News of the Day

Wisconsin’s Real Estate Market Grew by 14% in 2021

Yesterday, the Wisconsin Department of Revenue (DOR) released its annual Equalized Values Report. The report shows Wisconsin’s total statewide equalized property value as of January 1, 2022, was $745 billion, a 14% increase over the prior year, which is the largest increase since 1979. Growth occurred in all property classes and was led by residential and commercial property. Equalized values are based on data from January 1, 2021, to December 31, 2021.

Report highlights:

  • Change in equalized value = $90.6 billion, a 14% increase from 2021

o   $77.3 billion due to market value increases (12%)

o   $11.6 billion due to new construction (2%)

  • Menominee and Price Counties saw the largest increase at 31% and 19%, respectively

The Equalized value represents an estimate of a taxation district’s total taxable value and provides for the fair apportionment of school district and county levies to each municipality. Changes in equalized value do not necessarily translate into a change in property taxes.

U.S. House Passes Inflation Reduction Act

Wisconsin lawmakers were divided over the Inflation Reduction Act that passed the U.S. House on Friday. The legislation now goes to President Joe Biden for his signature.

The bill provides around $375 billion over 10 years to help industry and consumers transition away from fossil fuels to cleaner energy sources. The bill provides around $64 billion to extend the Affordable Care Act to around 13 million people who need help paying health care premiums for insurance bought on the private market. The bill raises around $740 billion in revenue over the next 10 years, and that includes around $222 billion raised from a 15 percent minimum tax on corporations.

During debate Friday, Democratic U.S. House Rep. Mark Pocan said the bill lessens the effects of global inflation while investing in renewable energy development.

“That will make us more energy independent and less dirty,” said Pocan.

Republican U.S. House Rep. Tom Tiffany called the bill a “tax-and-spending bonanza” amid record inflation. The nonpartisan Congressional Budget Office found the bill’s impact on inflation could be positive or negative, and its effects are largely uncertain.

 

CDC Loosens COVID-19 Guidance

The Centers for Disease Control and Prevention (CDC) on Thursday relaxed many of the guidelines for COVID-19 in communities, a major shift that emphasizes living with the virus rather than strict prevention of infection. The new guidance puts the onus on individuals to assess their own personal risk levels, rather than businesses, governments or schools.

The new guidelines no longer recommend case investigation and contact tracing, except in health care settings and certain high-risk congregate settings. The new guidance also treats a COVID-19 exposure in the same way regardless of whether the person exposed is vaccinated. Under the new guidelines, there is no quarantine recommendation.

The agency no longer recommends physical distancing, and instead asks individuals to consider the risk in specific settings.

CDC will also no longer recommend screening testing of asymptomatic people without known exposures, except in certain high-risk settings like nursing homes and prisons.

“Screening testing might not be cost-effective in general community settings, especially if COVID-19 prevalence is low,” CDC wrote.

In schools, CDC removed the recommendation that kids avoid mingling with other classrooms, a practice known as cohorting.

It also removed a recommendation on “test-to-stay,” which was aimed at keeping children who were exposed to COVID-19 in the classroom as long as they had no symptoms and repeatedly tested negative.

 

U.S. Wholesale Inflation Fell in July

Thursday’s report from the Labor Department showed that the producer price index — which measures inflation before it reaches consumers — declined 0.5% in July. It was the first monthly drop since April 2020 and was down from a sharp 1% increase from May to June.

Wholesale food prices rose 1% from June to July, a sign that grocery prices will likely keep rising in the coming months. The wholesale costs of eggs, beef and vegetables all jumped.

Trucking freight costs, though, fell 0.3%, evidence that some supply chain snarls are easing.

Inflation at the wholesale level still jumped 9.8% in July compared with a year earlier, suggesting that inflation will remain at painful levels for months to come. That was down from a year-over-year surge of 11.3% in June — near a four-decade high — and was the smallest annual rise in eight months.

Thursday’s report showed that wholesale gas prices tumbled 16.7% from June to July, a sign that retail prices at the pump will continue to decline this month and likely into September. Consumers are already seeing steady reductions: Gas prices fell below $4 a gallon, on average, on Thursday for the first time in five months.

 

Tim Michels Wins Republican Primary for Wisconsin Governor

Construction executive Tim Michels has won the Republican primary for governor in Wisconsin, defeating former Lt. Gov. Rebecca Kleefisch with the help of a “political outsider” message, millions of dollars of his personal wealth and a critical endorsement by former President Donald Trump.

As of 10:37 p.m., unofficial totals from the Associated Press showed Michels defeating Kleefisch 47-43 percent.

I’m here to say the American dream is still alive, and good people need to step up and run,” Michels told a cheering crowd at his campaign victory party in Waukesha. “We’re going to get an outsider, a businessman and a veteran in the governor’s office.”

Michels won his race by performing well in a wide swath of rural counties that have supported Trump in his runs for office, but he also performed better than Trump in some suburban counties. For example, Michels carried one of the vaunted “WOW” counties in southeast Wisconsin, winning Washington County while Kleefisch narrowly won Waukesha and Ozaukee counties.

Along with Wisconsin’s race for U.S. Senate, the race for governor is likely to be fiercely competitive. Thirty-six states will hold elections for governor this year. Wisconsin is one of just four of those races considered toss-ups by the Cook Political Report.

Department of Workforce Development: Participating in National Integrity Data hub to Detect and Prevent UI Fraud

Building on its multifaceted, modernized approach to detect and prevent fraud, the Wisconsin Department of Workforce Development (DWD) is now participating in the National Association of State Workforce Agencies’ Integrity Data Hub, which provides states with cross-matching verification options for identifying potential unemployment insurance (UI) fraud and improper payments.

Data from the National Association of State Workforce Agencies (NASWA) shows that the integrity data hub has assisted with the prevention of $2.4 billion in improper payments in the states and territories where it is utilized through June 2022.

“Combating UI fraud is a top priority,” DWD Secretary-designee Amy Pechacek said. “These additional tools available through NASWA’s Integrity Data Hub will give our UI staff more options in the fight against fraud, helping to protect the integrity of the UI program and ensuring that benefits remain available to individuals who are out of work through no fault of their own.”

The additional fraud identification tools available through the data hub include:

  • The Suspicious Actor Repository (SAR), which allows states to compare UI claims against a list of suspicious claims from other states;
  • A database of suspicious email domains;
  • A database of foreign IP addresses;
  • Data analysis tools that allow states to compare claims to national data and conduct cross-state validation checks;
  • A multistate database of UI claims data;
  • A centralized identity verification service;
  • The Fraud Alert System, which allows states to share information about new fraud schemes; and,
  • Bank account verification, which enables states to validate bank account ownership and status.

These modernized tools add to DWD’s existing fraud prevention and detection technology, which includes the wage records cross-match, state and national new hire cross-matches, work search audits, interstate cross-match, deceased citizen cross-match, and many others.

U.S. Senate Passes Inflation Reduction Act

Democrats pushed their election-year economic package to Senate passage Sunday. The estimated $740 billion package heads next to the House.

The money would come from a 15% minimum tax on a handful of corporations with yearly profits above $1 billion, a 1% tax on companies that repurchase their own stock, bolstered IRS tax collections and government savings from lower drug costs.

The President urged the House to pass the bill as soon as possible. Speaker Nancy Pelosi said her chamber would “move swiftly to send this bill to the president’s desk.” House votes are expected Friday.

Americans are Putting Inflation on the Credit Card, Federal Reserve Bank Study Shows

They’re not just racking up higher balances on their credit cards as sky-high inflation and rising interest rates hit household wallets, though. A study released Tuesday by the Federal Reserve Bank of New York’s Center for Microeconomic Data shows a 13% cumulative year-over-year increase in credit card balances. That’s the largest jump in 20 years, since 2002.

Credit card debt stands at $890 billion as of the end of the second quarter, according to the quarterly report on household debt and credit. While credit card balances typically rise during the second quarter, the $46 billion increase makes the second quarter one of the highest jumps on record since 1999. The last time total credit card balances were this high was the first quarter of 2020.

“Americans are borrowing more, but a big part of the increased borrowing is attributable to higher prices,” New York Fed researchers wrote Tuesday. Not only did balances increase, researchers note, but the number of new credit cards was up too.

Mortgages, auto loans, retail cards, and other consumer loans also rose at a fairly rapid clip. In total, non-housing debt grew by $103 billion during the second quarter, the largest increase recorded by the New York Fed since 2016.

Overall, Americans’ total household debt increased by 2% to $16.15 trillion during the second quarter, according to the New York Fed. That puts balances about $2 trillion higher than they were at the end of 2019, prior to the onset of the pandemic.

State of Wisconsin Joins Nationwide Anti-Robocall Litigation Task Force

Yesterday, Wisconsin Attorney General Kaul announced that the State of Wisconsin is joining a nationwide Anti-Robocall Litigation Task Force of 50 attorneys general to investigate and take legal action against the telecommunications companies responsible for bringing a majority of foreign robocalls into the United States. This bipartisan nationwide Task Force has one goal:  to cut down on illegal robocalls.

“We have to reduce the number of illegal robocalls that folks receive,” said AG Kaul. “I’m proud to join this bipartisan group of AGs in working to crack down on the telecom companies that are failing to do their part to stop illegal scam calls.”

The Task Force has issued 20 civil investigative demands to 20 gateway providers and other entities that are allegedly responsible for a majority of foreign robocall traffic. Gateway providers that bring foreign traffic into the U.S. telephone network have a responsibility to ensure the traffic is legal, but these providers are not taking sufficient action to stop robocall traffic. In many cases, they appear to be intentionally turning a blind eye in return for steady revenue. The Task Force will focus on the bad actors throughout the telecommunications industry, to help reduce the number robocalls that Wisconsinites receive and benefit the companies that are following the rules.

According to the National Consumer Law Center and Electronic Privacy Information Center, over 33 million scam robocalls are made to Americans every day. These scam calls include Social Security Administration fraud against seniors, Amazon scams against consumers, and many other scams targeting all consumers, including some of our most vulnerable citizens. An estimated $29.8 billion dollars was stolen through scam calls in 2021. Most of this scam robocall traffic originates overseas. The Task Force is focused on shutting down the providers that profit from this illegal scam traffic and refuse to take steps to otherwise mitigate these scam calls.

 

Utilities Set to Spend more than $2 Billion on New Transmission Lines in Wisconsin

Three new transmission lines that are estimated to cost around $2.2 billion will cross through Wisconsin under a large expansion approved by the Midwest grid operator that’s designed to facilitate the clean energy transition.

The board for the Midcontinent Independent System Operator signed off on a $10.3 billion portfolio of 18 transmission projects for the Upper Midwest on July 25. The lines are expected to support 53 gigawatts of renewable energy and provide between  $23 to $52 billion in benefits as utilities retire aging coal plants. Projects in Wisconsin are slated to start coming online as early as 2028.

The regional grid operator plans to begin issuing requests for proposals this fall. All projects approved would be built in MISO’s Midwest subregion that includes Michigan, Minnesota, and Wisconsin. Utilities building the transmission lines would still need the approval of state regulators. The cost would be paid for by customers in that region.

The largest proposal in Wisconsin is a $1 billion transmission line that would run through the central region of the state. Xcel said the utility and other partners expect to replace existing lines with 345-kilovolt lines as part of that project, although some lower-voltage lines may remain in place. American Transmission Company and other local transmission owners also have lines in the region.

While renewable advocates and utilities welcome word of the investment, groups representing industrial energy customers filed a complaint with the Federal Energy Regulatory Commission over the plans. The Wisconsin Industrial Energy Group, or WIEG, and others argue that MISO’s plan to exclude around $5.5 billion in projects from a competitive bidding process will lead to customers paying more for transmission lines, including in Wisconsin.

Todd Stuart, executive director of WIEG, said the way MISO defines work as “upgrades” to transmission lines also blocks competition. The grid operator plans to assign projects to existing owners of transmission lines if at least 80 percent of the costs are due to upgrading the system, arguing that competition on small pieces of projects could delay their construction.

“I don’t think Wisconsin families and businesses can afford this burden. We need all tools for reducing rates or mitigating rates,” said Stuart, adding that includes competitive bidding.

Wisconsin Public Service Commission data shows transmission expenses among the state’s largest investor-owned utilities increased from $263.1 million to $684.5 million from 2005 to 2020, representing an increasing share of their total operating expenses. Even so, the PSC said expenses paid by customers have remained “comparatively stable” as costs ranged from $3.9 to $4.5 billion each year between 2008 and 2019.