WisPolitics Budget Blog

Sen. Russ Decker, D-Weston, said today at a WisPolitics luncheon that he doesn't expect to see any sales tax exemptions repealed in the new budget and had some advice for groups that continually complain about the tax climate.

"We need to stop bashing our state as a tax hell," he said.

The luncheon with Decker and his fellow JFC co-chair Rep. Kitty Rhoades, R-Hudson, at the Madison Club was sponsored by WHD Government Affairs, Flaherty & Associates and Sonic Foundry.

Rep. Kitty Rhoades, R-Hudson, said the Legislature needs "to have serious talks about establishing truly segregated funds." She suggested that she would not support any proposals for increasing revenues until the issue of protecting them from transfers.

"You learn very early on in your legislative career that there's no such thing as a segregated fund except for the money you put in your shoe," she said.

Decker said in a perfect world, there would be no transfers from the transportation fund. "No one wants to see a road cutback. I think there's areas we need to beef up the infrastructure" he said. Still, he said it may be appropriate for the state to transfer funds from other areas to fix its $1.6 billion deficit, singling out the recycling fund as one that should be considered.

Both legislators indicated they would not support cutbacks to medical assistance funding. Asked about the state's commitment to fund two-thirds of public education, Rhoades responded, "Two-thirds of what?"

"You know what? We've got good schools. We've got really good schools," Rhoades said. "And we also need to remember that in the past 10 years there has never been less money put into K-12 than the year before."

Decker said the two-thirds commitment has provided property tax relief and created jobs. If the state abandons the commitment, schools will be forced to make cuts and go to referendum, he said.

Hear audio from the luncheon:http://www.wispolitics.com/index.iml?Content=173

Gov. Jim Doyle's Healthy Wisconsin Council approved a report today recommending a $1 per pack increase in tobacco taxes in part to help pay for other recommendations designed to cut health insurance costs.

The council approved its draft report with some tweaks before sending it to the governor as he builds the next budget. That includes recommending the extra $227.5 million the increased tobacco taxes would bring in go to a health care trust fund that would cover increased reimbursement rates for Medicaid providers, the council's recommendations and other health care reforms.

Doyle created the council in July to recommend ways to reduce the uninsured rate in Wisconsin by 50 percent, cut the health insurance premiums for individuals and businesses by 30 percent, and strengthen the private insurance market in the state, among other things.

One recommendation is the creation is an authority to issue reinsurance for small businesses and co-ops. It would essentially be an insurance program for insurance companies that would kick in for catastrophic claims. The proposed authority would be allowed to finalize details on how it would work.

The other is an expansion of the Medicaid program to cover childless, uninsured adults making up to $19,600 a year.

Sen. Carol Roessler, one of the council members, said she has long supported an increase in the cigarette tax because of the health care costs associated with tobacco products.

She said she has been encouraged by remarks Doyle has made lately that he is open to such a hike, and she said the reinsurance program was an important experiment to cut health care costs for small businesses and co-ops.

"Standing still isn't sufficient," she said.

Wayne Corey, executive director of the Wisconsin Independent Businesses Inc., said the committee recommended restricting the additional tobacco tax revenue to health care to send the message it shouldn't be used to fill existing holes in the budget. He said he expects Doyle to use it in his budget proposal somehow. But he said it will likely be tweaked by Doyle and then again by lawmakers once they get the budget.

Doyle spokesman Matt Canter called the plan a "blueprint for meaningful health care reform" but couldn't say for sure whether the governor will incorporate it into the budget. He also would not commit the governor to the council's recommendation for an increase in tobacco taxes to $1.77 a pack.

"He's always said he's open to a cigarette tax increase if and only if the money goes toward reducing tobacco use and reducing health care costs," Canter said. "He'll have to look at it."

Sen. Mike Ellis, R-Neenah, today called proposals to increase the cigarette tax increase a "money grab" and said the state should not be considering new programs at a time when it has a $1.6 billion shortfall.

*See the council's draft report:http://www.wispolitics.com/1006/061211HealthyWis.pdf

*See the Ellis release:http://www.wispolitics.com/index.iml?Article=80773

Requests from the state's tribal nations range in size from a few thousand to several million dollars as the tribe's take advantage of Gov. Jim Doyle's invitation to submit their wish lists.

The requests submitted in May range from the tangible, like the Red Cliff Band's need to replace a 20-year-old X-ray machine at a cost of $70,000, to the more abstract, such as $150,000 for the creation of the Wisconsin Indian Education Association.

Added up, the tribes have requested $34.2 million over the upcoming biennium, according to the Department of Administration's budget shop.

"We simply give them the courtesy we give everyone else of hearing their requests and prioritizing them within the state budget," said Sean Dilweg, DOA executive assistant.

The first time the tribes were given the chance to submit requests was two years ago when, Dilweg said, the tribes "didn't get much of what they asked for outside usual earmarks."

Since the compacts were entered in 1998, roughly $20 million annually is spent on state projects like tourism promotion and sewer and water treatment, Dilweg said. Prior to 1998, the federal government capped at $350,000 the amount states could receive from tribes in exchange for exclusive gaming rights.

The state receives approximately $100 million annually in revenue from the gaming compacts, and returns about $20 million annually to the tribes, Dilweg said.

According to a Legislative Fiscal Bureau paper released in January 2005, the state allocations of tribal gaming revenue back to state programs totaled $20.2 million in 1999-00, $22.2 million in 2000-01, $24.0 million in 2001-02, $27.2 million in 2002-03, and $22.9 million annually in 2003-04 and 2004-05. LFB staffer Art Zimmerman, who prepared the memo, said some of the money provided to state agencies goes to programs that benefit tribal members, while some is spent on projects with no ties to the tribes.

Under current law, monies in excess of the amounts allocated to state agencies are deposited in the general fund, according to Zimmerman.

See the LFB paper: http://www.legis.state.wi.us/lfb/Informationalpapers/81.pdf (The allocation amounts are provided in Table 3 of the document, pages 26 and 27 of the pdf file.)
According to a presentation made to the Wisconsin Legislative Council Special Committee on State-Tribal Relations last month, the tribal gaming revenue allocations made to agencies in 2006-07 was approximately $28 million and provided base funding for 42 programs in state government.

See the memo: http://www.wispolitics.com/1006/061208Nov06LFBMemo.pdf

"It's a positive thing because it is bringing tribal governments right into the operations of the state," said Bad River Band operations manager Ray DePerry of the request process. "We've benefited in an across-the- board way. We understand that sure, we may not get everything on our list, but the fact we have the process in place'' is beneficial.

While Doyle has kept the funding level steady in his budgets, legislators have chosen to pare back the money sent back to tribes. "We may include some requests in budget; it's too early to tell," said Dilweg. "But the Legislature has to agree, and in the past the Legislature has not agreed on some of those issues."

A spokesman for Assembly Speaker-elect Mike Huebsch, R-West Salem, said the office wouldn't comment on the tribal requests until the governor finalizes his budget.

DePerry said the Wisconsin Indian Education Association would work in conjunction with state agencies and groups like the Department of Public Instruction, the Board of Regents and the Wisconsin Education Association.

DePerry said the proposed WIEA has been backed by the Great Lakes Inter-Tribal Council because the Native American community lacks a centralized agency to deal with education issues on a statewide level. "If there's one issue where all the tribes can pull together, it's education," he said. DePerry said $150,000 would be enough to hire staff and locate an office, get the organization operating "and hopefully fine-tune from there."

Bad River is also looking for $115,000 in FY 07 and $150,000 in FY 08 for the purchase of road maintenance equipment. DePerry said federal Bureau of Indian Affairs funding isn't enough to keep the community's 41.3 miles in roads in good repair.

"We need plows, graders, heavy equipment-type machinery," he said. "The equipment we have looks like it's from the Third World."

Also on the Bad River list is $1 million for the proposed Native American Cultural Educational Center in Wausau, a cooperative effort between the city, the GLITC and the Ho-Chunk Nation. The estimated $6.4 million project is to convert an existing federal building "into a place that will promote diversity, respect and an understanding of the state's 11 tribal nations," said Bad River chairman Eugene Bigboy. "Nowhere in the state does such a building now exist, and nowhere in the state has such a project received the overwhelming support of all 11 tribes."

The Ho-Chunk had a nine-item wish list, including road improvements near their casinos, increased DPI funding for alternative schools teaching native language, expanded funding of the Tribal Law Enforcement Grant Program, and more support for Health and Family Services programs. The Ho-Chunk list also included a request for increased funding to the State Historical Society for preserving cultural artifacts, and the establishment of a facility to hold and preserve artifacts.

The Lac du Flambeau seek $2.5 million to help with a new $5 million clinic project, and more funds for human services like elderly care, alcohol and drug abuse prevention, child welfare and mental health services. Also included in the Lac du Flambeau request is $4.3 million over the biennium for various natural resources programs such as wild rice enhancement, mercury contamination prevention, and funding to stop the invasion of invasive aquatic species.

The Oneida Tribe is requesting roughly $4.8 million over the biennium. Of that, $1.5 million is to build a therapy pool and therapeutic education center at the Syble Hopp School for children with disabilities, and about $1.4 million is for road improvements and a new fire station in the Village of Hobart.

Among the St. Croix Tribe's request is $10.3 million for the tribal police department, most of which would be earmarked for a new $10 million Justice Center, Law Enforcement Training Facility/Emergency Operation Center.

Among the Menominee Tribe's requests is additional funding for family services, child and adult care food programs, and elderly care programs.

The Red Cliff Band seeks $30,000 to manage the sport and commercial fishery they operate in Lake Superior.

The request from the Sokaogon Chippewa Community (located near Mole Lake) includes $2.6 million to construct and equip an emergency services facility in the Town of Nashville, which envelopes the Sokaogon reservation. Also requested is $1.2 million environmental education aquatic culture facility.

The Potawatomi tribe, which operates a lucrative casino in Milwaukee, did not submit a request.
See a summary of tribal requests: http://www.wispolitics.com/1006/061208tribal.pdf

Gov. Jim Doyle has promised he'll fill a $1.6 billion budget hole without raising taxes while insisting he'll still find a way to live up to his campaign pledges to create new tax breaks for college tuition, child care and health insurance premiums.

But that doesn't leave him many options for fixing the shortfall, according to budget-watchers who spoke with WisPolitics this week.

"He really doesn't have very much room to maneuver," another lobbyist said. "Since the election, he almost seems to be taking things off the table instead of leaving them on."

That includes Doyle's dismissal of a recent proposal from Sen. Jon Erpenbach, D-Middleton, to eliminate sales tax exemptions in order to help school funding and property tax relief.

For Doyle's part, so far he's been giving few clues about his strategy. More may emerge in coming weeks as Doyle widens a statewide swing to discuss the state budget, health care and other second-term priorities. His first was in Cudahy, followed by an event in Green Bay. Further listening sessions are scheduled for Wausau and Eau Claire next week.

See a Wisconsin Eye webcast of the first listening session in Cudahy: http://www.wiseye.org
Today at Madison Area Technical College, Doyle said it was too early to speculate on how he will close the gap, but he doesn't think he'll have to redirect funds from transportation to fill the hole.

"Those decisions all have to get made as we get closer to my introduction of the budget," said Doyle.

Hear the audio clip: http://www.wispolitics.com/1006/061208Doylebudgetquote.mp3
At MATC, Doyle reiterated his commitment to make BadgerCare coverage available to every child in the state, with families paying what they can on a sliding scale according to income. He also said he would continue to look for community-based options for caring for the elderly and disabled needing long-term care, and said he would allow individuals and families to deduct the full cost of their health insurance premiums on their taxes.

Doyle also said he looks to at least continue the state's $600 million biennial subsidy for child care, and would again push to institute a rating system for daycare centers.

On higher education, Doyle said the state's commitment to financial aid has more than doubled in the last four years, and he is committed to at least continuing current levels, and expanding tax deductibility for college tuition to the level of UW-Madison tuition as well as allowing tax deductibility for college textbooks and fees.

"There's plenty of speculation going on about the budget, but it is all premature at this point," Doyle spokesman Dan Leistikow said. "The governor will announce details of the budget after he's decided them, not before."

The general consensus among the lobbyists and interest group representatives who spoke to WisPolitics.com this week is Doyle won't go after shared revenue or propose any increases in sales, income or corporate tax rates, something administration officials have already indicated.

Doyle used transfers from the Patients Compensation Fund and the Transportation Fund to close a $3.2 billion shortfall in the last budget, accounting tricks some lobbyists said would be hard to fathom him trying again.

"If he does, that would be a 'wow,'" one lobbyist said.

Another lobbyist agreed transfers aren't a viable option based on the legislators that Assembly Speaker Mike Huebsch, R-West Salem, appointed to the Joint Finance Committee.

"Huebsch has sent his staunch conservatives to counteract the Senate and the governor," he said.

But at least a couple lobbyists think Doyle will use the Patients Compensation Fund again.

"From a long-term perspective - the approach the governor has taken in the last few budgets isn't good," one of them said. "From a re-election perspective, it was the smart way to do it."

Doyle made some of his intentions for the upcoming budget clear on the campaign trail, including his proposed tax breaks. The guv also wants to continue paying for two-thirds of the cost of K-12 public education, overhaul Medicaid, and pump money into efforts to promote job growth in manufacturing and high-tech industries.

One lobbyist expects revenue projections to grow before the budget is introduced in February, potentially filling one-third of the hole. But the lobbyist added: "That all gets eaten up if he maintains two-thirds" funding for public education. Unless Doyle finds new revenue through some kind of tax or fee increase, "you'd have to deny every agency request in the first year," which would ultimately lead to a property tax increase as schools struggle to make up for the loss, one lobbyist said.

"I think they're going to go to fees," one lobbyist said. "Neither the governor nor Republicans mentioned fees during the entire campaign."

Budget requests from state agencies provide some clue of what fees may not go up, such as those for hunting and fishing, which the DNR is not seeking to raise this time around. But the agency wants to raise boating registration fees anywhere from $5 to $23, depending on boat size, and charge campers between $1 and $3 more at most state parks. The DNR also wants to increase the 50-cent per ton tipping fee on hazardous waste disposal to $1.50 per ton.

Some hunters and sportsmen are pushing the state to find additional funding sources for the agency's wildlife fund, such as a special license plate, requiring licensing for recreational trailers or implementing a 1/8 of one percent sales tax to generate money for wildlife and tourism programs.

Leistikow said it was too early to say whether any of those suggestions would be included in the budget Doyle submits to lawmakers.

Another lobbyist said fees will have to be part of the solution for Doyle.

"He could be more aggressive than he has been in that area," the lobbyist said.

DOT proposed increasing vehicle registration fees to $80 from $55, but Doyle has said he doesn't support that large of a hike. He said during the campaign he would support a $10 hike in the license plate fee, and has repeated that since he won re-election. One lobbyist suspected the proposed $25 increase was part of the administration's strategy.

"That's raising it to $10 and looking like a hero in doing it," the lobbyist said. "It is a harbinger of things to come as far as fees go."

Doyle will likely get some help from Democrats in the Senate on fee increases. Joint Finance Committee Co-Chair Russ Decker, D-Weston, has proposed increasing the registration fee for semis, which hasn't gone up in a decade.

But fees alone won't get the job done, budget-watchers said.

"Truthfully, that doesn't raise you a lot of money," one lobbyist said.

Doyle has said he'll consider backing a cigarette tax increase from 77 cents to $1 if the hike is dedicated solely to paying for treating smoking-related illnesses, smoking cessation programs and keeping kids from smoking. Even though that would go against his promise not to raise taxes, it might sit OK with voters, lobbyists said.

"It's way more popular with voters than increasing the gasoline tax," one lobbyist said.

The lobbyist said Doyle is unlikely to put the proposal in his budget bill but could convince Senate to add it to give him some political cover.

"That's how I'd do it," the lobbyist said.

Another lobbyist said Doyle has "boxed himself in," and the end result will be a tax increase of some kind.

"There's not a lot of options," the lobbyist said. "I don't think he can make good on all his promises."

Doyle supports adopting streamlined sales tax guidelines, which would adopt standards for Internet and catalog retailer to collect sales taxes. But one lobbyist said the revenue the effort would yield "small potatoes" in the larger context of the whole state budget.

Revenue Department officials estimate the change would bring in an additional $4.8 million by 2009.

Doyle's proposed tax breaks have an estimated $157.2 million price tag, but lobbyists said the guv could phase those in over time so he gets credit for providing them without having to worry about how to pay for them in this budget.

The same can be said for Doyle's proposal to offer a "covenant" promising low-income eighth graders financial assistance to attend college if they keep up their grades, take college prep courses and stay out of trouble. Today, Doyle said his figures show the covenant program would add about $10 million to the state's current college financial aid commitment. "To me, that's about as good a $10 million investment as you could ever make," he said.

"It's going to be a few years before the real costs kick in, in terms of covering some of the tuition," a lobbyist said.

Another lobbyist speculated Doyle could turn to the state's Native American tribes for more revenue under their tribal gaming compacts with the state.

"Does a Beloit casino or a Kenosha casino become the means to balance this budget?" he said.

And yet another lobbyist suggested Doyle could move to re-securitize the state's tobacco settlement, which would generate $1 billion in one-time dollars. But one of his peers doubted Doyle would go that route since he fiercely criticized former Gov. Scott McCallum for using tobacco money to balance the budget.

"I think that would be really, really far-fetched," he said.

In the end, Doyle and lawmakers might keep everyone guessing.

"You'll have 8,000 hearings and meetings ... in the last 24 hours they decide," a lobbyist said. "It all comes fast and furious at the end -- that's when you'll see the price tag and how it's paid for. Until then, everything's on the table."

Gov. Jim Doyle has yet to introduce his next two-year budget plan. But Capitol observers already are expecting a long slog through the Joint Finance Committee for the 2007-09 budget, bracing for a series of 8-8 stalemates in the panel split down the middle between Democrats and Republicans.

Plus, a legislative conference committee to iron out the differences between Dem-controlled Senate and GOP-controlled Assembly versions before it goes back to the governor is inevitable, say the observers.

"I think it's going to take a long time to get the budget done," said one veteran budget watcher.

"It depends on if there's another Kevin Shibilski out there," quipped another observer, referring to the 2002 deliberations over the budget reconciliation act.

The JFC was split 8-8 that year as well, and Shibilski, the former Dem senator from Stevens Point, broke with his party and voted for a GOP package said to ``fix'' the deficit.

Many point to the vote as the beginning of the end of Shibilski's career as an elected pol, although he went on to run for lieutenant guv and then become Doyle's first Tourism secretary.

"There are going to be a lot of 8-8 votes likely," said the observer. "It will be an interesting process of getting to nine votes."

Dem wins this fall have again produced split control of the Legislature and with it the JFC. Republicans had controlled both houses over the past four years, and lawmakers approved their versions of the last two budgets without a conference committee, presenting a mostly unified front against the first-term Dem guv.

The split control could recreate the atmosphere of 2001-03 budget and the 2002 budget repair bill. Both required a conference committee to hammer out a final version that passed both houses and could be sent to the governor.

"Conventional wisdom says it's a foregone conclusion," said another observer on the chances of a conference committee. "Maybe it can be avoided if they look over their shoulders and say, 'We were sent here with a fairly large margin of people who voted for reform, so let's stop the partisanship.'"

Both of the newly elected JFC co-chairs, Dem Sen. Russ Decker of Weston and GOP Rep. Kitty Rhoades of Hudson, said they have a good working history together. Both served on the committee together during the past session.

"We are both reasonable people and can identify our priorities," Rhoades said.

Decker said he's gotten along with most Republicans with whom he has served on the committee, including Rhoades and former Assembly GOP co-chairs Dean Kaufert and John Gard.

"We didn't always see eye to eye, but when it came down to it we sat down and got to work," Decker said.

Decker optimistically predicted that the JFC can wrap up its budget work by the end of May "if we can sit down and work like we have in the past."

While they admit that Rhoades and Decker make a good working pair, skeptics point to the mixture on the committee could produce a contentious atmosphere.

Some see the potential for conservative Assembly Republicans like Reps. Steve Kestell, Scott Suder and Dan Meyer, who represent rural areas, to clash with more liberal members, including Sen. Lena Taylor and Rep. Pedro Colon, both of Milwaukee, and Sen. Mark Miller and Rep. Mark Pocan, both from Dane County.

Those conflicts set up the potential for an 8-8 quagmire throughout the process.

"I think initially they'll kind of throw their weight around and try to wave conservative flags and wave their liberal flags," said the veteran budget-watcher. "I imagine that Kitty and Decker will work together in the end, but there are so many far-right conservatives and far-left liberals, there are going to be some battles."

Getting the work done will depend a lot on what kind of budget Doyle turns over to them in February. Republicans credit Doyle with sticking to fiscal matters in past budgets.

"The reason we got away from putting policy in the budget is because when he was running for governor he said he would not put policy in the budget, and to his credit he has somewhat stuck to that," said incoming Assembly Speaker Mike Huebsch, R-West Salem. "If he does, I would expect the legislators in a bipartisan fashion would work to remove that."

Doyle said this morning the appointment of Michael Morgan as DOA Secretary shouldn't delay him from handing over the budget, but said he may ask legislators for an extension, as has been the custom.

"We may well be asking our Legislature for a week extension or so," he said.

There are a number of potential minefields that could erupt and waylay the budget. It's expected that the Transportation Fund will be a major sticking point, as Republicans continue to wonder if the governor will again "raid" the fund to pay for other programs.

This week in a radio interview, Senate Minority Leader Scott Fitzgerald, R-Juneau, indicated that there could be a battle over a gas tax increase. Doyle said Wednesday that he too believes it's too early to bring back indexing.

There's also likely to be a fight over the DOT proposal to raise license plate registration fees for cars from $55 to $80. Doyle has said that is too high, and that an increase of $10 is more likely to be in his budget.

Decker said this week that he may propose an increase in the registration fee for semi-trucks to shore up the state's transportation fund.

Doyle has also distanced himself from Dem Sen. Jon Erpenbach's proposal to remove sales tax exemptions from a number of services. Doyle, speaking with reporters after a town hall meeting in Cudahy Wednesday, said consumers ultimately pay for sales tax exemptions that are lifted. He said he'd be open to proposals to shift the burden off property taxpayers but he would like to see a guarantee that it would provide property tax relief.

"You end up just paying more sales tax and then over the next couple of years your property taxes continue to go up," Doyle said. "I obviously am not going to go along with anything like that."One observer said the speed of the JFC's work will also depend on whether there is anyone from either party who will cross the line.

The observer sees GOP Sens. Luther Olsen and Alberta Darling as potential stalemate breakers. "They are somewhat toward the moderate wing of their caucus, so you could see deals cut with them and Democrats on the committee," predicted the observer.

Gov. Jim Doyle has long promised that the property tax "freeze" he signed in 2005 would keep this month's bills largely flat for the statewide average on a typical home while preserving the state's K-12 education system.

Whether his plan lives up to that pledge will be determined over the next few months as municipal property tax levies begin to roll into the state, giving a clearer picture of tax bills. A WisPolitics review of various community levies show homeowners will likely see a mixed bag across the state.

Generally, levies are expected to increase overall, said the head of the Wisconsin Taxpayers Alliance, while the impact on individual homeowners across the state will vary widely. Madison and Milwaukee predict the bills on their typical homes will be up, while Eau Claire expects bills on its average home to go down.

Should Doyle's plan hold up to his promise, helped in part by a more robust lottery credit, it could reduce complaints and slow the impetus for fundamental change to the system, some observers suggest. Currently, citizens, local government interest groups and some Dems are pushing for dramatic property tax changes to reduce annual angst among residential property taxpayers and allow schools and other local governments to rely less on the tax people seem to hate the most.

If Doyle is to propose major changes early next year, he'll have to do it while cutting a projected $1.6 billion deficit for the 2007-09 budget cycle. Mike Prentiss, a spokesman for Senate Minority Leader-elect Scott Fitzgerald, R-Juneau, said Senate Republicans will likely continue to push for more limits on property tax growth in the upcoming session.

Republicans have been critical of Doyle's efforts, saying their own plans, which he vetoed, would have produced better results for homeowners without the large infusion of state tax dollars for K-12 education. Doyle and Dems have countered the GOP plan would have devastated schools and local communities.

"Despite the governor's rhetoric to have frozen property taxes, he hasn't, and property taxes remain the No. 1 concern for homeowners," Prentiss said.

WisPolitics checked with municipalities around the state to see how the "freeze" is playing out with their bills.

In Madison, the typical home worth $239,449 will see a property tax bill $65.99 higher than the year before once all credits are figured in, according to the city comptroller. That bill of $4,601.14 amounts to an increase of 1.45 percent over the year before.

Milwaukee officials estimate the tax bill for an average home of $131,400 will be $2,944 this year, up $83. That increase amounts to just more than 2.8 percent.

Eau Claire finance director Rebecca Noland said the typical home there worth $125,000 will see a $75 decrease on the property tax bills going out this month. But she complained that while bills are going down, so are city services. She said the city has cut 26 positions since 2000 and will face a deficit of at least $1.5 million in next year's budget because of negotiated wage and benefit levels for city employees outpacing expected levy limits. She also said the city received complaints this year because it only partially mowed some parks in an effort to save money and it takes longer to plow the streets.

Local governments and the organizations that represent them have generally chafed at the limits, arguing they unfairly hurt slow- or no-growth communities and rob officials of local control. "Yes, the tax rate has dropped slightly, but the services have dropped a lot," Noland said.

According to Doyle's budget office, the mythical median-valued home in Wisconsin worth $153,500 saw a $24 increase on last year's property tax bill over the year before.

Budget director Dave Schmiedicke said he's expecting an increase of just a few dollars on the median-valued home for a statewide average this year, once new construction is factored into the levy increases and the lottery and school levy credits are applied. Schmiedicke said the increase he expects this year of a few dollars is partly due to a lottery tax credit that is projected to be $96 for the median-valued home, up from earlier projects of $86.

Using his veto pen, Doyle crafted restrictions on cities and counties to limit levy increases to a minimum of 2 percent or the change in net new construction from year-to-year, whichever was greater. He also pumped additional state aid into K-12 schools -- a sure way to contain property taxes since most of them go to fund education. Despite that infusion of cash, the school property tax levy statewide will be $3.78 billion, up about 5.4 percent.

The school credit is also up about $124 million, helping to offset much of the $195 million increase in the levy. WisTax president Todd Berry said Doyle was successful in holding down property tax increases last year largely because the extra money he put into K-12 education resulted in a slight decrease in the overall tax levy. That helped offset increases by other municipalities. He said the early indicators are that municipalities are again increasing their levies.

How that impacts individual homeowners will depend on a host of factors, including how much of that growth is from new construction, Berry said.

"You can pick and choose pieces of this or do calculations in a way where you can cast the levy information in a more favorable or less favorable light depending on your political angle, but the bottom line is gross levies on a statewide basis for most governments are going to be up more than last year," said Berry, a former assistant secretary in the Department of Revenue.

As property tax bills start to arrive later this month, various groups are pushing new plans for school funding. State Sen. Jon Erpenbach, D-Middleton, has proposed eliminating a series of sales tax exemptions to pay for schools. He then wants to take school funding off the property tax rolls and rely on the increased sales tax revenue to cover those costs.

Doyle has expressed opposition to the plan, as have Republicans who believe any relief for homeowners will be temporary. Allan Odden, a University of Wisconsin-Madison education professor, has also been working on a plan to restructure the state's school funding system. He predicts his proposal could double academic achievement among Wisconsin students - but for 6.8 percent more money than the state spends currently.

Municipalities have responded in a variety of ways to the limits Doyle created.

In Pewaukee, in relatively rich Waukesha County, the property tax levy will go down by almost $20,000, city administrator Tammy LaBorde said. The city accomplished that in part by not levying any taxes for road projects, instead deciding to use existing funds.

The city has also done a re-evaluation this year that upped assessed values to $2.6 billion from $2 billion for the city of 12,600. LaBorde said the typical home assessed at $250,000 last year is now valued at $330,000. The city's portion of the property tax bill on that home is expected to be $801.90, up slightly from $800 the year before.

Here's a sampling of what taxing districts have done with their levies:

*The Village of Kronenwetter, near Wausau, increased its property tax levy 5 percent. But because of new construction, the owner of a $100,000 home will pay $299.24 in village taxes, down almost $100.

*La Crosse County increased its levy 7.95 percent to $25.9 million, which will add $18.20 to the county portion of the tax bill for a $100,000 home.

*The Appleton School District levy will go up $1 million, about 1.9 percent, with the owner of a $150,000 home paying $27 more on that portion of the property tax bill.

*The Sauk-Prairie School District cut its levy to $11.9 million, down 2.1 percent from the year before.See more: http://www.wispolitics.com/index.iml?Article=78452