By
joint committee for review of Administrative Rules.
To committee on Natural Resources
.
Assembly Bill 562
Relating to: creating a southeast Wisconsin crime abatement task force.
By
committee on Criminal Justice.
To committee on Criminal Justice
.
Assembly Bill 563
Relating to: the creation of a new type of financial institution; the powers of and requirements applicable to these financial institutions; providing an exemption from emergency rule procedures; and granting rule-making authority.
By
Representatives Jeskewitz, Rhoades, Kelso, Ward, Riley, F. Lasee, Huebsch, Plale, Jensen, Kestell, Ladwig, Staskunas, Montgomery, Hahn, Spillner, Owens, Ziegelbauer, Vrakas, Gronemus, Stone, Duff, Kedzie, Miller, Hoven, Leibham, Olsen, Hundertmark, Reynolds, Suder, Pettis, Walker, Klusman, Sykora, Grothman, Kreibich and Lassa; cosponsored by Senators Moore, Fitzgerald, Welch, Darling, Rosenzweig, Lazich, Rude, Drzewiecki, Farrow and Zien.
To committee on Financial Institutions
.
Assembly Bill 564
Relating to: providing a public school for a pupil that is accessible by the pupil's disabled parent.
By
Representatives Sinicki, Black, Berceau, Young, Boyle, Pocan, Miller, Riley and Richards; cosponsored by Senators Grobschmidt and Drzewiecki.
To committee on Education.
Assembly Bill 565
Relating to: requiring insurance coverage of the diagnosis and treatment of infertility and prohibiting collective bargaining by the state with respect to the requirement.
By
Representatives Wasserman, Black, Bock, Musser and Reynolds; cosponsored by Senators Grobschmidt, Darling and Risser.
To committee on Health.
Assembly Bill 566
Relating to: employe supervision by real estate brokers and requiring the exercise of rule-making authority.
By
Representatives Wieckert, Spillner, Sykora, Porter, Hahn, Schooff, Vrakas, Kestell, F. Lasee, Pocan and Meyer; cosponsored by Senators Clausing, Fitzgerald, Roessler and Rude.
To committee on Housing.
Assembly Bill 567
Relating to: granting high school diplomas to certain veterans.
By
Representatives Plouff, Musser, Sherman, Bock, Goetsch, Gronemus, Gunderson, Gundrum, Hebl, Huber, Hundertmark, Kreuser, Krug, Ladwig, J. Lehman, Meyer, Miller, Montgomery, Olsen, Pettis, Riley, Ryba, Seratti, Suder, Sykora, Turner, Wasserman and Waukau; cosponsored by Senators Moen, Breske, Chvala, Fitzgerald, Erpenbach, Clausing, Darling, Welch, Farrow, Rude, Drzewiecki, Wirch, Zien, Burke and Decker.
To committee on Education.
__________________
Reference Bureau Corrections
Assembly Substitute Amendment 1 to Assembly Bill 312
A405
1. Page 4, line 18: delete "
All of the following" and substitute "
. All of the following".
__________________
Executive Communications
State of Wisconsin
Office of the Governor
Madison
October 27, 2001
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 133 (partial veto)9October 27, 2001
Respectfully submitted,
Tommy G. Thompson
Governor
__________________
Governor's Veto Message
State of Wisconsin
Office of the Governor
Madison
October 27, 1999
To the Honorable Members of the Assembly:
I have approved
Assembly Bill 133 as
1999 Wisconsin Act 9 and deposited it in the Office of the Secretary of State.
The signing of this budget bill continues our efforts to reduce taxes in Wisconsin. Making tax reductions our number one priority will help all taxpayers throughout Wisconsin. The extra income made available to citizens will lead to an even stronger economy in the next century.
I have long argued that taxes in Wisconsin are too high at all levels of government. This budget acts on my pledge to work to make our taxes competitive with other states. Under the bill I am signing with vetoes, personal income taxes will be permanently reduced from current levels by 5.8%. For the average home, the property tax bill received in December 1999 will be reduced by an average of 3.6%, or $76, compared to the December 1998 bill.
To deliver this property tax relief, I used my veto power to restructure the lottery credit mechanism the Legislature adopted. I vetoed out the use of general purpose revenue to pay for administrative expenses of the lottery in prior years. I did this because I have grave doubts about the constitutionality of using general tax revenue to buy back administrative expenses of the state lottery made as long ago as 1995. I also vetoed out the use of general purpose revenue to pay for ongoing administrative costs of the lottery in fiscal year 2000-2001. I do not believe we should be paying administrative expenses of the lottery with general tax dollars on a permanent basis.
Instead, I have crafted language that redirects the bulk of the money that the Legislature used to fund the lottery credit into other forms of property tax relief. I have used the partial veto to add to current law an additional property tax/rent credit payment of 6.4% of the first $2,000 of property taxes in tax year 1999, an additional property tax/rent credit payment of 10% of the first $2,000 of property taxes in tax year 2000, and an increase in the school levy credit of $60 million to be reflected on the December 2000 property tax bill. Under the budget as vetoed, homeowners will see a $76 reduction in their December 1999 property tax bills for the typical home. Citizens will also see an increase of up to $128 in the property tax/rent credit on their tax year 1999 income taxes, an increase of up to $200 in the property tax/rent credit on their tax year 2000 income taxes, and an average increase of $22 in the school levy credit applied to the December 2000 property tax bill.
My proposal is constitutional, provides significant property tax relief and is a more equitable way to provide the relief than the expanded lottery credit plan passed by the Legislature. However, I believe the best way to return the budget surplus to citizens is to provide a property tax relief rebate check as soon as possible. To this end, I am signing the budget bill with the property tax reduction crafted through my vetoes as described above, but today I am also calling the Legislature back into special session to pass a bill giving citizens a rebate check averaging $286. If the Legislature can pass this bill by November 11, the deadline for printing the 1999 income tax forms affected by the budget, the property tax plan I crafted through the veto will be replaced by the rebate check. If the Legislature cannot act by this deadline, the plan I crafted through my budget veto will stand. We will have property tax relief either way, but my preference is to do it immediately via a rebate check.
Wisconsin has many other needs that we have also addressed in the budget. We continue to fund two-thirds of K-12 school costs and will now fund significant reductions in class sizes in grades K-3 in many Wisconsin school districts. We recognize the importance of a world class university system by investing in quality improvements in the University of Wisconsin, while increasing financial assistance for students who need it. We fund the BadgerCare program to provide health insurance for 67,500 low-income working families and begin our efforts to streamline how long-term care is provided in Wisconsin. We address the need to reuse Brownfields sites, continue recycling programs and reauthorize the Stewardship Program at a much higher level of funding. We have funded additional prison capacity while also increasing funds for social services that can prevent crime from happening in the first place.
I am proud we are addressing these and other needs. However, two problems in the budget concern me greatly. First, spending in fiscal year 2000-2001, the last year of the biennium, exceeds estimated revenue in that year by $435 million. This structural imbalance is simply too high. The budget I proposed contained a smaller imbalance, and my original budget did not take into account the additional $567 million in revenue the state now expects to receive between fiscal year 1998-1999 and fiscal year 2000-2001. This $435 million structural imbalance is the highest in our history.
A406
This structural imbalance is a concern because it means that, under the budget bill as passed by the Legislature, the first $435 million of revenue growth we receive in fiscal year 2001-2002 would have to be devoted simply to continuing the base level of spending from fiscal year 2000-2001. Furthermore, there are additional pressures affecting the next budget because:
• This budget contains over $75 million in advance commitments that will need to be funded in fiscal year 2001-2002 (the first year of the 2001-2003 budget), and will be a further draw upon available revenue.
• The Legislature pushed back my timetable to increase the required 1% budget balance to 1.1% in fiscal year 2000-2001, leaving a smaller reserve in fiscal year 2000-2001.
• School aids have increased to 40% of total GPR spending and debt service is also on the rise, both of which further constrain budget flexibility in the event of an economic downturn.
The combination of the structural deficit and these additional pressures means that we would need to have revenue growth of approximately 8% in the first year of the next biennium in order to fund our commitments and the unavoidable pressures we face under the bill as passed.
I believe that, in its zeal to be responsive to many different demands, the Legislature has been too ambitious in increasing GPR spending by 6.3% and 7.4% in fiscal year 1999-2000 and fiscal year 2000-2001, respectively. While the budget that passed is balanced in both fiscal years, the ending balance of $117.8 million in fiscal year 2000-2001 is just $5 million above the required 1% reserve. It will be extremely difficult to continue current programs in the next budget given the structural imbalance and the very limited balance overall.
My second major concern is the large increase in bonding authorized in the budget, particularly for new programs. Since we must meet our debt service payments once bonds are issued, we need to be vigilant that debt service does not become an increasing proportion of our total spending. My proposed budget authorized $572 million in new GPR-supported general obligation bonding in the 1999-2001 biennium, a level calculated specifically to ensure that debt service payments would remain at 3.3% of total GPR revenue over the next decade. The budget passed by the Legislature contains $698 million in new GPR-supported bonding authorizations. This level of bonding means that debt service will increase as a percentage of total revenue. We should not incur new long-term debt of this magnitude. Debt service payments will increase by 8.5% in fiscal year 2000-2001, while our GPR revenue will increase just 4.0%. Therefore, I vetoed several new bond authorizations to lower the total new bonding authorization amount by $39 million to reduce the new debt we will incur to a more affordable level.
In order to address these issues, I vetoed a total of $43 million in additional GPR spending items approved by the Legislature as a means to improve the ending balance. This is the largest amount of GPR budget savings achieved through vetoes during my tenure as Governor. I also exercised a veto to increase the size of the balance we are required to maintain from 1% to 1.2% of GPR spending. Finally, I will support legislation creating a fund to retain any additional revenue we collect during 1999-2001 compared to what the budget assumes, in order to help meet our needs in the following biennium. These are the most responsible ways to begin preparing for what can be expected to be a difficult budget in 2001-2003. It should also be noted that while the net ending balance is now projected to be $86 million under the budget as vetoed, $60 million of this must be set aside to pay the December 2000 school levy increase which is not paid under current law until July 2001 (fiscal year 2001-2002).
Total spending under the 1999-2001 budget as passed is $20.8 billion in fiscal year 1999-2000 and $21.3 billion in fiscal year 2000-2001, for a biennial total of $42.1 billion. These figures represent annual spending increases of 7.9% and 2.8%. From general purpose revenue, net spending will be $10.6 billion in fiscal year 1999-2000 and $11.4 billion in fiscal year 2000-2001, for a biennial total of $22.0 billion. These figures represent annual spending increases of 6.3% and 7.4%, primarily due to increases in spending to meet our commitment to fund two-thirds of school costs, to house our prison population, to pay for increased medical assistance costs for our low-income citizens and to make investments in our higher education system.
I am signing this budget with a total of 255 vetoes. Many of these vetoes were needed to reduce spending by a total of $43 million GPR. Some of these vetoes rolled back tax increases, saving $43 million. I do not believe we should be increasing taxes when the state has a booming economy. A number of these vetoes are technical in nature and were required to make provisions workable. I also tried to limit the Legislature's involvement in the day-to-day management of state agencies by eliminating the most burdensome new reporting requirements. The Legislature has a legitimate interest in knowing how state programs are working, but it should not micromanage agencies or dictate agency workload.
The budget I introduced and the Legislature passed moves Wisconsin forward, blazing a trail for other states to follow. Among the highlights are the following items:
Tax and Local Government Finance
• Enacts a comprehensive individual income tax reform and reduction package which makes Wisconsin's tax code simpler and more progressive.
• Reduces income taxes on a permanent basis in the second year of the biennium by $331 million, a 5.8% decrease. This will result in a tax cut of $200 for the average Wisconsin taxpayer in tax years 2000 and 2001. These income tax cuts are in addition to the 2.5% income tax cut enacted in the last biennium.
• Reduces all income tax rates in tax years 2000 and 2001, creating new rates for married joint filers in tax year 2001 and thereafter of 4.60% for taxable income below $10,000, 6.15% for income from $10,000 to $20,000, 6.50% for income from $20,000 to $150,000, and 6.75% for income over $150,000.
• Dramatically increases the base standard deduction from $9,040 to $12,970 for joint filers and from $5,280 to $7,200 for single filers and raises the ceiling for using the sliding scale standard deduction to $70,380 for individuals and $80,150 for married, joint filers.
A407
• Creates a new personal exemption for each tax filer, spouse and dependent of $600 for tax year 2000 and $700 for tax year 2001 and provides elderly filers with an added $200 exemption in 2000, which would increase to $250 in 2001.
• Increases the school property tax rent credit to 16.4% in tax year 1999 and continues the 10% credit into tax year 2000.
• Increases the married couple credit by raising the income ceiling to $16,000 from $14,000. The maximum credit would increase to $480 in tax year 2001.
• Increases the homestead income ceiling from $19,154 to $24,500.
• Reduces the typical homeowner's property tax bill by 3.6% in December 1999.
• Increases the lottery credit by $77 million in fiscal year 1999-2000.
• Increases the school levy tax credit by $60 million for December 2000.
• Increases funding for the expenditure restraint program by $9.0 million (19%), for the small municipalities shared revenue program by $1.0 million (10%), for the county mandate relief program by $600,000 (3%) and for the payments for municipal services program by $3.5 million (19%).
• Provides $64 million in fiscal year 1999-2000 and $71 million in fiscal year 2000-2001 to fully fund the personal property exemption for computer equipment effective January 1999.
Economic Development and Transportation
• Improves highway safety and enhances economic development by increasing state and federal support for highway construction projects and local transportation aids by over $150 million over the biennium.
• Establishes a new municipal street improvement program funded at $2 million over the biennium and increases local road improvement funding by a total of 9.3% for critical transportation infrastructure projects.
• Establishes mechanisms to ensure that state and federal transportation aid is dedicated to infrastructure improvement.
• Increases local transportation aids by 6.75% to meet rehabilitation and maintenance costs and to limit growth in property taxes.
• Establishes a four-tier transit aid distribution structure, creates performance-measurement and cost-effectiveness mechanisms for transit systems, and increases state assistance to local systems by 7.5%.
• Increases highway safety and law enforcement efforts by authorizing 14 new State Patrol troopers.
• Provides over $6 million in new funding for brownfields assessment, remediation and redevelopment efforts.
• Expands funding to promote Wisconsin tourism destinations by over 25% through use of gaming compact revenues.
• Provides $9 million from gaming compact revenues for support of economic development and diversification through grants to businesses.
