Dan Meyer's Legislative Update - July 31, 2009

34th Assembly District - July 31, 2009

Setting the Record Straight

Recently, Democrat Majority Leader, State Representative Tom Nelson (Kaukauna) was on the circuit defending the democrat's budget. He stopped by the Rhinelander Daily News while "on vacation" up north, in his freshly pressed suit & tie.

He summed up his budget comments by saying, "The significance of many of the decisions we made today will not be fully appreciated until well into the future."I would have to agree.

This budget increases spending by 6.2% in comparison to the last budget. And this isn't chump change: the 07-09 budget totaled $58.6 billion dollars while this budget will total $62.1 billion dollars. A spending increase of $3.6 billion dollars.

I haven't met a family or business that is able to increase their spending by this amount right now. In fact, many are scaling back. June unemployment numbers say Wisconsin is at 9.2% unemployment, nearly double what it was last June.

Not only does the state budget increase spending, but it also contains a net increase of 109 government positions. It's no wonder that Dane County is so recession proof, with the lowest unemployment rate in the state.

I would be the first to agree that core government programs, like unemployment, must be funded and are especially crucial during times like these. But when government over-extends and creates new programs and funding commitments - it's often the core government services that are threatened.

I don't accept the premise that government had to grow by 6.2%. Further, in two years when federal funding has run out (or maybe even sooner if there is a need to repair this budget) the state will have to face harsh realities about where the money will come from to sustain this level of spending.

A memo by the Legislative Fiscal Bureau (LFB) identified $3.4 billion in federal stimulus funds that have been used in earlier legislation and this budget, a total of $2.2 billion of which were used to offset general spending.

This practice was mentioned in the July 2009 issue of "Governing" magazine: "But the real problem may be that the news coming out of capitols hasn't been shocking enough. States have used the federal stimulus money in most cases to ease the current shortfalls, rather than to help them face up to the prospect of future long-term deficits. (Stimulus dollars made up about 40 percent of states' shortfalls this year.)"

Compounding this reality about federal money is the issue of Wisconsin's growing structural deficit, which the LFB estimates at $2 billion for the 2011-2013 state budget. I know what you're thinking; 'How can our next state budget already have a deficit, when its two years away?' The structural deficit occurs when projected revenues aren't sufficient to pay for existing programs & costs committed in future budgets.

While structural deficits have been part of Wisconsin's budget history, the $2 billion figure is a whole new level.

In an earlier update, I mentioned there are numerous location-specific earmarks that were tacked onto the budget at various points during the process. Now that the budget process is complete, a final tally is available: nearly $40 million will be spent on earmarks, the bill for which will go to general taxpayers. So your higher garbage taxes can pay for Wrightstown's recycling bins. Many of these were added in the last days of the budget process. Here is a sample of the earmarks that made it through:

• $6.6 million for a Yahara River project in Dane County
• $5 million for the Bradley Center in downtown Milwaukee
• $3.3 million in engineering grants in the City of Milwaukee
• $500,000 for the Oshkosh Opera House
• $500,000 for an environmental center in Madison and Monona
• $500,000 for Eco Park in La Crosse
• $250,000 for the Madison Children's Museum
• $125,000 to remodel a library in Eau Claire
• $100,000 for the Stone Barn Historic Site in Oconto County
• $50,000 for a shooting range in Eau Claire County
• $46,000 for new recycling bins in Wrightstown

These allocations don't follow the regular process of lining up next to other communities and programs to compete for grants or available funding based on merit. While some of projects may have merit, they do not have to compete for the funds.Even aside from funding earmarks, there are a number of other goodies like roads, directional signs, bike & pedestrian paths, and municipal beer & liquor licenses.

Spending isn't the only thing going up in the budget - taxes & fees will grow too, as will borrowing. Taxes will increase by a total of $1.67 billion, fees by $241 million. Property taxes are estimated to increase by $1.5 billion. (But watch out - some of the factors that will increase your property taxes were delayed until 2011.) Borrowing, to be paid back in future years, is set to total $3.6 billion.Were the tough decisions made in this budget? Everyone has an opinion and they're entitled to it. Mine is that those decisions were put off for a later day.

I can't end this update with my disappointment in the budget. Now that the budget process is over, its time for the legislature, the Governor and communities everywhere need to focus on what they should have been focused on all along: retaining and creating jobs.

State Representative Dan Meyer
State Capitol - Room 308 North - Post Office Box 8953
Madison, Wisconsin 53708
(608) 266-7141 - Fax (608) 282-3634 - Toll Free: (888) 534-0034
Email: Rep.Meyer@legis.wi.gov