I am vetoing sections 29, 29m, 35m, 41m, 55m, 375m, 378t and 1176m in their entirety, and partially vetoing sections 364m, 366m, 392g and 392r [as they relate to eligible energy conservation projects], to eliminate the new master lease program. While I support the concept of using master lease financing to accomplish energy efficiency projects, I object to the lack of accountability in this proposal. The state is responsible for initial financing of any master lease project, and requires assets with bona fide value to secure what essentially is a loan to an agency. Therefore, a measure of accountability is needed for such a program. I am requesting that the system, Legislature and Department of Administration work together to craft a more judicious proposal that provides the system with additional financing opportunities while protecting taxpayers.
20. Investment of Certain Funds
Section 1162r
This section allows the Board of Regents to invest auxiliary enterprises revenues, gifts, grants, donations and segregated fees for building projects outside of the State Investment Fund. It also requires the Board of Regents to directly employ a financial manager, contract with the State of Wisconsin Investment Board or hire an investment firm to manage any investments outside of the State Investment Fund.
I am partially vetoing this section to allow the Board of Regents to invest only gifts, grants and donations outside of the State Investment Fund. Since the University of Wisconsin System will remain a state agency, I believe that revenues generated by University of Wisconsin institutions should remain in the state treasury and be invested in the State Investment Fund. Allowing the Board of Regents to invest gifts, grants and donations outside the State Investment Fund is consistent with the flexibility to conduct building projects funded with gifts and grants without Building Commission and Department of Administration approval and oversight.
21. Gift and Grant Funded Building Projects
Section 369t [as it relates the purpose of gifts and grants]
This section defines "UW gifts and grants project." This definition is utilized in two additional sections of the bill which collectively exempt University of Wisconsin building projects from Building Commission and Department of Administration approval and supervision if the project meets the following requirements: (a) the project is funded entirely with gifts and grants made for the express purpose of funding the building project; and (b) the project is let by the University of Wisconsin System using the current law single prime contracting process.
I am partially vetoing this section to strike the language "for the express purpose of funding the construction project." I object to this language because the requirement that funds be specifically earmarked for a certain building project is overly restrictive and burdensome. I support providing the Board of Regents with more flexibility in the planning and execution of certain building projects. As a result of this veto, the Board of Regents may plan and execute building projects funded with any gifts and grants funds outside of the Building Commission's process.
22. Department of Administration Assessment for Program Revenue Funded Building Projects
Sections 365m and 9301 (3f)
These sections require the Department of Administration to assess the University of Wisconsin System on a fee-for-service basis for design and management of program revenue supported building projects. It also caps the amount the Department of Administration may assess the University of Wisconsin System at 4 percent of the total project cost.
I am vetoing these sections because I object to the vagueness of the concept of assessments using a "fee-for-service" model. I am directing the Department of Administration to develop a definition of "fee-for-service" within the context of project management and building construction. This will assist stakeholders in determining whether such a model should be employed. In addition, I object to the 4 percent cap on fees the Department of Administration may assess the University of Wisconsin System. Current law requires the Department of Administration to oversee all engineering, architectural and construction work and bid letting for University of Wisconsin System building projects supported by program revenue. Arbitrarily capping the rate at which the Department of Administration may assess for such work may prevent the department from recouping costs actually incurred on larger building projects, which may have negative impacts on other projects under the department's management.
23. Student Identification Numbers
Sections 1279, 4468e, 4468m and 4468s
These provisions repeal current law prohibiting University of Wisconsin institutions and private higher education institutions from using or incorporating a student's social security number as a student identification number.
I am vetoing these provisions in their entirety because the restrictions in current law are in the best interests of maintaining student privacy and protecting the integrity of student data.
24. Procurement
Sections 316p, 321, 322, 327d, 328, 355s, 1204m, 3578p, 9148 (2d) and 9448 (2d)
These provisions require the Board of Regents to develop policies for procurement and submit those policies to the Joint Committee on Finance. If the Committee approves the policies, current law relating to state agency purchasing would not apply to the University of Wisconsin System.
I am vetoing these sections because the segregation of university purchasing from the rest of state government may result in unintended consequences. The University of Wisconsin System constitutes a majority of state spending on procurement contracts and, therefore, any discussions to remove the University of Wisconsin System from state procurement contracts should include the Department of Administration to allow both organizations to properly analyze and prepare for any changes. In addition, current law under s. 16.71 (1m) provides the Department of Administration with the ability to delegate to the Board of Regents and the University of Wisconsin-Madison the authority to enter into any contract for materials, supplies, equipment or contractual services relating to information technology or telecommunications. Therefore, I am directing the Department of Administration to work with the Board of Regents and the University of Wisconsin-Madison to continue to improve upon existing delegation agreements and develop a framework that provides these entities with more flexibility in purchasing and procurement while balancing the need to maintain the state's purchasing power. 25. Aquaculture Specialist
Sections 806g, 806r and 9448 (5j)
These sections provide tribal gaming funding of $100,000 annually for the Aquaculture Demonstration Facility, to fund a University of Wisconsin System-Extension aquaculture specialist position.
I am vetoing these sections because I object to the unnecessary use of tribal gaming funding for this purpose, and believe that if the University of Wisconsin System believes a position is needed to carry out the mission of the Aquaculture Demonstration Facility, it may reallocate system resources.
26. Minority Teacher Loan Program Eligibility
Sections 1372r and 9319 (3f) [as it relates to the requirement to student teach in Milwaukee]
Section 1372r sets forth eligibility provisions for a reformed minority teacher loan program. To be eligible for the program, students must be: (a) state residents enrolled at least half-time as sophomores, juniors or seniors in an institution of higher education; (b) individuals enrolled in a program of study leading to a teacher's license in teacher shortage areas; (c) individuals enrolled in a program of study that includes student teaching in the city of Milwaukee; and (d) individuals with a grade point average of at least 3.0 on a 4-point scale or the equivalent.
I am partially vetoing these sections to delete the requirement that eligible individuals must be enrolled in a program of study that includes student teaching in the city of Milwaukee. The Milwaukee Public School District certainly is in need of excellent teachers, and the loan forgiveness structure of the improved program encourages teachers to teach and remain in Milwaukee. As such, I object to this eligibility provision because it is unnecessary and overly restrictive.
27. Position Reports
Section 277m
This section modifies current law to require the Board of Regents to report annually, instead of quarterly, on the number of non-GPR full-time equivalent positions created or abolished by the Board of Regents in the previous 12-month period and specifies that the report be based on the October 1 payroll. It also deletes current law specifying that positions authorized for the University of Wisconsin System not be included in any state position report beginning on July 1, 2015.
I am partially vetoing this section to maintain current law that excludes University of Wisconsin System positions from state position reports. The University of Wisconsin System has transitioned to its own personnel systems (one for the University of Wisconsin-Madison and one for all other system employees), which simplify titling structures in a way that is specific to the university and establish a separate compensation structure. Therefore, it is inappropriate to include university employees in the same report as all other state government employees.
28. Academic Staff Appointments
Section 1210m
This section prohibits the Board of Regents from making probationary or indefinite academic staff appointments beginning July 1, 2015. In addition, all academic staff holding probationary appointments on June 30, 2015, are transitioned to a fixed term appointment, while indefinite appointments are made permanent.
I am vetoing this section in its entirety because I object to making these changes without additional study to determine whether there are possible unintended consequences, particularly on certain programs at the University of Wisconsin-Madison.
29. Conservation Fund Appropriations
Sections 596g, 596r and 9448 (5k)
Section 596g specifies that, from the grants for forestry programs appropriation, in each year of the 2015-17 biennium, $124,400 be provided to the University of Wisconsin- Stevens Point for the paper science program and $10,100 (the remaining appropriation balance) be provided to the University of Wisconsin-Madison for the Center for Cooperatives. For fiscal year 2017-18, sections 596r and 9448 (5k) restore the prior funding levels for the paper science program and Center for Cooperatives of $78,000 and $56,500 (the remaining appropriation balance), respectively.
I am vetoing these sections in their entirety because I believe existing funding levels from the conservation fund are appropriate, and that the University of Wisconsin System can reallocate other funds if needed for the University of Wisconsin-Stevens Point paper science program.
C. REFORMING GOVERNMENT
30. Group Insurance Board Appointments
Sections 105d, 136d and 9112 (1c)
This provision requires that the six members of the Group Insurance Board who are appointed by the Governor to two-year terms under current law be appointed with the advice and consent of the Senate. The terms of office of the current gubernatorial appointees would terminate on the effective date of the budget bill, but the appointees could continue until successors are appointed and qualified to assume the board positions.
In addition, this provision would expand the board from 11 members to 15 members and specify the following new members: (a) one Representative appointed by the Speaker of the Assembly; (b) one Representative appointed by the Minority Leader of the Assembly; (c) one Senator appointed by the Majority Leader of the Senate; and (d) one Senator appointed by the Minority Leader of the Senate.
I am vetoing this provision in its entirety because it is administratively burdensome and unnecessarily adds a layer to the appointment process for the board. While the Legislature has a substantial role in setting statutory policy and establishing overall funding levels, the members of the board must develop significant expertise in health plan design and administration, while balancing the needs of the employers, employees and health plans. This is best achieved with the current composition of the board.
31. Review of Annual Proposed Changes to the State Group Health Insurance Program
Sections 1389r and 9112 (3j)
These sections require the Group Insurance Board to submit proposed changes to the state group health insurance program to the Joint Committee on Employment Relations by April 1 of each year. The committee must hold a public hearing and act by May 1 to approve, disapprove or modify the changes and then submit them to the Governor. The Governor is then required to approve or reject the changes in their entirety within 10 calendar days. An affirmative vote of at least six of the eight members of the committee would be required to override any rejection by the Governor.
For calendar year 2016, any changes must be submitted to the committee no later than 30 calendar days after the enactment of the budget and the committee must act within 30 calendar days of receiving the proposed changes.
I am vetoing this provision in its entirety because I object to having the committee infringe on the responsibilities of the board, which was created to set policy and oversee administration of the group health insurance plan for state and local employees, retirees and employers. The committee already has a substantial role given its biennial review of the compensation plan for state employees. Additionally, health plans are already in the process of bidding for calendar year 2016, and requiring the board to submit changes to the committee after enactment of the budget will create a substantial and problematic delay in the rate setting process.
32. Agency Budget Requests
Sections 272d, 272h and 272i
These sections require state agencies, beginning in the 2017-19 biennium, to submit budget requests under three scenarios: (a) no increase in GPR, PR or SEG funding over base with the exception of sum sufficient reestimates and amounts required to comply with federal law; (b) the scenario under (a) modified to include cost-to-continue amounts as well as amounts due to caseload or population adjustments, and amounts necessary to fund previously enacted program commitments; and (c) the scenario under (b) modified to include any amounts requested for programmatic changes.
I am vetoing these sections in their entirety because I object to these restrictions on gubernatorial flexibility to establish budget instructions in a manner consistent with his or her fiscal and policy priorities.
33. Statutory Reserve and Budget Stabilization Fund
Sections 282m, 478d, 478g and 478h
Section 282m specifies that a revenue transfer from the general fund to the budget stabilization fund can only occur if the statutory reserve of 2 percent of GPR appropriations plus compensation reserves has been met in the general fund. Any general fund revenues in excess of 2 percent of GPR appropriations plus compensation reserves would then be subject to the current provision, which transfers to the budget stabilization fund 50 percent of the amount that actual deposits during the fiscal year exceed the amount projected to be deposited in the general fund during the fiscal year.
Under current law, each year, the Department of Administration secretary calculates the difference between the amount of moneys projected to be deposited in the general fund during the fiscal year that are designated as "Taxes" in the general fund summary of the biennial budget bill and the amount of such moneys actually deposited in the general fund during the fiscal year. Under sections 478d and 478g, the required statutory balance at the end of fiscal year 2015-16 would be $65,000,000 plus the amount calculated by the secretary for fiscal year 2015-16; and in fiscal year 2016-17, the balance would be $65,000,000 plus the amount calculated by the secretary for both fiscal year 2015-16 and fiscal year 2016-17.
Section 478h specifies that in fiscal year 2017-18, and in each fiscal year thereafter, the required statutory balance would be the prior fiscal year's required statutory balance plus $5,000,000 and the accumulated amount calculated by the secretary for fiscal year 2017-18, and each fiscal year thereafter, but not to exceed 2 percent GPR appropriations plus compensation reserves.
I am vetoing sections 282m, 478d and 478g, and partially vetoing section 478h, because I object to reducing the amounts to be deposited into the budget stabilization fund in the future. The budget stabilization fund is an important tool that helps ensure the state's financial stability. I support increasing the required statutory balance each fiscal year, however, and am therefore retaining a portion of section 478h, which will add $5,000,000 each year, beginning in fiscal year 2017-18, to the required statutory balance.
34. Utilization of Department of Administration Procurement and Purchasing Services
Sections 282s, 326q, 327b, 327d [as it relates to s. 16.745], 330n, 333r, 334c, 339n, 345b, 345d, 345f, 345h, 346p, 354p, 355b and 355s [as it relates to s. 16.745] These sections specify that the Department of Administration may not require the Department of Employee Trust Funds to utilize the Department of Administration’s procurement and purchasing services. These sections also establish statutory authority and a process for the Department of Employee Trust Funds purchasing function. The Department of Employee Trust Funds would be required to file all bills and statements of purchase with the Department of Administration secretary, who would then be required to audit and authorize payment of such bills and statements. Upon the Department of Employee Trust Funds' request, the Department of Administration would be required to make recommendations and provide assistance regarding purchasing procedures, as well as process requisitions for purchases and procure materials for the Department of Employee Trust Funds.
I am vetoing sections 282s, 326q, 327b, 330n, 333r, 334c, 339n, 345b, 345d, 345f, 345h, 346p, 354p and 355b, and partially vetoing sections 327d [as it relates to s. 16.745] and 355s [as it relates to s. 16.745] because I object to limiting the ability of the Department of Administration to create statewide efficiencies related to procurement. For Chapter 16 purchasing authority, the Department of Employee Trust Funds should be treated like other agencies and operate under Department of Administration procurement policies and contracts unless a delegation agreement is signed by both parties. I am directing the Department of Administration to work collaboratively with the Department of Employee Trust Funds on such an agreement. 35. Pay-for-Performance Contracting Reports
Sections 1785m and 9152 (1c)
Section 9152 (1c) requires all state agencies to review current programs and submit a plan that identifies existing government expenditures that could be decreased or programs that could be improved by using pay-for-performance contracts. The plan must be submitted to the Joint Committee on Finance on or before December 1, 2015.
In addition, under section 1785m, the Department of Children and Families is authorized to issue a request for proposals for a pay-for-performance contract to reduce offender recidivism in the city of Milwaukee. The section specifies that after selecting a proposal, the department must submit a written plan including certain information to the Committee under passive review.
I am vetoing section 9152 (1c) to remove the requirement that all state agencies review current programs and submit a plan to the Committee because it is unduly burdensome to those state agencies that do not have operations that are likely to be candidates for pay-for-performance contracts. With this veto, all state agencies would not be required to review and report as prescribed. However, I direct other cabinet agencies that do have the potential to use these contracts to review applicable programs and consider the use of this type of contracting.
I am partially vetoing section 1785m because I object to the department having to submit a report to the Committee. With this veto, the department would not need to submit the plan under passive review, but would be authorized to pursue the pay-for-performance contract to reduce Milwaukee offender recidivism.
36. Local Zoning Exception
Sections 44b and 44m
These sections exempt the structure or facility constructed for the benefit or use of the state that was enumerated under the state building program as the State Transportation Building Replacement – Madison (the Hill Farms facility) from compliance with municipal zoning ordinances.
Though well-intentioned, I am vetoing these sections because this exemption is unnecessary, as the city and state are working to ensure the project meets local standards and is constructed on schedule.
37. Building Commission Contracting Requirements
Sections 47b, 370, 373b and 374b
These sections clarify the authority of the Building Commission by separating two existing types of alternatives to state construction specified in the statutes.
I am partially vetoing section 47b and fully vetoing sections 370, 373b and 374b because I object to removing acquisition of facilities from the Building Commission's authority and adding a cross-reference that does not clarify the exemption of alternative state construction types from single prime contracting requirements. The intent of this veto is to retain current practice.
38. Health Insurance for Protective Services Employees
Section 1952c
This section specifies that if a first class city offers health care insurance to employees who are police officers, fire fighters or emergency medical technicians, it shall also offer to those employees a high-deductible health plan that has identical design features to the plan offered to state employees.
I am partially vetoing this section because I believe that the city of Milwaukee should be able to choose the specific design features of its high-deductible plan to best suit its overall benefit structure rather than being required to use the design of the state's high-deductible plan.
39. Information Technology Services for Certain Agencies and Shared Agency Services Pilot Program
Section 9101 (5n) (a)
Section 9101 (5n) requires the Department of Administration to consult with certain agencies to develop a plan for assuming responsibility for human resources, payroll, finance, budgeting, procurement and information technology services, to be submitted to the Joint Committee on Finance by March 1, 2016, for approval under s. 13.10, for implementation beginning July 1, 2016. I am partially vetoing section 9101 (5n) (a) to remove the Board on Aging and Long-Term Care, Board for People with Developmental Disabilities, Office of the Secretary of State, Office of the State Treasurer, Office of the Governor and Office of the Lieutenant Governor from the list of agencies that are subject to the plan. These agencies already receive most, if not all, of the above services from the department. With this veto, the department can focus on plans to extend services to agencies currently receiving few or no services.
40. Energy Efficient Building Designer Tax Deduction Certification
