Supreme Court Justice David Prosser Announces Retirement

Yesterday, Justice David Prosser announced that he would be retiring from the Wisconsin Supreme Court effective July 31, 2016. Justice Prosser was appointed to state’s highest court in 1998 by Governor Tommy Thompson following the retirement of Justice Janine Geske. He was elected to the Wisconsin Supreme Court in 2001 and re-elected to a second ten-year term in 2011.

Justice Prosser’s decision to retire before the end of his term sets up a rather unique situation. Under Wisconsin’s Constitution, the Governor has the authority to appoint an interim Justice to the seven-member court, but his appointee must stand for election in the first year where no other justice’s term expires. That’s because the state’s Constitution also specifies only one justice may be elected in any year.

In each of the next three years, there will be a member of the Wisconsin Supreme Court up for re-election – Justice Annette Ziegler in 2017, Justice Michael Gableman in 2018 and Justice Shirley Abrahamson in 2019. Therefore, the Governor’s appointee will stand for election in 2020.

State Lawmakers Continue to Reform Wisconsin’s UI Program

During the 2015-2016 Legislative Session, state lawmakers enacted 24 separate amendments to Wisconsin’s Unemployment Insurance (UI) law. A majority of these changes are beneficial to WIB members and small businesses in general.

A plain language summary of the modifications to Wisconsin’s UI law has been published by the Wisconsin Department of Workforce Development. We encourage members to review this document.

If you have further questions or need additional information, please contact our Legislative Director, Brian Dake at 1-800-362-9644 (toll-free) or via e-mail at bdake@wibiz.org.

State Legislature Shifts to “Committee Work” Mode

During the summer and fall of each even-numbered year, the Legislature’s Joint Legislative Council selects a number of subjects for further study. Generally speaking, these Committees focus on:

a) public policy problems that are expected to confront a future Legislature;
b) controversial subjects that were unresolved by the previous Legislature;
c) major updates or revisions to existing state law; or
d) methods of improving the operation and effectiveness of state agencies.

Study committees are comprised of legislators and public members with expertise or interest in the issue. Study committees generally meet from three to six times and ultimately report their recommendations, in the form of legislation, to the full Legislative Council for approval and introduction in the next legislative session.

The Joint Legislative Council recently approved seven Study Committees. They are:

1. Access to Civil Legal Services – the Study Committee is directed to review the funding and delivery of legal services for the indigent in civil cases.

2. Preservation of Burial Sites – the Study Committee is directed to review Wisconsin’s Burial Site law and determine whether it adequately balances the
interests of scientists, landowners, developers and others with an interest in a burial site.

3. Publication of Government Documents and Legal Notices – the Study Committee is directed to update and amend existing states laws related to the
publication and distribution of government documents and legal notices, to reflect technological advances and remove obsolete provisions.

4. Reducing Recidivism and Removing Impediments to Ex-Offender Employment – the Study Committee is directed to review effective strategies and best
practices to reduce recidivism.

5. Rural Broadband – the Study Committee is directed to review the Wisconsin Broadband Expansion Grant program and the extent to which it has encouraged
construction of broadband infrastructure in underserved areas of the state.

6. School Data – the Study Committee is directed to review all student data gathered by the Wisconsin Department of Public Instruction and the data security
measures that protect student privacy.

7. Volunteer Firefighter and Emergency Medical Technician Shortages – the Study Committee is directed to examine issues related to the shortage of volunteer
firefighters and Emergency Medical Technicians in the state and propose measures to address the shortages.

Of particular interest to WIB is the Rural Broadband Study Committee. In 2013, we backed the creation of the Broadband Expansion Grant program and last year we successfully lobbied for additional funding for Broadband Expansion grants. Now that we have some experience with this program, it is appropriate to determine whether this program has, in fact, expanded broadband service in underserved areas of the states and consider alternative methods for encouraging construction of broadband infrastructure.

We sincerely hope you find this e-publication to be a valuable member service. Let us know what you think and how we can make it better by contacting the editor, Brian Dake, at bdake@wibiz.org.

Sincerely,
John Gard
Wisconsin Independent Businesses

Exercise Your Right to Vote – Tuesday, April 5

he Wisconsin Government Accountability Board (GAB) is projecting a 40% turnout in next Tuesday’s statewide Spring General Election. Voters will elect a new member to a ten-year term on the Wisconsin Supreme Court and influence which candidate will represent the Republican and Democrat parties in the race for the White House.

We encourage members to exercise their right to vote. On Tuesday, the polls are open from 7:00 a.m. to 8:00 p.m.

If you have voting-related questions, please go to My Vote Wisconsin – a website operated and maintained by the Wisconsin Government Accountability Board. On this site, you can register to vote, check your voter registration status, find your polling place and see what’s on your ballot.

PSC Releases Energy 2022 Report

State law requires the Wisconsin Public Service Commission (PSC) to prepare and publish a strategic energy assessment (SEA) every two years to evaluate the state’s current and future energy demands, how those demands will be met, and the reliability of the electrical system over the next seven years.

Last Thursday, the PSC released its latest SEA – Energy 2022 – based on data and information collected in 2015 and 2016 from Wisconsin utilities and power cooperatives. The key findings from the Energy 2022 report include:

1. More than 90% of the electricity generated in Wisconsin comes from three fuel sources – coal (65%), nuclear (15%) and natural gas (12%);

2. State law requires that approximately 10% of all electricity sales in Wisconsin come from renewable resources by 2015. Sales of electricity from renewable
resources surpassed 10% for the first time in 2013 and projections show this goal will continue to be met through at least 2020. The primary renewable
resources of electricity are hydro (3%); biogas (3%) and wind (2%);

3. Since the last SEA, electricity rates have increased for all customer classes both in Wisconsin and the Midwest. U.S. average electricity rates in the residential
class increased; whereas the rates for the commercial and industrial classes decreased. For 2015, the average rates (per kilowatt hour) are as follows:

Wisconsin Midwest U.S.

Residential $14.42 $12.06 $13.32
Commercial $11.06 $9.56 $11.01
Industrial $7.81 $7.09 $8.02

4. Forecasts indicate that Wisconsin will maintain an adequate and reliable electric supply through 2022. By then, Wisconsin’s electricity providers estimate they
will retire approximately 520 MW of existing Wisconsin-based electric generation. Electricity providers expect a combined need for an additional 200 to 700
MW of capacity and energy by 2020; and

5. Between 2016 and 2022, annual electric energy efficiency expenditures by electric utilities and the state-mandated Focus on Energy program are projected to
be in the range of $88 to $100 million.

Tax Filing Deadline – April 18

Federal and state tax returns must be received or postmarked by midnight on Monday, April 18. The deadline is extended this year because of the emancipation holiday in Washington, DC on April 15.

For state tax filing, the Wisconsin Department of Revenue (DOR) offers the following tips to make the filing process easier.

a) Pay online. The DOR offers easy online payment taxes on its website.

b) Taxpayers must request an extension from the Internal Revenue Service (IRS) by April 18 to avoid penalties. Go here for more information. Taxpayers who file
an extension request with the IRS automatically receive an extension from the state. Taxpayers should keep a copy of their IRS federal extension application
(Form 4868) for their records.

c) Call the DOR customer service during off-peak hours at (608) 266-2772. Customer service hours are 7:45 a.m. to 4:30 p.m. Monday through Friday. The
best time to call is Tuesday – Friday, especially in the afternoon. The call center is the busiest on Monday and during the lunch hour.

We sincerely hope you find this e-publication to be a valuable member service. Let us know what you think and how we can make it better by contacting the editor, Brian Dake, at bdake@wibiz.org.

Sincerely,
John Gard
Wisconsin Independent Businesses

Status Report on WIB Legislative Priorities

With the end of the 2015-2016 legislative session in sight, we want to update you on our lobbying efforts. By way of background, our public policy priorities for 2016 are:

Phase-Out of Wisconsin’s Personal Property Tax
More Accountability and Integrity to the Worker’s Compensation Program
Tougher Penalties for UI Benefit Fraud
Improve the State’s Tax Administration Process
Create a More “Small Business-Friendly” State Regulatory Process

Phase-Out of Wisconsin’s Personal Property Tax

2015 Assembly Bill (AB) 750 would phase-out Wisconsin’s personal property tax over a four-year period beginning in 2016. AB 750 will not receive any further consideration this year. While there is bipartisan support for the elimination of the state’s personal property tax, that support is contingent upon at least some state reimbursement to local governments to offset their loss of personal property tax revenues. At this time, Wisconsin’s current fiscal condition and budget outlook are positive, but there is not enough money available to provide so-called “hold harmless” payments to local governments.

More Accountability and Integrity to the Worker’s Compensation Program

On March 2, Governor Walker gave final approval to an omnibus package of amendments to the state’s Worker’s Compensation law. The “small business-friendly” provisions included in 2015 Wisconsin Act 180 are:

a) no recovery of indemnity or death benefits when an employee violates the employer’s drug and/or alcohol policy and where there is a direct causation
between the violation of the drug and/or alcohol policy and the workplace injury;

b) denial of temporary disability when an employee is released to light duty work and is suspended or terminated due to misconduct or substantial fault as defined under the state’s Unemployment Insurance law;

c) apportionment of permanent disability resulting from accidental injuries will be based on causation;

d) reduction in the statute of limitations for traumatic injuries from 12 years to six years; and

e) funding for the Wisconsin Department of Justice to investigate and prosecute worker’s compensation fraud committed by employees, employers, insurance
carriers and providers.

Tougher Penalties for UI Benefit Fraud

2015 Assembly Bill (AB) 212 creates a seven-year period of ineligibility for UI benefits if the UI claimant commits two acts of concealment or impersonation in two consecutive benefit years. By way of background, the term concealment means to intentionally mislead the DWD by withholding or hiding information or making a false statement or misrepresentation. AB 212 was approved by the Wisconsin State Assembly. As of this writing, the Wisconsin State Senate has not taken final action on AB 212.

2015 Assembly Bill (AB) 533 revises the criminal penalty for a person who knowingly makes a false statement or representation to obtain UI benefits. The bill revises the penalty from a misdemeanor, with a fine between $100 and $500 and incarceration up to 90 days, to a specific penalty structure that ranges from a Class A misdemeanor to a Class G felony, depending on the dollar value of the benefits obtained. AB 533 was approved by the Wisconsin State Assembly. As of this writing, the Wisconsin State Senate has not taken final action on AB 533.

Improve the State’s Tax Administration Process

By law, the Wisconsin Department of Revenue (DOR) may disallow tax deductions, credits and exemptions as well as impose financial penalties on taxpayers who fail to produce tax records within a specified period of time (generally speaking 60 days) for purposes of a state tax audit.

On March 2, Governor Walker signed into law 2015 Act 218 which eases this compliance burden. Under this new law, a taxpayer is subject to the aforementioned penalties if the taxpayer fails to comply with a request by DOR to produce records or documents that support information on a tax return and fails to comply in good faith with a summons issued by DOR seeking the records or documents.

Create a More “Small Business-Friendly” State Regulatory Process

2015 Assembly Bill (AB) 80 creates an expedited procedure to eliminate obsolete and unnecessary regulations – a process we believe can lead to the elimination of existing regulations in a matter of months, not years. 2015 Assembly Bill (AB) 251 creates a new opportunity for small businesses to inform state government agencies of their concerns with a proposed regulation at the front-end of the regulation-making process; and a new mechanism for lawmakers to receive economic analysis of a proposed regulation that fairly and objectively accounts for the compliance costs. AB 80 and AB 251 have been approved by the Wisconsin State Assembly. As of this writing, the Wisconsin State Senate has not taken final action on AB 80 or AB 251.

The last day for the Wisconsin State Legislature to take final action on legislation during the 2015-2016 Legislative Session is April 7. While we do not believe that the State Senate or State Assembly will come back in before that date, we must continue to advocate for our legislative priorities until the very end.

A Positive Report on the State’s UI Program

Earlier today, the Unemployment Insurance Advisory Council (UIAC) received a briefing from the Wisconsin Department of Workforce Development (DWD) on the financial condition of the state’s Unemployment Insurance (UI) Trust Fund and the Department’s ongoing UI fraud detection and prevention efforts. There is plenty of good news to share. Outlined below are the highlights:

1. For calendar year 2015, the total dollar amount of UI benefits paid (federal and state) to eligible UI claimants was $605.5 million – down 17% from 2014;

2. At the start of 2015, the balance in the state’s UI Trust was $215.8 million. The year-end balance in this account was $742.9 million. As a result, the UI
employer tax burden will decline by an estimated $97 million for tax year 2016;

3. Fraud against Wisconsin’s UI program is down – both in terms of actual dollars ($13.3 million in 2015 compared to $20.4 million in 2014) and in terms of a
percentage of total unemployment claims (2.2% in 2015 compared to 2.8% in 2015);

4. In 2015, DWD staff identified 9,793 cases of UI benefits obtained by fraud and recovered more than $20.7 million in fraudulently paid UI benefits. There is
often a lag time between the detection and the subsequent recovery of fraudulent UI payments; and

5. In 2015, DWD referred 115 cases of UI fraud for potential criminal prosecution by the Wisconsin Department of Justice – up from just 19 cases in 2014.

Over the past five years, WIB has successfully lobbied for new laws as well as changes in existing laws which provide DWD with more “tools” to detect and prevent UI fraud. We are pleased these tools are being put to good use.

For more information, here is a copy of the Department’s 2016 UI Fraud Detection and Prevention Report.

Federal Health Care Law Update

Yesterday, the Wisconsin Office of the Commissioner of Insurance (OCI) provided guidance to insurers who write health insurance in Wisconsin.

According to the guidance document, OCI will allow insurers to renew, at their option, non-ACA (Affordable Care Act) compliant individual and small group coverage if coverage has been continuously in effect since December 31, 2013. Policies may continue to be renewed on or before October 1, 2017, provided that the policy will terminate by December 31, 2017. Insurers may early renew coverage or issue coverage for periods less than one year if a policy terminates prior to December 31, 2017, and the consumer or employer desires coverage to the end of the calendar year.

The OCI guidance notes that coverage must have been in force on December 31, 2013, to continue use of a transitional policy. Insurers electing to extend non-ACA compliant plans have the following options for individual and employer-sponsored group outreach and enrollment:

a) An insurer may permit individuals and employer-sponsored groups currently enrolled in the insurer’s non-ACA compliant plan to continue to renew their
coverage; or

b) An insurer may provide an additional opportunity to renew coverage in its non-ACA compliant plan to an individual or employer-sponsored group who is
currently enrolled in the insurer’s non-ACA compliant plan but who has indicated their intent to non-renew at the end of the plan year.

Consistent with Wisconsin insurance laws and regulations, the individual or small employer may change their plan options from one non-ACA compliant plan to another non-ACA compliant plan and renew that coverage provided:

a) Coverage was in force for the individual or small employer before December 31, 2013; and

b) The new plan was available for purchase prior to December 31, 2013.

Insurers opting to renew non-ACA compliant plans must provide disclosure to their enrollees including notice that an enrollee’s premium may be affected either on the date of renewal or in advance of the date on which the premium change will be affected.

Insurers choosing to offer individual and group insureds the option for auto-enrollment must provide the insured a notice at least 30 days in advance of the renewal date that the insured will be automatically renewed in the new plan unless the insured exercises his or her right to choose any plan from any insurer and will receive coverage that is guaranteed.

We sincerely hope you find this e-publication to be a valuable member service. Let us know what you think and how we can make it better by contacting the editor, Brian Dake, at bdake@wibiz.org.
Sincerely,
John Gard
Wisconsin Independent Businesses

DOR Taking Steps to Prevent Tax-Related Identity Theft

Tax-related identity theft is a growing national problem. The perpetrators of this crime collect millions by filing false claims for tax refunds using the Social Security Numbers of honest, hard-working taxpayers.

To illustrate the nature and cost of this criminal activity, the Wisconsin Department of Revenue (DOR) recently highlighted the conviction of a Milwaukee woman for her role in a scheme where 2,000 fraudulent state tax claims were filed between January 1, 2011 and December 31, 2012. The scheme attempted to get a total of $960,175 in tax refunds. While the fraud detection and prevention efforts by DOR blocked most of these false claims, these thieves still pocketed nearly $250,000.

DOR uses sophisticated analytics to identify tax returns that indicate possible identity theft. If this happens, the Department will send a letter to the taxpayer asking them to complete a quiz, enter a unique Personal Identification Number (PIN), or submit documentation to confirm their identity.

If you are interested in learning more about the Department’s ID Verification Program or have reason to believe that you have been a victim of tax identity theft, click here.

Governor Signs Worker’s Compensation Legislation into Law

On Monday, Governor Walker gave final approval to an omnibus package of amendments to the state’s Worker’s Compensation law. A plain language summary of the new law – 2015 Wisconsin Act 180 – has been provided by the Wisconsin Department of Workforce Development (DWD).

We lobbied in support of this new law because it contains five amendments that we believe will help to reduce waste, fraud and abuse in the program. Under the new law, the following changes went into effect on March 2, 2016:

a) There shall be no recovery of indemnity or death benefits when an employee violates the employer’s drug and/or alcohol policy and where there is a direct causation between violation of the drug and/or alcohol policy and the workplace injury;

b) Temporary disability will be denied when an employee is released to light duty work and is suspended or terminated due to misconduct or substantial fault as defined under the state’s Unemployment Insurance law;

c) Apportionment of permanent disability resulting from accidental injuries will be based on causation. A health care provider who prepares a report on permanent disability shall address the issue of causation of the permanent disability that includes a determination of the percentage of permanent disability caused by the direct result of the
work-related injury and the percentage attributable to other factors before and after the injury;

d) The statute of limitations for traumatic injuries will be reduced from 12 years to 6 years; and

e) DWD shall fund one Wisconsin Department of Justice (DOJ) position to investigate and prosecute fraud committed by employees, employers, insurance carriers and providers.
This is in additional to current law which authorizes local district attorneys to investigate and prosecute Worker’s Compensation fraud.

State Supreme Court Candidates Agree to Two Debates

On Tuesday, April 5, Wisconsin voters will elect a new member to a ten-year term on the Wisconsin Supreme Court. The nominees are newly-appointed Supreme Court Justice Rebecca Bradley and Judge JoAnne Kloppenburg, who currently serves as the Presiding Judge on the Wisconsin Court of Appeals – District 4.

The candidates have agreed to two debates before the election. The first will be a WISN-TV debate scheduled for Tuesday, March 15 at Marquette University in Milwaukee. The second debate, co-hosted by Wisconsin Public Television, Wisconsin Public Radio and the Milwaukee Journal Sentinel, is scheduled for Friday, March 18 in Madison.

We encourage members to tune in to these broadcast debates.

We sincerely hope you find this e-publication to be a valuable member service. Let us know what you think and how we can make it better by contacting the editor, Brian Dake, at bdake@wibiz.org.
Sincerely,
John Gard
Wisconsin Independent Businesses

Governor Says Cutting Property Taxes is Top Priority

Last Thursday, the Manitowoc Herald Times published a story entitled: “Walker’s top 2015 priority: Cut property taxes.” In this story, Governor Walker said he remains committed to cutting property taxes. He added – “My goal going forward, as we put together the next budget, is to continue this trend so that four years from now, in December 2018, we can look back and say ‘Property taxes are lower in ’18 than they were in ’14.”This is good news for WIB and its members. Property tax relief is a top legislative priority and elimination of the state’s personal property tax would be wholly consistent with the Governor’s goals.

Cheaper Gas and Diesel in 2015
Earlier this month, the United States Energy Information Agency (EIA) announced its latest petroleum price projections for 2015. According to the EIA, regular gasoline retail prices are projected to average $3.37/gallon in 2014 and $2.60/gallon in 2015. Diesel fuel prices are projected to average $3.82/gallon in 2014 and $3.07/gallon in 2015.If these projections hold, American consumers will be spending far less at the pump and businesses will see a reduction in shipping costs. The benefits of lower fuel prices extend beyond relief at the pump.Consumer spending accounts for 70% of the nation’s economy. Lower gas prices are expected to save American consumers about $100 billion next year – money that is likely to flow back into the local economy.

Scam Alert: Tax Preparation Fraud
The Wisconsin Department of Agriculture, Trade and Consumer Protection (DATCP) is asking for help from the public to be on the lookout for questionable tax and loan practices and to report any suspicious activity to the agency. In particular, DATCP is concerned about one type of tax and loan scam that has repeatedly surfaced over the past couple of years which involves tax preparation businesses filing returns on behalf of consumers without their consent. These businesses initially solicit the consumers’ business with a promise of providing short-term loans. DATCP offered the following tips to businesses to avoid tax preparation fraud:
a) be alert to promotions such as “holiday loans” or other

short-term loans that can be used to gain the personal

financial information needed to file an individual’s tax return;

b) be careful providing personal financial information to a

business unless you want the preparer to file your taxes.

Make sure you provide clear direction and that the company

specifically advises you on whether they intend to file your

tax return;

c) never sign an authorization permitting a company to file

your taxes if you do not want the company to do so;

d) never sign a document without first reading and

understanding what it says;

e) always insist upon receiving copies of all documents that

you are required to sign or that identify the terms of a

transaction and the charges you will be required to pay; and

f) confirm, before signing, that you will receive copies. If a

business does not agree to provide copies, don’t sign.

DATCP works with the Wisconsin Departments of Justice and Revenue to detect tax preparation fraud. Anyone suspecting fraudulent activity is encouraged to file a complaint with DATCP.

Complaints can be filed online through the DATCP website (http://datcp.wi.gov) or a complaint form can be requested by calling the state’s Consumer Protection Hotline at 1-800-422-7128.

We sincerely hope you find this e-publication to be a valuable member service. Let us know what you think and how we can make it better by contacting the editor, Brian Dake, at bdake@wibiz.org.
Sincerely,
John Gard
Wisconsin Independent Businesses