Section 40m
This section assigns an employee of the Legislative Reference Bureau to work with state agencies and the federal government in an attempt to increase the amount of federal funds received by the state.
I am vetoing this section because it is unnecessary. The Legislature may assign work load to its staff as it sees fit. This assignment does not need to be done by a statutory provision.
PROGRAM SUPPLEMENTS
24. Joint Committee on Finance Emergency Supplemental Appropriation
This provision allocates funding for the supplemental appropriation of the Joint Committee on Finance. Included in this appropriation is $352,200 GPR in each fiscal year that was added to the budget by the Legislature for unforeseen emergencies.
I find this amount to be excessive. By lining out the committee's s.
20.865 (4) (a) appropriation and writing in a smaller amount that deletes $252,200 in each fiscal year, I am partially vetoing section 286 [as it relates to s.
20.865 (4) (a)]. I am also requesting the Department of Administration secretary not to allot these funds. This partial veto leaves $100,000 GPR in each fiscal year for unforeseen emergencies.
SECRETARY OF STATE
25. Deputy Secretary of State
Sections 53m, 734e, 735e, 2398r and 9146 (1x)
These sections eliminate the position of deputy secretary of state.
I am vetoing these sections in order to retain statutory authority and position authorization for the deputy secretary of state. I object to the removal of this position because I believe constitutional officers should be able to have deputies. This position is eligible to perform all of the duties of the Secretary of State, except membership on the Board of Commissioners of Public Lands, and is a sworn public officer as prescribed by Article IV, Section 28, of the Wisconsin Constitution.
VETERANS AFFAIRS
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26. Veterans Tuition and Fee Reimbursement Schedule
Sections 1089g, 1092q, 1092r and 9358 (1f)
Current law provides participants in the Veterans Tuition and Fee Reimbursement Grant Program and Part-Time Study Grant Program a reimbursement rate of an amount not to exceed 85 percent of tuition and fees at Wisconsin four-year institutions and technical colleges. As a special benefit, disabled veterans participating in either program are eligible for an amount not to exceed 100 percent reimbursement of tuition and fees.
These provisions modify the Tuition and Fee Reimbursement Grant Program and Part-Time Study Grant Program to exclude fees and, instead, provide 100 percent tuition only to all veterans and reduce the100 percent tuition plus fees benefit for disabled veterans. Section 1089g allows both nondisabled and disabled veterans who participated in the Veterans Tuition and Fee Reimbursement Program on a full-time basis before the effective date of the bill to receive an amount not to exceed 85 percent tuition plus fees, 100 percent tuition only or 100 percent tuition plus fees, whichever is greater (which always will be 100 percent of tuition plus fees). Section 1092q allows nondisabled veterans who participated in the Part-Time Study Grant Program before the effective date of the bill to receive an amount not to exceed 85 percent tuition plus fees or 100 percent tuition only, whichever is greater. The bill does not effectively provide a similar eligibility standard for disabled veterans who participated in the Part-Time Study Grant Program prior to the effective date of the bill. While this group of disabled veterans currently receives a rate of 100 percent tuition plus fees in the Part-Time Study Grant Program under current law, this group of disabled veterans would in the future receive the same lower reimbursement as new disabled enrollees – 100 percent of tuition only.
I strongly object to the changes in the reimbursement rate for a number of reasons. These changes will introduce unjustified inequities within the program between former veterans and future veterans. For example, veterans of Operation Desert Storm who are currently enrolled in the full-time program would be eligible to receive 100 percent tuition plus fees. However, veterans returning from Operation Iraqi Freedom would receive only 100 percent reimbursement of tuition. As a result, some of the men and women returning from service in Iraq would receive a lower level of reimbursement. Every veteran should be entitled to the same education benefits, whether they are from the current generation or past generations.
I also object to the use of 100 percent of tuition only as the standard for reimbursing veterans for educational expenses. Compared to the current standard of 85 percent of tuition and fees, the 100 percent of tuition-only standard would penalize some veterans who attend technical schools that rely less on tuition and more on fees.
Finally, I object to the reduction in the benefit for disabled veterans who enroll in the full-time program in the future, as well as the immediate repeal of the special benefit for both current and future disabled veterans who participate in the Part-Time Study Grant Program. This provision unfairly penalizes Wisconsin's disabled veterans and I am using my veto authority to remove it.
To restore a tuition reimbursement schedule that appropriately reflects the sacrifices of our fighting men and women, I am partially vetoing these provisions in a way that will place all veterans, past and future, disabled or not, on the same reimbursement schedule – 100 percent of tuition and fees for both the full tuition and part-time study grant programs. While it was not my original intent to increase reimbursement levels in this budget, I have little alternative but to exercise this partial veto in order to treat current and future veterans fairly and restore the special disabled veterans benefit eliminated by the Legislature.
This change in reimbursement levels may have a fiscal effect on the appropriations funding these benefits. I request the Department of Veterans Affairs secretary to evaluate these impacts and submit a request to the Legislature for supplemental funding as needed.
E. TAX AND FINANCE
REVENUE
1. Cigarette and Tobacco Excise Tax Refunds
Section 2057m
This provision reduces the rate of refunds to the tribes related to excise taxes on cigarettes sold to non-Native Americans from 70 percent to 30 percent. I am vetoing this provision because it is an irresponsible action by the Legislature which may result in the loss of millions of dollars in revenue to the general fund. This provision would immediately abrogate a long-standing contract with Wisconsin's Native American tribes concerning the effective retail enforcement of the sale of tobacco products and cigarettes.
Before 1983, there was no agreement between the state and the Native American tribes regarding the collection of state excise taxes on cigarettes and tobacco products. Sales of these products were completely unregulated, creating serious enforcement and public health concerns.
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The 1983-85 biennial budget created the refund provision to respond to these issues. The refund provision was enacted to encourage Native American retailers to sell only stamped cigarettes. In 1983, the cigarette tax was converted from an occupational tax to an excise tax to allow the state to impose the tax on sales of cigarettes made by Native Americans to non-Native Americans on reservations. The state then entered agreements with Native American tribes through which Native American retailers purchase and sell only stamped (taxed) cigarettes. The state then provides a refund to the tribes of 70 percent of the tax paid on sales to non-Native Americans and 100 percent of the tax paid on sales to Native Americans (federal law prohibits states from imposing a cigarette tax on sales by Native Americans to Native Americans on reservations). The net annual revenue to the state under these contracts is approximately $18 million annually.
The Legislature's proposed abrogation of these contracts would result in serious financial and public health related consequences for the state. Without the contracts, the tribes could return to selling cigarettes and tobacco products without excise tax stamps affixed to the packages. The Department of Revenue would be forced to collect these revenues from each individual purchaser. Tracking every individual and collecting the legislatively mandated cigarette tax would be an enforcement nightmare. As a result, the short-term savings of $6 million estimated by the Legislature could become an on-going $18 million revenue loss to the state.
The Legislature's proposal also opens up the possibility of broader gray market sales or competitive tribal smoke shops. Not only does this undermine free market principles, it also creates an opportunity for unregulated sales of cigarettes to minors and young adults. This attempt to save a few million dollars could result in a public health disaster, reversing all of the recent gains in tobacco control efforts.
According to the Attorney General, the absence of enforcement brought on by this proposal would also open the state to the possibility of lawsuits from holders of tobacco bonds issued to securitize the state's share of the Master Settlement Agreement with the tobacco manufacturers. The Master Settlement Agreement requires that states maintain rigid enforcement mechanisms regarding the sale of cigarettes and tobacco products. The revenue estimates included in the agreement are predicated on certain assumptions that are tied to these enforcement measures. Reduced or nonexistent enforcement that would result from the abrogation of the excise tax agreement with the tribes would upset those assumptions and trigger immediate and massive lawsuits against the state for breach of contract.
This proposal puts Wisconsin at extreme risk. This is not the way to balance our budget. It's this type of short-sighted policy making that created the $3.2 billion deficit in the first place.
2. Bad Debt Deductions Against Cigarette and Tobacco Products Taxes
Sections 2057v, 2058f and 9445 (1b)
These provisions allow cigarette and tobacco product wholesalers to claim as a deduction against excise taxes an amount equal to the taxes portion of a bad debt deducted under federal tax law.
I am vetoing these provisions because the proposed language draft is sufficiently flawed as to be unworkable. The proposal cannot be applied consistently. The tobacco products tax statute is specific to distributors, while the cigarette tax may include permittees other than distributors. The proposal lacks definitions that cannot be
addressed by supplemental rules. Finally, it would be necessary to add personal liability to the cigarette and tobacco products tax statutes to allow the Department of Revenue to assess the debtor for the taxes owed to the state. The proposal is better considered as separate legislation rather than in the budget.
3. Joint Committee on Finance Approval of Lottery Privatization
Sections 2630g, 2630h and 2631
These provisions require that privatization of the lottery can proceed only if the Joint Committee on Finance approves the contracts acting under s.
13.10.
I am vetoing these provisions since such detailed contract review is an unwarranted intrusion into the daily management of a state agency. They are also completely unnecessary. Section
565.25 (1m) of the statutes already provides standards for any potential private contract the lottery would consider. The statutes also specify requirements for contractor financial responsibility and prohibit conflicts of interest. Moreover, any contract for privatizing the lottery would have to address transition to operation of the lottery by a private entity.
State of Wisconsin
Office of the Governor
July 24, 2003
The Honorable, The Senate:
I am vetoing Senate Bill 206 in its entirety. This bill is a trailer bill to Senate Bill 44 (the 2003-05 biennial budget bill) and makes several modifications to the municipal levy limits proposed under Senate Bill 44. The modifications include exempting from the limits any levy imposed by the City of Milwaukee on behalf of Milwaukee Public Schools; authorizing cities and villages to increase their levies for property newly annexed from a town only if the city or village has provided services for a fee to that property for at least 10 years; and authorizing towns with populations below 2,000 to exceed the levy limits by adopting a resolution to that effect at a special town meeting.
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After the Legislature passed
Senate Bill 44, it immediately passed this bill to address problems with its levy limit proposal in that bill. I expect that had I not vetoed the levy limit proposal on
Senate Bill 44 that
Senate Bill 206 would have been the first of many similar bills to address issues not considered by the Legislature when it crafted its levy limit proposal in
Senate Bill 44. I object to this bill because it is indicative of the numerous problems associated with the levy limit I vetoed in
Senate Bill 44.
Sincerely,
Jim Doyle
Governor
State of Wisconsin
July 24, 2003
The Honorable, The Senate:
Pursuant to Senate Rule
20 (2)(a) and
(b) I have appointed Senator Leibham to the Joint Committee on Finance and removed Senator Fitzgerald.
With regard to members of the minority party, appointments are made based on the nominations of that caucus.
Sincerely,
Mary E. Panzer
Senate Majority Leader
State of Wisconsin
July 24, 2003
The Honorable, The Senate:
Pursuant to Senate Rule
20 (2)(a) and
(b) I have appointed Senator Stepp to the Joint Committee on Finance and removed Senator Welch.
With regard to members of the minority party, appointments are made based on the nominations of that caucus.
Sincerely,
Mary E. Panzer
Senate Majority Leader
State of Wisconsin
July 25, 2003
The Honorable, The Senate:
I have appointed the following Republican Senators to the Special Select Committee on Job Creation:
Senator Kanavas - Co-chair
Senator Stepp - Co-chair
Senator Leibham
Please let me know if you have any questions.
Sincerely,
Mary E. Panzer
Senate Majority Leader
State of Wisconsin
July 28, 2003
The Honorable, The Senate:
Pursuant to Senate Rule
20 (2)(a) and
(b) I have appointed Senator Carpenter to the Joint Committee on Finance and removed Senator Moore.
With regard to members of the minority party, appointments are made based on the nominations of that caucus.
Sincerely,
Mary E. Panzer
Senate Majority Leader
State of Wisconsin
July 28, 2003
