male professor in the Criminal Justice Department.

Burton claims administrators took away a grant and committee seats, effectively stalled her career, and repeatedly threatened her job for criticizing the university's handling of the sexual harassment complaint. She alleges a former acting chairman of the department physically threatened her and that she was defamed by an instructor.

An appeals court earlier this year dismissed Burton's lawsuit against Shields and other university officials, ruling that the evidence presented did not rise to proof of retaliation. A lower court's similar ruling, however, took Burton's attorney to task for failing to include more demonstrative evidence of retaliation and discrimination in the lawsuit. Burton points to what she believes will be her "rigged" dismissal as the ultimate proof that the university administrators have long wanted to get rid of an outspoken, conservative professor they view as a troublemaker.

And now the same federal court judge who originally ruled in favor of the university has ruled that a due process lawsuit brought by Burton may proceed. The Equal Employment Opportunity Commission earlier issued a right-to-sue order in the case.

Burton said at least one former UW-P academic staff member will testify about how administrators attempted to isolate Burton and prohibit faculty and staff interaction with her.

"She was my mentee. She said people were harassed and intimidated not to talk to me," Burton said.

The chancellor also hired a private investigator and sent him to question Burton at her home. That investigation eventually ended with the dismissal of claims against Burton and a university staff member. Burton provided evidence showing the allegations made against her were false.

The record of administration testimony paints a different picture, one of Burton creating a culture of fear and dysfunction in the Criminal Justice Department. A University of Wisconsin System review, however, notes the department was dysfunctional for many reasons. A faculty committee investigation into the department's handling of the sexual harassment incident found administrators mishandled the case to the point of "slut-shaming" the female student who was assisted by Burton in reporting a male professor's inappropriate conduct.

While Burton has her critics, scores of UW-P students have come to her defense. Some have created a Facebook page expressing outrage over the university's treatment of the popular professor. Pioneers Against Injustice was formed to "spread awareness and gain support against the unfair treatment Dr. Burton has received from UW-Platteville after advocating for a student."

University officials have declined to comment in recent months, asserting the dismissal process is a personnel matter.

Sen. Stroebel Applauds Promised Vetoes Shortly Before Budget Vote

Mon, 09/18/2017 - 11:59

September 18, 2017 | MacIver News Service

[Madison, Wis...] In an interview with MacIver News, Senator Duey Stroebel explains the vetoes agreed to by Governor Scott Walker that helped move him and other conservative senators from the No column to the Yes column. The budget passed the Senate Friday night 19-14.

Budget Blog: Walker Veto Pledge Secures Senate Passage Of Budget

Fri, 09/15/2017 - 22:32

MacIver News Service | September 15, 2017

By M.D. Kittle

[Madison, Wis...] After 36 hours of wondering whether Senate Majority Leader Scott Fitzgerald would have the votes to pass the 2017-19 state budget, four of five Republican senators who had been leaning no came through with yeses Friday night to push an amendment-free spending plan over the goal line.

The Republican-controlled Senate, on a mostly party-line vote of 19-14, approved the $76.5 billion budget with the support of Sens. Robert Cowles, Chris Kapenga, Steve Nass, and Duey Stroebel. Sen. Dave Craig (R-Town of Vernon) joined the 13 Democrats in voting no on the spending plan, which Craig has long said spends too much money.

After months of fits and starts, the two-year budget is nearly in the books. It now awaits the governor's signature.

The budget eliminates multiple taxes, holds the line on property taxes, and continues the University of Wisconsin-System tuition freeze into its fifth and sixth years.

The four reluctant Republicans switched to the "yes" column by late afternoon after Gov. Scott Walker pledged vetoes of certain provisions, many of them inserted at the last-minute, that the conservative lawmakers couldn't stomach.

"I didn't think the budget was a bad budget, but I thought it could be better," Stroebel, R-Saukville, told MacIver News Service. "I feel very good about some of the vetoes the governor is going to be making. I think it's going to fashion this budget in more of the way that I think will be good for the conservative cause and good for the state of Wisconsin and all of its residents."

.@SenStroebel explains why promised vetoes by @GovWalker moved him & other conservative senators from no to yes on tonight's #WIbudget vote. pic.twitter.com/Ptf7lycgfC

— MacIver Institute (@MacIverWisc) September 16, 2017

The fiscal hawks, billed as "the Three Musketeers" by Nass, say they have received pledges that Walker would veto provisions extending the power of the shadowy, Public Finance Authority. The measure, among other things, would have granted the tax-free, risky bond peddler the force of eminent domain.

Breaking: The Public Finance Authority budget scam that @VickiMcKenna and @MacIverWisc helped expose will be vetoed. #wiright

— AFPWI (@AFPWI) September 16, 2017

Walker also pledged a partial veto that will permit school districts to conduct referendums only on regularly scheduled and general election days.

A partial veto would reinstate the governor's provision removing the energy efficiency exemption to school district revenue. The popular school program, critics say, has been abused and is a money grab without accountability to the taxpayer.

Stroebel gets the federal swap language that he has sought. A Walker partial veto would delete the requirement that the cost-savings measure first be studied, instead giving the state Department of Transportation the flexibility to enact a fed-swap policy.

And the governor has pledged to use his veto pen to more speedily implement repeal of the state portion of prevailing wage, which artificially inflates the cost of taxpayer-funded state building and highway projects.

Gone, too, would be a last-minute provision changing the makeup of the state Transportation Projects Commission. Walker assured the senators he would partially veto the measure, deleting the changes but leaving the independent engineering study included.

"I do believe some of those things that the governor will be vetoing out were kind of driven by special interests, and I'm glad that those are out because that certainly wasn't where I was coming from nor the vast majority of our Senate, if any of them," Stroebel said.

Less than an hour after the Senate passed the budget and sent it on to the governor's desk, Walker, on his way home from a week-long economic development trip to Asia, released a longer list of what he intends to ax from the spending plan. The list, so far, includes the requests from the senators, as well as a provision in the budget that would provide $1 million in so-called state Capitol basement renovations, sought by the Assembly. And the governor said he would veto a measure that specially releases quarries from onerous local restrictions.

And there it is, folks. @GovWalker's veto list for #wibudget pic.twitter.com/smWiyKxSdo

— MacIver Institute (@MacIverWisc) September 16, 2017

"Governor Walker is vetoing this item because he believes changes of this magnitude should be addressed in separate legislation," the administration press release states. All vetoes, including full summaries, will be included in the governor's veto message.

Walker praised the GOP-led Senate for finalizing a budget that's 2 1/2 months overdue, a budget bogged down by internecine battles between Republican leadership driven in large part by philosophical differences on paying for Wisconsin's transportation system.

"Thank you to the members of the State Senate for approving our budget that will put more actual dollars into K-12 education than ever before," the governor said in a statement. "We are providing historic increases in funding for our public schools and we are lowering property taxes for the typical home at the same time."

"Historic increases in funding for our public schools...&lowering property taxes at the same time...this budget proves you can do both." pic.twitter.com/IQrpIE8w9Y

— MacIver Institute (@MacIverWisc) September 16, 2017

The budget pumps $639 million over current spending levels into K-12 education, while eliminating the state portion of the property tax and delivering more money for local road work. To the disappointment of Milwaukee-area Democrats and Republicans alike, the budget doesn't provide funding for the third phase of the Zoo interchange or the East-West Interstate 94 mega projects.

Craig said he was satisfied with the positive provisions of the budget, but it "fails in its primary function - to appropriately limit the size, and thus the role, of government in our lives."

.@SenDaveCraig statement on his "no" vote on #wibudget. He was the lone GOP Senator voting no #wiright pic.twitter.com/FHpyc7wLuq

— MacIver Institute (@MacIverWisc) September 16, 2017

As Ronald Reagan once said, 'As government expands, liberty contracts," the senator added.

The Representative from the 28th wholeheartedly agrees with the Senator from the 28th! https://t.co/WL63KJ8tAO

— Rep. Adam Jarchow (@AdamJarchow28) September 16, 2017

While Walker's vetoes may take away some Assembly and Joint Finance Committee provisions, Fitzgerald gave Assembly Speaker Robin Vos (R-Rochester) what he had asked for. As word spread about the Republican senator holdouts, Vos warned the Senate not to send his house back an amended budget.

.@SpeakerVos said the Assembly would only entertain "technical" changes to #WIbudget, won't be coming back if Senate adds its own amendments pic.twitter.com/Hy9If9G1Ok

— MacIver Institute (@MacIverWisc) September 13, 2017

It took some doing, but the Senate majority leader, with the help of the governor, was able to deliver the votes he needed for clean passage.

Cowles, considered to be a hard no on the budget earlier in the week, was wooed by veto promises and better-than-expected structural deficit numbers. He said his vote also was a matter of striking while the political iron was hot.

"I came to the conclusion that any kind of horse-trading between the houses would end up with more (non-fiscal) policy in the budget. I had fought that all along," he said. The Green Bay-area Republican has long been adamant about limiting the budget to only fiscal items. "I came to the conclusion that there wasn't a scenario where we could get any more out. At some point it's done and I hope the governor vetoes the things."

Cowles argued for the removal of the quarry protection language.

The minority Democrats, not surprisingly, hated just about everything in the Republican-dominated budget - even the things they usually like, such as significantly more spending for education. It wasn't nearly enough, they said. Sure, it's a record amount, but it doesn't make up for the money cut from education - and elsewhere - in the dire state budget days of 2011, Dems explained.

Democrats forwarded 17 amendments, and spent much of the nearly nine-hour debate pitching them while castigating the Republican plan. They pushed changes (and much more money) to education and health care (another you-should-take-the-"free"-Medicaid amendment). And they decried legislation denying Milwaukee a crack at more funding. Each amendment was rejected on a party-line vote.

Two days after their colleagues in the Assembly rolled out the narrative of a "rigged" Republican budget, Senate Dems coined the "Foxconn First" rhetorical theme.

The budget was written and debated amid what has been billed by supporters as a "once-in-a-century" economic development opportunity - Taiwanese tech giant Foxconn's plan to build its first North American Liquid Crystal Display plant in southeast Wisconsin. The Legislature this week finished off passage of a $3 billion incentives bills for Foxconn, which has said it would create 13,000 jobs on a $10 billion capital investment. Walker is expected to sign the bill Monday.

"We pay Foxconn first," Sen. Janet Bewley (D-Ashland) declared during Friday's debate. "We took care of Foxconn ahead of the people of Wisconsin." Pushers of that narrative failed to note that many of the incentives are tied to job creation and construction of the manufacturing campus. They left out the part about the anticipated 10,000 construction jobs that would be needed, the thousands of spin-off jobs, and the billions of dollars added to the economy.

State Sen. Alberta Darling (R-River Hills) said the budget was one of the best she's seen in her long legislative career.

"If you say yes to this budget, you are supporting the largest investment in K-12 education in state history. If you say yes to this budget, you are saying you want to put more money in the pockets of your constituents," Darling said at the start of Friday's debate.

The Senate has approved a #wibudget that our members and our state can be proud of.

— Scott Fitzgerald (@SenFitzgerald) September 16, 2017

The budget next goes to Walker's desk for his signature, expected some time next week.

UPDATE: Republican Senators Present List Of Demands For Their Votes on Budget

Thu, 09/14/2017 - 00:28

Reluctant senators still saying, 'no, unless ...', but does Fitzgerald have the numbers?

MacIver News Service | September 14, 2017

By M.D. Kittle

[Madison, Wis...] The answer is still no.

Three conservative senators say they are prepared to vote against the Republican-led budget, a $75.7 billion, two-year spending plan that isn't conservative enough for their liking. They have presented to leadership a list of nine items they want in the budget in order to secure their votes. They say they don't need everything on the list.

As of late Thursday morning, Sens. Chris Kapenga (R-Delafield), Steve Nass (R-Whitewater), and Duey Stroebel (R-Saukville) remained in the no camp.

Sen. Robert Cowles (R-Green Bay), once a solid no, is now leaning yes, sources tell MacIver News Service. That would get Sen. Majority Leader Scott Fitzgerald (R-Juneau) to 16 votes. He needs 17.

Sen. Dave Craig (R-Town of Vernon) tells MacIver News Service he's still uncomfortable with the spending in the budget.

Meanwhile, Assembly Speaker Robin Vos (R-Rochester) made clear late Wednesday night, moments before his GOP-led house passed the long-awaited 2017-19 state budget, that the bill would not be held "hostage" to renegade senators.

"We will not be coming back next week," Vos said.

.@SpeakerVos said the Assembly would only entertain "technical" changes to #WIbudget, won't be coming back if Senate adds its own amendments pic.twitter.com/Hy9If9G1Ok

— MacIver Institute (@MacIverWisc) September 13, 2017

Fitzgerald acknowledged Wednesday afternoon he did not have the votes to pass the budget but that he was "optimistic" he would find them by the time the Senate clocked in Friday morning for its budget debate. He had scheduled debate as of early Thursday afternoon, and Fitzgerald is not one to take up a bill without knowing what he's got.

Mike Mikalsen, spokesman for Nass, said the reluctant Republicans have not ruled out a yes vote.

"The three members are not saying, 'Hell, no!' These are reasonable things we are asking for," he said. "We are trying to get to a yes. It's not our intent to vote no unless we're forced to. It's not as if we have not given them options."

The "no vote for now" senators want equality for statewide school choice, reforms to the troubled Department of Transportation and other changes in return for their support for the budget.

In fact, they have a list of demands.

The senators want to amend a Joint Finance Commission provision that expands income eligibility for the statewide school choice program to 220 percent of the Federal Poverty Level. They'd like to expand eligibility even further, to 300 percent - the same level as in the Milwaukee and Racine parental choice programs.

Also on the list is a language revision that would prohibit the University of Wisconsin System from spending an anticipated $4 million on mandatory diversity, sensitivity, and cultural fluency training for students, faculty, and staff.

Stroebel in particular is calling for an amendment that would add a provision from Senate Republicans changing Joint Finance Committee language on school referenda. And the senators want checks on a runaway law that has allowed Wisconsin school districts to raise more than $217 million in new taxes (according to the Milwaukee Journal Sentinel) ostensibly for so-called green projects, without voter approval.

The reluctant Republicans have several concerns on the transportation front. They want an amendment to a bill requiring local referenda to impose a wheel tax. And the senators are seeking implementation of a federal swap initiative in which a portion of federal transportation funds within local programs are swapped with existing state transportation dollars. Stroebel has been pushing for the change for years, asserting it would remove burdensome, expensive and ineffectual regulations from local highway projects.

The senators, too, are not happy with a Joint Finance Committee measure tucked in at the end of the budget-writing process that would prohibit stringent local regulations on quarry operations. Some conservatives are concerned that other industries, such as Wisconsin's growing sand-mining trade, could face tougher local restrictions because of the specific language protecting just quarries.

State Sen. Dave Craig, a Republican fiscal hawk from the Town of Vernon, is a flat no vote, according to legislative sources, as is Sen. Robert Cowles (R-Green Bay).

Fitzgerald is a consummate vote-counter. With 20 Republicans to 13 Democrats, he'll need to pick up a couple of the "no vote for now" conservatives to pass the budget and move it on to Gov. Scott Walker's desk. Just how the majority leader will accomplish that remains to be seen. Fitzgerald's office said Senate Republicans did not expect to caucus again Thursday, but there would be smaller meetings throughout the day.

Budget Blog: After 11 Hours Of Debate, Assembly Passes Tax-Ending Budget

Wed, 09/13/2017 - 23:26

September 13, 2017 | MacIver News Service

[Madison, Wis...] After 11 hours of debate heavy on Democrat-led shaming, recriminations, vilifications and fact smashing, the Republican-led state Assembly passed a $75.7 billion budget with generous spending increases for K-12 education, another round of in-state tuition freezes, and the death of several taxes.

The 2017-19 state spending plan, which passed on a vote of 57-39, saw five Republican defectors join the 35 Democrats in the lower house. The bill now moves onto the Senate, where, as of late Wednesday, it faced an uncertain future with the defection of three conservative senators.

Democrats turned much of Wednesday's floor session into "segregation" day, accusing Republicans of creating a pre-Brown v. Board of Education system in the Racine Unified School District for a provision that would allow RUSD collar communities the right to decide whether they want to remain in a failed school district.

Rep. Therese Berceau (D-Madison), made it clear who the minority party was trying to reach in their stream of partisan diatribes against Republicans and their budget.

"To take care of something for the newsroom, 'rigged, rigged, rigged,'" Berceau said just after 10 p.m., as the late TV newscasts were getting underway. It was a common mantra - the Republican-led budget is rigged in favor of the rich to the detriment of the poor, class warfare chestnuts the left is so fond of.

For good measure, she added that Democrats and Republicans are from different planets, and Republicans "are the aliens."

At the end of a very long day, all the speeches and grand-standing was for the TV cameras and not much more. This Republican-led budget passed with few defectors, as was expected with an Assembly controlled by the largest GOP majority since the Eisenhower administration.

Republicans focused on the expansive tax cuts, increased services, and substantive government reforms including a full repeal of the state prevailing wage. Democrats plugged their noses and voted against a budget bill they despise.

"We know one thing for sure, not one Democrat will vote for this bill," said Assembly Minority Leader Peter Barca (D-Kenosha).

.@PeterWBarca echoes Trump: this budget is "rigged." #wibudget #wipolitics pic.twitter.com/xv2LHBLLEI

— MacIver Institute (@MacIverWisc) September 13, 2017

The budget passed by the Assembly eliminates not one, not two, but three different taxes. The Forestry Mill Tax, the Alternative Minimum Tax, and a soda tax are swept away in this document. It holds the line on property taxes, and increases funding for local road maintenance without raising gas taxes or vehicle registration fees.

.@DaleKooyenga: #WIbudget doesn't just lower taxes, but eliminates some altogether. Urges federal government to reform/lower taxes.

— MacIver Institute (@MacIverWisc) September 13, 2017

Democrats introduced 18 separate amendments to the budget - some spanning just a page or two, and others containing 50 or more pages.

They weren't just amendments tinkering around the edges. Many contained substantive spending, providing a peek into what the debate might look like if liberals held the majority. Joint Finance Committee co-chair Rep. John Nygren (R-Marinette) pointed out the costs of those amendments.

Running tally: so far democrats have introduced $1.037 BILLION of increased costs to taxpayers. We are less than two hours into debate.

— John Nygren (@rep89) September 13, 2017

Eleven amendments dealt with the Opportunity Schools Partnership Program (OSPP) and Racine Unified School District (RUSD). OSPP was written into law in the last budget and would have allowed a special superintendent to implement reforms in a handful of the worst-performing schools in the state.

One provision added by the Joint Finance Committee would give the troubled RUSD a year-long pass from OSPP, provided they comply with certain requirements. The motion's language opens the door to a potential referendum down the line, allowing the villages within RUSD to split off and create their own school districts.

It's not the "Racine School District," it's the Racine Unified SD, with villages that have rights, too, says Tom @RepWeatherston #wiright

— MacIver Institute (@MacIverWisc) September 13, 2017

Democrats argued that such a move would increase racial segregation in the area. Some drew comparisons to landmark cases such as Brown v. Board of Education and Plessy v. Ferguson. Others still, such as Rep. Cory Mason (D-Racine), claimed the plan would mark a new era of racial segregation.

Extreme rhetoric over RUSD: "What you're proposing here is a new era in racial segregation." -Rep. Cory Mason #wiedu #wiright #wibudget

— MacIver Institute (@MacIverWisc) September 13, 2017

Saying school choice ⬆️ segregation, @PeterWBarca employs a fear tactic not remotely supported by data. https://t.co/qAe6vrK7tx #wibudget pic.twitter.com/2HvZFMtqHi

— MacIver Institute (@MacIverWisc) September 13, 2017

Members on both sides of the aisle spoke at length about education. Democrats repeated the notion that K-12 education budgets have been slashed year after year. Nygren called for a fact check on that number, and MacIver delivered.

Fact check: every #wibudget since '11 has increased K-12 funding. Survey says: true. @rep89 pic.twitter.com/cv93otpE0y

— MacIver Institute (@MacIverWisc) September 13, 2017

Transportation was the sticking point between Assembly Republicans, who wanted more sustained revenue (gas tax increases and/or vehicle registration fee hikes) and less bonding, and Senate Republicans who sought more bonding and no tax hikes. Walker's transportation plan, rejecting tax increases in a time of budget surpluses, won the day. The transportation battle is a big reason why the budget is nearly two and a half months past due.

Vos called the transportation compromise his "one great disappointment."

"We should have done more, but in a time of political compromise we got as much as we could," the speaker said, calling out "intransigent folks" in the "smaller house," referring to the Senate.

While legislators knew the budget would pass the Assembly floor before gaveling in, its chances in the Senate is another question. As debate raged on in the Assembly, the Senate GOP met in a closed caucus, hoping to find the 17 votes needed to pass the bill.

Sources say three GOP senators still "hard nos" on budget - @SenStroebel @SenatorKapenga and Sen. Steve Nass #wiright #wibudget

— MacIver Institute (@MacIverWisc) September 13, 2017

.@SenStroebel says he wants to get to a yes vote but he thinks as conservative-led Legislature "we can do better." #wiright #wibudget

— MacIver Institute (@MacIverWisc) September 13, 2017

Three Senate conservatives also released a document outlining their objections to the budget. At the beginning of the day, Speaker Robin Vos (R-Rochester) declared that he would not allow anyone to hold the document "hostage," saying that the Assembly would take only technical but not substantive amendments.

.@SpeakerVos said the Assembly would only entertain "technical" changes to #WIbudget, won't be coming back if Senate adds its own amendments pic.twitter.com/Hy9If9G1Ok

— MacIver Institute (@MacIverWisc) September 13, 2017

Vos reiterated that position at the end of the long debate.

"We will not be coming back next week," he said.

Now, with the budget out of the Assembly, the ball is in the Senate's court. Senate Majority Leader Scott Fitzgerald (R-Juneau) said Wednesday that he did not yet have the votes to pass the budget bill, but he was still planning on taking up the vote Friday morning.

GOP Lawmaker Calls For Audit Of Shadowy Wisconsin Bond Agency

Wed, 09/13/2017 - 19:55

MacIver News Service | September 13, 2017

By M.D. Kittle

[Madison, Wis...] State Rep. Scott Allen (R-Waukesha) voted against his party's budget Wednesday for one reason: he couldn't support a measure that greatly expands the power of the Public Finance Authority - a shadowy, Wisconsin-based agency that he believes has done little to benefit Wisconsin.

Allen tells MacIver News Service that not only is he opposed to giving more authority to the Public Finance Authority, he will issue a memorandum to Assembly Speaker Robin Vos and the Joint Legislative Audit Committee seeking an audit of the PFA.

"I am voting against the budget, an otherwise good budget, because good government is more important than a good budget," Allen said in an interview Wednesday with MacIver News Service. "This should not be in the budget in my estimation."

As MacIver News first reported this week, the PFA is involved in some questionable investments around the country.

Allen's biggest concern, however, is that the Finance Authority, a political subdivision of Wisconsin, has done so little for the Badger State. Just 1.9 percent of the total bond debt issued by the PFA has been for Wisconsin projects, Allen said.

"I had representatives of the PFA in my office this morning and I asked them what is the public purpose of the PFA, and with a little hemming and hawing I got, 'Well, economic development.' Okay, great, let's examine the record."

The bond broker was ostensibly formed by four Wisconsin counties and the city of Lancaster. The Legislature in 2009 unanimously passed the law that created the PFA. It launched the following year. Its purpose: finding investors for tax-exempt and taxable "conduit bonds" for so-called "public benefit projects."

What is the public benefit of a Wisconsin organization that has done very little development in Wisconsin? It would seem very little, Allen said. Out of the scores of projects that the Finance Authority has issued bonds for, only two were located within the jurisdictions of the founding Wisconsin local governments, according to the lawmaker.

The PFA has been busy elsewhere. Earlier this year, it issued more than $1 billion in bonds for a 2.9 million square-foot shopping mall in East Rutherford, N.J., known as American Dream Meadowlands. The commerce monstrosity is to include an indoor ski slope and water and amusement rides in the mix of high-end retail.

Last month, Bloomberg reported that Goodwill Industries of Southern Nevada, which runs 50 donation centers and retail stores in Las Vegas, filed for bankruptcy 20 months after issuing $22 million of municipal bonds. The nonprofit issued the debt through the Public Finance Authority, which specializes in serving as a conduit for risky debt.

The PFA is one of more than a dozen third-party bond issuers doing business in the U.S.

"The authority, however, is uniquely lax in its filing requirements and has shown a tendency to issue bonds for projects outside its state when conduits there will not," Debtwire reported.

Despite its critics, the majority of PFA-connected bonds are performing, according to Debtwire's breakdown of Bloomberg data. In 2016, the issuer posted a record year of $1.79 billion in bonds issued.

Allen said he's not going to scrutinize every PFA investment, but he is bothered that the broker has done so much business outside the state that effectively created it.

"If the Wisconsin Legislature is going to act to create or expand the powers of a financing authority whose purpose or mission is economic development, the economic development ought to be occurring in Wisconsin," the lawmaker said. "Or there ought to be tangible benefits to the citizens and taxpayers of the state of Wisconsin or we shouldn't be doing it."

There are tangible benefits to PFA's founders and sponsors, the National Association of Counties, the League of Cities, the Wisconsin Counties Association, and the League of Wisconsin Municipalities.

Allen said PFA officials provided him a document showing the founding members and the sponsoring organizations help promote the authority's economic development efforts. For those services, they receive compensation. PFA officials would not disclose how much compensation.

Mark D. O'Connell, executive director of the Wisconsin Counties Association, did not return calls from MacIver News seeking comment. Jerry Deschane, executive director for the League of Wisconsin Municipalities, referred all questions to O'Connell.

"There's more to this than I have had time to investigate. That's why I'm calling for the audit because I think it deserves investigation. It deserves scrutiny before we consider expanding its powers," Allen said.

One of the powers sought in the legislation is the force of eminent domain - the ability of governments to take private property for public use in return for "just compensation" to the owner. Specifically, the provision would authorize "eminent domain to a commission created by contract under current law governing intergovernmental cooperation among Wisconsin entities that are acting under the provision of PFA statute." That would be the commission that oversees the PFA.

PFA directors have pledged to legislators that the Finance Authority would never actually use the power. Eminent domain is just a tool among a handful of IRS requirements needed to unlock PFA access to new market tax credits and receive tax-free financing status.

"They are giving this quasi-public, shadowy organization the power of eminent domain?" said Eric Bott, state director of the Wisconsin chapter of Americans for Prosperity. The libertarian organization has voiced its opposition to the Finance Authority legislation, asking Gov. Scott Walker to veto it, if it survives legislative debate.

Allen said the IRS is challenging the PFA's local government status, "and appropriately so." They need to have either the power to tax, policing power or the power of eminent domain authority. There's no specific language in the state statute that requires that, hence the move to change the law, Allen said.

"I don't know whether they have had the authority or whether they are trying to clean up the language to represent their authority," the legislator said. "Either way, it should not be in the budget and we should not be expanding their authority until we do a careful review of their processes and their mission and purpose."

Proponents of the modifications to Wisconsin's PFA statute say they provide greater transparency. The provisions do so by requiring quarterly bond activity reports to the state Department of Administration and the Legislative Audit Bureau. And the commission that oversees the Finance Authority would be considered an "authority" as defined under Wisconsin's open records law, which means it would be subject to the law. It also would be subject to Wisconsin's open meetings law.

In 2011, a year after its creation, the PFA branched out nationwide.

"The (PFA) partners with private borrowers and local governments to provide tax-exempt financing for public benefit projects that create temporary and permanent jobs, affordable housing, community infrastructure and improve the overall quality of life in local communities," according to the organization's website.

Traditional fees associated with securing tax-exempt financing are too often cost prohibitive, particularly for small projects. By "standardizing and streamlining the entire process," PFA claims it can save local governments and nonprofits money. More important, PFA asserts its Wisconsin Small Bond Program can move from application to approval and issuance in "as little as six weeks."

"The (PFA) is out there to create an alternative at a time when communities are really struggling to generate economic activity," Liz Stephens, Finance Authority program manager, told the Bond Buyer investor newspaper in 2011. "Access to capital is really difficult, and the PFA is there to provide another tool and resource to help local governments."

In a press release explaining his no vote on the budget, Allen described the PFA legislation as the "ugly" in the two-year state spending plan.

"What is ugly about this budget is that rather than curbing the authority of this so-called political subdivision the budget, in a non-fiscal item, greatly expands the authority and works to remedy PFA's problems with the Internal Revenue Service," the lawmaker said. "The obscure provision of the budget has been largely undetected by the public or by legislators. It has gained no attention, no debate, and no public scrutiny. It is yet another example of the need for budget transparency."

Walker Gives DPI's Education Improvement Plan An F, Asks Evers To Resubmit

Wed, 09/13/2017 - 12:20

MacIver News Service | September 13, 2017

By M.D. Kittle

[Madison, Wis...] Gov. Scott Walker is rejecting an education plan by the state Department of Public Instruction because, according to the governor, the plan is bereft of accountability and bloated with bureaucracy.

In a letter sent Wednesday to DPI Superintendent Tony Evers, Walker said he could not sign off on Evers' proposal to the U.S. Department of Education. Each state is required to provide an education improvement plan under the federal Every Student Succeeds Act.

ESSA is billed as the more flexible replacement to the No Child Left Behind Act. It allows states more freedom in coming up with innovative policies to improve education outcomes.

"Your bureaucratic proposal does little to challenge the status quo for the benefit of Wisconsin's students," the governor wrote in his letter to Evers. "For example, under the law, a 'rigorous intervention' is required for low-performing schools. In your plan, schools may simply implement an improvement plan created under the supervision of the Department of Public Instruction."

"I hope you will agree that adding layers of bureaucratic paperwork does little to help low-performing schools," Walker added.

Walker notes other states are using their plans to "drive improvement through bold reforms." He pointed to Tennessee's proposal, already approved by the U.S. Department of Education. That plan, Walker wrote, supports "creative reforms, using innovations such as Achievement School Districts and Innovation Zones to support efforts to reform low-performing schools."

Tennessee's plan, which went into effect this school year, brings "sweeping changes to transparency, accountability and school turnaround, and includes ranking schools A-F, changes how Tennessee reports on subgroups of students and boosts the recruitment an training of students," according to a story last month in the Tennessean.

In May, DPI released its initial state plan for the implementation of the new federal education law. The state plan is the culmination of more than a year of work, including legislative briefings in the state Capitol and public hearings for stakeholders around the state. The document lays out new academic achievement goals and plans of action for Wisconsin's students, including specific English language arts and mathematics proficiency goals.

The state aims to cut achievement gaps by half over the next six-year period, with a long-term goal of closing the gaps entirely by 2029. That translates to an average 1 percent annual increase in overall student proficiency for both English and math over six consecutive years.

MacIver's latest State of Education Report details the myriad challenges and failings in Wisconsin's K-12 education system.

Evers last month announced he is running for governor. While his position is supposedly nonpartisan, Evers is a liberal long backed by education unions and the public education establishment. He is seeking the Democratic Party nomination and, ultimately, a match-up with Walker, a two-term Republican who in 2012 survived a recall campaign driven by Evers' union allies.

In his letter to Evers, Walker urges his would-be political challenger to think bolder and asks the DPI secretary to take another shot at the education success plan.

"On other issues, such as welfare and parental choice in education, our state is recognized as a national leader," the governor wrote. "It is because we took action in the face of government special interests.

"We urge you to take this opportunity to make Wisconsin a reform leader yet again and resubmit a new proposal that allows our schools to innovate and students to succeed," Walker closed.

Late Legislative Motion Would Create New Transportation Bureaucracy

Tue, 09/12/2017 - 17:37

MacIver News Service | September 12, 2017

By M.D. Kittle

[Madison, Wis...] Legislation that changes the makeup up of the state's transportation advisory commission would create an expanded bureaucracy sympathetic to hiking gas taxes and vehicle fees, critics of the proposal charge.

Last week, the Republican-controlled Joint Finance Committee passed an omnibus motion on transportation finance, including a measure that would modify membership to the Transportation Projects Commission and provide hundreds of thousands of dollars to fund new positions.

More so, the legislation would require the state Department of Transportation to adopt the long-range planning recommendations made by the TPC, to "the extent permitted by federal and state law."

Sen. Steve Nass does not support the TPC language in the omnibus motion, said Mike Mikalsen, spokesman for the Whitewater Republican.

"He clearly thinks this particular change is to thwart the governor," he said. "If you look at the changes to the TPC and then look at the failure of the Joint Finance Committee to incorporate significant DOT reforms, from the Assembly position they are not looking to reform the DOT but spend more."

Assembly GOP leadership pushed for hikes to the state's gas tax and vehicle fees, and other sources of new revenue to feed Wisconsin's disputed $1 billion transportation budget shortfall. They warned the state could not longer borrow its way to a long-term transportation fix. Assembly Republicans expressed disappointment that the JFC budget mainly stuck to Walker's transportation initiatives, including more than $400 million in bonding and no tax or fee increases.

Rep. John Nygren (R-Marinette), co-chair of the Joint Finance Committee, said the budget bill is workable for now. "You live to fight another day," he told MacIver News last week. But the "conversation is far from over," Nygren tweeted, "and I'm looking forward to continuing to advocate for a dedicated and sustainable solution."

Could the solution begin with a reconfigured Transportation Projects Commission?

Senate Majority Leader Scott Fitzgerald told reporters Tuesday evening that he feels good about the reforms to the Transportation Projects Commission.

"I have only had positive feedback from members on TPC reforms," the Juneau Republican said. "Compared to what the TPC is now, which is completely dysfunctional, this makes a lot of sense."

Contradicting our sources, @SenFitzgerald said he's heard "only positive feedback" about TPC changes that create new transpo bureaucracy. pic.twitter.com/oJ358P1U7b

— MacIver Institute (@MacIverWisc) September 13, 2017

The motion reduces from three to two the number of public members appointed by the governor to the commission. The Assembly and Senate would each name three legislators, down from five, and the Legislature would appoint four members of the public. The measure specifies that either the secretary of the DOT or the Department of Administration would be appointed as non-voting members, as determined by the governor. Currently, the commission is served by five senators, five representatives, three public members appointed by the governor, the secretary of the DOT, and the governor, who chairs the panel.

The proposal also would initially create three new positions and a commission director. TPC staff would include an engineer, legal counsel, and financial auditor. An appropriation of $150,000 in 2017-19 would fund the "initial costs associated with the Director position," according to the omnibus motion.

Another $550,000 in general purpose revenue funds would cover as many as four additional positions "determined necessary by the TPC in consultation with the Director." The money also would pay for supplies and services approved by the commission.

TPC staff would review DOT financial records to assure the transactions are "legal and proper." And the staff would annually evaluate the Department of Transportation based on goals and performance measures established by the TPC.

The commission is charged with reviewing major highway project candidates and it recommends to the governor and the Legislature projects to be "enumerated" for inclusion in the two-year state budget.

An expanded TPC would be required to consider the denumeration of projects that are at least 10 years old. The proposal would require the TPC to submit a report to the governor and the Legislature "describing the short-term and long-term impacts of each DOT biennial budget request on state and local roads." It would do the same review on the governor's proposed budget.

Fitzgerald said the changes were necessary, especially in light of an audit earlier this year that "demonstrated that the TPC had zero handle or control over budget timelines and interaction with the feds. That's why when the Speaker (Rep. Robin Vos) and I sat down to kind of map out what that might look like I felt really good about the outcome of the TPC reform."

"I think it's going to work and function and that's what we're looking for," he added.

The Joint Finance Committee didn't take up many of the transportation reforms authored by a group of fiscal hawks. Those reforms included different practices for completing projects, streamlining the bidding, designing and building process to save taxpayers money.

"You have to look at the TPC changes in context," Mikalsen said. "Assembly leadership prevented certain other reforms from being included in the budget, delaying prevailing wage until September of next year. That's a whole other construction season."

Fitzgerald said he wasn't ready to give on the prevailing wage timeline. He said there needs to be a "grace period" in the implementation of prevailing wage-free state construction projects, as there was in the last reform to Wisconsin's antiquated prevailing wage law in 2015.

.@SenFitzgerald is comfortable w/ timeline for #PrevailingWage repeal included in #WIbudget. Repeal would take effect in 12 mos. #wipolitics pic.twitter.com/fZBKuoNKTx

— MacIver Institute (@MacIverWisc) September 13, 2017

The Senate aide said the TPC modifications represent a small piece of the overall $6.072 million transportation package, something Nass hopes the governor will veto.

The governor's office declined to comment on vetoes until the legislative process is completed.

Kit Beyer, spokeswoman for Speaker Robin Vos, said the Rochester Republican supports the changes to the commission "in order to add a level of accountability and oversight to the Department of Transportation and highway projects."

Looking For Votes

Fitzgerald said the Senate is "working toward hitting the floor" Friday morning to take up the overdue state budget - two days after the Assembly is expected to vote on the two-year spending plan.

Does he have the votes? Not yet.

"Hopefully we'll have a minimum of 17 votes to be able to take the vote up and run with it," the majority leader said.

"We're still working on pulling those votes together right now," he added, counting 15 Senate Republicans in the support column.

Fitzgerald said it's hard to nail down the concerns of reluctant caucus members, that there are a "wide range of items" in the budget that are sticking points with some Republicans.

#WIbudget needs 17 votes, but Tuesday night @SenFitzgerald said he has 15, is "still working on pulling those votes together." #WIpolitics pic.twitter.com/9xAxbuaLUg

— MacIver Institute (@MacIverWisc) September 13, 2017

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