AB513: Bill Text

AB513,1,11 An Act to amend 20.235 (1) (fe), 38.28 (1m) (a) 1., 71.06 (1p) (e), 71.06 (2) (g) 5., 71.06 (2) (h) 5., 71.06 (2e) (b), 71.09 (11) (f) and 560.205 (3) (d); and to create 20.143 (1) (cr), 20.292 (1) (cr), 38.31, 71.06 (1p) (f), 71.06 (2) (g) 6., 71.06 (2) (h) 6. and 560.147 of the statutes; relating to: the amounts appropriated for tuition grants and for Wisconsin higher education grants for University of Wisconsin system students, technical college students, and tribal college students; grants to technical college districts to reduce unemployment; grants to businesses to make capital expenditures; increasing the total amount of angel investment credits; creating a new individual income tax upper bracket; providing an exemption from emergency rule procedures; granting rule-making authority; and making appropriations.

Analysis by the Legislative Reference Bureau

Under current law, there is appropriated to the Higher Educational Aids Board (HEAB) a sum sufficient equal to $37,750,000 in the 2009-10 fiscal year and equal to $58,345,400 in the 2010-11 fiscal year for Wisconsin higher education grants for University of Wisconsin (UW) System students (WHEG-UW grants). There is also appropriated to HEAB for WHEG-UW grants in the 2009-10 fiscal year $17,250,000 in auxiliary enterprises moneys transferred to HEAB by the UW System. This bill appropriates to HEAB for WHEG-UW grants a sum sufficient equal to $43,313,900 in the 2009-10 fiscal year and equal to $69,850,200 in the 2010-11 fiscal year.

Under current law, there is appropriated to HEAB, as a biennial appropriation, $36,960,100 in the 2009-11 state fiscal biennium for Wisconsin higher education grants for technical college students (WHEG-tech grants). This bill increases the amount appropriated for WHEG-tech grants in the 2009-11 state fiscal biennium by $24,116,800 over the total amount appropriated for that purpose under current law.

Under current law, there is appropriated to HEAB, as a biennial appropriation, $893,000 in the 2009-11 state fiscal biennium for Wisconsin higher education grants for tribal college students (WHEG-tribal grants). This bill increases the amount appropriated for WHEG-tribal grants in the 2009-11 state fiscal biennium by $372,000 over the total amount appropriated for that purpose under current law.

Under current law, there is appropriated to HEAB, as a biennial appropriation, $53,208,600 in the 2009-11 state fiscal biennium for tuition grants for students attending accredited, nonprofit, post-high school educational institutions in this state. This bill increases the amount appropriated for tuition grants in the 2009-11 state fiscal biennium by $5,046,700 over the total amount appropriated for that purpose under current law.

This bill directs the Wisconsin Technical College System (WTCS) Board to award grants to technical college districts for programs that assist in reducing unemployment. To be eligible for a grant, a technical college district must meet certain eligibility criteria relating to the unemployment rate of areas within the district or recent increases in the unemployment rate of areas within the district. Grants are available for three specified purposes:

1. To recruit, enroll, instruct, provide support services to, and pay the tuition and fees of dislocated workers who enroll in the district. A dislocated worker is a person who has been laid off or terminated from employment and meets certain additional criteria; a person who was self-employed but is currently unemployed as a result of economic conditions or natural disasters; or a displaced homemaker.

2. To recruit, enroll, instruct, and provide services to adults who enroll in the district in a program leading to a certificate of general educational development (commonly referred to as a GED) or a high school equivalency diploma.

3. To expand existing capacity or create capacity in district programs for which there are student waiting lists or that address projected workforce needs in the district.

The bill authorizes the WTCS Board to modify the grant eligibility criteria and the purposes for which grants may be awarded in order to ensure the eligibility of district boards for grants awarded by the federal government for programs that improve completion rates and train workers for skilled occupations.

The bill directs the WTCS Board to give preference in awarding grants to programs that serve persons who reside in areas with the highest unemployment rates. The board must also submit annual reports to the governor and to the legislature regarding the programs that have been awarded grants.

This bill creates a new grant program in the Department of Commerce (department). Under the program, the department may award a grant to a business with operations, equipment, or facilities in an economically distressed area of the state for the purpose of making capital investments to upgrade or modernize the operations, facilities, or equipment of the business if the capital investments will result in the retention or creation of jobs. The bill defines an "economically distressed area" as any of the following:

1. A county, city, or micropolitan statistical area with an unemployment rate of at least 6 percent in two or more months during the 12 months preceding the date of the grant application.

2. A county, city, or micropolitan statistical area with an average unemployment rate equal to at least 120 percent of the statewide average unemployment rate during the 12 months preceding the date of the grant application.

3. A county, city, or micropolitan statistical area with an unemployment rate that has increased by at least 2 percent during the 12 months preceding the date of the grant application.

The department is to award grants on a competitive basis, and to give priority to businesses that have established or propose to establish a partnership with a technical college district board for the purpose of providing skill training or retraining to meet the specific workforce needs of that business.

Under current law, the total amount of angel investment tax credits that taxpayers may claim is $5,500,000 in 2010 and $18,000,000 in each year thereafter. Under the bill, the total amount of angel investment tax credits that taxpayers may claim is $7,500,000 in 2010 and $20,000,000 in each year thereafter.

Under current law, there are five income tax brackets for single individuals, certain fiduciaries, heads of households, and married persons. The brackets are indexed for inflation. The rate of taxation under current law for the lowest bracket for single individuals, certain fiduciaries, heads of households, and married persons is 4.6 percent of taxable income; the rate for the second bracket is 6.15 percent; the rate for the third bracket is 6.5 percent; the rate for the fourth bracket is 6.75 percent; and the rate for the highest bracket, which was created in the budget bill, 2009 Wisconsin Act 28, is 7.75 percent.

Currently, the highest bracket applies to taxable income exceeding $225,000 for single individuals, certain fiduciaries, and heads of households. For married persons, the highest current bracket applies to taxable income exceeding $300,000 for joint filers and $150,000 for separate filers.

This bill creates a sixth bracket with a taxation rate of 8.75 percent. For single individuals, certain fiduciaries, and heads of households, this bracket applies to taxable income exceeding $750,000. For married persons, this bracket applies to taxable income exceeding $1,000,000 for joint filers and $500,000 for separate filers. This bracket is indexed for inflation starting with taxable year 2010, and first applies to taxable years beginning on January 1, 2009.

For further information see the state and local fiscal estimate, which will be printed as an appendix to this bill.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

AB513, s. 1 Section 1. 20.005 (3) (schedule) of the statutes: at the appropriate place, insert the following amounts for the purposes indicated: - See PDF for table

AB513, s. 2 Section 2. 20.143 (1) (cr) of the statutes is created to read:

AB513,4,5 20.143 (1) (cr) Grants for business retooling and retention. Biennially, the amounts in the schedule for grants under s. 560.147.

AB513, s. 3 Section 3. 20.235 (1) (fe) of the statutes, as affected by 2009 Wisconsin Act 28, is amended to read:

AB513,5,2 20.235 (1) (fe) Wisconsin higher education grants; University of Wisconsin System students. A sum sufficient equal to $37,750,000 $43,313,900 in the 2009-10 fiscal year, equal to $58,345,400 $69,850,200 in the 2010-11 fiscal year, and equal to the amount calculated under s. 39.435 (7) for the Wisconsin higher education grant program under s. 39.435 for University of Wisconsin System students, except for grants awarded under s. 39.435 (2) or (5), thereafter.

AB513, s. 4 Section 4. 20.292 (1) (cr) of the statutes is created to read:

AB513,5,5 20.292 (1) (cr) Grants to reduce unemployment. The amounts in the schedule for grants to technical college districts to reduce unemployment under s. 38.31.

AB513, s. 5 Section 5. 38.28 (1m) (a) 1. of the statutes is amended to read:

AB513,5,15 38.28 (1m) (a) 1. "District aidable cost" means the annual cost of operating a technical college district, including debt service charges for district bonds and promissory notes for building programs or capital equipment, but excluding all expenditures relating to auxiliary enterprises and community service programs, all expenditures funded by or reimbursed with federal revenues, all receipts under sub. (6) and ss. 38.12 (9), 38.14 (3) and (9), 118.15 (2) (a), and 118.55 (7r), all receipts from grants awarded under ss. 38.04 (8), (20), (28), and (31), 38.14 (11), 38.26, 38.27, 38.31, 38.33, and 38.38, all fees collected under s. 38.24, and driver education and chauffeur training aids.

AB513, s. 6 Section 6. 38.31 of the statutes is created to read:

AB513,5,17 38.31 Grants to reduce unemployment. (1) Definitions. In this section:

AB513,5,18 (a) "Dislocated worker" has the meaning given in 29 USC 2801 (9).

AB513,5,21 (b) "Micropolitan statistical area" means a geographic area defined by the federal office of management and budget for use by federal agencies in collecting, tabulating, and publishing federal statistics.

AB513,5,23 (2) Eligibility criteria. (a) Subject to par. (b) and sub. (6), a district board is eligible for a grant under this section if it meets one or more of the following criteria:

AB513,6,3 1. The district includes a county, city, or micropolitan statistical area with an unemployment rate of at least 6 percent in 2 or more months during the 12 months preceding the date of the grant application

AB513,6,7 2. The district includes a county, city, or micropolitan statistical area with an average unemployment rate equal to at least 120 percent of the statewide average unemployment rate during the 12 months preceding the date of the grant application.

AB513,6,10 3. The district includes a county, city, or micropolitan statistical area with an unemployment rate that has increased by at least 2 percent during the 12 months preceding the date of the grant application.

AB513,6,13 (b) The board may not award a grant to a district board under this section unless the district board demonstrates how the grant will serve the area or areas that established the eligibility of the district board for a grant under par. (a).

AB513,6,15 (3) Grants. Subject to sub. (6), the board shall award grants to eligible district boards for the following purposes:

AB513,6,19 (a) To recruit, enroll, instruct, provide support services to, and pay the tuition and fees of dislocated workers who enroll in the district in an associate degree program, collegiate transfer program, vocational diploma program, or vocational-adult program.

AB513,6,22 (b) To recruit, enroll, instruct, and provide support services to adults who enroll in the district in a program leading to a certificate of general educational development or a high school equivalency diploma.

AB513,6,25 (c) To expand existing capacity or create capacity in district board programs for which there are student waiting lists or that address projected workforce needs in the district.

AB513,7,3 (4) Preference. The board shall give preference in awarding grants under this section to district boards serving persons residing in areas with the highest unemployment rates.

AB513,7,7 (5) Limitation on use of funds. A district board may not use a grant awarded under this section to pay any portion of tuition that would otherwise be paid for by a tuition remission, tuition waiver, tuition reimbursement, or any other state or state or federal financial aid program.

AB513,7,12 (6) Compliance with federal law. The board may modify the eligibility criteria under sub. (2) and the purposes for which grants may be awarded under sub. (3) in order to ensure the eligibility of district boards for grants awarded by the federal government for programs that improve completion rates and train workers for skilled occupations.

AB513,7,15 (7) Report. (a) By January 15, 2011, and annually thereafter, the board shall submit a report to the governor and to the legislature under s. 13.172 (2). The report shall include all of the following:

AB513,7,17 1. The district boards awarded grants under this section and how they used the funds.

AB513,7,18 2. The rates of unemployment in the areas in which the grants were disbursed.

AB513,7,24 3. The number of people who were assisted with each grant awarded, the technical college programs in which they enrolled, the number of people who completed such programs, the number of people who found employment in the district and elsewhere upon completing such programs and their annual salaries, and the tax revenue generated as a result, as estimated by the department of revenue.

AB513,8,2 (b) Beginning with the report submitted in 2012, the board shall include longitudinal data.

AB513,8,4 (8) Rules. The board shall promulgate rules to implement and administer this section.

AB513, s. 7 Section 7. 71.06 (1p) (e) of the statutes, as created by 2009 Wisconsin Act 28, is amended to read:

AB513,8,8 71.06 (1p) (e) On all taxable income exceeding $225,000 but not exceeding $750,000, 7.75 percent.

AB513, s. 8 Section 8. 71.06 (1p) (f) of the statutes is created to read:

AB513,8,10 71.06 (1p) (f) On all taxable income exceeding $750,000, 8.75 percent.

AB513, s. 9 Section 9. 71.06 (2) (g) 5. of the statutes, as created by 2009 Wisconsin Act 28, is amended to read:

AB513,8,14 71.06 (2) (g) 5. On all taxable income exceeding $300,000 but not exceeding $1,000,000, 7.75 percent.

AB513, s. 10 Section 10. 71.06 (2) (g) 6. of the statutes is created to read:

AB513,8,16 71.06 (2) (g) 6. On all taxable income exceeding $1,000,000, 8.75 percent.

AB513, s. 11 Section 11. 71.06 (2) (h) 5. of the statutes, as created by 2009 Wisconsin Act 28, is amended to read:

AB513,8,20 71.06 (2) (h) 5. On all taxable income exceeding $150,000 but not exceeding $500,000, 7.75 percent.

AB513, s. 12 Section 12. 71.06 (2) (h) 6. of the statutes is created to read:

AB513,8,22 71.06 (2) (h) 6. On all taxable income exceeding $500,000, 8.75 percent.

AB513, s. 13 Section 13. 71.06 (2e) (b) of the statutes, as created by 2009 Wisconsin Act 28, is amended to read:

AB513,9,17 71.06 (2e) (b) For taxable years beginning after December 31, 2009, the maximum dollar amount in each tax bracket, and the corresponding minimum dollar amount in the next bracket, under subs. (1p) (d) and (e) and (2) (g) 4. and 5. and (h) 4. and 5., and the dollar amount in the top bracket under subs. (1p) (e) (f) and (2) (g) 5. 6. and (h) 5. 6., shall be increased each year by a percentage equal to the percentage change between the U.S. consumer price index for all urban consumers, U.S. city average, for the month of August of the previous year and the U.S. consumer price index for all urban consumers, U.S. city average, for the month of August 2008, as determined by the federal department of labor, except that for taxable years beginning after December 31, 2011, the adjustment may occur only if the resulting amount is greater than the corresponding amount that was calculated for the previous year. Each amount that is revised under this paragraph shall be rounded to the nearest multiple of $10 if the revised amount is not a multiple of $10 or, if the revised amount is a multiple of $5, such an amount shall be increased to the next higher multiple of $10. The department of revenue shall annually adjust the changes in dollar amounts required under this paragraph and incorporate the changes into the income tax forms and instructions.

AB513, s. 14 Section 14. 71.09 (11) (f) of the statutes, as created by 2009 Wisconsin Act 28, is amended to read:

AB513,9,23 71.09 (11) (f) The taxpayer has underpaid the taxpayer's estimated taxes due to the change in brackets under s. 71.06 (1p) (e) or (f) and (2) (g) 5. or 6. and (h) 5. or 6. This paragraph applies only in the first taxable year to which these bracket changes apply.

AB513, s. 15 Section 15. 560.147 of the statutes is created to read:

AB513,9,25 560.147 Grants for business retooling and retention. (1) In this section:

AB513,10,1 (a) "Economically distressed area" means any of the following:

AB513,10,4 1. A county, city, or micropolitan statistical area with an unemployment rate of at least 6 percent in 2 or more months during the 12 months preceding the date of the grant application.

AB513,10,8 2. A county, city, or micropolitan statistical area with an average unemployment rate equal to at least 120 percent of the statewide average unemployment rate during the 12 months preceding the date of the grant application.

AB513,10,11 3. A county, city, or micropolitan statistical area with an unemployment rate that has increased by at least 2 percent during the 12 months preceding the date of the grant application.

AB513,10,14 (b) "Micropolitan statistical area" means a geographic area defined by the federal office of management and budget for use by federal agencies in collecting, tabulating, and publishing federal statistics.

AB513,10,18 (2) (a) From the appropriation under s. 20.143 (1) (cr), the department may award a grant to a business that applies to the department under this section for capital investments to upgrade or modernize the operations, facilities, or equipment of the business if all of the following are satisfied:

AB513,10,20 1. The operations, facilities, or equipment of the business are located in an economically distressed area of this state.

AB513,10,22 2. The business demonstrates to the satisfaction of the department that the capital investments will result in the retention or creation of jobs.

AB513,11,2 (b) The department shall award grants on a competitive basis and shall give priority to a business that has established or that proposes to establish a partnership with a technical college district board for the purpose of providing skill training or retraining to meet the specific workforce needs of that business.

AB513,11,7 (3) The department shall promulgate rules to implement and administer this section. The rules under this subsection shall include limits on the amount of a grant to be awarded under this section to ensure that grant moneys are distributed to as many eligible businesses as possible and will result in the retention or creation of as many jobs as possible.

AB513, s. 16 Section 16. 560.205 (3) (d) of the statutes, as affected by 2009 Wisconsin Act 2, is amended to read:

AB513,12,9 560.205 (3) (d) Rules. The department of commerce, in consultation with the department of revenue, shall promulgate rules to administer this section. The rules shall further define "bona fide angel investment" for purposes of s. 71.07 (5d) (a) 1. The rules shall limit the aggregate amount of tax credits under s. 71.07 (5d) that may be claimed for investments in businesses certified under sub. (1) at $3,000,000 per calendar year for calendar years beginning after December 31, 2004, and before January 1, 2008, $5,500,000 per calendar year for calendar years beginning after December 31, 2007, and before January 1, 2010, $7,500,000 per calendar year for calendar years beginning after December 31, 2009, and before January 1, 2011, and $18,000,000 $20,000,000 per calendar year for calendar years beginning after December 31, 2010, plus, for taxable years beginning after December 31, 2010, an additional $250,000 for tax credits that may be claimed for investments in nanotechnology businesses certified under sub. (1). The rules shall also limit the aggregate amount of the tax credits under ss. 71.07 (5b), 71.28 (5b), 71.47 (5b), and 76.638 that may be claimed for investments paid to fund managers certified under sub. (2) at $3,500,000 per calendar year for calendar years beginning after December 31, 2004, and before January 1, 2008, $6,000,000 per calendar year for calendar years beginning after December 31, 2007, and before January 1, 2011, and $18,500,000 per calendar year for calendar years beginning after December 31, 2010, plus, for taxable years beginning after December 31, 2010, an additional $250,000 for tax credits that may be claimed for investments in nanotechnology businesses certified under sub. (1). The rules shall also provide that, for calendar years beginning after December 31, 2007, no person may receive a credit under ss. 71.07 (5b) and (5d), 71.28 (5b), 71.47 (5b), or 76.638 unless the person's investment is kept in a certified business, or with a certified fund manager, for no less than 3 years.

AB513, s. 9110 Section 9110. Nonstatutory provisions; Commerce.

AB513,12,11 (1) Rule making.