The Chief Clerk makes the following entries under the above date:
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Relating to miscellaneous fee schedule changes and affecting small businesses.
Submitted by Department of Commerce.
Report received from Agency, July 14, 2005.
To committee on Labor.
Referred on July 25, 2005
.
Relating to certification of first responders.
Submitted by Department of Health and Family Services.
Report received from Agency, July 14, 2005.
To committee on Health.
Referred on July 25, 2005
.
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Speaker's Communications
July 25, 2005
Mr. Patrick Fuller
Chief Clerk, Wisconsin State Assembly
Room 208, Risser Justice Center
17 West Main Street
Madison, Wisconsin 53708
Dear Patrick:
Pursuant to Assembly Rule
23 (4), please message Enrolled Assembly Bill 399 to the Office of the Governor. If your office is unable to deliver the enrolled bill today, please notify me as soon as possible.
Sincerely,
John G. Gard
Speaker
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Chief Clerk Reports
The Chief Clerk records:
Assembly Bill 399
Presented to the Governor on Monday, July 25.
Patrick E. Fuller
Assembly Chief Clerk
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Communications
State of Wisconsin
Office of the Secretary of State
Madison
To Whom It May Concern:
Acts, Joint Resolutions and Resolutions deposited in this office have been numbered and published as follows:
Bill Number Act Number Publication Date
Assembly Bill 21022July 22, 2005
Assembly Bill 43724August 4, 2005
Sincerely,
Douglas La Follette
Secretary of State
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Executive Communications
State of Wisconsin
Office of the Governor
Madison
July 25, 2005
To the Honorable Members of the Assembly:
The following bill, originating in the Assembly, has been approved, signed and deposited in the office of the Secretary of State:
Bill Number Act Number Date Approved
AB 100 (in part)25July 25, 2005
Respectfully submitted,
James Doyle
Governor
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Governor's Veto Message
State of Wisconsin
Office of the Governor
Madison
July 25, 2005
To the Honorable Members of the Assembly:
I have approved Assembly Bill 100 as
2005 Wisconsin Act 25 and deposited it in the Office of the Secretary of State.
Over five months ago, I introduced a budget that addressed a $1.6 billion deficit by focusing on two simple goals – protecting Wisconsin's taxpayers and investing in Wisconsin's priorities. My budget froze property taxes for the next two years, but in a way that was responsible and did not sacrifice the quality of our schools and vital local services. As with my previous budget, we solved this deficit without raising any taxes – income, sales, corporate or excise. Instead, we set priorities and funded them by using savings gained by making state government more efficient and additional revenue generated from economic growth.
After five months of debate – too often in the wee hours of the morning and out of sight of public scrutiny – the Legislature returned a budget to me. It froze property taxes, but did so at the expense of our schools. At a time of record gas and utility price increases, they told schools they would have to live with only a one percent increase. The state's association of school boards and other experts suggest the Legislature's actions would be devastating to our schools: over 4,000 teachers losing their jobs, larger class sizes, and cuts to programs ranging from reading to math to arts, music, and athletics.
My first impulse was to send the budget back to the Legislature and make it start over again. But the Wisconsin Constitution entrusts the Governor with broad powers to improve on the Legislature's work and set different priorities, as long as the budget remains balanced. While some may criticize me for being too bold, I undertook to reshape this budget to one that protected both property taxpayers and our children.
The end result is a budget that much more closely resembles the one I submitted in February than the one passed in the dead of night by the Legislature. It freezes property taxes for two years and protects our schools.
I have said repeatedly that taxes are too high in Wisconsin. That is why, when I sought this office, I promised to solve the state's fiscal problems without raising taxes. Perhaps no single tax is as onerous as the property tax, especially for our seniors who want to stay in their homes and middle-class families trying to make ends meet. Additionally, rising property taxes have created an unhealthy tension between property taxpayers and our schools.
In my first budget, I made holding down property taxes a top priority. Despite a $3.2 billion deficit, I restored shared revenue, fully funded nearly $1 billion in property tax credits and increased funding for our schools. But I would not go as far as signing a property tax freeze, which would have cut spending for schools by over $400 million.
During the past two years, we have worked hard so that we can now deliver the property tax relief our citizens deserve without sacrificing the quality of our schools and vital local services. By cutting spending elsewhere in state government, and by promoting economic growth to raise revenue, we now are in a position for a responsible freeze.
The freeze I am signing today means that the average homeowner's property tax bill will be frozen this December and be reduced by an average of $5 next year. That's compared to an average property tax increase of $119 a year over the past five years.
While the end result is the same to the average taxpayer, the freeze I am signing today differs from the one presented to me by the Legislature in several key respects:
First, the Legislature's budget froze property taxes by cutting the amount schools can spend by a total of $350 million over two years. My freeze maintains the current revenue cap limits that have been in place for over a decade, under both Republican and Democratic governors. In short, my property tax freeze is responsible, while the Legislature's freeze is really a freeze on our kids' education that would force devastating cuts to our schools.
Second, the Legislature's freeze allowed localities to increase their spending only if they were experiencing growth. My freeze enables all communities to deal with the impact of inflation on providing services by allowing a minimum increase of two percent, or the rate of growth, whichever is higher.
Third, the Legislature's freeze also included technical colleges, even though they already have mill rate limits and constitute only a small portion of the overall levy. My freeze maintains the current law mill rate limits on technical colleges so they will not have to raise their tuitions or cut their vital role in worker training and economic development.
Fourth, the Legislature's freeze lasted for three years even though the state budget extends for only two. My freeze is for two years because it only works if the state keeps its commitment to funding schools and shared revenue. As I said in my budget address, the state shouldn't put a freeze on communities longer than we can guarantee our funding commitment to them.
Fundamental to a sound school system and real property tax relief is the level of state financial support for schools. The bill I am signing today returns the state to the goal of funding two-thirds of local school costs. The increase in state school aid necessary to reach two-thirds will be funded by increasing the general fund balance by almost $360 million through my vetoes of excessive state spending, unnecessary financing strategies, ill-conceived tax giveaways and pork barrel projects. Over 95 percent of this increase will be allocated under the bill to deliver real property tax relief. The remainder will help eligible University of Wisconsin students pay tuition, restore planning grants to communities and reinstate funding for quality child care.
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I also used my veto pen to increase direct property tax relief by over $73 million through the school levy tax credit. Taken together, the budget I am signing today will increase state funding for schools and property tax relief by over $400 million compared with the Legislature's budget. Schools will receive a modest 3 percent cost-of-living increase, just as they have received annually for many years under Democratic and Republican administrations alike. The additional funding I am providing through my vetoes will enable the state – rather than local taxpayers – to shoulder the burden of paying for the increased costs of education over the next two years so that property taxes can be frozen.
When we think of property taxpayers, we think of the elderly couple or the young family. But many Wisconsin businesses pay property taxes as well. In fact over the next two years, the property tax freeze will save Wisconsin businesses over $270 million compared to estimated levy increases without a freeze. This tax cut will give businesses the resources they need to expand their operations and create new jobs to grow Wisconsin's economy.
Balancing two budgets without raising taxes and enacting a property tax freeze are just the beginning of reducing the tax burden on Wisconsin citizens. The budget I am signing includes $325 million in tax cuts over the next four years. It cuts a penny off the gas tax. It allows parents to deduct the cost of college tuition up to the cost of the average University of Wisconsin tuition. Working people who are not provided health insurance benefits at their jobs will be able to deduct the full costs of their health insurance. Unemployed persons will also be aided in maintaining their health coverage by allowing them to deduct the costs of their policies. Those serving our country will be able to deduct their military income, and those disabled veterans and widows of those killed in action will get credits for their property taxes. I have also used my veto pen to accelerate by one year (to 2008) the implementation of a full exclusion of social security benefits from taxation for Wisconsin seniors. Supporting education, health care, veterans and our seniors – the tax cuts I am signing today invest in our priorities and help to foster a Wisconsin that is optimistic about its future. These tax cuts, along with holding the line on state taxes and freezing property taxes, are a major step in reducing the tax burden on Wisconsin citizens.
We would not be in the position to invest in our schools, freeze property taxes and afford tax cuts if it were not for aggressive actions in reducing government spending in the rest of state government and for economic growth. This budget, along with the previous one, achieves
major reductions in the government spending so we can invest in priorities. Some of these reductions include:
• Cuts $272 million from agency operating budgets and reduces the state government work force by 1,900 positions. Over four years, my administration will have reduced the state work force by a total of 3,900 positions through elimination of agencies and programs, streamlining of state government and increased efficiency of agency operations.
• Implements my Accountability, Consolidation and Efficiency (ACE) Initiative, with savings of $35.5 million in the 2005-07 biennium and almost $150 million over the next four years. Savings will be realized through bulk purchasing of commodities, better commodity contract negotiation strategies, consolidating computer network servers and streamlining of human resources management.
• Includes $36 million in savings associated the sale of low-priority state buildings and related assets due to improved use of state-owned office space.
• Continues innovative approaches that control state employee health insurance costs by leveraging the state's purchasing power. These approaches have already saved millions of dollars by holding this year's health insurance cost increases to 4.9 percent (less than half of the national average increase of over 11 percent), by reducing prescription drug costs by $25 million through use of a pharmacy-benefits manager, and through a $14 million savings from initial health care provider organization bids.
• Reduces excessive spending and pursues more reasonable financing strategies to save nearly $160 million in transportation spending during the 2005-07 biennium. My vetoes maintain the robust highway spending increase of 16 percent included in my original budget.
• Eliminates over $7 million of legislative earmarks and pork barrel projects.
• Accomplishes state Medicaid cost savings of over $130 million, including $40 million proposed by the Governor and adopted by the Legislature and approximately $90 million saved through vetoes. Savings will be realized through further prescription drug cost containment measures, improvements in quality control and fraud prevention, expansion of managed care, increases in federal support, and vetoes of targeted rate increases for certain providers due to insufficient GPR funding. State Medicaid program costs are also benefiting from a renegotiated fiscal agent contract that will save $93 million over the five year contract period.
