Budget Change Items
1. STANDARD BUDGET ADJUSTMENTS
GPR $135,700
PR - 20,800
Total $114,900
Governor: Provide adjustments totaling $67,400 GPR and -$10,400 PR in 1999-00 and $68,300 GPR and -$10,400 PR in 2000-01 for: (a) removal of non-continuing elements from the base (-$10,400 PR annually); (b) full funding of salary and fringe benefit costs ($52,000 GPR annually); (c) full funding of financial services charges ($300 GPR annually); (d) reclassifications ($9,900 GPR annually); (e) fifth week of vacation as cash ($3,900 GPR in 1999-00 and $4,800 GPR in 2000-01); and (f) full funding of lease costs ($1,300 GPR annually).
2. INCREASED FUNDING FOR WECF
GPR $750,000
Governor: Provide $750,000 GPR in 2000-01 to be transferred on September 1, 2000, to the legislative campaign account of Wisconsin Election Campaign Fund (WECF). A new GPR appropriation would be created for this purpose. Currently, legislative candidates, as well as candidates for statewide offices, are eligible for grants from the WECF, which is funded by monies directed through a $1 taxpayer designation on state individual income tax returns ($2 for joint returns) to the WECF.
[Bill Sections: 589 and 706]
3. INFORMATION TECHNOLOGY CONTRACTUAL STAFF
GPR $62,400
Governor: Provide $31,200 GPR annually to fund a computer programming support contract for the Elections Board information system software which includes allowing the filing of campaign finance reports in an electronic format. The request assumes the purchase of 520 hours of contract programming support annually at $60 per hour for technical support in the event of software failures and for future software design and access issues. Current law requires any registrant who accepts contributions or makes distributions of $20,000, or more, during a campaign period to file required campaign finance reports in an electronic format after June 30, 1999.
4. DRAFTING INSTRUCTIONS: LEGISLATION FOR CAMPAIGN FINANCE REFORM
Governor: Create session law language, to be retroactively effective on February 28, 1999, requiring the Legislative Reference Bureau to prepare draft legislation relating to campaign finance reform and the composition of the state Elections Board. DOA would be required to submit final instructions for drafting of this legislation no later than March 1, 1999, and the Secretary of DOA would be required to submit the proposed legislation to the Co-chairs of the Joint Committee on Finance no later than April 1, 1999. (The date requirements in this language will have passed before the budget bill itself becomes law.)
[Bill Sections: 9158(6) and 9414(1)]
EMPLOYE TRUST FUNDS
Budget Change Items
1. STANDARD BUDGET ADJUSTMENTS
Funding Positions
SEG $20,900 - 3.00
Governor: Provide $7,800 in 1999-00 and $13,100 in 2000-01 and -3.0 positions for standard budget adjustments for: (a) turnover reduction (-$192,400 annually); (b) removal of noncontinuing elements from the base (-$247,200 and -3.0 positions annually) (c) full funding of continuing salaries and fringe benefits ($238,500 annually); (d) full funding of financial services charges ($118,100 annually); (e) overtime ($45,900 annually); and (f) fifth week of vacation as cash ($44,900 in 1999-00 and $50,200 in 2000-01).
2. RETIRED EMPLOYES BENEFIT SUPPLEMENT REESTIMATE
GPR - $3,554,600
Governor: Reduce the base level funding estimate for benefit supplements for retirees who first began receiving annuities prior to October 1, 1974, by $1,306,900 in 1999-00 and $2,247,700 in 2000-01. These supplements were authorized primarily by Chapter 337, Laws of 1973, and 1983 Wisconsin Act 394, as further affected by the 1997 Wisconsin Supreme Court ruling on the special investment performance dividend lawsuit. The reestimate is due to a declining number of retirees eligible for these supplements due to deaths. Current base level funding for the appropriation is $6,810,500.
3. ANNUITY PAYMENT SYSTEM REDESIGN
Funding Positions
SEG $805,600 2.50
Governor: Provide $370,400 in 1999-00 and $435,200 in 2000-01 and authorize 2.5 two-year project positions to enable ETF to redesign its current Wisconsin Retirement System (WRS) annuity payment system. The system generates monthly retirement checks, computes withholding and deduction amounts and compiles year-end tax payment reports. The purpose of the redesign would be to: (a) enhance on-line access through ETF's participant data (WEBS) to annuity payment data; (b) improve data maintenance and updating capabilities; and (c) integrate these annuity payment functions into both the agency’s electronic image and workflow system and its interactive voice response (IVR) system. The recommended funding would be used as follows: (a) one-time financing of $296,400 in 1999-00 and $336,500 in 2000-01 for contract programming assistance; and (b) $74,000 in 1999-00 and $98,700 in 2000-01 for salary, fringe benefit and support costs for the 2.5 project positions to support reassignment of in-house permanent staff to assist in project analysis, design and development activities. Existing IT staff would also be assigned to the project to assist in IT analysis and programming activities. This recommendation represents phase 1 (design, construction and testing of the new annuity payment system) of the project. Funding for phase 2 (conversion and final implementation) would be requested in the next biennium.
4. CUSTOMER SERVICE CALL CENTER
Funding Positions
SEG $773,900 2.00
Governor: Provide $584,100 in 1999-00 and $189,800 in 2000-01 and authorize 1.0 two-year project position, 2.0 one-year project positions (1999-00 only) and 1.0 permanent position for enhancements in the agency's ability to handle WRS participant and employer inquiries for the establishment of a customer service call center. (The Executive Budget Book references all the positions as being project positions.)
The proposed center would be designed to ultimately provide a single telecommunications unit within ETF to address the customer (WRS participants or employers) service inquiry requirements of the both the member services and employer administration bureaus within ETF. As a part of this proposal, ETF would internally reallocate 6.0 staff (five trust funds specialists and one trust funds supervisor) to this new center, in addition to the recommended additional staff. In addition to having staff dedicated solely to call center duties, the proposed center would have enhanced hardware and software for the handling of customer inquiries, including: (a) an automated call center server which would automatically route calls to appropriate accessible data bases or networks; (b) enhancements to ETF's existing IVR (interactive voice response) phone system; and (c) computer software which would serve to further automate the inquiry response process in the center. The goal of the call center would be to develop the capability to respond to 85% of WRS participants' and employers' telephone inquiries within two minutes by fiscal year 2000-01.
The recommended funding would be for: (a) one-time funding for enhancements to the agency’s existing integrated voice response system, a new call center server and associated software purchases ($365,500 in 1999-00); (b) one-time funding for contractor assistance for installation of the new system ($80,000 annually); (c) agency administrative and staff expenses ($104,900 in 1999-00 and $70,500 in 2000-01); and (d) on-going maintenance and software licensing costs ($33,700 in 1999-00 and $39,300 in 2000-01). This funding would be for the first two phases of a proposed three phase implementation. Funds for phase three would be requested in the next biennium.
5. CREDITABLE SERVICE PROJECT
Funding Positions
SEG $210,000 3.00
Governor: Provide $105,000 annually and authorize the extension of 3.0 project positions for an additional two-year period to continue project staff resources for an on-going, court-ordered review of certain active participant and annuitant accounts. ETF is in the process of reviewing an estimated 37,000 files of certain active and retired teachers who may be entitled to additional years of creditable service as a result of two recent Wisconsin courts (Wisconsin Court of Appeals and Dane County Circuit Court) rulings. These decisions found that ETF had incorrectly calculated the amount of service credits granted to certain school teacher participants who had originally been members of the former State Teachers Retirement System between July 1, 1957, and September 1, 1965, but had separated from service and withdrawn their retirement contributions and then later had returned to covered service. Under the court rulings, all affected annuitants who have retired since December 13, 1984, as well as all active participants who had service during the relevant time period, must have their creditable service calculations reviewed for possible correction. ETF was provided with 3.0 two-year project positions during the 1997-99 biennium to begin these reviews. Due to delays, ETF estimates that only some 4,500 potentially affected files will have been reviewed by June 30, 1999.
6. DUTY DISABILITY WORKLOAD
Funding Positions
SEG $121,100 2.00
Governor: Provide $51,900 in 1999-00 and $69,200 in 2000-01 and authorize 1.0 permanent position and 1.0 two-year project position for staff resources to continue ETF’s review of s. 40.65 duty disability benefit determinations and to meet expected workload increases in the duty disability program. A recent Wisconsin Supreme Court ruling required the establishment of new procedures for determining the amount of duty disability benefits. A portion of the funding ($25,900 in 1999-00 and $34,600 in 2000-01) and the project position would be used to complete the agency’s review of 670 existing duty disability benefit files. In June, 1998, the Joint Committee on Finance provided 2.0 one-year project positions to address backlog in current s. 40.65, duty disability benefit file reviews. The agency expects to have about half of these files reviewed by June 30, 1999. The remaining funding ($26,000 in 1999-00 and $34,600 in 2000-01) and the new permanent position would be used to address a growing workload of duty disability and disability benefit requests from protective and nonprotective WRS participants, respectively.
7. DOJ LEGAL SERVICES COSTS
SEG $109,000
Governor: Provide $54,500 annually to fund the increased costs of legal services billings from the Department of Justice. Under s. 40.03(3) of the statutes, DOJ is required to furnish legal counsel to ETF to defend the agency or its boards and employes in any legal actions.
8. MAILING COST INCREASES
SEG $61,000
Governor: Provide $29,600 in 1999-00 and $31,400 in 2000-01 to fund postage and service charge cost increases and projected volume increases associated with mailing of agency forms, bulletins, and publications.
9. FUNDING OF OUTSIDE LEGAL COUNSEL
Governor: Modify current law to allow ETF to charge the costs of any legal services independent contractors selected by the ETF Board directly against the investment earnings of the appropriate benefit plan or retirement trust fund receiving the services. As a result of this modification, the costs of these legal services would be paid from an off-budget appropriation account rather than from the agency's general operations appropriation where such costs must be appropriated by the Legislature. Currently, only the costs of investing the assets of the retirement system's benefit plans may be paid from this off-budget account.
[Bill Section: 939]
10. USE OF ACCUMULATED SICK LEAVE CONVERSION CREDITS (ASLCC)
Governor: Authorize certain state employes who either are currently circuit court judges, court reporters or assistant court reporters but who were county employes before August 1, 1978, or who are currently district attorneys or assistant district attorneys but who were county employes before January 1, 1990, and are persons who elected to retain their original county-provided health insurance coverage upon becoming state employes, to use any state accumulated sick leave credits for post-retirement health insurance coverage offered either through the Group Insurance Board or through such county health insurance programs. Specify that the credits could not be used to pay for individual health insurance coverage provided outside of the state group insurance or county health insurance plan.
Stipulate that the use of such credits for county-provided post-retirement health insurance coverage would be limited to the extent provided by new ETF rules. These rules would have to ensure that the affected annuitants do not have constructive receipt of any of the sick leave conversion credits, as governed by s. 106 of the Internal Revenue Code.
Under the language, the rules could also provide for the payment of sick leave conversion credits for other unspecified health insurance plans offered either by the Group Insurance Board or a county health insurance program.
In general, the current ASLCC program permits the unlimited accumulation of unused sick leave from year to year by state employes and authorizes the conversion of these accumulated sick leave hours upon retirement, at the employe’s final hourly base rate of pay, into credits used to pay for the cost of the retiree’s state group health insurance premiums. Currently, ASLCC post-retirement coverage is available only for health insurance coverage that is offered through providers that contract with the Group Insurance Board or the state's self-insured standard health insurance plan.
[Bill Sections: 933, 934 and 938]
11. PROTECTIVE SERVICE STATUS FOR DIVISION OF STATE PATROL ADMINISTRATOR
Governor: Newly include, as a protective occupation participant under the WRS, any authorized unclassified position in DOT, the occupant of which is functioning as the Administrator of the Division of State Patrol provided the Administrator is certified as a law enforcement officer by the Law Enforcement Standards Board. Specify that this provision would take effect on January 1, 2000. Retitle all state patrol members who are protective occupation WRS participants as "state traffic patrol" participants and create new language specifying that a member of the state traffic patrol includes the Division Administrator participant.
Under current law, WRS participants are deemed protective occupation participants if they are involved in active law enforcement or active fire suppression and are involved in duties that expose them to a high degree of danger or peril and require a high degree of physical conditioning. Notwithstanding these general requirements for designation as a protective participant under the WRS, the statutes also enumerate a number of specific occupations that are deemed to be protective category WRS participants. Under the Governor's recommendation, the Administrator of the Division of State Patrol would be classified as a protective occupation participant separately enumerated in this manner.
As a result of newly designating the Administrator of the Division of State Patrol as a protective category employe under the WRS, a qualified individual holding this position would be eligible for: (a) early retirement at age 50 [rather than at age 55 for other WRS participants]; (b) normal retirement at age 54, or a age 53 after twenty-five years of service [rather than age 65 for general participants or age 62 for state elected or appointed participants]; and (c) coverage under the s. 40.65 duty disability program.
[Bill Sections: 935, 936, 2031, 2032 and 9450(3)]
12. INTEREST PAYMENTS ON WRS REFUNDS AND UNDERPAYMENTS
Governor: Repeal the current law prohibition barring ETF from paying interest on WRS refunds or credits of monies incorrectly paid to the WRS. Instead, authorize ETF to include interest on WRS refunds or credits, pursuant to rules promulgated by the Department. Under current law, ETF issues refunds to employee participants or credits to the employer accounts for monies that are paid into the retirement system: (a) by or on behalf of persons who are not WRS participants; and (b) in excess of annual contribution maximums established by the federal Internal Revenue Code.
Also, repeal the current law requirement that where a WRS annuity underpayment exceeds certain dollar amount thresholds [currently $66.60 for lump sum payments and $2 per month on monthly annuities] and has not been corrected for at least 12 months, ETF must pay interest on the underpayment at a rate of 0.4% for each full month during which the underpayment occurred. Specify instead that ETF shall pay interest on an underpayment at a rate of interest established by the Department by rule.
Provide that these revised provisions regarding interest payments on refunds, credits and underpayments would take effect on June 30, 2000, and would first apply to refunds, credits and annuity payments occurring on and after the effective date.
