WisPolitics Budget Blog

This post is to notify you that the URL for the WisPolitics Budget Blog has changed effective immediately.

To visit the site directly, the new URL is http://budget.wispolitics.com/

The new URL for the RSS feed is
http://budget.wispolitics.com/atom.xml

Contact schramm@wispolitics.com with any questions about this change.

U.S. Rep. Ron Kind, D-LaCrosse, sent out this summary of the benefits for Wisconsin of the $789 million stimulus bill passed by the House today.

The Senate is set to vote on the bill later, and President Obama is expected to sign it on Monday.

According to Kind, the American Recovery and Reinvstment Act:

- Creates or saves 70,000 jobs in Wisconsin over the next two years.

- Provides a "Making Work Pay" tax cut of up to $800 for 2.2 million Wisconsin workers and their families, designed to start paying out immediately into workers' paychecks, as well as tax cuts for small businesses.

- Modernizes our infrastructure and creates jobs with an extra $716.4 million for infrastructure in Wisconsin, $529.1 million for roads and bridges alone.

- Modernizes schools and makes college more affordable with improved Pell Grants for the 91,532 Pell Grant recipients in Wisconsin and a higher education tax credit for 63,000 students in the state.

- Helps workers hurt by the economy, expanding unemployment and maintaining health care benefits for the 191,400 of Wisconsinites that are out of work right now.

- Saves the jobs of teachers, police officers, health care workers, and protects the vital services they provide through direct aid to the Wisconsin state government.

UPDATE: More information on the Recovery Act from the Center for American Progress, forwarded by Kind's office.

An interactive map showing state-by-state allocations, which reports that the total fiscal impact for Wisconsin.

A spreadsheet on the allocation of funds.

In a press conference with reporters this afternoon, Gov. Jim Doyle said that in addition to the $2 billion the federal stimulus bill, the legislation provides $550 million for infrastructure projects in Wisconsin as well as other cash through grants and other programs.

In the final tally, the impact to the state from the American Recovery and Reinvestment Act could reach $3.5 billion, Doyle estimated.

Doyle said $2 billion in fiscal stabilization funds in the bill can be used state medical assistance a education, and will help to relieve some of the state's $5.7 billion projected deficit. But he warned that would not be "dollar for dollar" relief.

"This is not going to solve all the budget problems Wisconsin has or any of the other states have," he said, warning that the budget he introduces Tuesday will contain "very, very deep cuts."

Doyle said he will continue his mantra for this budget, that "being held even is the new increase."

According to Doyle, here is what some of the provisions in the $798 billion legislation mean for Wisconsin:

* $550 million for roads, bridges and other infrastructure projects. Under the state stimulus bill unveiled yesterday, $300 million of those projects would be pre-approved

* Doyle plans to seek a chunk of the $8 billion for railroad modernization and high speed rail

* Education incentive grants for schools in which Wisconsin schools can compete for extra funding. Doyle said he expects Wisconsin schools could get as much as $90 million

* The bil includes $19 billion for health information technology, which Doyle hopes state businesses like Epic Systems, Marshfield Clinic and GE Medical can capitalize on.

* Doyle said Wisconsin will get $150 million of the $5 billion in the bill earmarked for weatherization of homes. He said the weatherization money will not only lower heating bills for low and moderate income families, but also employ many state residents.

See more on the impact to Wisconsin in this document from the White House.

Wisconsin is in line to receive roughly $2 billion for medical assistance and education programs from the compromise stimulus legislation federal lawmakers hammered out, Gov. Jim Doyle said today.

Doyle, speaking with reporters on a conference call with U.S. Rep. Dave Obey, said the money by no means will alleviate the state's $5.7 billion budget shortfall. He said the budget he introduces next week will still include some "very, very hard choices," but the federal money will help the state avert a "disaster."

Doyle had estimated earlier this week the Senate version of the stimulus bill would mean $600 million less for Wisconsin than the version approved by the House. A good chunk of that was restored in the conference committeee, and the compromise bill drops the state's share of the federal plan by about $250 million.

"This agreement is considerably better than what came out of the Senate," Doyle said, praising the work of Obey, who chairs the House Appropriations Committee and served on the conference committee.

Obey, D-Wausau, took issue with those who have combed through stimulus bills trying to find questionable items to single out for ridicule. He said there is always at least one "strange item" in a budget bill that could be mocked, but he insisted lawmakers need to keep their eye on the big picture. Doing nothing could put the nation's economy into an even deeper hole.

"We cannot afford to nitpick," Obey said. "We have to take our best shot and if we make a mistaken then we have to, as we move down the line, correct things."

Citing a White House analysis, U.S. Rep. Ron Kind says in a press release that the American Recovery and Reinvestment Act could bring as many as 70,000 jobs to the Badger State.

"This bill is a smart mix of tax cuts for small businesses and 95 percent of American families, investment in vital infrastructure, and aid to people in need," Kind said. "While there will never be total consensus on a bill of this magnitude and nature, I believe the recovery compromise achieves a balanced goal: using stimulative spending and tax cuts to get our economy up and running again so that we can keep and create jobs - 70,000 right here in Wisconsin."

UPDATE: Here are state-by-state and congressional district breakdowns of the job creation proponent of the bill, from the White House via U.S. Rep. Dave Obey.


State-by-state

Congressional district

GOP legislative leaders derided the stimulus plan introduced by Gov. Jim Doyle and Dem lawmakers today as a collection of tax increases with limited capacity for job growth.

Senate Minority Leader Scott Fitzgerald, R-Juneau, and Assembly Minority Leader Jeff Fitzgerald, R-Horicon, said their members were unlikely to support the package, and Jeff Fitzgerald predicted Assembly Democrats would have to take a tough vote on the bill.

"As of 1:30 today, Gov. Doyle became a tax-increase governor," Scott Fitzgerald said.

He said the provisions to initiate the hospital assessment, combined reporting, the streamlined sales tax and reverse a court decision on the Menasha Corp. shouldn't be construed as anything other than tax hikes on businesses and citizens.

"They're just kick-starting the revenue early," Scott Fitzgerald said.

Jeff Fitzgerald wants strict oversight of the $300 million in the bill for new infrastructure projects, but both leaders said they'd endorse the use of one-time money for one-time projects. But both also said the bill's job creation potential is limited.

"How does the hospital tax create jobs? How does combined reporting create jobs?" Jeff Fitzgerald asked. "Combined reporting will drive business out of the state of Wisconsin."

Gov. Jim Doyle said today that the federal stimulus package agreed to today by congressional leaders and President Obama does not fully restore the full fiscal stabilization funds that were pared back by the U.S. Senate.

Doyle said a portion of the funds were put back in, but he doesn't think "it's a whole lot."

Doyle on Tuesday expressed concern over the Senate's version of the stimulus bill, dubbed the American Recovery and Reinvestment Act, because it cut $40 billion for fiscal stabilization that was in the House version. He said the reduction could force cuts to essential positions like teachers and firefighters, and would make balancing the state budget more difficult to do.

Doyle said today, speaking with reporters following an address at WMC's Business Day in Madison, he didn't know what the Wisconsin's share of the $789 billion stimulus will shake out to be. Tuesday he said that the difference in the House and Senate version would mean about $600 million less for Wisconsin. The Senate bill passed yesterday had a price tag of $838 billion.

"I do know that the House members, and again I'm very thankful to (U.S. Rep.) Dave Obey, were able to get more into the state stabilization. I don't think it was anywhere near what they had originally proposed," Doyle said.

Doyle also spoke about the combined reporting proposal included in the state stimulus bill unveiled today, indicating it was part of a compromise to put together the package.

"I think you all know this has never been ... part of my agenda, I've never proposed it. But I do think we're at a time where we ... need revenue and I think there's fairness to it," Doyle said. "I do think as part of the bill I also got some things we never would have had. ... [T}he early stage credits, the business incentives, the tax credits are really good things that I've been working to get done a long time. So I think for business there's a mixed bag here but I think it's exactly the kind of thing we're all going to have to confront. There's going to have to be some shared sacrifice and we're all going to have to compromise a little and move forward."

Doyle also said that local option sales tax to fund regional transit authorities is a good mechanism.

"If you look around the country that is the way that most successful regional transit authorities have been funded," he said, but stopped short of saying the proposal would be in his 2009-11 budget bill.

Listen to Doyle's comments here.

The state stimulus plan introduced today by Gov. Jim Doyle and Democratic legislative leaders will be on a fast track as the authors hope to get it to the governor by Feb. 20.

The Joint Finance Committee will begin deliberations on the bill Tuesday, the same day Gov. Jim Doyle will unveil his 2009-11 budget bill.

Some highlights of the bill:

* $125 million in cuts to state agencies, including $500,000 in cuts from the Legislature's budget

* Adoption of an assessment on hospital gross revenues, which is estimated to bring $900 million in federal revenues over a three year period. Doyle said the timing of this bill is essential to the hospital tax as a federal deadline for states to recover funds is fast approaching

* Expansion of tax credit programs, such as angel and investor credits, to encourage more investment and create jobs

* The pre-approval of $300 million in infrastructure projects funded by the federal stimulus bill. The pre-approved projects can be viewed here

* Implements combined reporting, which is estimated to bring in $22.6 million for FY 2008-09 and $150.4 million for FY 2009-11

* Implements streamline sales tax, or Main Street Equity Act. It is projected to bring in tax revenues of $9.4 million in this fiscal year, and $61.3 million over the 2009-11 biennium

The bill relieves about $168 million of the state's current $593 million budget deficit in this fiscal year ending June 30. Doyle said the rest of the fiscal year 2009 deficit will be addressed in his biennial budget package Tuesday, along with his plan for eliminating the rest of the state's projected $5.7 billion gap.

The state has a constitutional amendment that requires the budget be balanced at the end of a fiscal year, so Doyle's strategy to close the current year's gap in the budget bill will put added pressure on the Legislature and Doyle to come to a deal.

Asked whether it was realistic to expect the Legislature to pass a budget by this year's deadline given past years, Senate Majority Leader Russ Decker, D-Weston, said with mock confidence, "We're Democrats."

Doyle said the cuts to agencies will be across-the-board "percentage cuts" and more cuts will be included in his 2009-11 budget bill. He added, though, that some agencies involved with public safety will be exempted from the cuts.

Agencies are going to have "to do more with less," Doyle said, adding that state residents "are going to have to do with not quite the level of service we've had for some time." He said that could mean the closure of some regional state offices, or the consolidation of services.

Asked if furloughs for state employees to cut costs would be part of Doyle's budget bill, he said that it was an option, but one that he'd rather not pursue.

"I don't want to do that and I don't have plans to do that," he said. "During this economy, we're trying not to have people go out of their jobs, we want people to maintain their jobs."

Doyle also said his budget plan also includes reaping tobacco resecuritization, which could be a shaky proposition given the current bond market.

State agencies would be required to lapse $125 million, hospitals would pay a new assessment to generate matching federal dollars and businesses would be subject to combined reporting for their tax bills under legislation the governor and lawmakers unveiled this afternoon.

The bill would trim the state's $5.7 billion budget gap by an estimated $675 million.

The package also includes expanding eligibility for angel investor tax credits, consolidating existing tax credit programs and other measures.

It also pre-approves $300 million in anticipated federal stimulus funds for infrastructure and transportation projects. Additional stimulus money would be approved by the Joint Finance Committee.

Read the release.

Read Doyle's letter to legislative leaders.

A state stimulus package to be released later today is expected to include a new assessment on hospital revenues, combined reporting for corporate taxes and a provision giving lawmakers some oversight of any federal money flowing into the state to jumpstart the economy.

The governor and legislative leaders scheduled a 1:30 p.m. news conference today to announce details of the plan. Some final language was being worked out this morning.

Gov. Jim Doyle and lawmakers have been working on a state bill that would complement the pending federal stimulus package, streamline processes for moving federal money into state projects and include job creation efforts and the expansion of angel investor tax credits.

Also expected in the package is the streamlined sales tax proposal to allow the state to capture taxes from online purchases, and language to reverse the Menasha Corp. Supreme Court decision on taxing specialized computer software, sources said.

Sources expected the stimulus package to include across-the-board cuts to state agencies, adding the plan would either eliminate or come close to eliminating the projected $594 million budget deficit in this fiscal year. Funding for job training programs and some infrastructure projects are also expected, as well as language to stem the rising tide of foreclosures in Wisconsin, sources said.

Gov. Jim Doyle said today's state stimulus package announcement will be focused on creating jobs and enacting cuts and revenue uppers to help balance the state budget.

"I think what we're talking about is a good package and one that will help us significantly," Doyle said during a media availability in Milwaukee. "It's going to be both something that will help us a lot with the budget and it's something that will also help us to create jobs."

The package will include measure aimed at stimulating job creation and getting the state lined up with the forthcoming federal stimulus act to ensure the state cam put people to work quickly, Doyle said.

Doyle said it will also include "some of the very deep cuts" that will need to be made to balance the budget.

"We better start making them starting now," Doyle said.

The hospital assessment will be among revenue uppers included in the package, he said.

"Clearly the hospital assessment is something we should get done and need to get done in order to access federal money," Doyle said.

Doyle dismissed claims that the assessment is a tax and faulted Republicans in the Legislature for blocking it in the past.

"They have fought against what they call the hospital tax for all of these years," Doyle said. "The fact is, even the hospitals support it. They don't think it's a tax. It's not a tax. It's a way we can get more federal money into the state."

"While most other states have been receiving hundreds of millions of dollars from the federal government for years, because of the Republicans in the Legislature, we have not been able to do that," Doyle continued. "That's just nonsense. We're now at a point where we can't play these games."

Gov. Jim Doyle's cabinet secretaries will forgo a scheduled 2 percent pay increase scheduled to go into effect this summer.

Administration Secretary Mike Morgan wrote in a letter to the secretaries yesterday that Doyle had asked him to formally direct them to give up the pay hike. The cabinet met to discuss the issue yesterday.

"We have all agreed to take this step because, as leaders of this Administration, we need to send a message to the working families in our state who have been hit hard by the national economic recession," Morgan wrote.

Doyle returned a portion of his salary each quarter during his first term. He received a pay increase after his second term began in 2007, and his salary won't go up during the current term, his office said.

See the letter here.

Senate Majority Leader Russ Decker, D-Weston, said this afternoon he hoped a deal on a state stimulus package could be done by tonight or tomorrow.

"We've still got some details to work out," Decker said. "Hopefully we'll have something to announce very shortly."

The governor and lawmakers have been working to hammer out a deal on a state bill that would complement the federal stimulus package, streamline processes for moving federal money into state projects and include job creation efforts.

A source with knowledge of the negotiations told WisPolitics lawmakers have reached a general overall agreement on the package and details would likely be released tomorrow.

Asked if the bill will include provisions to close the state's estimated $594 million budget deficit in this fiscal year, Decker said, "That's still part of the process. We're still crunching some numbers."

Decker said the bill would follow the normal legislative channels; through the Joint Finance Committee before moving on to the Legislature.

Decker declined to give details on how many jobs the stimulus might create, but said they will include initiatives to build infrastructure.

"We've been talking about public works projects for a couple months now, whether it's roads, bridges, airports or harbors," Decker said.

One issue that had been thought to be snagging negotiations, the so-called Columbus Park issue, is still something he'd like to see get done, Decker said.

"We'd still like to see this taken care of, if not in this vehicle than in another fashion," Decker said.

On the so-called Las Vegas loophole, Decker said, "I certainly hope it makes it in there." Decker has championed closing the loophole, sometimes called combined reporting, that prevents companies from moving offices outside of Wisconsin to avoid corporate income tax here. Enacting the change would bring an estimated $130 million to state coffers this fiscal year.

Decker said the hospital assessment hasn't been a contentious issue in the negotiations, and that streamline sales tax has also been part of the discussions.

Lawmakers have reached a general overall agreement on a state stimulus package, a source with knowledge of the deal told WisPolitics this afternoon.

The source said details would likely be released tomorrow.

The governor and lawmakers have been working to hammer out a deal on a state bill that would complement the federal stimulus package, streamline processes for moving federal money into state projects and include job creation efforts.

Senate Majority Leader Russ Decker, D-Weston, said last week he would also like to see the budget deficit in the current fiscal year, which ends June 30, addressed in the package as well.

U.S. Sen. Russ Feingold, D-Middleton, said in a statement the economic recovery package the Senate approved today is not perfect, but the country's rising unemployment rate requires quick and responsible action.

"The economic recovery package is not perfect but it does take important steps to create or save millions of jobs while addressing our country's energy and infrastructure challenges," Feingold said in a statement.

Feingold also highlighted some of the Wisconsin provisions in the bill:

--$537 million for Wisconsin roads and bridges.

-- $99.8 million for transit infrastructure; there's also $2.25 billion for passenger rail and $5.5 billion for national infrastructure projects that Wisconsin can compete. Feingold mentioned as an example a Milwaukee-Madison high speed rail corridor.

-- $107.6 million for Wisconsin's Clean Water State Revolving Fund and $38 million for the Drinking Water State Revolving Fund.

-- $17.7 million for Wisconsin law enforcement through the Byrne Grant program.

-- $161 million in funding for the supplemental nutrition assistance program, formerly known as food stamps.

-- $26.1 million for the Public Housing Capital Fund that public housing authorities could use to modernize public housing facilities.

U.S. Sen. Herb Kohl, D-Milwaukee, released some details on what funds are included in the $838 billion Senate stimulus package approved this morning on a 61-37 vote.

Among the provisions is $1.6 billion nationally for federal and state law enforcement initiatives, and provisions for funding nutrition and agricultural initiatives.

Gov. Jim Doyle said this morning that he was "very discouraged" by the U.S. Senate's removal of state fiscal stabilization funds in the federal stimulus package.

He told the Wisconsin Counties Association's Legislative Exchange conference this morning that those funds were meant to help state and local governments meet basic needs in this struggling economy.

"You wonder what they were thinking," he said.

"Hopefully as this bill now goes to conference, maybe some cooler heads will prevail or we'll see a compromise," he said.

The bill that is before the Senate today removes a $25 billion fund directed to states for firefighting, police, education and other essential services, Doyle told reporters following his address.

"We're talking about money that goes directly out in wages to some of the most important workers in our state," Doyle said.

In terms of what Wisconsin could see from the federal stimulus package, Doyle said that the difference between the House and Senate versions is about $600 million.

Doyle said he has been "constantly on the phone in the last couple of days" talking with governors about how they can educate the senators on the needs of states.

"This isn't about money going to states where it's just going to get spent wildly. This is about states like Wisconsin and many others that are going to have to make deep, deep cuts. And without this the cuts are going to get deeper," Doyle said.

The result of the cut in stabilization aid to states is that firefighters, teachers and "other absolutely essential people may not have jobs," Doyle said.

Doyle said he hopes the conferees will restore the funds in the final bill.

"It doesn't make much sense to be working to be working to put operating engineers and laborers to work on the roads, which is a very good thing and we really want that to happen, when on the other end you're laying off health care workers and teachers," Doyle said.

The removal of the fund makes balancing the budget without a significant tax increase "a lot harder to do," Doyle said.

"One of my main principles here is to do everything I can to make sure that hard-working, middle class families don't have an added tax burden," Doyle said.

"It's another irony -- you can't be saying at the federal level let's have middle class tax breaks then cut this from the states in a way that the states are required to do it," Doyle said.

As the stimulus bill heads to a conference committee, Doyle said he will make a decision in the next couple of days which numbers to present in his state budget address, scheduled for Tuesday at 7 p.m.

"Generally I'll go with the most conservative numbers. I'm not going to put a budget on everything I wish Congress would have in a bill," Doyle said.

-- Doyle offered few specifics in his speech to the Wisconsin Counties Association gathering on a topic that many had on their minds -- what his budget hold for state shared revenues to local municipalities.

Doyle told them that every level of state spending will see cuts, but the only way through this economic crisis is cooperation.

"We really need to stay together and work together," he said.

Doyle of his run against ex-Gov. Scott McCallum, who proposed eliminating shared revenues in his 2002 campaign. Doyle hammered McCallum on the proposal on his way to beating the incumbent.

"We have acted as good partners together in these last six years and I deeply appreciate it," Doyle said.

The governor said he doesn't think county leaders will be "terribly upset" with his budget proposal, "and I think some of you may be very pleasantly surprised."

At the same time, Doyle said it will be a budget "where we're all going to have to pare back some, and we're all going to have to do more with less."

The U.S. Senate passed a cloture vote to end debate on the federal stimulus bill in that chamber. Sixty-one senators voted for cloture, narrowly meeting the requirement of 60 votes to end the debate. Thirty-six senators, all Republicans, voted against cloture.

The vote clears the way for a vote on passage tomorrow.

A spokesman for Gov. Jim Doyle said today the governor "has some concerns" about a compromise stimulus package now before the U.S. Senate that carries a price tag of $827 billion.

One report estimated Wisconsin would receive nearly $600 million less in the Senate compromise compared to the version the House passed last month; a bulk of that difference would be reductions in money for education.

Doyle spokesman Lee Sensenbrenner said the details of the bill are "changing hour by hour."

"The governor in particular is working hard to make sure Wisconsin schools get what they need to continue moving forward," Sensenbrenner said.

If the Senate approves the stimulus package it will next head a conference committee to iron out the differences between the House and Senate bill. U.S. Dave Obey, D-Wausau, the chairman of the House Appropriations Committee and a key architect of the bill, is expected to sit on that conference committee.

The U.S. Senate is expected to take a procedural vote on the federal stimulus package today, which could lead to a vote on passage tomorrow. Senators made cuts to the package passed in the House, including cutting $40 billion for state fiscal stabilization, $2 billion for broadband funding, and $600 million for Title I school funding.

Once the bill is passed by the Senate, it will go to a conference committee to iron out a final compromise between the House and Senate.

See a list of cuts in this story.

Sen. Russ Decker wants a proposal to broaden the availability of tax exemptions for low-income housing in the stimulus package.

But not everyone involved in the talks is on the same page.

The conflict has some budget watchers concerned that a hard-line stance could derail the state stimulus package and foul the water for money expected to come from the feds.

The so-called "Columbus Park fix" was vetoed by Gov. Jim Doyle from the budget repair bill last spring after Decker fought hard to put it in. In his veto message, Doyle said he didn't think it was proper to include the bill in a budget repair bill and that it needed a full airing by the Legislature.

Doyle's position hasn't changed, according to spokesman Lee Sensenbrenner.

"It should be given a full debate, and there's not a necessity to have it passed in the budget repair," he said.

Rebekah Sweeney, spokeswoman for Sheridan, said the Janesville Democrat's priority is focused on stimulating the economy and getting people back to work.

"We are not negotiating the bill in public," she said, when asked if the issue has been a roadblock to agreement on the package.

She stressed there has been progress. "There's a lot of agreement, a lot of overlap with this," Sweeney said.

Decker said today the past concerns have already been answered. The bill passed the Senate unanimously last session, and was approved by an Assembly committee on a 5-3 vote but failed to come to the floor in that house, he said.

"The position of the Senate is we'd like to keep a roof over the head of the elderly people," Decker said. "I'd like to see that these people are taken care of."

Asked if this was a bottom line for him, Decker responded, "You never say never in politics."

The bill has caused turmoil because of the uncertain effect on local governments. A fiscal estimate of the bill last session didn't determine the impact, and many are wary it could end up exempting many more properties than intended.

Rep. Mark Pocan, co-chair of the Joint Finance Committee, said in the end there will be a "unified package" coming from the Democrats. He said he's hopeful it can be introduced before Doyle's Feb. 17 budget address.

"I fully anticipate we are going to have a good, strong stimulus plan in the very near future," he said.

Asked if that would include the "Columbus Park" issue, he said, "We need to focus on the most pressing, important issues that deal with the budget. And after that we can take care of some other issues in the session."

See the bill history here.