News of the Day

House GOP bill Repeals ObamaCare Taxes — With One Exception

The legislation that House Republicans have unveiled to repeal and replace ObamaCare would eliminate nearly all of the 2010 health law’s taxes — with one key exception.

The House bill, unveiled Monday evening, would allow ObamaCare’s “Cadillac” tax on high-cost health plans to take effect in 2025. The tax, which has been opposed by both Democrats and Republicans, had been slated to take effect in 2020 under current law.

By keeping that tax, albeit after a delay, Republicans are trying to ensure that their bill will not add to the deficit after 10 years. That’s a key consideration necessary to ensure the measure can pass the Senate with a simple majority, rather than with 60 votes.

“We dismantle Obamacare’s damaging taxes and mandates so states can deliver quality, affordable options based on what their patient populations need, and workers and families can have the freedom and flexibility to make their own health care choices,” House Ways and Means Committee Chairman Kevin Brady (R-Texas) said in a statement Monday.

The other ObamaCare taxes would be eliminated starting in 2018, including taxes on medical-device manufacturers, health insurers, pharmaceutical manufacturers, and indoor tanning services. The legislation would also repeal a 3.8-percent tax on net investment income and a 0.9 percent Medicare surtax that apply to high earners.

Two cornerstones of ObamaCare, the individual and employer mandates, would be repealed retroactively. The penalties for not having or providing insurance would be eliminated for 2016 and subsequent years.

The legislation would also repeal ObamaCare’s premium tax credits starting in 2020. The bill creates new refundable tax credits for those without employer-sponsored or government health insurance, which is adjusted by age and phases out for individuals making more than $75,000 per year.

The House Ways and Means Committee is scheduled to consider the tax portions of the ObamaCare repeal and replace bill on Wednesday.

Voters Approved $1.35 Billion in School Borrowing Last Year

In 2016, voters in 54 Wisconsin school districts approved $1.35 billion in borrowing for new construction projects. That amount was the highest in at least 25 years and about 30% greater than the inflation-adjusted $1.04 billion approved in 1996, according to a new report from the Wisconsin Taxpayers Alliance (WISTAX). WISTAX is a nonpartisan, nonprofit organization devoted to public policy research and citizen education.

Although reasons for school borrowing vary, growth is a factor: Over the past five years, in districts where student numbers rose, 55% held debt referenda. Over those same years, voters have approved almost $3 billion in new borrowing. However, that is less than the inflation-adjusted $4.7 billion approved during 1996-2000, the last period of major school construction. Debt referenda in 2016 were unusual in several other ways.

According to WISTAX research, the 83 proposed were the most since 2001 and 64 approved the most since 2000. The percentage passed (77.1%) was the highest since at least 1993. In February and April of this year, districts are asking to borrow another $707.9 million for building projects.

The surge in new borrowing comes at a time when referenda to exceed state-imposed revenue limits are passing at record rates. In 2016, 81.7% of these referenda were approved, nearly double the average during 1996-2010 (44%).

Districts seeking revenue limit exceptions are different from those seeking new borrowing in at least one key aspect: They are likely to be suffering declining enrollment. Of 171 districts with revenue limit referenda in the past five years, 130 (76%) had falling student numbers—the reverse of districts seeking new debt.

Macco wants comprehensive functioning tax structure

As chair of the Ways and Means Committee, Rep. John Macco has held five public hearings on taxation in Wisconsin.

In an interview with the Wheeler Report, Macco said the hearings were an opportunity for the committee to understand the tax structure in Wisconsin, allowing all the committee members to have a fundamental understanding of where the revenue comes from, who pays it, how it’s handled, and where it goes. Macco said he was glad the committee concluded by having the Towns, Villages, Municipalities, and Counties testify last because it brought everything together. Macco emphasized that he thought the committee hearings were a success, saying committee members had excellent questions, and it deepened everyone’s understanding of the issues.

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7 Months in, Green Bay Airport’s New International Facility Thrives

Since opening in early June 2016, the new International Arrivals Terminal at Austin Straubel International Airport has seen a significant rise in traffic through what is becoming a hotspot for corporate and private traffic. The last seven months alone of 2016 say 277 flights clear US Customs.

The new facility has enabled the airport to expand it’s capabilities for international traffic services such as a fully operational USDA-approved auto-clave to handle regulated international trash.

The new terminal also provides space and upgraded technology for CBP officers to operate in facilities that meet the federal security standards.

As this trend continues, Austin Straubel Directors believe this momentum will bring international commercial charter aircraft capabilities within reach sooner than most expected.

For the official statement on this progress, click here.

Wisconsin Bank Profits Declined in 2016

Wisconsin’s federally insured banks reported $1.1 billion in net income in 2016, down from $1.2 billion in 2015, according to the latest Quarterly Banking Profile from the Federal Deposit Insurance Corp.

The number of commercial banks and savings institutions reporting to the FDIC also declined year-over-year, from 243 as of Dec. 31, 2015 to 222 as of Dec. 31, 2016. The reporting banks had 21,661 employees, down from 22,202 at the end of 2015. That’s partly because the number of Wisconsin banks continues to fall, with several high-profile mergers taking place among the state’s community banks as they seek economies of scale and carry out succession plans.

The institutions had $108.9 billion in total assets as of Dec. 31, up from $106.9 billion at the same point in 2015. Deposits totaled $87 billion, up from $86.1 billion at the end of 2015.

Lending was up in 2016. Loans and leases totaled $77.5 billion, up from $74.8 billion in the fourth quarter of 2015. The state’s banks reported a net loans and leases to assets condition ratio of 70.14, up from 68.97 at the end of 2015.

“Wisconsin banks continue to move forward despite a wide variety of obstacles challenging the industry, such as a prolonged low interest rate environment; compliance and technology costs escalating every year; and the number of bank mergers in Wisconsin continuing to increase (21 mergers were announced in 2016 compared to 12 in 2015, which was considered a large number at the time),” said Rose Oswald Poels, president and chief executive officer of the Wisconsin Bankers Association.

“The latest FDIC numbers continue to highlight the fact that the diversity of Wisconsin’s strong banking industry directly benefits Wisconsin consumers. Wisconsin banks remain committed to helping businesses grow and families prosper, creating thriving communities. Our institutions are healthy, well-capitalized and ready to help keep our economy growing.”

Individually, Green Bay-based Associated Bank NA brought in the highest profit in 2016, with $225.3 million for the year. The bank has $29.1 billion in total assets.

Madison-based John Deere Financial f.s.b. had the second-highest profits, with $83.5 million in 2016. It has assets of $2.5 billion.

Racine-based Johnson Bank came in third, with $30 million in 2016 profits. It has $4.5 billion in assets.

Wauwatosa’s WaterStone Bank SSB was fourth, with $26.3 million in profits for the year and $1.8 billion in assets.

And rounding out the top five was Fond Du Lac-based National Exchange Bank and Trust, with $25.5 million in 2016 profits and $2 billion in assets.

Milwaukee-based Northwestern Mutual Wealth Management, usually a mainstay in the top five earning banks in the state, was in sixth place with $25.1 million in profit for the year. It has $218.4 million in assets.

President Trump, in Speech to Congress, Calls to “Restart the Engine” of U.S. Economy

President Trump declared Tuesday that a “new chapter of American greatness is now beginning” as he made economic revival the centerpiece of his first address to Congress – issuing a clarion call to “restart the engine of the American economy” through tax cuts, better trade deals, immigration enforcement and a $1 trillion infrastructure program.

He also called on Congress to replace what he called the “imploding ObamaCare disaster” with legislation that lowers costs and expands access, an ambitious goal for GOP lawmakers still trying to come together on a plan.

The president outlined his agenda in an address to a joint session of Congress that lasted roughly an hour and focused largely on priorities at home, more than abroad. He offered a decidedly upbeat vision for the future of the country that stood in contrast to his at-times foreboding inauguration address.

“Everything that is broken in our country can be fixed. Every problem can be solved. And every hurting family can find healing, and hope,” Trump said, urging lawmakers to “join forces” to deliver.

Trump called for a “national rebuilding,” urging Congress to pass legislation that produces a $1 trillion public-private investment in infrastructure.

Speaking to a key campaign promise that has yet to be realized, he said his team is developing “historic tax reform that will reduce the tax rate on our companies so they can compete and thrive anywhere and with anyone.” He vowed a “big, big cut” including “massive tax relief for the middle class.”

And he urged Congress to replace ObamaCare “with reforms that expand choice, increase access, lower costs, and at the same time, provide better health care.”

He outlined “principles” to guide negotiations, including a call for Americans with pre-existing coverage to keep access to care, for states to have “flexibility” with Medicaid, and for Americans to be able to buy insurance across state lines.

In calling to “restart” the American jobs engine, Trump said the U.S. must make it “easier for companies to do business in the United States, and much, much harder for companies to leave our country.”

The biggest task ahead is Republicans’ drive to repeal and replace ObamaCare. As Trump appealed for a comprehensive package, some in the party have been divided over the plans being privately discussed at the Capitol.

House Speaker Paul Ryan played down divisions ahead of Tuesday’s speech. “This is a plan that we are all working on together,” he told reporters. “There aren’t rival plans here.” After the speech, Ryan applauded Trump for what he called a “home run.”

But the official Democratic response offered a reminder of the resistance Trump will face on his legislative agenda, particularly on ObamaCare.

Former Kentucky Gov. Steve Beshear warned those efforts would strip affordable health insurance from Americans. “This isn’t a game. It’s life and death for people,” he said.

Wisconsin Department of Revenue Targets Fraud and Identity Theft

More than $63 million in fraudulent and erroneous refunds and credits were blocked last tax season thanks in part to the Wisconsin Department of Revenue’s use of identity verification tools.

“We are vigilant in our efforts to safeguard the refunds and identities of tax filers with enhanced ID verification tools,” said Richard Chandler, Wisconsin Department of Revenue Secretary.

“As reports of cybercrimes and identity theft become more common, the DOR prevents fraudulent activity by diligently reviewing filed tax returns to protect our citizens,” Sec. Chandler said. “Our systems are secure, however when fraudsters steal your identity from other sources, they may try to file a fraudulent tax return.”

“We ask tax filers to allow at up to 12 weeks processing time this season as we leverage our ID verification tools to ensure their refund is not going to someone who’s stolen their personal, confidential information,” Chandler added.

How ID Verification Works

The Wisconsin Department of Revenue uses analytics to identify returns that indicate possible identity theft. When this happens, the DOR sends a letter to the tax filer asking them to complete a quiz, enter a Personal Identification Number (PIN), or submit documentation to confirm their identity. The unique PINs are a tool the DOR began using last year to help safeguard tax filers.

During the past six tax seasons, the Department stopped more than $255 million in potential fraud. The increase is due to the DOR’s continuous expansion of its anti-fraud efforts and tools as more cybercriminals attempt fraud. For more information, visit the DOR’s Protecting Taxpayers page.

Proposed Federal Budget Would Hike Defense Spending, Cut EPA

President Donald Trump is proposing major defense spending increases and big cuts to the Environmental Protection Agency, State Department and other federal agencies in a proposed budget to be presented soon to Congress, said a person familiar with the plan.

The outline of the budget will be made public as early as Monday, according to two White House officials. They declined to comment further on what the budget may entail. Trump is scheduled to make an address to Congress on Tuesday night.

Congress ultimately determines how the federal government’s money is spent, and the White House budget is mostly an opening bid in what could be a protracted process to set a federal spending plan for the upcoming fiscal year.

Treasury Secretary Steven Mnuchin said Trump’s first budget won’t touch entitlement programs such as Social Security or Medicare. It will instead focus on ways to produce long-term economic growth by slashing taxes, he said in an interview taped Friday and broadcast Sunday on Fox News Channel.

The New York Times reported Sunday evening that the budget will assume economic growth of 2.4 percent, below the 3 percent growth Trump has pledged. Mnuchin said that the administration thinks a combination of tax cuts and regulatory relief will lead to economic growth of 3 percent or higher. “We’re going to make sure this works,” he said in the Fox interview. “This is all about creating growth.”

Defense Budget

A spokesman for the Office of Management and Budget, which compiles the document, declined to comment on its details. He said the outline wouldn’t address entitlements or tax changes, which would be included in a fuller budget proposal later in the year.

“The president and his Cabinet are working collaboratively to create a budget that keeps the president’s promises to secure the country and restore fiscal sanity to how we spend American taxpayers’ money,” the spokesman, John Czwartacki, said in an e-mail.

One top national security official said the budget’s main thrust is to boost defense spending, as Trump has repeatedly promised. The president has called the U.S. military, the world’s largest, “badly depleted.”

“We’re also putting in a massive budget request for our beloved military,” Trump said in a speech Feb. 24 at the Conservative Political Action Conference. “We will be substantially upgrading all of our military, all of our military, offensive, defensive, everything, bigger and better and stronger than ever before. And hopefully, we’ll never have to use it, but nobody’s gonna mess with us, folks, nobody.”

Restructuring, Cuts

Trump’s budget outline will show the president’s “commitment to fixing VA,” Veterans Affairs Secretary David Shulkin said in an interview that aired on Fox News on Monday. Shulkin said it’s not about increased funding, but a matter of restructuring the system.

The State Department will not share in the largesse. One of the agency’s deputy secretary positions, in charge of management and resources, is expected to be eliminated and its staff reassigned, people familiar with the plan said. Trump and his aides also are reviewing whether to eliminate many special envoy positions, the people said — diplomatic staff assigned to key regions and issues, including climate change, anti-Semitism and Muslim communities.

The EPA, meanwhile, has been a consistent target for Trump. He’s said the agency has too many regulations that burden companies and cause long delays for businesses trying to get approvals for new factories.

Trump’s pick for EPA administrator, Scott Pruitt, was a long-time foe of the agency as Oklahoma’s attorney general. Trump is slated to sign documents as soon as Monday compelling the EPA to begin undoing recent regulations, including the Clean Power Plan that slashes greenhouse gas emissions from electricity generation and the Waters of the U.S. rule that defined which waterways are subject to pollution regulation.

“Its clogged the bloodstream of our country,” Trump said of the agency earlier this month. “People can’t do anything, people are looking to get approvals for factories for 15 years.”

Two-Thirds Cut

The EPA is a perennial target for budget cuts for some conservatives in Congress, and advisers on Trump’s transition team said its funding and staff could be slashed below its $8.3 billion budget this fiscal year. Myron Ebell, who led the Trump transition team focused on the EPA, said the agency’s workforce could be cut to a third of its current size — about 15,000 employees nationwide.

The White House’s budget outline, a so-called “skinny budget,” is essentially a summary document often used by new presidents to provide advance looks at an administration’s policy and funding priorities. Typically, more details come from the White House in a fuller budget document later.

House and Senate committees don’t have to embrace the president’s proposals, as presented. They will hold hearings to establish a congressional budget resolution laying out a framework for anticipated revenues and discretionary spending allocations for the 12 annual appropriations bills for the next fiscal year, which begins Oct. 1. That budget resolution is adopted by Congress, but is not signed by the president.

State Lawmakers Tout Self-Driving Cars at Hearing

The prospect of self-driving vehicles on Wisconsin roads got a warm reception from state lawmakers at an informational hearing at the state Capitol on Wednesday.

Legislators on the Assembly Committee on Jobs and the Economy peppered speakers from the University of Wisconsin-Madison, in addition to officials with companies like Uber and General Motors, with questions on the emerging technology.

They raised concerns ranging from cybersecurity to how the cars would handle deer crossings. But for the most part, committee members hailed the technology as an exciting development.

“I am absolutely sold. I have experience through a friend who uses these things out in Seattle,” said Rep. John Macco, R-Ledgeview. “He swears by ’em.”

“It’s really an exciting topic, and one I’m sure we’re going to be involved in,” added Rep. Tod Ohnstad, D-Kenosha.

Many of the legislators said they were particularly keen on attracting business and research centered on driverless technology. Macco said that kind of economic activity could be a way of bringing younger workers to the region.

“We have less millennials than we do boomers,” he said. “Here’s a reason to attract those young lives to our state.”

The crux of the testimony at the hearing came from two engineering researchers with the University of Wisconsin-Madison leading an effort to bring autonomous vehicles to Wisconsin for testing. The U.S. Department of Transportation recently designated the state as an officially sanctioned proving grounds. The designation means that experimental autonomous vehicles could be on Wisconsin’s roads within the year.

Rafferty stressed to lawmakers that the advent of driverless cars isn’t up for debate.

“It’s not a question of whether you agree or disagree with what’s going on,” he said. “They are going to be happening.”

Lisa Schrader, a public affairs official with Uber, echoed that idea. She stressed that the future is one in which autonomous cars, coupled with ridesharing, will increasingly become the norm.

“If you have a child or a grandchild or a niece or nephew under 10 years old today, it’s less likely that the first thing they do before they turn 16 is get a driver’s license,” she said.

Doug Rebout, a local farmer, also gave a presentation on what autonomous vehicles looks like in agriculture, an area in which the technology has already seen some integration. He said that thanks to autonomous combines and tractors, he and his family have been able to drastically change their workflow.

“We’re able to go relax, and we’re able to pay attention to other things that are going on in the field,” said Rebout.

The informational hearing came as an increasing number of states pass laws permitting autonomous vehicles on their roads, and laying out rules on what they can or cannot do. Wisconsin currently has no autonomous vehicle laws on the books.

Sen. Fred Risser, D-Madison, has said he is planning to introduce an autonomous vehicles bill for Wisconsin this session. The Assembly GOP also have the issue on their agenda.

Pruitt: Federalism Matters at the EPA

New Environmental Protection Agency Administrator Scott Pruitt wants to make the agency a place where “federalism matters” and states are not seen as adversaries, he said Tuesday.

“I seek to ensure that we engender the trust of those at the state level,” rather than approach them as “adversaries,” Pruitt said in his first address to agency staff on Tuesday.

He made the comments after being sworn in as President Trump’s head of the EPA on Friday, despite widespread Democratic opposition and protests by environmental groups and former EPA administrators.

Trump has pledged to roll back a number of EPA regulations seen as detrimental to coal miners and energy production jobs.

Pruitt said Tuesday that he doesn’t see a conflict between being pro-energy and pro-environment. “We can be both pro-energy and pro-environment … and we don’t have to choose.”

Pruitt also wants to make sure everything the agency does is based firmly in statute and the law.

He said the agency should abide by the law to “avoid litigation,” devoting more of its time doing the business of the agency, and less time going to court over its regulations.