LRBs0284/1
MPG:ahe&amn
January 2018 Special Session
2017 - 2018 LEGISLATURE
ASSEMBLY SUBSTITUTE AMENDMENT 1,
TO ASSEMBLY BILL 7
February 8, 2018 - Offered by Joint Committee on Finance.
AB7-ASA1,1,2 1An Act to create 16.298 and 20.505 (1) (kp) of the statutes; relating to: pay for
2success contracting and making an appropriation.
Analysis by the Legislative Reference Bureau
This substitute amendment authorizes the Department of Administration to
contract with a private service provider for payments to provide social, employment,
or correctional services to individuals.
DOA may not execute a contract under the substitute amendment unless DOA
determines that the contract is expected to result in significant performance
improvements or significant budgetary savings for the state if the contract objectives
are achieved. Additionally, each contract under the substitute amendment is subject
to approval by the Joint Committee on Finance and must include all of the following:
1. A requirement that a majority of the total contract payment must be
conditioned on the service provider achieving certain performance measures
specified in the contract toward the outcome of the contract objectives.
2. A defined objective procedure by which an independent evaluator is required
to determine whether the performance measures have been achieved.
3. A schedule of the amounts and timing of payments to be earned by the service
provider during each year or other specified period of the contract.
The substitute amendment also requires the Departments of Health Services,
Corrections, Children and Families, and Workforce Development to submit, after
study, reports to the legislature concerning the programs those departments

administer and advise whether and how the kind of contracting provided for under
the substitute amendment could be utilized as an alternative to current funding
models for those agencies' provision of program services.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB7-ASA1,1 1Section 1 . 16.298 of the statutes is created to read:
AB7-ASA1,2,2 216.298 Pay for success contracting. (1) Definitions. In this section:
AB7-ASA1,2,63 (a) “Eligible services” means social, employment, or correctional services, as
4determined by the department in conjunction with the department of health
5services, department of corrections, department of children and families,
6department of workforce development, or other state agency, as appropriate.
AB7-ASA1,2,77 (b) “Pay for success contract” means a contract authorized under sub. (2) (a).
AB7-ASA1,2,98 (c) “Service provider” means a private organization, whether operated for profit
9or not for profit, that provides eligible services to individuals.
AB7-ASA1,2,1410 (d) “State agency” means any office, department, agency, institution of higher
11education, association, society, or other body in state government that is created or
12authorized to be created by the constitution or any law and is entitled to expend
13moneys appropriated by law, including any authority, but not including the
14legislature or the courts.
AB7-ASA1,2,17 15(2) Contract execution. (a) The department may contract, including jointly
16with another state agency, with a service provider for the payment of moneys to the
17service provider for the provision of eligible services to individuals.
AB7-ASA1,2,1818 (b) Each pay for success contract shall provide all of the following:
AB7-ASA1,3,3
11. That a majority of the total contract payment is conditioned on the service
2provider achieving performance measures, as specified in the contract, toward the
3outcome of the contract objectives.
AB7-ASA1,3,64 2. A defined objective procedure by which an independent evaluator is required
5to determine whether the performance measures specified under subd. 1. have been
6achieved.
AB7-ASA1,3,87 3. A schedule of the amounts and timing of payments to be earned by the service
8provider during each year or other specified period of the contract.
AB7-ASA1,3,109 (c) For each pay for success contract, the department may not execute the
10contract unless all of the following occur first:
AB7-ASA1,3,1311 1. The department determines that the contract is expected to result in
12significant performance improvements or significant budgetary savings for the state
13if the contract objectives specified in the proposed contract are achieved.
AB7-ASA1,4,214 2. The department notifies the joint committee on finance in writing of the
15proposed contract. The notification shall describe in detail the department's
16proposal for the contract and shall identify all appropriations from which the
17department proposes to transfers moneys to the appropriation under s. 20.505 (1)
18(kp) and the amounts the department proposes to transfer. If the cochairpersons of
19the committee do not notify the department within 14 working days after the date
20of the department's notification that the committee has scheduled a meeting for the
21purpose of reviewing the proposed contract, the department may execute the
22contract as proposed in its notification, and the secretary may make each proposed
23transfer. If, within 14 working days after the date of the department's notification,
24the cochairpersons of the committee notify the department that the committee has
25scheduled a meeting for the purpose of reviewing the proposed contract, the

1department may execute the contract and the secretary may transfer moneys to the
2appropriation under s. 20.505 (1) (kp) only with the approval of the committee.
AB7-ASA1,4,5 3(3) Contract payments. (a) For each pay for success contract, from the
4appropriation under s. 20.505 (1) (kp), the department shall make payments under
5sub. (2) (b) 3. subject to the contract terms.
AB7-ASA1,4,86 (b) For each pay for success contract, the secretary shall transfer the following
7moneys, if any, from the appropriation under s. 20.505 (1) (kp) to the appropriation
8from which the moneys were transferred under sub. (2) (c) 2.:
AB7-ASA1,4,119 1. If the contract is terminated or otherwise expires, an amount equal to the
10amount transferred to the appropriation under s. 20.505 (1) (kp) but not expended
11under the contract.
AB7-ASA1,4,1412 2. Any amount the department recovers from a service provider for
13overpayment under the contract and any amount the department otherwise recovers
14under the terms of the contract.
AB7-ASA1,4,19 15(4) Reports. (a) Upon completion of each pay for success contract, the
16department shall submit a report to the joint committee on finance and the
17appropriate standing committees of the legislature under s. 13.172 (3) that describes
18in detail the performance measures specified for the contract under sub. (2) (b) 1. and
19the extent to which those performance measures were achieved.
AB7-ASA1,4,2420 (b) Upon completion of each pay for success contract under which another state
21agency jointly contracts with the department under sub. (2) (a), the other state
22agency shall submit to the joint committee on finance and the appropriate standing
23committees of the legislature under s. 13.172 (3) a report that describes in detail the
24outcomes of the contract.
AB7-ASA1,5,2
1(5) Purchasing exemption. A contract is subject to ss. 16.753 and 16.765, but
2is otherwise exempt from subch. IV.
AB7-ASA1,2 3Section 2 . 20.505 (1) (kp) of the statutes is created to read:
AB7-ASA1,5,64 20.505 (1) (kp) Pay for success contracts. All moneys transferred under s.
516.298 (2) (c) 2. for the purpose of administering contracts under s. 16.298 and
6making contract payments under s. 16.298 (3) (a).
AB7-ASA1,3 7Section 3 . Nonstatutory provisions.
AB7-ASA1,5,158 (1) Agency studies and reports. The departments of health services,
9corrections, children and families, and workforce development shall each conduct a
10study of the programs it administers to determine whether and how pay for success
11contracting under section 16.298 of the statutes could be utilized as an alternative
12to current funding models for the provision of services under the programs. Each of
13those departments shall submit to the joint committee on finance and the
14appropriate standing committees of the legislature under section 13.172 (3) of the
15statutes a report that details its findings from the study.
AB7-ASA1,5,1616 (End)
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