Brian Dake

Joint Finance Co-Chair Considers Toll Roads Best Fix for Transportation Funding Shortfall

Joint Finance Committee Co-Chairman John Nygren (R-Marinette) told Newswatch 12 last week he sees three potential options to fix a billion-dollar shortfall: raising registration fees, raising the gas tax, or using toll roads.

Nygren says lawmakers have pushed off this issue for the last two budgets, so now’s the time to take action.

“I do think tolling, which is a true user fee–you can use other roads if you choose not to use the interstate system–could be an option,” Nygren said.

Toll roads wouldn’t be an immediate fix, because Wisconsin would need federal approval. Nygren thinks the system would be easy enough to install.

“It’s the direction we’re going and, as I said, it’s a true user fee,” Nygren said. “I know it’s not the old world of tolling with all the booths. You can do it nowadays with a transponder in your car.”

Gov. Scott Walker told reporters last week he’s not pushing for toll roads, telling the Associated Press that if he agreed to tolls, he would want the gas tax to drop. Meanwhile, Joint Finance Co-Chair Sen. Alberta Darling (R-River Hills) said Republicans aren’t unified in backing the toll idea.

“I don’t know that I ever met anybody who agrees with me on every single issue, right?” Nygren said. “I don’t care if they’re a constituent or they’re another elected official. We’re elected to bring different perspectives to the table.”

The Joint Finance Committee plans to meet Thursday, when Nygren hopes to focus more on transportation funding.

Walker’s Sales Tax Holiday Appears to be Doomed

Gov. Scott Walker’s proposed sales tax holiday for back-to-school shopping appears to be doomed, with Republican lawmakers saying Friday that they instead want to reduce or end the personal property tax for businesses.

Republican members of the Joint Finance Committee said they hadn’t seen support for the sales tax break, making it unlikely to survive the Legislature’s re-write of Walker’s budget. There is a strong push, primarily from businesses that are subject to the personal property tax, to eliminate that.

Walker’s sales tax holiday cost an estimated $17 million a year in revenue while getting rid of the personal property tax would cost about $260 million annually.

Walker’s sales tax holiday would apply to certain purchases targeted to families, including clothing under $75, computers costing less than $750 and school supplies. The personal property tax is primarily paid for by businesses for items like boats, furniture, machinery and non-residential property.

Republican lawmakers have been voicing increasing support for doing away with the 170-year-old personal property tax, if they can find a way to pay for it. Eliminating it would create a $260 million hole that could take property tax revenue away from schools and local municipalities if not replaced with funding elsewhere.

While support is growing to reduce that tax, there appeared to be little enthusiasm for the sales tax holiday. The nonpartisan Legislative Fiscal Bureau in a memo released this week identified several other tax cut options that would more precisely target families in the state, while also raising concerns about how the sales tax holiday would be implemented and whether it would work as envisioned.

Seventeen other states have sales tax holidays.

“I have a feeling it probably won’t happen,” said Republican Sen. Luther Olsen, a member of the budget committee. “People are concerned it’s not money well spent.”

DHS Submits Application to Reform BadgerCare Plus for Childless Adults

The Wisconsin Department of Health Services (DHS) has submitted an application to the Centers for Medicare and Medicaid Services (CMS)  requesting an amendment to certain provisions of the Section 1115 Demonstration Waiver, known as the BadgerCare Reform Demonstration Waiver. The policy amendments, many of which are included in 2015 Wisconsin Act 55, are aimed at bolstering Governor Scott Walker’s efforts to help people move from government dependence to true independence.

“Wisconsin Works for Everyone is about helping people transition from public assistance into Wisconsin’s workforce, where they can build a solid financial foundation for themselves and their families,” Governor Walker said. “Unemployment is low, and the percentage of people working in Wisconsin is among the best in the nation. This application is a step in the right direction, and we’re continuing to build on Wisconsin’s legacy as a leader in welfare reform.”

The core changes in the waiver amendment application affect the childless adult population and include the following:

  • Establishes monthly premiums and copayments for emergency department visits.
  • Implements a work requirement that members work or participate in job skills training at least 80 hours every month.
  • Limits benefits to 48 months, unless a member meets a work requirement.
  • Rewards healthy behaviors by establishing lower premiums for members who make healthy choices.
  • Requires members to be screened for drugs and if necessary, submit to a drug test. Those who test positive will be offered treatment so they can get healthy. Healthy workers help Wisconsin employers fill jobs that require passing a drug test.
  • Expands access to treatment by creating a new residential substance use disorder treatment benefit to allow coverage of medically necessary residential substance use disorder treatment services for up to 90 days for all BadgerCare Plus and Medicaid members.

Once CMS receives the complete application, a 30-day federal public notice process begins along with a 45-day minimum federal decision-making period. During this time, DHS will work with CMS to finalize the details of the waiver. Once the changes to the waiver are approved by CMS, the effective date of the changes will be at least one year after approval to inform and work with members, providers, and partners, and to make system enhancements and implement the changes.

Repeal Of Personal Property Tax Gains Steam In State Legislature

More Republican state lawmakers are lining up behind a push to end Wisconsin’s personal property tax, a move that could come with a big price tag for state government.

The personal property tax applies mostly to small businesses, which pay taxes on the value of their equipment, like refrigerators or manufacturing machinery.  According to estimates from the state Department of Revenue, the tax brings in about $261 million per year to help fund schools and local governments.

Several GOP lawmakers are now pushing to repeal the tax as part of the state budget.  “Locked myself in the office this evening to develop a plan to eliminate the state’s personal property tax,” Rep. Dale Kooyenga, R-Brookfield, tweeted on Tuesday night.

Kooyenga is the author of the Assembly GOP transportation and tax plan that rolled out last month.

Last week, a spokeswoman for Senate Majority Leader Scott Fitzgerald’s office said the repeal “is certainly still on the table for this legislative session.”

Gov. Scott Walker said Wednesday he’s open to the change, but only under certain conditions.

“I want to make sure that the property tax relief that we’re providing for homeowners across the state is maintained, I don’t want it to be one at the expense of the other,” Walker said. “So, if there are ways they can chip away at that without taking away from the property tax relief we proposed in the budget, then we’re willing to look at it.”

Aside from a movement to insert the tax repeal in the state budget, a separate bill is moving through the state Legislature to do the same thing.

Small business owners from across the state testified in support of the measure at a public hearing in the Capitol last week.

“By investing in our business, we ended up with a higher tax bill,” said Ted Balistreri, a small business owner in the Milwaukee area. “In fact, at a time when we could use help the most, when we have just spent a lot of money remodeling a store, the tax is the highest.”

Opponents to the bill argue its supporters haven’t offered a good way to replace the estimated $261 million annually that would be lost if the tax were repealed.

“I think that the personal property tax is not a good and fair tax, but just to repeal it without a plan to backfill the dollars that municipalities and schools and counties rely on is not a good idea,” said Sen. Janis Ringhand, D-Evansville.

The bill repealing the personal property tax has yet to receive a vote in committee.

Consumer Alert: Fake DATCP Email Circulating

A “phishing” email is making the rounds, pretending to be from the Wisconsin Department of Agriculture, Trade and Consumer Protection, or DATCP. Officials there are warning consumers not to click on any links in the email.

The email says, “Wisconsin DATCP has sent you a PDF via Adobe® Cloud. Kindly read through and respond with the required details. Open in Adobe®.”

This message is not from DATCP. Do not click on the “Open in Adobe®” box or anything else in the email. The scammers may be trying to collect credit card information or personal data.

DATCP does not send emails under aliases. However, if you have any doubts about whether a message is actually from DATCP, hover your cursor over the sender’s email address to see the underlying, actual address. Messages from the agency will generally be in the format of firstname.lastname@wi.gov or firstname.lastname@wisconsin.gov. In some cases, the address may include the name of a program rather that an individual’s name, such as “datcphotline.” But the suffix will always be either wi.gov or wisconsin.gov.

For more information or to file a complaint, visit the Consumer Protection Bureau at http://datcp.wisconsin.gov, send an email to datcphotline@wisconsin.gov, or call 1-800-422-7128.

GOP Wants to Cut Personal Property Tax in State Budget

Republican leaders are considering whether to eliminate or phase out in the state budget a 170-year-old property tax that generates — mostly from businesses — a quarter billion dollars a year for municipalities and schools.

Business and conservative groups have been urging elimination of the so-called personal property tax for years and several small business owners spoke out last week at a public hearing in favor of a Republican bill that would exempt everything subject to the tax.

But the bill comes with a steep $261 million annual price tag that could make it difficult to pass during a contentious budget year in which resources are scarce. Under the proposal the state would reimburse municipalities and schools with general tax dollars that otherwise could pay for education, transportation or other tax cuts.

A spokeswoman for Senate Majority Leader Scott Fitzgerald, R-Juneau, said in an email the proposal “is certainly still on the table for this legislative session” and “as budget deliberations continue, further discussions about this measure will be guided by the amount of available revenue.”

Rep. John Nygren, R-Marinette, said in a statement that many of his Assembly Republican colleagues are interested in repealing the personal property tax.

A spokesman for Gov. Scott Walker said eliminating the personal property tax is “a proposal worth considering” but Walker does not want it to come at the expense of cutting property taxes for homeowners.

Homeowners are familiar with the annual tax bill on land and permanent structures, but they generally aren’t affected by the personal property tax, which has been around since 1849 and is assessed for non-residential properties on certain tangible items such as furniture, boats and machinery.

Over time, the state has exempted broad swaths of property from the tax, including computers and cash registers, which has led to complaints from businesses that the tax is unfair.

Those who have to pay it are required to determine each year the value of their personal property, which depreciates over time.

Jerry Martell, owner of Modern Disposal Systems in Sparta, told the Assembly Ways and Means Committee on Thursday the roughly $11,000 a year he pays in personal property taxes on his equipment could help him expand his business or hire more youth interns.

“If I get this money back, I’m not going to stick it in a bag and run down to the Carribbean with it … I’m going to put that money back into the economy,” Martell said. “I don’t think it’s right for me to pay this knowing it’s an unfair tax.”

 

Editorial: Two-State Tax Reciprocity Long Overdue

For 41 years, Wisconsin and Minnesota were downright neighborly when it came to tax reciprocity.

If you lived in Minnesota and worked in Wisconsin, you could pay your income taxes to Minnesota. If you lived in Wisconsin and worked in Minnesota, you could pay your income taxes to Wisconsin.

For a border area like ours, it was a big deal. You didn’t have to file tax returns in both states. Life was good.

That changed in 2009, when Minnesota Gov. Tim Pawlenty understandably grew tired of waiting on the Badgers to settle up with about $60 million they owed to the Gophers.

While Wisconsin finally paid up, reciprocity has been hung up because the two sides have been arguing over a difference of $6 million.

That means about 80,000 workers – about 56,000 who live in Wisconsin and work in Minnesota, and about 24,000 Minnesotans who work in Wisconsin – have been stuck with the needless inconvenience and cost of filing in two states.

During that time, we’ve emphasized the need to fix the problem and move on. We’ve emphasized it in several editorials and during discussions with governors, legislators and revenue secretaries in both states. Now, two Minnesota state legislators from our region has taken some positive steps to get the ball rolling, and it’s time for the two states to come to agreement before the frost returns.

Thanks to legislation successfully pushed in St. Paul by Rep. Greg Davids, R-Preston, and Sen. Jeremy Miller, R-Winona, Minnesotans who work in Wisconsin will be eligible for a reciprocity tax credit on their income tax for 2017 (total cost estimate is $8 million).

The measure also directs the commissioner of the Minnesota Department of Revenue to resume negotiations on a renewed agreement with the folks in Wisconsin.

For goodness’ sake, sit down and figure this out.

It’s the right thing to do and the best thing for 80,000 people who are tired of being jerked around for no good reason.

If you the revenue directors of the two states can’t settle on a place to meet, you’re welcome to use the conference rooms in our newspapers in La Crosse and Winona. No charge for the rooms – and the coffee is free.

It’s time to put pride aside and think of what’s best for the taxpayers.

We have a regional economy. We have a mobile workforce. We have regional tourism attractions. We have contributors and volunteers who do good work on both sides of the river.

In other words, the people of our region have figured this out. It’s time for our elected officials to follow.

United States Exits Paris Climate Accord

President Trump’s America-first mantra steamrolled over the objections of lawmakers, top CEOs, the Pentagon, the U.N. and even his own daughter, as he announced Thursday that he was withdrawing the U.S. from the landmark Paris climate accord to limit greenhouse gas emissions.

“We’re getting out, but we will start to negotiate, and we will see if we can make a deal that’s fair. And if we can, that’s great. And if we can’t, that’s fine,” Mr. Trump said to applause from critics of the Paris deal assembled on the White House lawn. “I was elected to represent the citizens of Pittsburgh, not Paris,” he continued. “I promised I would exit or renegotiate any deal that doesn’t serve America’s interests.

Mr. Trump, though, delivered a detailed evisceration of the deal Mr. Obama signed, saying it crushes American businesses, unnecessarily funnels billions of dollars to other nations and allows the world’s top polluter, China, to do little to curb its own emissions for the next 13 years.

Mr. Obama had committed the U.S. to cut its greenhouse gas emissions by at least 26 percent by 2025, while China needs only to cap its pollution by 2030. The pact also calls on America to commit billions of dollars to the U.N.’s Green Climate Fund to pay developing countries to develop cleaner energy. Those terms, Mr. Trump said, are unacceptable.

“Compliance with the terms of the Paris accord and the onerous energy restrictions it has placed on the United States could cost America as much as 2.7 million lost jobs by 2025,” Mr. Trump said, citing numbers from a recent National Economic Research Associates study. “The cost to the economy at this time would be close to $3 trillion in lost GDP and 6.5 million industrial jobs, while households would have $7,000 less income, and, in many cases, much worse than that.”

Legislators Plan to Approve State Property Tax Cut

State lawmakers plan to eliminate the state’s portion of the property tax in the next state budget, according to leaders of the budget-writing committee.

Gov. Scott Walker called for eliminating the forestry mill tax in his 2017-2019 budget proposal. According to the state’s nonpartisan budget office, the average homeowner paid about $26 for the tax in 2016.

Leaders of the budget committee said Wednesday they plan to approve the governor’s plan to cut the tax.

“Both houses agree we’re going to stay with the governor’s position,” said state Sen. Alberta Darling, R-River Hills, co-chair of the budget committee.

The tax funds forestry programs and pays for equipment used by local fire departments to fight forest fires. Under the governor’s plan, those programs would keep current funding levels, with their money coming instead from the state’s general fund.

40 Percent of State Budget is Property Tax Relief

A state tax watchdog group is reporting a large portion of the state budget actually is devoted to property tax relief in one form or another.

President Todd Berry of  Wisconsin Taxpayers Alliance says property tax relief is the ‘tail that wags the political dog in Wisconsin’…

“….we looked at all the taxes and fees spent by the state and close to $10 billion of that, or about 4 in every 10 dollars goes in some way or another to try to reduce property taxes. That could be either through aiding local governments or schools or funding direct property tax credits on tax bills or various credits on the income tax…..”

Berry says since starting the income tax in 1911 has provided a lot of money to local governments, counties and municipalities. He says about half of the $10 billion goes to schools at various levels. He says the most effective property tax relief has been the state property tax credits on the local tax bill have been the most effective, while other forms of relief are less direct to local taxpayers.

Berry says only about 12 percent of the budget goes to state agency operations. Berry says it’s ironic that the budget puts so much emphasis in controlling property taxes…

“….for all intents and purposes, the state doesn’t levy property taxes. The other irony is that in spite of all this Wisconsin’s property taxes still rank in the top 10-12 states in the country and are typically up to 20 percent above the state average. Alot of money from the state attempting to relieve something that the state doesn’t directly control….”