State Senate Republicans have announced a plan to end the 18-day standoff over the state’s overdue budget, but it’s not clear if the proposal will satisfy Assembly Republicans, who have starkly different views on how to pay for roads.
The 2017-19 state spending plan released Tuesday provides the most detailed look at where Senate Republicans stand on unresolved areas of the budget, such as taxes and funding for schools, roads and bridges.
The plan would have the state take on more than $700 million in new borrowing to fund road and bridge projects. It would repeal the state’s prevailing, or minimum, wage requirement for workers on public construction projects.
The plan would make more families eligible for the private school voucher program outside Milwaukee and Racine. It proposes repealing the state personal property tax but abandons Gov. Scott Walker’s plan for an income tax cut.
Senate Majority Leader Scott Fitzgerald, R-Juneau, said the proposal puts the onus back on Assembly Republicans in budget talks. Fitzgerald, Walker and Assembly Speaker Robin Vos, R-Rochester, are set to meet Wednesday.
While Tuesday’s proposal is intended to restart budget discussions, Fitzgerald acknowledged, even as he unveiled it, that he’s not sure if the Senate could pass the measure as-is.
“I’m not going to make that prediction that I have the votes right now,” Fitzgerald said.
Assembly Majority Leader Jim Steineke, R-Kaukauna, said the Senate plan contained few new proposals, but a “wide gap” remains on transportation funding, the main issue holding up the budget’s passage. Still, Assembly GOP leaders said the plan’s arrival is good news.
“It’s good to see Senate Republicans have solidified their positions and are ready to come back to the table,” Assembly Republican leaders, including Vos, said in a statement.
Walker’s spokesman Tom Evenson also tweeted Tuesday that the governor “welcomes the initiative by the state Senate to move the process forward while keeping his priorities largely intact on K-12 education funding, property tax relief, and transportation. The governor will continue to champion income tax relief.”
Sen. Jon Erpenbach, D-Middleton, blamed Walker for the budget delay. He said past governors have stepped up to resolve budget disagreements, but Walker so far has failed to do so.
“This is the fault of the governor,” Erpenbach said. “He needs to come back to Madison and do his job.”
Lawmakers and Walker already missed a July 1 deadline to enact the next two-year state budget. The previous budget continues into the new fiscal year until a new one is enacted.
The budget proposal includes K-12 school proposals that have largely been negotiated with Assembly Republican leaders, including increasing the number of families eligible for a taxpayer-funded voucher to attend a private school, Fitzgerald said.
Families who earn 220 percent of the federal poverty level will now be eligible to receive a school voucher to attend a school participating in the statewide voucher program. Currently, the income limit is set at 185 percent.
That means a family of four with a combined income of $53,826 would be eligible to receive a voucher. Previously, Senate Republicans had opposed a push to increase the income limits to 300 percent of the federal poverty limit — which would match the limits for families in the separate Milwaukee and Racine voucher programs.
Assembly Republicans said they are committed to increasing the limit to 300 percent despite Fitzgerald’s promise the position in his budget proposal was backed by the Assembly GOP caucus.
The budget also eliminates Walker’s proposal to require school districts to force employees to pay at least 12 percent of health care costs to receive a proposed funding increase in Walker’s budget. Instead, districts would be required to report employee benefit and salary information to the Department of Administration, whose officials would report that information to the budget-writing committee.
School districts’ ability to ask residents to raise their property taxes to fund school projects would be limited under the budget proposal, too. Districts would be allowed to seek a referendum twice a year during regularly scheduled elections only, instead of being allowed to call a special election to ask voters to raise taxes.
The Senate Republican plan also nearly eliminates Walker’s proposed $20 million increase in aid for rural schools, and increases the amount of money school districts that spend less on each student than the state average can raise in property taxes.
The budget also decreases funding for summer school programs in the Milwaukee School District from the amount Walker proposed in his budget. Funding for grants districts could apply for to implement mental health programs also would increase from what Walker proposed, under the Senate Republicans’ budget.
On transportation funding — where the gap between Assembly and Senate GOP leaders appears greatest — Fitzgerald said his plan would avoid delays to major highway projects, in part with $712 million in new borrowing.
Assembly Republicans have said they won’t support new road borrowing without a plan to pay for it. Senate Republicans and Gov. Scott Walker have resisted proposals to provide more revenue for roads and bridges.
The Senate GOP plan uses most of its extra borrowing to fund massive freeway projects in southeast Wisconsin, including on U.S. Interstate 94 near Milwaukee. It also would repeal the prevailing wage requirement for state-funded projects, as Walker proposed. Two years ago, Walker and lawmakers repealed prevailing wage for projects funded by local governments.
The Senate plan would eliminate 200 state Department of Transportation staff positions and end DOT studies of possible future highway expansions, including one for the Madison Beltline.
Fitzgerald said the plan does not move the state closer to collecting highway tolls, a step state leaders had weighed heavily in recent months.
Tax cuts on personal property, not on income
The Senate plan includes several key tax changes, including eliminating the state’s personal property tax and alternative minimum tax.
It excludes Walker’s proposal for a state income tax cut, which would cut the tax rates of the two bottom income brackets.
Another Walker proposal that doesn’t make the Senate plan is a sales tax holiday for two days in August for school supplies, which would cost the state about $22 million in revenue.
Myranda Tanck, spokeswoman for Fitzgerald, said the budget proposal meets Walker’s requirement to keep property taxes below 2014 levels. Walker said he would veto any budget that doesn’t reduce property taxes on a median value home below what it was in 2014.