News of the Day

CBO Weighs in on a $15 Minimum Wage

Under a $15 minimum wage, the Congressional Budget Office (CBO) estimates that 17 million workers would see higher pay — plus some smaller number who already made more than $15 but might get raises too — while 1.3 million would lose their employment.

This implies the policy would kick one person out of his job for every 13 people who got a direct pay boost. And naturally those raises don’t come from nowhere; they’re paid by businesses, which in turn earn money from customers.

Adding together the various effects — higher wages, lower employment, higher prices, etc. — the CBO estimates that, on balance, a $15 minimum wage would give $7.7 billion to folks below the poverty line, boosting their income 5.3% percent, and $14.2 billion to folks between one and three times the poverty line, boosting their income 3.5%.

Everyone above that loses a small percentage of income (0.1 to 0.3%, depending on which income group we’re talking about), but these amounts add up to $30.5 billion, meaning that the policy costs Americans in general $8.7 billion net.

Governor Tony Evers Signs State Budget into Law

Wisconsin Gov. Tony Evers signed the Republican-crafted state budget into law Wednesday after issuing 78 line-item vetoes and moving to increase school spending by around $65 million in the next two years.

The actions came after the GOP-controlled Legislature approved the $81 billion spending plan last week, sending it to the governor’s desk.

The version of the plan Republicans approved featured some $2 billion less in spending than what Evers originally requested, and it didn’t include measures such as accepting the Medicaid expansion, providing $1.4 billion more in education funding and raising the gas tax for the first time in more than a decade.

Still, Evers during a news conference at the Capitol Wednesday credited his budget and administration for being able to “finally move the needle” in the GOP-controlled Legislature.

“But I have to make this clear: this budget is just a down payment on the people’s budget,” he said, as he pledged to continue pushing for the state to take the federal Medicaid expansion dollars.

Senate Majority Leader Scott Fitzgerald, R-Juneau, called Evers’ 78 vetoes “minimal” and said the GOP budget was “kept intact” for the most part.

“None of (the vetoes) jump out at me so significant that I think you can make the case that he really changed the document that we passed on the floor of the Senate last week,” he told reporters.

Governor Evers has until Friday to act on Budget

Gov. Tony Evers has until Friday to act on the state budget lawmakers sent him last week.

Evers can allow it to become law without his signature, use his partial veto authority, or reject the document outright.

Assembly Speaker Robin Vos, whose signature Friday sent the budget to Evers, said he is “optimistic” the governor will sign the appropriations bill.

“There is no good reason that Gov. Evers would not choose to sign the bills that we are moving forward, especially with a budget that we’re doing today,” he said, referencing legislation to delay the closure of Wisconsin’s troubled youth prison along with the budget.

Regardless of how Evers chooses to handle the two-year spending plan, Vos said lawmakers would “probably would not come back until October.”

“If there was some kind of a dire need, of course, I’d talk about it with our leadership team and Sen. Fitzgerald to see if we could come back sooner,” he said.

But the Rochester Republican noted that government funding will continue at the previous level if Evers chose to fully veto the document and thus Republicans would be unlikely to feel pressure to quickly propose a new budget.

“Last year we didn’t pass a budget until September and nobody noticed any difference,” he said.

President Signs Bipartisan IRS Reform Bill

President Trump on Monday signed into law a bipartisan bill to make improvements to the IRS.

“This signing is the culmination of a lengthy, bipartisan process undertaken by the Ways and Means Committee to implement pro-taxpayer reforms at the IRS for the first time in more than 20 years,” House Ways and Means Committee Chairman Richard Neal (D-Mass.) said in a statement. “New protections for low-income taxpayers, practical enforcement reforms and upgraded assistance for taxpayers and small businesses will all now go into place.”

The top Republican on the committee, Rep. Kevin Brady (Texas), also praised the measure’s enactment. “Thank you to President Trump for signing this historic legislation, which is the biggest and boldest step in over 20 years to redesign and restructure the IRS into an agency with a singular mission — quality taxpayer service,” he said.

The law makes a host of targeted improvements to the IRS, aimed at bolstering its customer service, modernizing its information technology, helping victims of tax-related identity theft and strengthening taxpayers’ rights during the IRS enforcement process.

Among the provisions in the new law are establishing an independent appeals office, preventing low-income taxpayers from having their cases referred to the IRS’s private-debt collection program and creating a single point of contact at the IRS for identity theft victims. It also includes a provision to increase the penalty for failing to file a tax return, so that the bill does not add to the deficit.

 

Nation’s Largest Coal Producers Look to Merge that Supply Nearly 60% of Wisconsin Coal

The nation’s largest coal producers want to merge two Wyoming mines that supplied more than half the coal burned last year in Wisconsin power plants, raising questions about the potential impact on ratepayers.

Peabody and Arch Coal last week announced plans to form a joint venture that would control seven mines, including five of the most productive mines in the country. The companies said the move would allow them to cut costs in order to compete with natural gas and renewable energy sources.

The two mines, which share a 7-mile property line in the Powder River basin, last year produced more than 10.4 million tons of coal delivered to Wisconsin power plants, according to the U.S. Energy Information Administration (EIA). That’s more than 57% of the state’s total supply.

What the merger, which is subject to approval from the Federal Trade Commission, means for Wisconsin utilities and their ratepayers is uncertain.

Representatives of the largest coal-burning utilities said the companies are still evaluating the potential effects.

“At this point it is too soon to say what, if any, impact this will have,” said Brendan Conway, spokesman for We Energies, the state’s largest utility, which last year got more than two-thirds of its coal from the two mines.

Arch and Peabody said in a news release that the joint venture would result in cost savings of $120 million a year .

Whether those savings would be passed along to customers remains to be seen, said Brett Watson, a resource economist who studies the coal industry at the University of Alaska-Anchorage.

Wisconsin Senate Approves Online Tax Bill, Income Tax Cuts

The state Senate has approved a bill that would require online vendors like Amazon to collect and remit sales taxes from third-party sellers in perpetuity, a move that would trigger income tax cuts.

Under the bill , revenue from the taxes would cover reductions in the two lowest income tax brackets. Taxpayers could expect an average reduction of $27 for 2019 and $59 for 2020.

The Senate approved the bill unanimously Wednesday. The Assembly passed it last week. The measure goes next to Gov. Tony Evers. His spokeswoman didn’t immediately respond to an email asking if he supports the bill.

Coupled with an income tax cut plan Republicans inserted in the state budget, taxpayers could expect a total annual reduction of $91 in 2019 and $124 in 2020.

Wisconsin Senate Sends $82 Billion State Budget to Governor Evers

Wisconsin’s next two-year spending plan is headed to Gov. Tony Evers’ desk.

The state Senate voted 17-16 Wednesday to approve the state budget, following hard on the heels of the Assembly’s approval late Tuesday evening.

The spending plan now moves to Evers’ desk. The governor, who holds one of the most powerful veto pens in the country, hasn’t said what changes he plans to make to the bill or if he will reject it entirely.

“I’ve said all along that the will of the people is the law of the land, and that’s what will be on my mind as I review the Legislature’s changes to our budget,” Evers tweeted after the vote.

During debate Wednesday, GOP leaders touted the budget as a responsible middle ground between Evers’ $83.4 billion budget proposal and their own conservative principles.

The budget includes a $500 million increase for K-12 education in Wisconsin, roughly $1 billion for construction projects on UW System campuses, $393 million in new revenue for state road projects and a $588 million increase for Medicaid and other state health programs.

The budget also cuts income taxes. Under the plan, the average taxpayer would save about $75 in the 2019 tax year and $136 in 2020, which would amount to a $457.6 million income tax cut overall.

‘Missed Opportunities’ vs. ‘Within our Means’: Wisconsin Assembly sends budget to Senate

The Wisconsin Assembly has voted to approve the state’s two-year funding plan over complete opposition from Democrats, sending the budget to the Senate where it’s expected to be taken up Wednesday.

The $81 billion biennial plan, which passed on a 60-39 vote, includes $1.9 billion for building projects, a nearly $500 million increase in K-12 education, a more than $300 million middle-income tax cut and boosts in vehicle title fees and car registration costs.

But the document doesn’t feature many of Gov. Tony Evers’ key priorities, including accepting the federal Medicaid expansion, providing $1.4 billion more in education funding and raising the gas tax for the first time in more than a decade. His $83.4 billion budget also sought to raise taxes by more than $1 billion, which Republicans nixed from the plan.

Democrats, who floated a series of amendments to the budget that were all rejected, slammed the document as series of “missed opportunities” that falls short in aiding Wisconsinites and argued it didn’t represent the will of the people.

But Republicans, including budget committee Co-chair John Nygren, R-Marinette, touted the plan’s investments in education and other areas, as well as GOP efforts to “hold the line” on property taxes and reject unsustainable spending levels, as they urged Evers to sign it into law.

 

Governor Evers Signs Bill Targeting Businesses Moving out of State

Gov. Tony Evers has signed into law a bill that eliminates a tax benefit for companies that move out of Wisconsin.

The measure he signed Monday targets tax deductions businesses claim when they move. Under current law, a business may deduct from its income or tax liability all expenses paid to move from one location to another.

The new law that passed the Legislature with bipartisan support does not allow for businesses to deduct expenses if they move out of state. The state Department of Revenue does not anticipate the change will result in a significant change in taxes paid, likely less than $1 million a year.

Recommendations on Groundwater Pollution Limits Could Affect Many Wisconsinites

State of Wisconsin health officials have recommended limits on 27 pollutants found in groundwater, including one type of pollutant that’s increasingly in the headlines — PFAS.

The limits, known as enforcement standards, can be used to regulate facilities, practices, and activities that can affect groundwater.

More than 60% of state residents obtain their drinking water from groundwater, including many people living in Milwaukee suburbs.

Officials from the Dept. of Health Services (DHS), Dept. of Natural Resources (DNR), and Dept. of Agriculture, Trade and Consumer Protection discussed the recommendations Friday at a news conference in Madison.

The portion of the proposal drawing the most initial attention covers substances known PFAS, or Per- and Polyfluoroalkyl Substances. Those are human-made chemicals found in non-stick cookware, fast food wrappers, firefighting foam, fabric protectors, and other products.

Wisconsin officials are proposing an enforcement standard for PFAS that is far more stringent than what the U.S. Environmental Protection Agency recommends.

DHS also wants even tighter limits that could trigger an earlier step — preventive action aimed at protecting the public.

The DNR hasn’t revised state groundwater standards in ten years. The department says it gave a list of substances to DHS and asked DHS to review.