I would very much appreciate your review and commentary as soon as possible. Thank you in advance for your timely assistance. Please contact me or Judy Witt of my staff (267-2116) should you require additional information.
Sincerely,
Steven D. Sell
Interim Executive Director
State of Wisconsin
Legislative Audit Bureau
January 27, 1998
The Honorable, The Legislature:
We have completed our review of the fiscal effects of replacing the sales tax on food and beverages sold through vending machines with a permit fee. As directed by
1997 Wisconsin Act 27, our review also included the feasibility of such a change and any constitutuional problems that would arise from the change.
Because vending machine sales tax revenues are not recorded separately by the Department of Revenue, the precise fiscal effect of the permit proposal cannot be determined definitely. Earlier estimates, including those made by the Legislative Fiscal Bureau, have been disputed by proponents and opponents of the proposal, who disagree strongly over the number of vending machines in Wiscosin and compliance with state tax laws. To develop new estimates of the fiscal effect, we used updated data from other states and information from Wisconsin entities concerning the number of machines in the state and annual sales per machine. Our estimates suggest the proposed fee of $65 per machine would result in a net revenue loss to the State. To be revenue neutral for the State, the permit fee would need to be increased to $123 per machine.
Our survey of Wisconsin's larger cities indicates that few would voluntarily provide local program administration for the $8 per machine administrative allowance envisioned in the proposal. However, the Department of Revenue has indicated it could provide both central and local administration and enforcement within the $8 allowance. We also note the counties that impose a local sales tax would have their receipts decrease from an average $20 per machine to $1 per machine under the proposal. To be revenue neutral for both the State and the counties, the overall cost of the permit would need to be increased beyond $123 per machine.
Based on experience in the two other states that have established similar permit systems, and on the opinion of Legislative counil staff, it appears that while opponents could challenge the constitutionality of a permit, the State's authority to establish such forms of taxation is broad. We identified no significant constitutional impediments to the Legislature enacting a vending machine permit fee.
We appreciate the courtesy and cooperation extended to us by the Department of Revenue, municipal governments, and vending machine industry representatives.
Sincerely,
Dale Cattanach
State Auditor
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State of Wisconsin
Office of the Governor
January 20, 1998
The Honorable, The Senate:
I am pleased to nominate and with the advice and consent of the Senate, do appoint Robertson, Dr. Russell G.,
of Mequon, as a member of the Rural Health Development Council, to serve for the interim term ending July 1, 2001.
Sincerely,
TOMMY G. THOMPSON
Governor
Read and referred to committee on Health, Human Services, Aging, Corrections, Veterans and Military Affairs.
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Relating to dispensing or prescribing of controlled substances for the treatment of obesity.
Submitted by Department of Regulation and Licensing.
Report received from Agency, January 26, 1998.
Referred to committee on Health, Human Services, Aging, Corrections, Veterans and Military Affairs,
January 28, 1998 .
Relating to pesticide regulation.
Submitted by Department of Agriculture, Trade and Consumer Protection.
Report received from Agency, January 23, 1998.
Referred to committee on Agriculture and Environmental Resources, January 28, 1998.
Relating to funding emergency grants under the community development block grant program.
Submitted by Department of Commerce.
Report received from Agency, January 27, 1998.
Referred to committee on Economic Development, Housing and Government Operations, January 28, 1998.
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The committee on Economic Development, Housing and Government Operations reports and recommends:
Relating to contributions from conduit accounts.
No action taken.
relating to filing campaign finance reports.
No action taken.
relating to the identification of the source of communications paid for with money raised for political purposes.
No action taken.
relating to conduit registration and reporting requirements.
No action taken.
relating to length, expiration date and fee for licenses issued to manufactured and mobile home dealers and salespersons and for registration plates issued to dealers.
No action taken.
relating to parking.
No action taken.
relating to the inspection of elevators and mechanical lifting devices.
No action taken.
relating to credentials.
No action taken.
Gwendolynne Moore
Chairperson
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State of Wisconsin
Revisor of Statutes Bureau
February 1, 1998
To the Honorable, the Senate:
The following rules have been published:
Sincerely,
GARY L. POULSON
Deputy Revisor
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By Charles Sanders, chief clerk.
Mr. President:
I am directed to inform you that the Assembly has amended and concurred in as amended:
Senate Bill 3
(Assembly amendments 2, 1 to 3, 3, 2 to 4, 4)
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Senate Enrolled Proposals
The Chief Clerk records:
Senate Bill 384
Report correctly enrolled on January 26, 1998.
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