Billing it a “breakthrough budget,” Governor Tony Evers rolled out a massive two-year spending plan on Wednesday that would dump billions more taxpayer dollars into a host of new programs, raise taxes by $1 billion-plus on businesses, deliver a sweetheart deal to the Milwaukee Brewers, and gobble up much of the state’s historic $7.1 billion surplus.
At approximately $104 billion, Evers’ budget proposal is the first to break the $100 billion mark and comes in at about $13 billion more than his 2021-23 plan and more than $16 billion higher than the current budget he signed into law in June 2021.
The Democrat claimed his litany of big-ticket budget requests is about “solutions not wish lists.”
“We’re not flirting with fringe ideas here,” Evers said.
The Republican-controlled Legislature he’ll have to go through begs to differ.
“Tonight, Governor Evers proposed a laundry list of liberal spending,” said state Senator Patrick Testin (R-Stevens Point). “This means that the legislature must again lead the way by crafting a responsible, forward-looking budget.”
Republican leaders have said the Legislature will do what it did with Evers’ previous record-spending biennial budget proposal: They will rebuild it from the ground up. Expect the Joint Finance Committee, the Legislature’s budget-writing arm, to jettison scores of Evers’ spending proposals, many of them considered policy, not fiscal measures.
Big-ticket Items
The governor wants to spend $230 million to fund a program that would provide three months of paid family and medical leave for public and private-sector workers.
He wants to dump an additional $2.6 billion into K-12 public education, on top of the unprecedented billions of dollars in federal COVID aid Wisconsin schools have yet to spend.
He wants a half billion dollars more for local workforce programs, more than $22 million for child care assistance, and another $150 million to underwrite an “affordable housing” initiative.
He wants another $750 million for broadband expansion.
“We have to do this folks, and together he will,” Evers told a joint gathering of state representatives, senators and other distinguished guests assembled in the Assembly chamber.
In short, Evers wants.
His budget proposal calls for about a half billion dollars in increased state aid for local governments — through a 20 percent carveout of the state’s sales tax revenue. Local government associations liked what Evers had to say.
“This evening’s budget address by Governor Evers represents his willingness to support local government reform,” the Wisconsin Counties Association, League of Wisconsin Municipalities and the Wisconsin Towns Association, said in a joint press release.
The governor is looking to spend $290 million on repairs to American Family Field — home of Major League Baseball’s Milwaukee Brewers. The deal is supposed to keep the club in Milwaukee through 2043. But it’s more taxpayer money going to fund a professional sports franchise. There was a good deal of resistance in the 2015 deal with the Milwaukee Bucks that included $250 million in taxpayer money to build the NBA team’s new gilded arena. That deal was led by Evers’ predecessor, Republican Gov. Scott Walker.
“The Legislature was never informed about this Brewers’ bombshell coming from the Governor. Projects this big have to be a collaborative effort between the Legislature and Governor,” said State Representative Dave Murphy (R-Greenville) in a statement. “A $7 billion surplus is no reason to have taxpayers pick up the tab to subsidize millionaire players and billionaire owners. Taxpayers and their representatives need to have a say in this.”
Tax Cuts and Tax Hikes
Evers began his budget address trumpeting his plan to cut taxes by $1.2 billion, a 10 percent reduction for Wisconsin income taxpayers earning $150,000 or less (married joint-filers).
His tax cut proposal pales in comparison to the tax reform bills — including a flat tax proposal — Republicans are calling for. Assembly Speaker Robin Vos (R-Rochester) has said he’d like to see at least half of the budget surplus go to tax relief.
As Evers talked tax cuts, he did not mention his tax hike on manufacturers and investors.
Again, the governor would limit the state’s manufacturing tax credit on qualified production income, raising taxes by more than $650 million. The tax credit, economists say, has played a significant role in keeping the state’s critical manufacturing sector competitive.
Evers’ budget also would stifle the 30 percent long-term capital gains exclusion, taking nearly $340 million from retirement and other investment income over the net two years.
“Unfortunately, Gov. Evers’ budget proposal would make it more expensive to manufacture products in our state and reverse a number of critical reforms that have kept us economically competitive,” Kurt Bauer, president and CEO of Wisconsin Manufacturers & Commerce. “Instead of punishing businesses for investing in our local communities, we should be looking for ways to boost our economy and significantly reduce the tax burden on hard-working Wisconsinites.”
Evers once more is dragging out his proposal to have Wisconsin accept federal Medicaid expansion. The governor claims the “free” Medicaid money would save the state $850 million in the first year, $770 million in the second. Nearly 900,000 more people could climb on the taxpayer-subsidized healthcare rolls.
But a new report shows the risks to states that have accepted expanded Medicaid. Medicaid expansion has failed to prevent hospital closure, with almost 50 shutting down in expansion states since 2014, according to research given exclusively to the Daily Caller News Foundation.
The research from the Foundation for Government Accountability (FGA) indicates that while Medicaid expansion was intended to solve hospitals’ finances and job shortage, its “empty promises” have done the opposite, report author Hayden Dublois wrote. Hospitals instead have had to shut their doors, lost thousands of jobs and racked up substantial losses, amounting to a loss of almost 5,400 beds.
State Representative Robyn Vining (D-Wauwatosa) said a budget is a “moral document — it reflects our values.”
“Tonight Governor Evers delivered a budget proposal that reflects the values and needs of my constituents–a state budget that focuses on mental healthcare; safe, healthy schools; affordable healthcare; clean water; affordable housing; fair assurance of the constitutional right to vote; a promise made and kept to deliver a middle class tax cut; healthy meals, and more!” the lawmaker said.
But state Representative Mark Born (R-Beaver Dam), called Evers’ proposal “unworkable” and “impractical.” Born, who as co-chair of the Joint Finance Committee will have much to say on the rewrite, said there are two visions for Wisconsin.
“Governor Evers’ vision of raising taxes on Wisconsinites by over a billion dollars, growing government despite being unable to effectively manage his existing agencies, and implementing policies that will stifle economic growth. Or, the Republican vision of returning taxpayer dollars, helping our kids learn to read and do math, and keeping our communities safe from criminals,” he said.
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M.D. Kittle is the National Political Editor for The Star News Network.
Image “Gov Evers Budget Address” by Gov Tony Evers.
