S354
I am vetoing this provision because it will have an adverse affect on the department. Every other state agency that must reduce general purpose revenue funding in state operations may request to reallocate its reduction to any other general purpose revenue appropriation for state operations within the agency. It is inequitable to prohibit the Department of Military Affairs from requesting to reduce general purpose revenue in the Badger Challenge Program when other state agencies are not restricted in such a manner.
REGULATION AND LICENSING
33.
Regulation of Closing Agents
Sections 3579c, 3608cg, 3608cm, 3608cr, 3608dg, 3608dq, 3608dr, 3608eg, 3608em, 3608er, 3608fg, 3608fm,3608fr, 3608gg, 3608gm, 3608gr, 3608hg, 3608hm, 3608hr, 3608ig, 3608im, 3608ir, 3608jg, 3608jm, 3608jr, 3608kg, 3608km, 3608kr, 3608Lg and 9443 (3km)
These provisions newly regulate real estate closing agents and require that all trust accounts used by closing agents be interest-bearing. The interest earned by these trust accounts would be transferred to the Department of Administration to provide grants to alleviate homelessness.
I am vetoing these provisions in their entirety because the licensing requirements do not respond to a demonstrated need and will add little additional protection for consumers.
34.
Regulation of Cemeteries
Sections 395 [as it relates to 20.165 (1) (q)], 465p, 1104p, 1144m, 2077, 2093, 2100m, 2852bb, 2852bf, 2852bj, 2852bL, 2852bn, 2852bp, 2852br, 2852bt, 2852bx, 2852da, 2852dc, 2852de, 2852dk, 2852dm, 2852ds, 2852dt, 2852dy, 2852fb, 2852fd, 2852fh, 2852fj, 2852fL, 2852fn, 2852fp, 2852fr, 2852ft, 2852fu, 2852fw, 2852fx, 2852gb, 2852hb, 2852jd, 2852jf, 2852jh, 2852jj, 2852jL, 2852jn, 2852jp, 2852jr, 2852jt, 2852jv, 2852jx, 2852jy, 2852jz, 2852Lb, 2852Ld, 2852Lf, 2852Lh, 2852Lj, 2852LL, 2852Ln, 2852Lp, 2852Lt, 2852ob, 2852obm, 2852oc, 2852od, 2852oh, 2852of, 2852og, 2852oj, 2852ok, 2852oL, 2852on, 2852op, 2852or, 2852ot, 2852ov, 2852ox, 2852oz, 2852pb, 2852pd, 2852pf, 2852ph, 2852pj, 2852pL, 2852pn, 2852pp, 2852pr, 2852pt, 2852pv, 2852px, 2852pz, 2852qb, 2852qd, 2852qf, 2852qh, 2852qhk, 2852qhL, 2852qj, 2852qL, 2852qn, 2852qp, 2852qr, 2852qt, 2852qv, 2852se, 2852sh, 2852si, 2852sj, 2852sk, 2852sL, 2852sm, 2852sn, 2852snb, 2852so, 2852sp, 2852sq, 2852sr, 2852ss, 2852st, 2852sv, 2852sx, 2852sz, 2852w, 2852yh, 2852yL, 2852yu, 3492w, 3504f, 3504h, 3504k, 3605gb, 3605gf, 3605gL, 3605gn, 3605gp, 3605gx, 3605ic, 3605ih, 3605in, 3605iq, 3605is, 3605iv, 3605kd, 3605kL, 3605km, 3605kn, 3605kp, 3605kr, 3605kt, 3605kv, 3605kx, 3605kz, 3605mb, 3605md, 3605mf, 3605mh, 3605mj, 3605mm, 3605mn, 3605mv, 3605mx, 3605mz, 3605ob, 3605od, 3605of, 3605oh, 3605oj, 3605oL, 3605on, 3605op, 3605or, 3605ot, 3605ov, 3605ox, 3605oz, 3605qb, 3605qd, 3605qg, 3605qh, 3605qhc, 3605qhe, 3605qhg, 3605qhj, 3605qhk, 3605qj, 3605qjd, 3605qjf, 3605qr, 3605qt, 3605qx, 3605qz, 3605sb, 3605sd, 3605sh, 3605sj, 3605sL, 3605sn, 3605sp, 3605sr, 3605st, 3605sv, 3605ud, 3605uh, 3605uv and 3605ux.
Under current law, if a cemetery is abandoned, the respective city, town or municipality having jurisdiction is obliged to assume care for the property. These provisions change the law to require that if a cemetery in Milwaukee County is abandoned or neglected for a period of six months, the city, town or municipality in which the cemetery is located must report the problem to a cemetery authority. The authority then has 90 days (plus one 90-day extension) to address the situation. If the cemetery authority does not succeed with a remedy, a court may appoint a trustee to manage the cemetery and correct existing problems.
The provision also creates a new Cemetery Management Insurance Trust Fund. This fund would consist of revenues collected in Milwaukee County from a $10 filing fee for death certificates and a $1 surcharge on certified copies of death certificates. The amounts available are to be used to fund activities of the trustee appointed to manage the neglected or abandoned cemetery.
I am concerned that the trustee's ability to adequately maintain the cemetery will be linked to the new Cemetery Management Insurance Fund balance. Currently, no other state requires a fee to file a death certificate. This fee could provide a disincentive for individuals to file a death certificate, which could impact the official number of deaths for Milwaukee County as well as limit the liquidity of the new fund.
Also, there has not been a formal inventory to estimate how many neglected cemeteries might require management by a trustee. Nor has there been a study to determine the trustee costs for managing a neglected cemetery. The provision provides no alternate means of payment of trustee costs should the insurance fund become depleted.
For these reasons, I am vetoing this provision in its entirety. Although local units of government in Milwaukee County are naturally concerned with the costs in assuming control of an abandoned cemetery, the provisions in the budget proposal offer questionable relief and would likely prove to be insufficient to accomplish their goals.
35.
Evaluation of Credentialing Fees
Section 9132 (3v)
This section requires the Legislative Audit Bureau to conduct a review to evaluate the methodology used by the Department of Regulation and Licensing for recalculating administrative and enforcement costs as part of fee setting for issuing and renewing credentials.
I am vetoing this section because this review can be completed without a session law requirement.
S355
36.
Inclusion of an Institutional Pharmacist on the Pharmacy Examining Board
Sections 182q, 182r and 9443 (2x)
This provision changes the makeup of the Pharmacy Examining Board to require that one of the seven members appointed to the board shall be employed as an institutional pharmacist.
I am committed to the appointment to the board of individuals who represent diverse aspects of the profession. However, I object to having membership dictated by statute, in this case, and am, therefore, vetoing this provision. Appointments to the board will continue to show the proper balance of interests without this requirement.
VETERANS AFFAIRS
37.
Regional Veterans Claims and Benefits Coordinators
Sections 1451m, 1451n, 1451p, 1451r and 9157 (5mk)
These provisions prohibit the Department of Veterans Affairs from employing more than eight regional coordinators, more than seven claims officers, more than two mobile claims officers, and more than one claims officer in each of the department's other three regions. In addition, the department is required to study the need for additional mobile claims officers and regional coordinators with the focus of each study to be on needs outside of the southeastern regional service area. Finally, the provisions require that the department consult with and receive the concurrence of a county veterans' service officer organization before submitting a request to the Joint Committee on Finance under a 14-day passive review procedure for additional regional coordinator positions if both the department and the organization find that more positions are needed.
These sections unduly constrain the current statutory authority of the Veterans Affairs Board which oversees the operations of the department and limits the ability and flexibility of the secretary of the department to analyze and accommodate the changing demographics and needs of Wisconsin's veterans. I object to restrictions and am vetoing these provisions. Currently, five committees comprised of eighteen representatives from the County Veterans Service Organization and 21 veterans service organizations provide counsel and recommendations on department programs and processes. The board also receives public testimony. This is sufficient oversight. The proposed language mandating consultation or concurrence from advocacy groups regarding internal staffing management is unacceptable.
38.
Veterans Outreach Initiative
Sections 788s, 788sf, 792j, 1458m and 9157 (6c)
These provisions require the Department of Veterans Affairs to provide funding for federal benefits dispute training for the Wisconsin Chapter of Vietnam Veterans of America, Inc., and to provide funding to the Armitage House for homeless veterans in Onalaska, Wisconsin.
I am vetoing the requirement to provide funding to the Wisconsin Chapter of Vietnam Veterans of America, Inc., because I object to the duplication this creates in services already available under existing department programs. The National Vietnam Veterans of America Office has approved the department's use of contractual claims training in place of National Vietnam Veterans of America sponsored training to meet accreditation requirements. There is no need for additional funding to support other training for this purpose.
I am also vetoing the requirement to provide funding to the Armitage House in Onalaska, Wisconsin. Although it is a worthy project and one that could be considered for increased funding in the future, I believe it is inappropriate to require the department to provide a grant to one specific program housing homeless veterans when the department already operates the Veterans Assistance Program which provides housing and veterans rehabilitation services to homeless veterans in several locations around the state.
39.
Veterans Emergency Aid Pilot Program
Sections 788s, 9157 (8c) and 9457 (3c)
These provisions establish a Veterans Emergency Aid Pilot Program in Monroe County. This program requires the department to provide a grant of $20,000 to the Monroe County Veterans Service Office to administer an emergency assistance program to low-income veterans receiving services from the Veterans Administration Medical Center in Tomah or at the Veterans Assistance Center in the same location. The program would allow the Monroe County Veterans Service Officer to determine eligibility of veterans for aid, which may consist of emergency services such as transportation services, food or temporary housing.
I am vetoing this program because it duplicates existing federal, state and local emergency aid facilities, programs and services to low-income veterans currently in use in Monroe County and surrounding counties. Discharge planning programs from the Veterans Administration Medical Center and Veterans Assistance Center at Tomah offer adequate referral services for veterans in transition from those facilities into, and around, Monroe County. The department currently operates the Veterans Assistance Program, which offers services to homeless veterans, and the Subsistence Aid Grant Program, which offers financial assistance for the same transportation services, food and temporary housing as the proposed emergency aid pilot program would provide. In addition, the proposed program would establish an inequitable use of a veterans trust fund allocation to one county and may establish a precedent in which multiple counties may pursue funding for similar purposes.
S356
F.
TAX, FINANCE AND LOCAL GOVERNMENT
ADMINISTRATION
Division of Gaming – License Requirements for Simulcast Racing
Sections 3713c, 3713d and 3713e
These provisions change the license requirements for simulcast racing. These sections would increase the number of live race performances from 250 to 275 performances, remove the requirement that simulcast wagering be conducted at a track only as an adjunct to live performance wagering and remove the requirement that simulcast revenues could not be a primary source of revenue.
I am vetoing these sections because I am concerned about this expansion of gaming. These sections could give rise to a virtual off-track betting facility at a racetrack. I believe such an expansion is beyond the scope envisioned in the constitutional amendment that originally authorized pari-mutuel wagering at racetracks. Such an expansion does not belong in the budget but should instead be subject to extensive legislative scrutiny and should be considered as separate legislation.
BUDGET MANAGEMENT
2.
Budget Stabilization Fund, Cash Building Projects Fund and "Buy Down" of School Aid Payment Shift
Sections 103, 245, 395 [as it relates to s.
20.867 (6) (a) and
(q)], 980c, 1104n, 1145d, and 9101 (25j) [as it relates to the cash building projects fund]
These sections create a cash building projects fund and specify an allocation of unanticipated tax revenues. Unanticipated revenues are split three ways under these provisions. One-half of unanticipated revenues are paid to the budget stabilization fund. Of the remainder, the first $115,000,000 is used to annually reduce the amount of the $115,000,000 June school aid payment shift. Any residual amount after paying the $115,000,000 is paid to the cash building projects fund.
I am vetoing these provisions because the payment flow to the cash building projects fund is badly flawed. Before any funds are actually paid to that fund, the unanticipated revenues must exceed $230,000,000 in a year. This seems unlikely in most years. Even in years this would occur, only a small amount of any unanticipated revenues would actually be allocated to the fund.
I am also vetoing these provisions because I am concerned with the "buy down" provisions of the school aid payment shift. The provisions preserve the $115,000,000 payment shift permanently and only reduce the amount shifted by one-half of unanticipated revenues in any one year. Rather than use a gain in revenues to permanently restore the payment, the payment shift is allowed to continue as an unfunded commitment in future years.
The fiscal future of the state is better served by investing unanticipated revenues toward paying its bills on time and building budget reserves. By vetoing this provision, I am maximizing the amount of revenues allocated to the general fund balance and placing the state on firmer financial footing.
3.
Statutory Minimum Balance
Sections 392m and 9101 (25j) [as it relates to establishing the statutory minimum balance for fiscal year 2002-03]
These provisions reduce the statutory minimum balance from 1.4 percent of general fund appropriations and compensation reserves to $90,000,000.
I am vetoing this provision because the reduction in the minimum balance would jeopardize the financial soundness of the general fund. At $90,000,000, the minimum balance would be less than one percent of general fund appropriations. This is inadequate as a financial reserve to preserve a balanced budget. As a result of my veto, the minimum balance would be increased to 1.2 percent for fiscal year 2002-03.
The state of Wisconsin has one of the weakest financial reserves of any state in the nation. Unlike the vast majority of states, Wisconsin has failed to build budget balances or set-aside revenues in a stabilization fund. During the last biennium, recognizing this weakness, the Legislature saw fit to adopt a staged approach to building higher budget balances. This biennium, the Legislature chose to retreat from this objective by adopting a minimum balance that is the lowest in years.
If Wisconsin had developed adequate reserves in times of surplus, some of the difficult decisions made in this budget would be unnecessary. To avoid retreating on the budget balance, I am partially vetoing these sections to preserve the budget balance standard in place for fiscal year 2000-01.
EMPLOYMENT RELATIONS COMMISSION
4.
Qualified Economic Offer
Sections 2609L, 2609m, 2609p, 2609t and 9317 (8m)
These sections make three major changes to Wisconsin's qualified economic offer provision, which affects the collective bargaining process between school boards and teachers unions. First, section 2609L requires a qualified economic offer to maintain all conditions of employment that existed in the previous contract. Second, section 2609m requires a qualified economic offer to maintain all permissive subjects of borrowing that existed in the previous contract. Third, section 2609p requires that school boards submit qualified economic offers on a timely basis. Section 2609t requires the Employment Relations Commission to establish a methodology for assessing the validity of qualified economic offers, and section 9317 (8m) makes the changes first apply to petitions for arbitration on the effective date of the budget act.
S357
I am vetoing these sections in their entirety because their potential economic and policy impact has not received any objective review or analysis. Before any changes are made to the qualified economic offer provision it is critical to know what impact they will have on the state's financial commitment to support elementary and secondary education and on school district revenue limits.
It is also important to analyze how the changes will effect the collective bargaining process itself. For example, requiring school boards to maintain all permissive subjects of borrowing may increase the reluctance of school boards to include these subjects in future contracts. Maintaining all conditions of employment, no matter how innocuous, could result in otherwise qualified offers being invalidated on technicalities. Depending on the interpretation, requiring school boards to submit qualified economic offers on a timely basis could force school boards to impose qualified economic offers instead of actively bargaining with teachers unions. In addition, making this provision apply to petitions for arbitration filed after the effective date creates a double standard between districts that have already settled their contracts for the 2001-03 contract period and those that have not.
The collective bargaining process is very complex and has significant implications for both the financing and management of the state's public school system. Major changes to the process must not be made without careful study and review. Including these changes in an omnibus budget bill without objective analysis or public hearings is not good public policy.
I recognize that state programs need to be reviewed periodically and sometimes require revision. I would support efforts to provide for a comprehensive and objective study of Wisconsin's qualified economic offer law.
Department of Financial Institutions
5.
Regulation of Rent-to-Own Agreements
Sections 3020p, 3020v, 3021v, 3021w, 3492f, 3492r, 9120 (1d), 9320 (1d) and 9420 (1d)
These sections remove rental purchase companies from the jurisdiction of the Wisconsin Consumer Act and create Subchapter
XI of Chapter
218 under which these companies would be licensed and rental purchase agreements regulated. The sections also authorize the Department of Financial Institutions to promulgate rules regarding certain licensing fees required under Subchapter XI.
Merchants who offer credit sales and merchants offering rental purchase agreements should be regulated to guarantee a level playing field for the merchants and fairness for consumers. Although these provisions recognize that the rental purchase industry offers a service that is in some ways different from credit sales, they do not sufficiently recognize the issues common to both rental purchase and credit sales merchants. One of these issues is disclosure of annual percentage rates. Without full disclosure of these rates, comparison shopping by consumers becomes even more difficult. These provisions fail to address this essential issue of consumer fairness.
I am vetoing these sections entirely because these provisions do not adequately address the common issues of consumer protection and because I object to the inclusion of this substantial and important policy change in the budget. The rental purchase industry offers consumers a valuable service and the unique features of this service should be recognized. Revisions to acknowledge the appropriate manner and substance of the regulation of rental purchase companies should be considered as separate legislation.
GENERAL FUND TAXES
6.
Internal Revenue Code Update
Sections 2130d, 2130db, 2130dd, 2130df, 2130dh, 2130dj, 2130dL, 2130dn, 2130dp, 2130dr, 2130dt, 2158d, 2158db, 2158dd, 2158df, 2158dh, 2158dj, 2158dL, 2158dn, 2158dp, 2158dr, 2158dt, 2158du, 2158dv, 2158dw, 2158dx, 2158dy, 2158dz, 2158dzb, 2158dzd, 2158dzf, 2175d, 2175db, 2175dc, 2175dd, 2175de, 2175df, 2175dg, 2175dgm, 2175dh, 2175dj, 2176d, 2182d, 2182db, 2182dc, 2182dd, 2182de, 2182df, 2182dg, 2182dh, 2182dj, 2182dk, 2182dL, 2182dm, 2182dn, 2182dp, 2182dq, 2182dr, 2182ds, 2182dt, 2182du, 2182dv, 2182dw, 2184r, 9144 (3z) and 9344 (28z)
Beginning in tax year 2001, these sections, with three exceptions, provide that state individual and corporate income and business tax provisions referenced to the federal Internal Revenue Code (IRC) would refer to the code in effect on December 31, 2000, rather than to December 1999, as under current law.
The Legislature intended to exclude the three federal law changes that relate to the deductions for environmental remediation costs, donations of computer equipment and the treatment of foreign sales corporations. However, the bill as passed by the Legislature excludes these provisions only for tax years prior to 2001. It inadvertently adopts them for 2001 and subsequent years. In so doing, there could be a decrease in tax revenue not intended by the Legislature.
I am vetoing these sections to avoid the potential revenue loss. This would keep the revenue estimates in accord with the estimates the Legislature considered in passing the budget.
I recognize the inherent complexity of the Internal Revenue Code. I request the Legislature to reconsider the IRC update as it intended and pass the update as separate legislation.
S358
7.
Sales Tax Exemption for Water Slides
Sections 2246nm and 9444 (3w)
This provision provides a sales and use tax exemption for commercial water-park slides including support structures, attachments and parts. The exemption reduces general fund revenues by $90,000 in 2001-02 and by $120,000 in 2002-03.
I am vetoing this section because I object to such a narrowing of the sales tax base. This is a highly selective exemption for one form of construction and maintenance of entertainment or recreational structures. This favors a single industry among a variety of industries providing recreation
8.
Individual Income Tax Exclusion for Military Pensions
Sections 2142m and 2142n
Starting in tax year 2002, these sections exclude from taxation all payments, other than surviving spouse benefits, received from the U.S. military employee retirement system that are not excluded under current law.
I object to the exclusion of surviving spouse benefits from this new tax benefit. Under current law pre-1964 military pension and surviving spouse benefits are not taxed. It is inequitable to broaden the exemption to include only post-1963 military pension and to not include post-1963 surviving spouse military retirement benefits. My partial veto of this section will make these surviving spouse benefits tax exempt.
9.
Estate Tax
Section 2200L
This section requires persons who prepare an estate tax return for deaths occurring after December 31, 2002, to prepare a return under this newly decoupled Wisconsin estate tax. Other provisions in the bill decouple the Wisconsin estate tax from the federal estate tax beginning in fiscal year 2003-04. Because estate taxes are due nine months after a death, the relevant date for deaths should have been for deaths occurring after September 30, 2002.
I am partially vetoing this section to remove the December 31, 2002, date because it does not reflect legislative intent. This partial veto realizes the Legislature's intent to begin the new, separate Wisconsin estate tax in fiscal year 2003-04 by requiring estate tax preparers to prepare returns under the decoupled Wisconsin tax in fiscal year 2003-04. It is my intent to rescind the decoupling of Wisconsin's estate tax from the federal estate tax in my 2003-05 biennial budget.
10.
Artistic Endowment Foundation Tax Credits
Sections 2148m, 2150d, 2150t, 2175, 2179d, 2179h, 2193d, 2193h and 2205n
