Votes Monday on school aid: Budget committee hopes to finish work in September
MADISON — Republicans who control the Legislature’s finance committee finally resumed work on the stalled state budget Thursday, August 24th after two months off, promising to wrap up revisions to the spending plan within the next two weeks.
The most significant action the Joint Finance Committee took Thursday was signing off on language eliminating the state portion of the property tax. The panel planned to follow up with votes on school aid Monday. That would leave road funding as the last big-ticket item the committee must address before sending the two-year spending plan to the full Senate and Assembly.
The committee’s co-chairs, Rep. John Nygren and Sen. Alberta Darling, said the panel expects to finish revising the budget the week of Sept. 5. The Assembly is expected to vote on the budget the following week with the Senate following suit the next week, they said.
State law requires lawmakers to finish the budget by July 1, but work halted in June amid GOP bickering over how to pay for road work in light of a nearly $1 billion shortfall in the state’s transportation fund. Gov. Scott Walker and Senate Republicans want to borrow more money and delay major projects. Assembly Republicans have called for raising more money, perhaps by raising the gas tax or vehicle registration fees, which the governor opposes. Walker wants to avoid being tagged with raising taxes or fees as he heads into a re-election campaign next year.
Republicans also have pushed the budget to the background in recent weeks as they focused on Walker’s $3 billion incentive package for a Foxconn Technology Plant in southeastern Wisconsin. The Assembly passed that bill last week but Senate Majority Leader Scott Fitzgerald has moved more slowly, saying lawmakers need to finish the budget because the incentive bill depends on it. Darling said the Senate expects to take up the incentive package the same week the Assembly votes on the budget.
Spending levels from the 2015-17 budget have continued during the stalemate. But the longer the delay, the more impact it will have on school districts, which are trying to set their budgets, and road projects that need more money to proceed. Things began to thaw last week when the committee announced plans to meet Thursday to resume voting on budget provisions.
The biggest item on Thursday’s agenda was Walker’s plan to eliminate the forestry mill tax. That’s a tax the state includes on homeowners’ property tax bills to fund forestry programs. The tax is the only property tax the state levies on homeowners.
Wiping out the tax would give Walker a key talking point on the campaign trail. He has promised that property taxes on a median-valued home would be lower in 2018 than in 2010, before he took office. Estimates from the nonpartisan Legislative Fiscal Bureau show property taxes have been lower every year since 2010; eliminating the forestry tax would drop a median home’s property taxes by another $50 or so over the next two years.
The state, meanwhile, would lose about $181.5 million in revenue for forestry programs over the next biennium. Walker would fill that hole with money from the state’s general fund. Critics argue that could pit forestry programs against other priorities such as schools, medical assistance and aid to local governments. They’ve also warned that the general fund transfer could eventually be reduced or eliminated.
“The forestry account … will now be moved … to be in direct competition with other programs in future biennia,” Rep. Katrina Shankland, D-Stevens Point, said. “Maybe not in this biennia, but no one can tell me we’ll have the resources in the future.”
Committee Republicans countered that people pay too much in taxes and ending the forestry tax is a step in the right direction.
“We are not in the state property tax business,” Rep. Dale Kooyenga, R-Brookfield, said. “This is the right vote and I applaud Governor Walker for being bold.”
In the end the committee approved the repeal on a 12-4 vote. All four Democrats on the committee voted against it.
The clearest sign of budget progress, though, was an announcement Thursday that the committee will meet again on Monday to address school funding. Walker wants to pump an additional $649 million to public, voucher and charter schools. Republican lawmakers also have been considering loosening income limits for the voucher program, which subsidizes private school students’ tuition.
Once school funding is squared away, the only major item left will be roads. Walker said earlier this week that he had reached an agreement “in principle” with Republican lawmakers that calls for $400 million in new borrowing and would impose a higher fee on electric vehicles. The gas tax and registration fees for other vehicles would remain unchanged. Nygren acknowledged Thursday that lawmakers and Walker were nearing a deal but nothing was set yet.