Gov. Scott Walker has always dismissed the idea of"> using segregated funds to help balance the state budget.

But buried on page 125 of the budget repair bill is a proposal to take $28 million in reserves from the state's health insurance/pharmacy fund and spend it in the second half of this year.

The monies would be used to offset costs for providing health insurance for state employees from July 1, 2011 to Dec. 31, 2011.

The Group Health Insurance Fund is money paid in through a combination of employee and state contributions. Managed by the">Department of Employee Trust Funds, the fund covers insurance premiums for public workers. It also serves as a rainy day fund to safeguard against sudden increases in health care costs or premiums.

The question, of course, is whether the Walker proposal is constitutional. ETF spokesman Matt Stohr says his agency would explore whether it is, in fact, legal.

"If and when it's included in the final version of bill we will be seeking legal counsel to get further direction on that," Stohr told Biz Beat Thursday.

The governor's office did not respond to the question by press time. But the transfer might pass muster, given that the money is intended to cover health insurance premiums.

At $28 million, the amount eyed by Walker is less than 3 percent of the current fund balance of $1.1 billion.  That balance fluctuates as premiums are paid and new contributions come in, Stohr says.

The proposed transfer came as a surprise to Eileen Mallow, the vice chair of the 10-member board that oversees the fund. 

One union activist, however, is already blasting the proposed transfer.

Andy Heidt, president of AFSCME Local 1871/Dane County Professionals, calls it "part and parcel of Governor Walker's pattern of continual lies."

"This type of financial chicanery was found unconstitutional when">Governor Thompson tried this many years ago and will be again, assuming a fair and unbiased review can occur in the Wisconsin Supreme Court," says Heidt.

Former Gov. Doyle was also prone to tranferring money. Doyle tapped  $200 million from the state patient's compensation fund to help cover the state's 2009 budget gap but"> the courts later ruled it illegal.

That $200 million, with interest, is now due back to the fund.


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