6:30 P.M.
Ninety-Eighth Regular Session
The Senate met.
The Senate was called to order by President Risser.
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The roll was called and the following Senators answered to their names:
Senators Breske, Carpenter, Coggs, Cowles, Darling, Decker, Erpenbach, S. Fitzgerald, Grothman, Hansen, Harsdorf, Jauch, Kanavas, Kapanke, Kedzie, Kreitlow, Lassa, Lazich, Lehman, Leibham, Miller, Olsen, Plale, Risser, Robson, Roessler, Schultz, Sullivan, Taylor, Vinehout and Wirch - 33.
Absent - None.
Absent with leave - Senators Ellis and Lasee.
The Senate stood for a moment of silent meditation.
The Senate remained standing and Senator Coggs led the Senate in the pledge of allegiance to the flag of the Untied States of America.
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Senator Fitzgerald, with unanimous consent, asked that Senators Ellis and Lasee be granted a leave of absence for today's session.
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President Risser appointed Senators Decker and Roessler to escort the Governor to the Assembly Chamber for a Joint Convention of the Legislature.
Senator Robson, with unanimous consent, asked that the Senate adjourn pursuant to Senate Joint Resolution 1, upon the rising of the Joint Convention.
The chair, with unanimous consent, asked that the Senate recess for the purpose of awaiting the Governor's Budget Address in Joint Convention in the Assembly Chambers at 7:00 P.M.
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The Senate proceeded in a body to the Assembly Chamber to meet in Joint Convention to receive the Governor's Budget Message.
6:45 P.M.
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Senate President Risser in the Chair.
The committee to wait upon the Governor appeared with his excellency the Governor, who delivered his message as follows:
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“Speaker Huebsch, Speaker Pro Tem Gottlieb, President Risser, Majority Leader Robson, Lieutenant Governor Lawton, Constitutional Officers, members of the Legislature, tribal leaders, members of the Cabinet, distinguished guests, and fellow citizens of Wisconsin.
Tonight, I come before you to submit my budget for the next two years ... a budget with three goals: being fiscally responsible, investing in our shared priorities, and creating opportunity for working families.
It is a plan that not only invests in the needs of all Wisconsinites, but reflects the greatest hopes and aspirations of our people.
My budget says every child ... every family ... should have a chance to get ahead and live the American dream.
This is not a budget for the big oil companies or the big tobacco companies ... it is a budget for the middle class - and those trying to get there.
An opportunity budget ... that cuts taxes on hardworking families.
An opportunity budget ... that is responsible with taxpayer dollars.
An opportunity budget ... that invests in schools and better jobs for our citizens.
An opportunity budget ... that says health care for all of our citizens is within our grasp ... and now it's time to reach for it.
An opportunity budget ... reflecting Wisconsin's values, protecting Wisconsin's priorities, and investing in Wisconsin's people.
Fiscal responsibility
Of course the first thing - the best thing - state government can do to create opportunity for the middle class is to get its own fiscal house in order.
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The truth is, this state got itself into a tremendous hole in the 1990s. Expensive new programs, excessive use of one time money, exploding corrections costs, and runaway deficits. To clean up the mess, we sold cars, airplanes, buildings and state property, cut government waste and eliminated overhead. We used our bargaining power to get discounts on everything from office supplies to prescription drugs.
We cancelled and consolidated government contracts, achieving the first reduction in contracting for at least a decade - and saving taxpayers more than $40 million dollars.
Together, as Democrats and Republicans, we balanced two straight budgets.
And because we know that Wisconsin families should keep more of what they earn, we did it all without raising income taxes...
...without raising sales taxes...
...without raising business taxes...
...and we held local property taxes to their smallest increase in a decade. You should take pride in what we did together - providing real property tax relief to Wisconsin families.
As a result, as a percentage of income, the state tax burden in Wisconsin is the lowest in 35 years.
We also stopped the decline in our bond rating. For the first time in six years, our bonds have been given a positive outlook by Standard and Poors.
But despite all of that progress, we still face real, long-term challenges.
Unless we make hard choices now, the choices we'll face in just a few more years will be unbearable: eroding the quality of our schools, laying off thousands of police and firefighters, abandoning our commitment to children and vulnerable families, or higher taxes for everyone.
So this budget begins with more hard cuts - continuing the progress of the last four years. We'll control the cost of prisoner health care, streamline the administration of Medicaid, cut information technology contractors, and sell state property. We'll eliminate duplicative human resource systems and use technology to save almost $100 million throughout government.
Tonight, I'm sending you supplemental legislation to begin that cutting immediately - reducing spending at our largest agencies by 2 percent this year.
Your state government will be leaner, more efficient, and more focused on the priorities of middle class families.
It's taken a long time to recover from the financial mess created in the 1990s, but this is the budget that turns the corner.
Let me show you the progress we're making:
When I took office, the budget I inherited was projected to end hundreds of millions of dollars in the hole.
We changed course ...
...showed a small surplus in 05 ...
...a surplus for 07 ...
...and the budget I present tonight will have a surplus of $130 million in 2009. Now that's progress.
We also had to address this state's over-reliance on one-time money to balance the budget. Prior administrations did things like cash in the tobacco settlement for a temporary budget fix.
Over the last four years, we've dramatically reduced the use of one-time spending ... to the lowest amount in years. The budget I present tonight relies on one-time money for less than one percent of the budget - a very responsible level.
Some level of advanced commitments - the so-called structural deficit - is normal in a budget, like tax cuts that grow over time. But you need to keep those in line ... and previous Administrations let this get out of control.
As you can see here, we've dramatically reduced our advanced spending commitments in the last two budgets.
And in this budget, to assure our long term fiscal health, we've kept our advanced spending commitments to their lowest level in 12 years.
The real problem with advanced commitments is how they compare to the growth in revenue.
The red line is advanced spending commitments. The yellow line is projected revenue growth that you need to pay for those commitments. Something's really wrong when the red line is above the yellow line.
Generally, revenue grows at about 5 percent a year. Before I took office, advanced commitments far exceeded revenue growth. In fact, the budget I inherited four years ago had $2.8 billion in advance spending commitments, but only about $1 billion in expected new revenue to pay for it. That left us with a huge gap.
The budget I present tonight will leave us with just $670 million in advanced commitments - and those commitments will be more than covered by the $2 billion in new revenue projected for the next budget.
Tax Cuts
The progress we've made in the past four years puts us in position to offer Wisconsin something important: real, meaningful middle class tax relief.
Because the middle class is being squeezed ... I propose to make every dollar you pay for health insurance completely tax free.
This simple change will save a typical family more than $300 dollars annually and help make heath care a little bit more affordable. It represents more than $250 million in middle class tax relief over the next five years.
To keep our commitment to seniors, we'll eliminate the state tax on Social Security next year.
To help working families, we'll make the cost of child care tax deductible, saving parents up to $400 a year.
And to help our students, we'll dramatically expand the tuition tax deduction ... saving families up to $400 off their tax bill - and making college more affordable. For the first time in history, students and families throughout the UW system, technical colleges and private colleges will be able to use this deduction not only for tuition, but for fees as well.
All together, my opportunity budget includes more than a dozen separate tax cuts aimed at creating jobs and helping families in their daily lives ... saving the taxpayers of Wisconsin $1.7 billion over the next four years.
Education
Not only will we provide tax relief, but we'll do it while investing in the priorities of Wisconsin's families. And the first of these is education.
Like every parent in this state, I can still remember the day I walked our oldest child to school for the very first time.
With a smile on his face and a bookbag on his shoulder, Gus grabbed my hand and we walked a few blocks down to Midvale elementary. By the time we got there, he was bursting with energy, ready to go into that school and begin a whole new chapter in his life.
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I'll never forget welling up with tears as I let go of his hand and watched him walk through those doors.
We live our whole lives for moments like that. You're taking a leap of faith with that school, entrusting it with all your hopes for your child.
