Scott Walker wants to get road projects done -- without paying for them (copy)

Gov. Scott Walker on Thursday offered a deal to legislative leaders who have been at odds over transportation funding in an effort to break the state budget impasse.

MATTHEW DeFOUR, STATE JOURNAL

State lawmakers and Gov. Scott Walker still appeared miles away from a deal on the next state budget Thursday, despite a fresh offer from Walker to revisit his plan to fund state roads and bridges.

Walker’s offer would reduce his borrowing plans for road projects by $200 million. But it does not include new revenue for transportation projects, which remains the core point of budget contention among statehouse Republicans.

An agreement among lawmakers could be near on another budget sticking point — funding for K-12 schools, Senate Majority Leader Scott Fitzgerald said Thursday. Fitzgerald, R-Juneau, said it’s possible the Legislature’s budget committee could reconvene soon, for the first time in nearly a month, to take up school funding.

Fitzgerald also said Senate Republicans, who met behind closed doors Thursday, agree on another budget issue: repealing the personal property tax. They want to scale back Walker’s proposed income tax cut to do it, he said.

But Fitzgerald remained pessimistic about an overall budget deal being reached in the next week.

Walker, in an attempt to jump-start budget negotiations Thursday, proposed lowering borrowing for roads projects to $300 million — down from the $500 million proposed in his budget. The deal also includes an option for more borrowing tied to potential federal funds for interstate highway projects in southeast Wisconsin, according to a letter sent Wednesday to Assembly Speaker Robin Vos, R-Rochester, and Fitzgerald.

Assembly Majority Leader Jim Steineke, R-Kaukauna, said, “It’s incredibly positive that the governor is actively working to try to get to a deal.” He also lauded Walker’s effort to reduce borrowing.

But Steineke said Assembly Republicans continue to oppose a budget that increases borrowing without additional revenue to pay for it.

“In the Assembly, we still have a hard time supporting anything like that,” Steineke said.

Steineke also said he expects Walker’s plan would result in additional construction delays for road projects.

Walker’s office did not respond to Wisconsin State Journal inquiries about whether such delays would result from his proposal. The letter announcing Walker’s offer said it would not disrupt the construction schedule for so-called “major” projects, a class of highway projects that excludes massive freeway projects in southeast Wisconsin.

DOT to seek extra federal funding

The disagreement on transportation funding between Assembly and Senate GOP leaders has been key to the delay in passing the next state spending plan, which was due to Walker by the end of June.

The two Republican caucuses have been unable to find a compromise in part because of Walker’s pledge not to support an increase in the gas tax, the primary source of funding for state roads and bridges. Fitzgerald has said the Senate won’t buck Walker on that pledge.

Fitzgerald, who previously said he could support a total of $850 million in road-related borrowing, said Thursday that he hopes to see that figure fall below $750 million. He said lawmakers are waiting for reassurance from the Legislative Fiscal Bureau that the numbers in Walker’s latest offer check out.

Walker’s plan relies in part on an ambitious plea for additional federal money to fix Wisconsin’s roads. The state Department of Transportation told the fiscal bureau it plans to seek a larger-than-usual $341 million in its annual request from a pot of redistributed federal transportation dollars, according to a fiscal bureau memo released Thursday by Rep. Gordon Hintz, D-Oshkosh. That’s three times more than the average over the past five years and 11 times more than it requested last year.

However, the state has only received on average $33.7 million in each of the past five years. The fiscal bureau cautioned that any expectation the state would receive additional federal funds should be tempered by the historical trend. Fitzgerald noted the average amount is already built into Walker’s budget proposal.

The federal request would include $211 million for mega-highway projects in southeast Wisconsin, though it would require $41.3 million more in state funding than is currently proposed in Walker’s budget. A prolonged delay in budget passage could also raise the risk of the state not being eligible for some of the federal funding.

Democrats: Walker’s plan not a ‘new deal’

Fitzgerald told reporters Thursday that he and senators were still reviewing Walker’s proposal. But he said it “might be one piece of what gets us through the transportation budget.”

“I’m glad people are thinking of other options,” Fitzgerald said.

Senate Republicans have been divided on the transportation revenue question.The most vocal bloc — including Fitzgerald and five other conservative senators who last week opposed an Assembly plan to start collecting a new fee on heavy trucks — say the state Department of Transportation needs to operate more efficiently within current funding constraints.

Other keys to get Senate Republicans to support the budget, Fitzgerald said, include funding for massive freeway projects in southeast Wisconsin — especially projects to rebuild and expand Interstate 94 south and west of Milwaukee.

Walker’s letter says “all active major projects remain on schedule with these additions to our proposal.” Four such projects are underway, including an expansion of Interstate 39-90 from the Madison area to the Illinois line and of Verona Road between McKee Road and Raymond Road.

The letter says the $200 million borrowing reduction can be achieved “by using an improved transportation fund balance, project cost savings, and other administrative actions.”

“This is a reasonable proposal that allows the leadership in the Assembly and Senate — as well as taxpayers — to have significant wins on our major issues,” Walker wrote.

Legislative Democrats, meanwhile, dismissed Walker’s offer. Senate Minority Leader Jennifer Shilling, D-La Crosse, accused Walker of seeking a “federal bailout” for Wisconsin’s roads.

“If I take money from my left pocket and put it in my right pocket, I still have the same amount of money,” said Assembly Minority Leader Peter Barca, D-Kenosha. “That’s what Walker is calling a ‘new deal.’ ”

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Molly Beck covers politics and state government for the Wisconsin State Journal.

Mark Sommerhauser covers state government and politics for the Wisconsin State Journal.

Matthew DeFour covers state government and politics for the Wisconsin State Journal.