The bill allows tax-option corporations and partnerships, including limited
liability companies and other entities that are treated as partnerships under federal
tax law, to elect to be taxed at the entity level for purposes of the income and franchise
taxes. An entity that makes the election is taxed at a rate of 7.9 percent on its net
income that is reportable to Wisconsin, and the situs of income is determined as if
the election was not made. The entity may not claim losses and tax credits except
for the credit for taxes paid to other states. The bill also provides that the adjusted
basis of the entity's partners, shareholders, or members is determined as if the
election was not made. If the entity fails to pay the taxes due, the Department of
Revenue may collect the amount from the entity's partners, shareholders, or
members. Persons who hold more than 50 percent ownership of the pass-through
entity must consent to the election and must consent to any revocation of the election.
The bill allows the election to be made for taxable years beginning in 2018 for
tax-option corporations and 2019 for other entities.
5.
This bill requires the Department of Veterans Affairs to submit to the Joint
Committee on Finance a notification of any transfers of funds from the
unencumbered balance of certain appropriations for veterans homes to the veterans
trust fund or the veterans mortgage loan repayment fund. Current law allows those
transfers to be made without any notification.
6.
Under current law, no later than September 15 of each even-numbered year,
each executive state agency must file with DOA the agency's budget request for the
succeeding biennium. This bill requires each agency to include with its biennial
budget request a report that lists each fee the agency is authorized to charge. The
report must also include the following:
1. The amount of each fee or the method of calculating the fee if there is no fixed
amount.
2. An identification of the agency's statutory authority to charge each fee.
3. A statement whether or not the agency currently charges the fee.
4. A description of whether and how each fee has changed over time.
5. Any recommendation the agency has concerning each fee.
The bill defines “fee” as any amount of money other than a tax that an agency
charges a person other than a governmental entity.
7.
Under current law, the Department of Transportation may make transfers of
state and federal funding between highway programs. This bill eliminates this
authority.
8.
This bill increases the size of the Group Insurance Board by four members. The
new members are appointed, respectively, by the speaker of the assembly, the
assembly minority leader, the senate majority leader, and the senate minority leader.
The bill also provides that the six members appointed by the governor for two-year
terms are subject to senate confirmation.
9.
This bill requires the Building Commission to establish an amortization
schedule for each short-term, general obligation debt authorized by the commission.
The amortization schedule must provide that a portion of the principal amount of the
debt is retired annually over the life of the improvement or asset to which the debt
is related. An amortization schedule established as required under the bill may not
be modified except as authorized by JCF under passive review.
10.
Under current law, the Department of Children and Families is directed to
allocate in each fiscal year specific amounts of money, including federal moneys
received under the Temporary Assistance for Needy Families (TANF) block grant
program, for various public assistance programs (commonly known as the TANF
schedule). Under current law, DCF may reallocate funds that are allocated for one
purpose in the TANF schedule for any other purpose in the TANF schedule if the
secretary of administration approves the reallocation. Also under current law, if the
TANF moneys received from the federal government are less than the amounts
appropriated for the purposes under the TANF schedule, DCF is required to create
a plan for reducing the amounts of moneys allocated under the TANF schedule and
to carry it out if the secretary of administration approves the plan. This bill replaces
the authority of the secretary to approve a reallocation or a plan to reduce the moneys
allocated under the TANF schedule with passive review by JCF.
11.
This bill separates a single appropriation to the Department of Workforce
Development for various workforce training programs, commonly referred to as the
Fast Forward program, into a separate appropriation for each program. The bill
appropriates the following amounts for each of the following programs for fiscal year
2018-19:
1. Career and technical education incentive grants — $3,500,000
2. Technical education equipment grants — $500,000
3. Teacher development program grants — $0
4. Apprenticeship programs — $225,000
5. Local youth apprenticeship grants — $2,233,700
6. Employment transit assistance grants — $464,800
7. Youth summer jobs programs in 1st class cities (currently only the city of
Milwaukee) — $422,400
Under the bill, DWD may request that JCF transfer moneys from the Fast
Forward appropriation account to the appropriation accounts for the teacher
development program grants and local youth apprenticeship grants to fund those
grant programs.
The bill also converts the Fast Forward appropriation from a continuing
appropriation to an annual appropriation.
12.
Under current law, DOA contracts with a vendor to provide web-based
technology services through a web portal to state agencies, state authorities, units
of the federal government, local governmental units, tribal schools, individuals, and
entities in the private sector. Revenue received from the fees charged for certain
services provided through the self-funded web portal is disbursed as payment to the
vendor.
This bill requires DOA to submit to JCF and the legislature by October 1 of each
year a report on the administration of the self-funded portal. The report must
include the following information: 1) a financial statement of state revenues and
expenditures; 2) a list of services available; 3) fees charged for each service; 4) the
activity level of each service; and 5) any other information that DOA determines is
appropriate to include.
13.
This bill eliminates the power of the attorney general to appoint a solicitor
general and up to three deputy solicitors general, each of whom must be licensed to
practice law in this state. The effect of the bill is to eliminate the Office of the Solicitor
General in the Department of Justice, which represents the state in certain cases on
appeal in state and federal courts.
14.
Under current law, the board of directors of the Wisconsin Economic
Development Corporation consists of 12 voting members as follows:
1. Six members are appointed by the governor subject to senate confirmation,
to serve at the pleasure of the governor.
2. Three members are appointed by the speaker of the assembly, consisting of
one majority and one minority party representative to the assembly and one person
employed in the private sector, all of whom serve at the speaker's pleasure.
3. Three members are appointed by the senate majority leader, consisting of
one majority and one minority party senator and one person employed in the private
sector, all of whom serve at the majority leader's pleasure.
Under this bill, the board consists of 18 members. The speaker of the assembly
and the senate majority leader each appoint five members to the board, and the
appointees need not be members of the legislature nor employed in the private sector.
Also, under the bill, the minority leader of each house appoints one member to the
board. The membership appointed by the governor remains unchanged.
The bill further provides that the chief executive officer of WEDC is appointed
by the board of directors of WEDC and serves at the pleasure of the board. Currently,
the governor appoints the CEO.
15.
This bill requires the presidential preference primary to be held on the second
Tuesday in March rather than the first Tuesday in April.
16.
Under current law, a qualified elector may apply for an absentee ballot
in-person no earlier than the third Monday preceding the election and no later than
the Friday preceding the election. Under this bill, a qualified elector may apply for
an absentee ballot in-person no earlier than the third Saturday preceding the
election and no later than the Friday preceding the election.
17.
This bill requires a party that alleges that a statute is unconstitutional, or in
violation of or preempted by federal law, to serve the speaker of the assembly, the
president of the senate, and the senate majority leader with a copy of the proceeding.
The bill also requires that, in such cases, the assembly, the senate, and the Joint
Committee on Legislative Organization (JCLO) are entitled to be heard,
representing the legislature and the state.
Under current law, if a statute, ordinance, or franchise is alleged to be
unconstitutional, the attorney general must be served with a copy of the proceeding
and be entitled to be heard. This requirement exists in the statutes for declaratory
judgment acts under s. 806.04 (11). The Wisconsin Supreme Court has also extended
the requirement to other types of actions involving claims that a statute is
unconstitutional. See Kurtz v. City of Waukesha, 91 Wis. 2d 103, 280 N.W.2d 757
(1979). This bill incorporates the Kurtz rule into the statutes and extends both the
current statutory and Kurtz requirements of service and an opportunity to be heard
to the legislature when a statute is alleged to be unconstitutional or in violation of
or preempted by federal law.
The bill also provides that when a party challenges the constitutionality of a
statute, facially or as applied, or challenges a statute as violating or preempted by
federal law, as part of a claim or affirmative defense, the assembly, the senate, and
JCLO have the right at any time to intervene and participate in the action and may
also retain legal counsel other than DOJ. Under the bill, the Committee on Assembly
Organization may intervene in the action, as well as obtain legal counsel, on behalf
of the assembly; the Committee on Senate Organization may intervene in the action,
as well as obtain legal counsel, on behalf of the senate; and JCLO may intervene in
the action, as well as obtain legal counsel, on behalf of the state. If JCLO determines
that the interests of the state will be best represented by special counsel appointed
by the legislature, JCLO must appoint special counsel to represent the state
defendants and act instead of the attorney general. In these circumstances, special
counsel has the powers of the attorney general with respect to the litigation to which
special counsel has been appointed.
Under current law, DOJ deposits settlement funds that are not committed
under the terms of the settlement into a DOJ appropriation and may spend the funds
only after submitting a plan for the expenditure to JCF for passive review. If JCF
does not schedule a meeting to review the proposed plan within 14 days, DOJ may
expend the funds as provided in the plan. This bill requires that DOJ must deposit
all settlement funds into the general fund. This bill also lapses all unencumbered
settlement funds that are currently in the DOJ appropriation into the general fund.
Current law allows the attorney general to compromise or discontinue an action
DOJ is prosecuting if the governor approves the compromise or discontinuance. This
bill requires JCF to approve the compromise or discontinuance instead of the
governor. Current law allows the attorney general to settle and compromise actions
in which the attorney general is appearing for and defending the state as the
attorney general determines to be in the best interest of the state. This bill requires
that, if the action is for injunctive relief or there is a proposed consent decree, the
attorney general must submit the settlement or compromise plan to JCF for passive
review. If JCF does not schedule a meeting to review the plan within 14 days, the
attorney general may proceed, but, if JCF does schedule a meeting, the attorney
general may proceed only with the approval of JCF.
The bill further provides that the attorney general may not submit a proposed
settlement plan to JCF in which the plan concedes the unconstitutionality or other
invalidity of a statute without the approval of JCLO.
18.
Under current law, as the final step of the administrative rule process, an
agency must file a certified copy of a rule with the Legislative Reference Bureau for
publication. Filing a certified copy of a rule with the LRB creates a number of
presumptions, including that the rule was duly promulgated by the agency and that
all of the required rule-making procedures were complied with.
This bill eliminates the statutory presumptions that a rule was “duly”
promulgated by the agency and that all of the required rule-making procedures were
complied with.
19.
Under current law, DOR must determine the amount of additional revenue
collected from the state sales and use tax as a result of any federal law that expands
the state's authority to collect sales and use taxes from out-of-state retailers. After
DOR makes that determination, it must then determine how much the individual
income tax rates may be reduced in the following taxable year in order to decrease
individual income tax revenue by the amount of additional sales and use tax revenue.
Finally, DOR must certify its determinations to the secretary of administration, to
the governor, and to the legislature and specify that the new individual income tax
rates will take effect in the following year. No further legislation is required to make
this change.
The U.S. Supreme Court recently upheld a South Dakota law that required the
collection of state sales and use taxes from any out-of-state seller that either
conducts 200 or more transactions annually with consumers in the state or has
annual sales in the state exceeding $100,000. See, South Dakota v. Wayfair, Inc., 585
U.S. ___ (2018). The Wayfair decision overturned longstanding precedent that
prevented a state from collecting sales and use tax from out-of-state sellers that did
not have a physical presence in the state. See, Quill Corp. v. North Dakota, 504 U.S.
298 (1992).
This bill clarifies that the recent U.S. Supreme Court decision that expands a
state's authority to collect sales and use taxes from out-of-state retailers triggers the
determinations mentioned above. The bill also provides that the new individual
income tax rates based on the determinations would not take effect automatically in
the year following DOR's certification, but, instead, DOA, in consultation with DOR,
would determine the new tax rates to take effect for the taxable year ending on
December 31, 2019, and report its determinations to the governor, JCF, and the
Legislative Audit Bureau. LAB would then review the determinations and report its
findings to JCF and the Joint Legislative Audit Committee. If LAB's review results
in a re-determination of the rates, JCF would determine which rates apply to the
taxable year ending on December 31, 2019, and report its determination to the
governor, the secretary of administration, and the secretary of revenue. Finally, the
bill includes in the definition of a “retailer engaged in business in this state” any
retailer that has annual gross sales into this state in excess of $100,000 or an annual
number of separate sales transactions into this state of 200 or more.
20.
Current law requires DOA, at the direction of JCLO, to lease or acquire office
space for legislative offices or legislative service agencies. This bill requires instead
that the cochairpersons of JCLO lease or acquire office space for legislative offices
or legislative services agencies.
21.
Currently, representatives to the assembly and senators, as well as legislative
employees, may receive legal representation from DOJ in most legal proceedings.
Assembly and senate policies and practices also allow legislators and legislative
employees to retain outside legal counsel in some instances.
With respect to the assembly, the bill provides that the speaker of the assembly
may authorize a representative to the assembly or assembly employee who requires
legal representation to obtain outside legal counsel if the acts or allegations
underlying the action are arguably within the scope of the representative's or
employee's duties. The speaker may also obtain outside legal counsel in any action
in which the assembly is a party or in which the interests of the assembly are
affected, as determined by the speaker.
With respect to the senate, the bill provides that the senate majority leader may
authorize a senator or senate employee who requires legal representation to obtain
outside legal counsel if the acts or allegations underlying the action are arguably
within the scope of the senator's or employee's duties. The majority leader may also
obtain outside legal counsel in any action in which the senate is a party or in which
the interests of the senate are affected, as determined by the majority leader.
Finally, the bill provides that the cochairpersons of JCLO may authorize a
legislative service agency employee who requires legal representation to obtain
outside legal counsel if the acts or allegations underlying the action are arguably
within the scope of the employee's duties. The cochairpersons may also obtain
outside legal counsel in any action in which the legislature is a party or in which the
interests of the legislature are affected, as determined by the cochairpersons.
22.
Under current law, a state agency must prepare a fiscal estimate for each
proposed rule, which must describe the fiscal effect of the proposed rule on local
governmental fiscal liabilities and revenues, the fiscal effect of the proposed rule on
state government, and, for rules that the agency determines may have a significant
fiscal effect on the private sector, the anticipated costs that will be incurred by the
private sector in complying with the rule. Also under current law, the agency must
prepare an economic impact analysis for a proposed rule, which must contain certain
specified information on the economic effect of the proposed rule on specific
businesses, business sectors, public utility ratepayers, local governmental units, and
the state's economy as a whole, as well as certain other information regarding the
economic impact of the proposed rule.
This bill specifically requires an economic impact analysis for a proposed rule
to be prepared and submitted separately from the fiscal estimate for the proposed
rule.
23.
This bill provides that a plan submitted by an agency to the federal government
for the purpose of complying with federal law (compliance plan) does not confer
rule-making authority and cannot be used by an agency as authority to promulgate
rules. The bill provides that no agency may agree to promulgate a rule as a
component of a compliance plan unless the agency has explicit statutory authority
to promulgate the rule at the time the compliance plan is submitted to the federal
government.
24.
This bill requires the Department of Corrections to submit a report to the
legislature upon request, and to post the report on its website, regarding individuals
who, since the previous report or during a date range specified in the request, were
pardoned or released from imprisonment before completing their sentences. The
report must identify each individual by name, include the crime for which he or she
was convicted, and provide the name of the person who pardoned the individual or
authorized the early release. If an individual appears on a report requested under
this bill and is subsequently convicted of a crime, this bill requires DOC to report also
the name of that individual and the crime.
25.
This bill requires all executive branch state agencies, other than the Board of
Regents of the University of Wisconsin System, to submit a quarterly report to JCF
listing all state agency expenditures for state operations in the preceding calendar
quarter. The report must specifically detail all expenditures for administrative
supplies and services that are made at the discretion of or to be used by heads of state
agencies, secretaries, deputy secretaries, assistant deputy secretaries, and executive
assistants. Under the bill, “state operations” means all agency expenditures except
aids to individuals and organizations and local assistance.
26.
Under current law, administrative rules that are in effect may be temporarily
suspended by JCRAR. If JCRAR suspends a rule, JCRAR must introduce bills in
each house of the legislature to make the suspension permanent. If neither bill to
support the suspension is ultimately enacted, the rule may remain in effect and
JCRAR may not suspend the rule again.
This bill provides that JCRAR may suspend a rule multiple times.
27.
Under current law, an agency may, by rule or by an order in a particular case,
specify that the decision of a hearing examiner who conducts a hearing in a contested
case proceeding is the final decision of the agency. This bill prohibits an agency from
delegating the authority to issue a final decision in a contested case to a hearing
examiner. This bill also requires that all final decisions of an agency must be
approved, signed, and dated by the secretary of the agency.
28.
The bill provides that any individual nominated by the governor or another
state officer or agency, and with the advice and consent of the senate appointed, to
any office or position may not hold the office or position, be nominated again for the
office or position, or perform any duties of the office or position during the legislative
session biennium if the individual's confirmation for the office or position is rejected
by the senate. Currently, there is no prohibition against the governor or another
state officer or agency nominating the individual again for the office or position or
appointing the individual to the office or position as a provisional appointment.
29.
This bill requires that WEDC obtain approval from JCF under passive review
before WEDC designates a new enterprise zone under the enterprise zone tax credit
program. The bill also eliminates any restriction on the number of enterprise zones
WEDC may designate. Currently, WEDC may not designate more than 30 enterprise
zones.
30.
This bill provides that for Southeast Wisconsin freeway megaprojects, major
highway development projects, and certain state highway rehabilitation projects for
which DOT spends federal money, federal money must make up at least 70 percent
of the aggregate funding for those projects. The bill provides that if DOT determines
that it cannot meet this requirement or that it can make more effective and efficient
use of federal money, DOT may submit a proposed alternate funding plan to JCF for
review under its passive review procedure.
The bill requires DOT to notify political subdivisions receiving aid for local
projects whether the aid includes federal moneys and how those moneys must be
spent. The bill provides that, for projects that receive no federal money and that are
reviewed and approved by a professional engineer or the county highway
commissioner, DOT may not require political subdivisions to comply with any
portion of DOT's facilities development manual other than design standards.
31.
