Fourth, these levy limits hinder educational attainment and job training. The limits on technical college levies will require students to pay more for classes or reduce the course offerings of the technical colleges. In either case, this diminishes our ability to provide individuals with the skills necessary to improve their earnings and compete for better paying jobs. Further, it hampers funding for many of the functions of municipal government – for example public libraries – that also support our children's education.
Fifth, these levy limits are inequitable. Wisconsin's neediest communities, with little open space for new construction, could have little or no levy growth. In contrast, wealthier municipalities with open land available for development will have substantial capacity to raise revenues. Consider what would have occurred had the proposal been in effect in 2001. In that year, the city of Milwaukee had a 0.9 percent increase in value due to new construction while Germantown had a 5.6 percent increase; Marinette had a 1.4 percent increase while Sun Prairie had a 6.1 percent increase; and Monroe had a 1.2 percent increase while Middleton had a 4.7 percent increase. The proposal will result in limiting the ability of municipalities to provide vital public services and exacerbating the existing discrepancies in economic growth.
Local elected officials are in the best position to make decisions regarding the appropriate level of services to fund and provide for residents of their communities. These officials have continually made difficult decisions regarding these important issues. Local governments and their residents should not be penalized for the state's own fiscal disorder.
The veto of the levy limit on Wisconsin Technical College Districts will have an impact on several of the state's tax relief programs. This impact is discussed under Department of Public Instruction, Item #3. I have not reestimated the spending levels in these programs related to vetoing limits on municipal and county levies. I believe that local elected officials will act responsibly and limit growth in local levies. As such, a reestimate is not necessary.
16. Municipal Shared Revenue Payments
Sections 286 [as it relates to s.
20.835 (1) (dd)], 661m, 662d, 662de, 662e, 663, 665, 1653d, 1653e, 1653f, 1654, 1655, 1656, 1658, 1658d, 1662b, 1662d, 1663b, 1664b, 1666b, 1669d, 1669e, 1669f, 1669g and 9445 (1) (b) and (1m)
These provisions create new formulas for municipal shared revenue payments in 2004 and 2005. Specifically, these provisions create a new equalization formula for larger population municipalities and a proportional reduction formula for smaller population municipalities. Jointly, these formulas reduce municipal shared revenue payments by $50,000,000 compared to current law beginning in 2004. These provisions then repeal the new formulas and eliminate all provisions regarding the distribution of municipal shared revenue for 2006 and beyond.
I am partially vetoing these provisions because these formulas misrepresent the actual allocation, create inequities among municipalities, add needless complexity and create uncertainty for long-term municipal funding.
First, the formula changes do not work as claimed. It is claimed that the new equalization formula aids important public safety needs, such as police and fire. In reality, it actually provides the most aid to those communities with the fewest public safety needs. Municipalities with costs below 50 percent of the state average of larger municipalities will have those costs weighted at 150 percent, while municipalities with above average costs will receive no aid on any dollar spent above the average. In other words, those who live in high-crime areas do not receive the state aid necessary to provide important police and other public safety services.
Second, the formula changes create inequities in aid to municipalities. When all the pieces of municipal budgets are put together, wealthier municipalities would have smaller percent reductions than poorer communities.
Third, the formula changes add unnecessary complexity. They redistribute state aid to mask the simple need for a modest reduction in shared revenue to help address the state's budget deficit.
Fourth, the proposal repeals shared revenues without an alternative. There should be no repeal without a replacement. State revenue sharing is a long-standing progressive feature of Wisconsin state-local finance. Municipalities need certainty regarding their future shared revenue payments.
S295
As a result of my veto, the $50,000,000 reduction to shared revenue will be accomplished directly. It will be computed on a straightforward per capita basis, equaling an estimated $12.73 per person. It will establish a maximum allowable percentage reduction. No municipality would have more than a 15.7 percent reduction compared to current law payments for 2004. The payment distribution will be settled for all future years.
Under my veto, all municipalities are expected to receive at least as much shared revenue as under my initial budget proposal. Indeed, my veto allocates the entire $20,000,000 that the Legislature added back to shared revenue to fund the minimum guarantee that is implicit in the maximum percentage reduction. As a result, over 1,100 municipalities will be better off, and no municipalities will be worse off, than under my initial budget proposals.
With this action, and the veto of the levy limits, I know and expect local elected officials will continue to make the types of difficult decisions that they have made in the past to hold the line on spending and still fund important services, such as police and fire, for the citizens of their communities.
17. Legislative Joint Committee to Study Municipal Aid
Section 9133 (3m)
This section specifies that the Joint Committee on Legislative Organization may create a joint committee to study the distribution of state aid to municipalities.
I am vetoing this section because it is unnecessary. The Legislature may create such committees without a provision in the budget bill. Moreover, my veto of the municipal shared revenue changes eliminates the primary need for this committee. While the Legislature left future municipal shared revenue distributions completely unspecified, and, consequently, left local officials with little direction in how to plan for future budgets, my veto of the municipal shared revenue changes establishes a distribution that continues into the future.
18. Agricultural Forest Land
Section 1536h
This section establishes agricultural forest land as a new classification of property. It specifies that agricultural forest land is to include land that is producing or capable of producing commercial forest products and that is included in a parcel that has been classified, in part, as agricultural land or is contiguous to a parcel, owned by the same person, that has been classified in whole or in part as agricultural land. The bill requires that agricultural forest land be assessed at 50 percent of market value for both property taxation and equalization purposes.
I am partially vetoing this section because its focus should be on forest land owned by farmers. As a result of my veto, only land that is producing or capable of producing commercial forest products that is contiguous to a parcel owned by the same person that is classified "in whole" as agricultural land will be included in this new category. As affected by this veto, land that is on a parcel that is "in part" agricultural land and land contiguous to a parcel that is "in part" agricultural land will be excluded from the definition.
This partial veto to narrow the classification is necessary because the Legislature's definition of agricultural forest land is too broad. It neither requires that a minimum percentage of a parcel be agricultural nor requires a minimum amount of agricultural acreage. Such a broad definition could also be subject to abuse and encourage nonfarmers to convert forest lands to receive tax benefits.
By limiting the land that may be classified as agricultural forest to land contiguous to a parcel that is fully devoted to agriculture and owned by the same person, my veto provides significant tax relief by targeting the property classification to those whose livelihood is farming without creating a greater shift of property taxes to nonagricultural land.
While I understand that this veto may exclude some land for which a legitimate claim for a tax break could be made, any additional expansion of the agricultural forest classification should not occur without further research into its effects on other properties. Absent such research, application of this new classification beyond its intended target could undermine farm tax relief efforts as property tax rates rise in response to lower overall valuations. This result would undercut not only this effort to assist farmers, but also efforts to assist farmers through use value and the new classification for undeveloped land that I am also signing into law in this budget bill.
Separately, I am acting to save an existing tax relief program for farmers by vetoing the elimination of the farmland preservation tax credit (see Agriculture, Trade and Consumer Protection, Item #1). Taken together, my actions provide a very substantial benefit for the agricultural industry by vetoing a $23 million income tax increase for farmers and retaining provisions that reduce property taxes on wetlands and certain forest lands that are part of a farm.
19. Property Classifications Within State Assessment Guidelines
Section 1536b
S296
This section divides a group of properties into separate components for the purpose of determining the types of property in a municipality that are subject to Department of Revenue assessment oversight. This oversight ensures that certain types of property be assessed within ten percent of full value at least once every four years. Under current law, the value of swamp and waste, forest land and other property is summed to determine if they are at least five percent of a municipality's total value and thus subject to Department of Revenue oversight. Under this section, swamp and waste (renamed "undeveloped land" under the bill), agricultural forest, productive forest and other are all considered separately rather than as a whole for this purpose.
I am partially vetoing this section because it unnecessarily weakens assessment standards. Maintaining property assessments within specified criteria is an essential step in ensuring fair and equitable property taxation. As a result of my veto, the current law treatment of property classifications for Department of Revenue oversight is restored.
20. Use Value of Agricultural Land
Section 1536m
This section requires that any modification to the procedures used by the Department of Revenue in implementing the use value of agricultural land be approved under the administrative rule process.
I am vetoing this section because this requirement is unduly cumbersome and results in unacceptable delays. The determination of use values of agricultural land will always be a complex process requiring many steps and modifications as changes to the farm economy and farm laws continue to unfold. To allow use values to reflect the Legislature's intent, it is essential that the department be able to update its data sources and make adjustments in a timely manner. The rigidity of the rule-making process would not allow this to occur. Administrative rules are also an inappropriate means to enact the level of detail that is needed to calculate use values across the state. Moreover, if he ordinary rule-making process is followed to comply with this provision, no change in the use value formula will likely be in place in time to avoid negative agricultural land values that will occur in 2004. Since this outcome from the current formula is unworkable, the department needs to act rapidly to ensure agricultural values are fairly calculated.
Rather than use the cumbersome administrative rule process for procedural changes, existing means to change the use value formulas should be employed. Many modifications to use value procedures can be put in place through revisions to the department's assessment manual. This approach allows timely action and ensures statewide uniformity and equity in property tax administration. To the extent that major changes in the formula are needed, current law provides that these be made through the rule-making process. In addition, I request that the department provide the Legislature and other interested parties with complete information on any changes to the use value determination process.
21. County and Municipal Fees
Section 1532p
This section requires that any fee imposed by a county or municipality bear a reasonable relationship to the service for which the fee is imposed. It further requires that when a fee is first imposed, the county or municipality shall issue a written finding that the fee is reasonably related to the service for which the fee is imposed.
I am vetoing this section because it is unnecessary. Court decisions have clearly articulated that fees must be reasonably related to the purpose for which they are imposed. Moreover, this section's requirement for a written finding merely adds a redundant state mandate to the list of requirements that localities must meet.
22. Lottery and Gaming Credit Precertification
Section 1670dt
This section requires each county and city that administers the lottery and gaming credit to implement a procedure verifying that lottery and gaming credits are being claimed only for properties used as the principal dwellings of the home owners. These local governments are further required to report to the Department of Revenue every five years on these procedures. In addition, this section requires the department to summarize local procedures in a report to the Joint Committee on Finance every five years.
I am partially vetoing this section to eliminate the reports required from the department to the Joint Committee on Finance because these reports are unnecessary and may not be timely. In lieu of these reports, the committee may request an update on local government verification efforts at any time. In addition, the department can also propose changes to ensure that lottery and gaming credits are being used solely for tax relief to Wisconsin home owners.
UNIVERSITY OF WISCONSIN SYSTEM
23. Auxiliary Enterprises Funding of Financial Aid
Section 9157 (1x)
This section requires the University of Wisconsin Board of Regents to submit to the Department of Administration and then to the Joint Committee on Finance under 14-day passive review its plan for using auxiliary enterprises balances to fund new program revenue appropriations created to support funding increases to Wisconsin Higher Education Grants-University of Wisconsin students, the Lawton minority undergraduate grant program and the graduate student financial aid program. It would also prohibit the use of student segregated fees in funding the financial aid appropriations.
S297
I am partially vetoing this section to remove the requirement that the Board of Regents submit a plan for the proposed use of auxiliary enterprises balances to fund student financial aid. I object to this provision because the management of the auxiliary accounts is a Board of Regents function. To require legislative oversight of this matter would erode the Board of Regents' authority and unnecessarily hinder the board's ability to manage these programs. This partial veto retains the provision prohibiting the use of segregated fees in funding the auxiliary enterprises appropriations for student financial aid.
24. Sunset Date for Auxiliary Enterprises Funding of Student Financial Aid
Sections 329d, 386d, 389d, 390d, 933g, 939g, 990g, 9425 (2x) and 9457 (2x)
Provisions within these sections would sunset the auxiliary enterprises appropriations related to student financial aid programs affecting University of Wisconsin System students on June 30, 2005.
I am partially vetoing these sections to delete the June 30, 2005, sunset date in order to maintain flexibility in meeting student financial aid needs. While I expect that auxiliary enterprises funding of financial aid programs will not be required beyond fiscal year 2004-05, this decision should be made in the context of the 2005-07 biennial budget.
25. Rock County Engineering Initiative Earmark
This section provides $378,300 GPR and $203,700 PR in fiscal year 2004-05 and 5.0 FTE GPR positions for the University of Wisconsin-Platteville. These additional resources are intended for University of Wisconsin-Platteville to provide engineering instruction at the University of Wisconsin-Rock County campus.
I am vetoing this provision because I object to having the Legislature earmark funding for campus specific programs in the University of Wisconsin System. The Board of Regents should retain the authority to approve new programs. While collaborative programs like this may have great value to help grow the state economy, the Board of Regents should have the ability to make decisions after considering all of its priorities.
Although there is no language in the budget bill that authorizes this increase, the purpose of this funding was included in a Joint Committee on Finance amendment to the bill. By lining out the University of Wisconsin System's s.
20.285 (1) (a) and s.
20.285 (1) (im) appropriations and writing in smaller amounts that delete the $378,300 GPR and the $203,700 PR in fiscal year 2004-05, I am vetoing the parts of the bill which fund this provision. In addition, I am requesting the Department of Administration secretary not to allot these funds and not to authorize the positions. I am also requesting that in setting tuition rates during the 2003-05 biennium, the Board of Regents not raise tuition related to the amount of academic student fees permitted under this amendment of the Joint Committee on Finance.
WORKFORCE DEVELOPMENT
26. Transitional Subsidized Jobs
Section 9159 (4f)
This section directs the Task Force on Transitional Jobs, created by the secretary of the Department of Workforce Development, to continue its work reviewing and researching the creation and implementation of a subsidized work program under the Wisconsin Works (W-2) program, and to propose legislation that effects its findings and recommendations.
I am partially vetoing section 9159 (4f) because I object to causing unnecessary delay in the implementation of a transitional subsidized jobs program. Through this veto, I am returning, as closely as possible, to the intent of my original proposal on transitional jobs. My budget proposal called for the creation of a new transitional subsidized jobs program, offering W-2 participants time-limited subsidized employment and access to the earned income tax credit (EITC) as a new rung on the W-2 employment ladder.
The rationale behind implementing a transitional subsidized job program is to create a mechanism that, by providing W-2 participants an on-the-job experience that enables them to learn the demands and rewards of real work by doing real work, is more cost-effective and efficient in moving W-2 participants into unsubsidized jobs. This model of transitional subsidized jobs assumes short-term job slots with limited extensions; minimum wage paying jobs with access to the earned income tax credit; full reimbursement of employers; and thorough monitoring and strong management to ensure that participants make a rapid transition from subsidized to unsubsidized, private sector jobs.
The experience of transitional subsidized jobs programs both here in Wisconsin and in other states provides evidence of benefits for participants, their children and employers. In addition, the transitional jobs program will be an important tool in growing the state's economy. With the dramatic increase in retirements expected over the next decade, providing employers with opportunities to train additional employees will be important to their success.
The secretary of the department has already appointed a task force on transitional jobs, which has been meeting for several months to research strategies for implementing a transitional subsidized job program and to make recommendations to the department. My budget proposal and the activity of the task force represent a first step in implementing a transitional job component in the W-2 program.
27. Governor's Work-Based Learning Board
S298
Sections 81, 117d, 286 [as it relates to s.
20.292 (1) (ga) and
(kx) and s.
20.445 (1) (em)], 544, 548, 549d, 550d, 552d, 553, 725d, 946d, 946e, 946f, 946g, 946j, 1862d, 1863d, 1865d, 1866d, 1867d, 1867t, 1869d, 1870d, 1871, 1872, 1872h, 1873, 1874, 1875, 1876, 1878, 2405d, 9149 (1x), 9159 (6x) and 9259 (3)
These provisions eliminate the Governor's Work-Based Learning Board and transfer responsibility for the youth apprenticeship program to the Department of Workforce Development and responsibility for all other programs currently overseen by the board to the Wisconsin Technical College System Board.
I am vetoing sections 81, 117d, 286 [as it relates to s.
20.292 (1) (ga) and
(kx) and s.
20.445 (1) (em)], 544, 548, 549d, 550d, 552d, 553, 725d, 946g, 1862d, 1863d, 1866d, 1867d, 1867t, 1872, 1873, 1874, 1875, 1876, 1878, 2405d, 9149 (1x) and 9259 (3) in their entirety and partially vetoing sections 946d, 946e, 946f, 946j, 1865d, 1869d and 9159 (6x) to reinstate the Work-Based Learning Board and to restore positions and funding to the Work-Based Learning Board that were transferred under the bill to the Wisconsin Technical College System Board.
I am also partially vetoing sections 1870d and 1871 to restore the Work-Based Learning Board's authority for administering the youth apprenticeship grant program, even though I could not, through a veto, transfer the actual appropriation dollar amounts for the youth apprenticeship program from the Department of Workforce Development to the board. Lastly, I am partially vetoing section 1872h to modify the expectation that 60 percent of participants completing a youth apprenticeship will be offered full-time employment by their employer to an expectation that 60 percent of participants will be offered employment, thereby expanding the expectation to include offers of part-time employment. This should minimize any disincentive an employer may have in taking on youth apprentices who may not want to pursue full-time employment immediately after high school graduation.
I could not veto the transfer to the Wisconsin Technical College System Board of the appropriations for school-to-work programs for at-risk youth and work-based learning grants to tribal colleges without stripping these programs of their funding. However, since these programs are essentially pass-through grants, having the programs administered by the technical college system board should not hamper the Work-Based Learning Board's ability to oversee school-to-work programs in general. I am requesting that the Work-Based Learning Board and Department of Workforce Development provide whatever assistance may be needed by the technical college system board to administer these programs.
I object to the repeal of the Work-Based Learning Board because dividing the state's school-to-work activities between separate departments would severely jeopardize the ability of the state to provide a coordinated and effective transition from education to employment. Building the skill level of Wisconsin's workforce is critical to my strategy to grow Wisconsin. Doing it in the piecemeal fashion that would result if the Legislature's changes were implemented will not get us where we need to be. The intent of this veto is to maintain as closely as possible a consolidated school-to-work program under the Work-Based Learning Board.
In addition to the 60 percent employment offer provision, the bill includes other important accountability measures for the youth apprenticeship program that I am retaining. These include limiting the maximum grant award to $900, requiring that local partners provide matching funds equal to 50 percent of the grant and expecting that 80 percent of individuals who participate in the program for two years receive a high school diploma. In addition, I expect that the Work-Based Learning Board will continue to work closely with the Wisconsin Technical College System, the Department of Public Instruction and the Department of Workforce Development to ensure that Wisconsin's school-to-work programs retain their high quality and their commitment to having participants reach their maximum potential.
28. Workforce Attachment and Advancement
Section 1251m
Section 1251m repeals the Workforce Attachment and Advancement (WAA) program. I am vetoing this section to retain the legal structure of the WAA program. I object to the elimination of the statutory language authorizing the Department of Workforce Development to distribute WAA grants. Under the WAA program, the department provides grants to Wisconsin Works (W-2) agencies and local work force development boards. The WAA grants are used to help low-income families and noncustodial parents find employment, remain attached to the work force and advance to higher paying employment.
These objectives should remain a component of the state's programs to assist low-income workers. While the allocation for the WAA cannot be recovered, I encourage the department to use other available funds to provide WAA grants to W-2 agencies and local work force development boards.
29. Department of Workforce Development Earmarks
S299
Sections 286 [as it relates to s.
20.445 (3) (dz)] and 1272g earmark $100,000 annually to support grants to an organization that provides summer and after-school recreation programs for children and families of Southeast Asian origin as part of the Temporary Assistance for Needy Families budget. Sections 286 [as it relates to s.
20.445 (1) (kv)], 492g, 614g and 1857m earmark $100,000 annually in tribal gaming revenues to support compulsive gambling grants to organizations that assist persons who are African American and persons of Southeast Asian origin with compulsive gambling issues. Finally, section 9159 (9d) requires the department to secure federal funding to be used to contract with certain specified faith-based organizations to create jobs and counsel families that have been impacted by gun violence.
I am partially vetoing section 286 [as it relates to s.
20.445 (1) (kv) and s.
20.445 (3) (dz)] and vetoing the remainder of these provisions in their entirety because I strongly object to the manner in which they were included in the budget bill.
While I support the goals of these programs, new funding initiatives like these should be discussed in open debate and not included in a late night omnibus motion in order to secure enough votes to pass the budget bill. When I was elected Governor, I promised to change the way government does business. Signing these items into law would be a return to a style of budget development that I promised to eliminate.
By lining out the Department of Workforce Development's s.
20.445 (3) (dz) appropriation and writing in a smaller amount that deletes $100,000 annually, I am vetoing the part of the bill that funds grants for summer and after-school recreation programs for families and children of Southeast Asian origin. I am also requesting the Department of Administration secretary not to allot these funds.
B. ENVIRONMENTAL AND COMMERCIAL RESOURCES
AGRICULTURE, TRADE AND CONSUMER PROTECTION
1. Farmland Preservation Tax Credit Sunset
Sections 1583p, 1731ec, 1731eg, 1731ek, 1731em, 1731g, 1731gm, 1731j, 1731L and 1731n
These sections repeal the Farmland Preservation Program by prohibiting farmland preservation tax credit claims for taxable years beginning after December 31, 2002, for a claimant who is subject to exclusive agricultural zoning. The provision allows claims by a claimant who is subject to an existing farmland preservation agreement until the agreement expires, but prohibits the Department of Agriculture, Trade and Consumer Protection from entering into new agreements.
