I appreciate you contacting me about the state budget. The Governor recently signed the two-year state spending plan into law. I am writing to provide you with an update on the final version.
Final action on the budget took longer than most anticipated. Even though Republicans (12 Republicans versus four Democrats) dominated the budget writing committee, for weeks the majority party did not have the votes to pass the budget out of committee. Negotiations on thorny issues like transportation borrowing, prevailing wage and the Buck’s Arena held up full legislative deliberation on the budget.
During the spring and early summer, I held many town hall meetings in western Wisconsin. I found a great deal of consensus among friends and neighbors on what the state should do to balance the budget. Generally, people did not want to use state money for private schools (especially those run by out-of-state entities). People opposed the cuts to the University of Wisconsin System, the Department of Natural Resources, agriculture and the Stewardship program. Many people strongly opposed turning the FamilyCare and IRIS programs over to a for-profit insurance company.
In response to these concerns, and many others, I constructed an alternative to the governor’s budget and shared some of these numbers with my Republican colleagues. The full Legislature did make changes to the governor’s budget. In final action, Governor Walker made over 100 vetoes to the budget presented to him by the Legislature.
My Senate Democratic colleagues and I tried to make changes that people around the state requested. We offered over 50 different amendments to the budget but none were accepted. In the end, I voted against the budget.
An important fact to know about this budget is that it spends more money than previous budgets. The 2015-17 budget spends $73.3 billion, which is an increase of about 3% or $2.3 billion over the last budget.
There has been much confusion of how much the budget spends because when the Governor originally introduced his budget, it did not include a large portion of the UW System budget. The Governor proposed cutting the UW System loose and making it an authority. When the UW System was included, the governor’s proposal cost $74.7 billion. Also adding to the confusion is the amount of borrowing for transportation. The final budget included less borrowing and less road spending.
Major spending in state government falls into six areas. Health, K-12 education, higher education, transportation, local government and corrections account for 86% of our state budget.
Health costs are the driver behind new spending. Nearly a third of the entire state budget goes to health programs. This budget increased health spending by 13% over the last budget. Despite these increases, the number of people covered by state programs has leveled off. In addition, the budget includes new drug testing requirements and calls for the state Department of Health Services to seek a federal waiver to allow the state to implement a two-year time limit for BadgerCare coverage for adults who are not caretakers of dependent children. I strongly oppose these changes. I supported taking the $360 million in federal Medicaid dollars to cover the cost of health insurance for those of very modest means. These dollars would have offset budget cuts in other areas and covered about 81,000 additional people.
The budget provides an offset of $71 million in disproportionate share payments for hospitals that care for a large number of uninsured. These dollars would not be necessary if Wisconsinites had health care coverage. It makes no sense to me that the Governor would refuse federal funds, kick poor folks off BadgerCare after two years, increase the uninsured and spend another $71 million so hospitals can care for the newly uninsured.
In his budget, the Governor proposed sending Family Care and IRIS (programs for the disabled, frail elderly and developmentally disabled) to a private insurance company. Budget writers made modest changes to the governor’s proposal but I think it is likely the current programs will be dismantled during the second year of the budget. I am very concerned this action will result in fewer services and increased expense.
People often ask me why spending is going up for health care if we are not serving more people. One area of spending we saw a 20% increase over the last budget was money going to private companies to administer Medicaid funded programs.
Public education (K-12) will receive a very small overall increase. Recent data from the Department of Public Instruction show 234 schools (or 55%) will receive a decrease in state aid. More than half of the 21 school districts in our senate district will receive less aid or a very small increase. Some districts, like Pepin and Alma, will again receive the maximum cut of over 15 percent.
Instead of investing in our local public schools, this budget again expands private school subsidies. Over $71 million in new tax dollar spending goes to private schools. However, this number does not include the expanded statewide “open-enrollment” vouchers. Less state aid dollars to local schools means more schools must go to referendum to cover educational programs and maintenance. The result is property tax-payers pick up more of the costs for operating public schools.
More money to private schools and less to our local schools is one of the main reasons I voted against the budget. I believe we must restore the funding cut from public education and we must change the way our state pays for schools. For the third budget in a row, State Superintendent Tony Evers proposed common sense changes in the school funding formula and for the third time the governor failed to include these changes in his budget. In my alternative budget, I fully funded Superintendent Evers’ plan because public schools cannot provide our children a quality education under the status quo.
Another reason I voted against the budget was the deep cut to the University of Wisconsin System. The four campuses in western Wisconsin will suffer from over $17 million in combined cuts. Faculty and staff will lose their positions. Others are voluntarily leaving the UW system for other places. It is difficult for UW campuses to find staff for various programs. Students will have a harder time graduating on time because of fewer course offerings. These cuts did not have to happen. In the alternative budget I wrote, I found ways to cover budget gaps and invest in additional financial aid.
In the new state budget, money for local government (shared revenue) remained flat, despite increases in local costs. Counties will lose money for recycling programs. While road aid continued at the same reimbursement per mile as the last budget, several portions of the rest of the transportation budget received cuts. My colleagues and I spent a great deal of time considering options for funding the transportation budget. Over the past several years, billions of dollars were spent on large road projects in Southeast Wisconsin while aid for maintaining local roads decreased.
The Governor proposed borrowing $1.3 billion to pay for expanding road building. He used borrowing to avoid any type of tax increase or cuts to spending. I agreed with my Republican colleagues when they cut back borrowing and certain large road construction projects. In my alternative budget, which I shared with my Republican colleagues, I cut the governor’s transportation borrowing in half, slightly slowed large road construction and put more money in transit and transportation alternatives. I also increased the fuel tax by a nickel. Other Midwestern states have considered fuel tax increase of ten cents or more per gallon.
My Senate Republican colleagues did not want to increase the fuel tax or consider any other of the nearly two dozen options the governor’s own Secretary of Transportation included in his budget. In the end, all they did was reduce the governor’s borrowing by about a third.
The budget made changes that impact the state’s natural resources: cutting 90 positions including scientists and educators at the Department of Natural Resources, eliminating all state funding for the state parks, cutting local conservation staff and grants to protect clean water and a big decline in the Stewardship program.
Finally, the budget as passed by the Legislature contained over 130 separate items of non-fiscal policy – a state record. Many of these policy items would never pass the Legislature if introduced as a separate bill. An example of such non-fiscal policy is removing tenure and shared governance at our universities from state law. Budget writers made changes that affect local government including limiting the authority of locals to spend room tax revenue, changing local authority on community specific shoreland zoning and changing culvert permitting.
In addition, the budget removes references to a ‘living wage’ from state law and weakens the requirement that employers provide one day of rest in seven. I do not support non-fiscal policy in the budget. All 130 or so items deserve proper vetting by the public through the public hearing process. I am working on an amendment to the state Constitution to prevent this type of action in the future.
I must emphasize there are many choices made in this budget that are not in the best interest of the people of the State of Wisconsin. I do not support the decisions made. I voted ‘no’. I offered suggestions to my Republican colleagues. I created an alternative budget that funded our priorities of local public schools, a clean environment, effectively operating state and local governments and health care for the most vulnerable among us.
If you would like any additional resources or have questions, please check out my website at http://legis.wisconsin.gov/senate/vinehout/Pages/default.aspx, or send me an email at Sen.Vinehout@legis.wisconsin.gov or call my office at 877-763-6636.
Again, thank you for sharing your concerns about state government.
Kathleen Vinehout, State Senator
31st Senate District