The two houses of the Wisconsin State Legislature passed widely differing versions of the 2007-09 Wisconsin State Budget Bill. Below is what each house proposed.
State Senate Proposal
The Governor’s budget bill
passed the Democratic-controlled State Senate last month on a party line vote of
18-15. Here is a summary of the
Senate’s major budget provisions:
Healthy Wisconsin:
Just prior to the public release of their budget proposal, Senate Democrats
added this surprise $15.2 billion amendment, which would create a state-run
universal health care program. The
funding for the program would come from a payroll tax on Social Security wages
of 10.5% on employers, 10% on sole proprietors, and 4% on employees.
A board of directors that would have the authority to adjust these tax
rates would administer the plan.
During its short life, Healthy
Wisconsin has generated intense passion and criticism from both sides of the
political spectrum. Forward
Janesville members submitted numerous comments on Healthy Wisconsin to FJI staff
and their local legislators. Opinions
on the proposal ran the gamut from: “It is a move in the right direction;” and “It may not be perfect, but it is
infinitely better than doing nothing,” to “The plan would be a
terrible burden on my business;” “Our premiums would more than triple under
the plan;” and “Healthy Wisconsin will result in the direct layoff of
at least one employee at my office.”
After much deliberation, FJI’s Government Relations Council and Board
of Directors decided to oppose Healthy Wisconsin (see
story in this issue).
Autism Insurance
Mandate: The Senate-passed
budget includes a proposal to require health insurance plans sold in Wisconsin
to provide coverage for treatment of autism spectrum disorders.
This proposal has been championed by our local legislative delegation,
especially Senator Judy Robson and Representative Kim Hixson, who have each
authored stand-alone bills on this issue.
Tax and Fee Increases: The Senate’s budget includes the Governor’s proposals to:
· Increase cigarette taxes by $1.25 per pack;
· Tax oil company gross profits at a rate of 2.5%;
· Double the real estate transfer tax;
· Increase automobile registration fees; and
·
Increase the allowable property tax levy limit to 4% or new construction,
whichever is greater, which would raise property taxes by $1.2 billion
statewide.
Transportation
Funding: The
Governor had proposed moving $164 million in general purpose revenue (GPR)
obligations, including school transportation and the civil air patrol, under the
umbrella of the Transportation Fund. The
Senate’s budget includes only the first year of the conversion of these
existing appropriations. FJI
opposes both years of these Transportation Fund raids, and believes the
integrity of the Fund must be maintained.
Wisconsin Assembly Proposal
Meanwhile, the Wisconsin State
Assembly approved its version of the 2007-2009 state budget on July 10. The Assembly’s budget stands in marked contrast to the
budget passed by the Wisconsin State Senate.
The Assembly’s plan rejects Governor Doyle’s proposal to raise taxes
on oil companies, hospitals and smokers, and eliminates the Healthy Wisconsin
proposal. It also provides
a number of tax cuts, and includes an income tax
exclusion for health savings accounts which Forward Janesville has long
supported.
The Assembly’s budget:
· Enacts a property tax freeze that would limit levy increases to the growth in value of new construction and provide more than $200 million in additional revenue for the local levy credit.
· Reduces the real estate transfer fee from $3 per $1,000 of value to $1 by 2011.
·
Provides an income tax
deduction for contributions to health savings accounts and creates a corporate
income tax credit for workplace wellness programs.
· Includes a new state income tax deduction for health insurance premiums paid by employees.
· Would stop single people younger than age 65 from qualifying for the Homestead Tax Credit.
· Creates an income tax exclusion for retirement income, beginning at $500 in 2008 and increasing to $20,000 annually by 2029.
·
Provides various smaller tax cuts, including increases in deductions for
college tuition and child care.
The
Assembly’s budget would pay for
these provisions by cutting the University of Wisconsin System by more than $100
million, reducing funding for public schools by $85 million, cutting state aid
to Wisconsin counties by a minimum of 5 percent, and requiring state employees
to pay more for health insurance. The
Republican proposal also eliminates Doyle’s plan to create BadgerCare Plus,
which would expand health coverage in the state, and his expansion of Family
Care, which helps the needy remain in their homes rather than forcing them to
move to nursing homes. The budget
also does away with Doyle’s proposed Wisconsin Covenant, which would guarantee
higher education opportunities for Wisconsin students who maintain B averages.
So
What Does This All Mean?