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Budget deal to cut taxes, fund universities
Wisconsin Gov. Tony Evers and Republican lawmakers reached a deal on Tuesday that could mean tax cuts and more money for special education and universities.
MILWAUKEE - Wisconsin Gov. Tony Evers and Republican lawmakers reached a deal on Tuesday that could mean tax cuts and more money for special education and universities – but there's a catch.
Missed deadline
Big picture view:
The budget deal was reached after Republicans killed more than 600 Evers proposals in the budget, including legalizing marijuana, expanding Medicaid and raising taxes on millionaires.
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The state missed a Monday night deadline to pass the biennial budget. In Wisconsin, the government does not shut down, but instead the old budget's funding continues at the old levels. The compromise came after months of negotiations. Here's what it means for you.
Wisconsin State Capitol
Tax cuts
What they're saying:
Evers and Republican legislative leaders agreed to $1.3 billion in income tax cuts largely targeting the middle class. More than 1.6 million people will have their taxes cut by an average of $180 annually.
The deal would expand the state's second-lowest income tax bracket and make the first $24,000 of income for people age 67 and over tax-free. It also eliminates the sales tax on electricity, saving taxpayers about $156 million over two years. However, it will also raise fees for car title and registration, with titles going up $50.
"The so-called tax cuts that are being touted by the majority party amount to a couple of dollars per pay period for an average middle-class family," said State Sen. Kelda Roys (D-Madison). "That’s going to be totally wiped out by the property tax increases that are going to be occurring."
Republican legislative leaders praised the deal as providing meaningful tax relief to the middle class and retirees.
"This budget delivers on our two biggest priorities: tax relief for Wisconsin and reforms to make government more accountable," Republican Assembly Speaker Robin Vos said in a statement.
"To say to folks, in the inflationary times we have been through, family budgets are still strapped, we’re going to take the tax off your utility, save you a little bit of money," said State Rep. Mark Born (R-Beaver Dam).
And Senate Republican Majority Leader Devin LeMahieu praised it as a compromise that cuts taxes but also stabilizes the state's child care system and strengthens schools by increasing special education funding.
Education and child care
What they're saying:
A big boost, nearly $500 million, will go to K-12 special education.
But, it's not enough for the Democrats on the budget committee who voted against the deal.
"Does this budget satisfy making sure our schools succeed without having to go to referendum? Does this budget make sure that people’s property taxes can remain low or get lower? I don’t believe so," said State Rep. Tip McGuire (D-Kenosha).
"Overall, we haven’t really caught up to inflation. So, if we would have just kept pace with inflation, we’d be giving schools a lot more money," said State Rep. Deb Andraca (D-Whitefish Bay).
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The Universities of Wisconsin would see a $256 million increase over two years, the largest funding increase for the UW system in about two decades. UW Regents had asked for an $855 million overall increase and Republicans in June floated the possibility of an $87 million cut.
The deal also imposes a faculty minimum workload requirement and calls for an independent study on the system’s future sustainability.
The agreement increases funding for child care by $330 million over two years, a third of which will be direct payments to providers. The money will replace the Child Care Counts program started during the COVID-19 pandemic. That program, which provides funding to child care providers, expired on Monday. Evers, Democrats and child care advocates have been pushing for additional funding to address child care shortages throughout the state.
"With every compromise, there’s things to like and things to dislike," Born said.
State Sen. LaTonya Johnson (D-Milwaukee) was the only Democrat on the finance committee who voted in favor of the deal getting added to the fuller budget proposal. She then went on to vote against the overall budget.
"There are things in this budget that I am super proud of, for example, increases to special needs funding at over 40%, Milwaukee County’s Highway Patrol and citation reimbursements, child care reimbursement rates to the 75th percentile," she said.
State employees, including at the university, would get a 3% raise this year and a 2% raise next year.
Prison and infrastructure
What they're saying:
A vote on a plan that would close the 127-year-old Green Bay Correctional Center by 2029 as Evers proposed was also expected. However, it's not clear what other elements of Evers' prison overhaul plan Republicans will endorse.
That part of the budget was not under the negotiated deal with Evers, which means he could make changes to it with his powerful partial veto.
There will be $200 million in additional tax revenue to pay for transportation projects.
Green Bay Correctional Institution
Final steps
What's next:
The Legislature's Joint Finance Committee approved the deal on Tuesday. It next moves to the full Legislature, which will meet to vote on final passage Wednesday.
The budget then goes to Gov. Evers' desk, where he has authority to use his powerful partial veto pen. When that's over, another question is expected to be answered.
Evers has said he will announce his decision on whether he will seek a third term after he has signed the budget. He has 10 business days to take action on the spending plan once the Legislature passes it.
Wisconsin Gov. Tony Evers (Photo by Jim Vondruska/Getty Images)
Democrats credit redistricting
Big picture view:
Democrats said Republicans were forced to compromise because they didn't have enough votes in the Senate to pass the budget without Democratic support.
Democrats gained seats in November under the new maps drawn by Evers and narrowed the Republican majority in the Senate to 18-15. Two Republican senators said they planned to vote against the budget, resulting in Senate Democrats being brought into the budget negotiations with Evers and Republicans.
"What we are seeing playing out in this budget is the consequence of Wisconsin’s new fairer maps – legislators working together to find compromise and make meaningful progress for the people of Wisconsin," State Sen. Jodi Habush Sinykin (D-Whitefish Bay) said in a statement.
Republican budget committee co-chair Sen. Howard Marklein said, "This budget has involved an awful lot of compromise."
The Source: FOX6 News referenced the budget vote. This story is supplemented with a report from The Associated Press' Scott Bauer.