News of the Day

I-94 East-West Expansion Approved in Legislature-Passed Budget

The Wisconsin Legislature green lights the expansion of the long-stalled I-94 East-West corridor. Former Gov. Scott Walker stopped it, then in 2020, Gov. Tony Evers revived it. But state law says the Wisconsin Department of Transportation needs legislative approval to spend money on the project. That could come if the governor signs the budget the legislature passed.

The proposed I-94 East-West expansion will add lanes from the Marquette to Zoo Interchanges, a roughly 3.5 mile stretch of the interstate, which Gov. Evers says is one of the most congested and dangerous roads in the state. WISDOT adds that the stretch has twice as many crashes as the average of similar roads in the state.

The governor’s budget proposal asked for $40 million in bonding for the expansion project, which the legislature kept in the budget they approved this week and will send back to him for his signature.

If the governor approves this item in the budget, don’t expect construction any time soon. That’s because the Wisconsin Department of Transportation has ordered a supplemental environmental impact study. It’s goal is to hear from the public, study issues like water runoff, and to see if the pandemic may have changed traffic patterns along this route. Wisconsin Secretary-designee of Transportation Craig Thompson says the earliest they could get final federal approval is late 2022.

Governor Evers, Oneida Nation Chairman Hill Sign Compact Amendment Permitting Event Wagering

Yesterday, Governor Tony Evers and Oneida Chairman Tehassi Hill signed a historic compact amendment that expands allowable gaming at Oneida Nation casinos and affiliate locations in the state of Wisconsin to include event wagering. This compact amendment will be the first to allow event wagering, including sports betting, to occur in Wisconsin.

“Event wagering,” as defined by the compact amendment, can include sports and events betting such as wagering on nationally televised award shows, professional sports league drafts, and professional sporting events such as the National Football League, the National Basketball Association, and Major League Baseball.  The current compact amendment does not allow for wagering on Wisconsin college athletics. Wagering is also prohibited on the outcomes of elections for public office and for events with participants under the age of 19.

The compact amendment signed today follows months of negotiations between the Oneida Nation and the Wisconsin Department of Administration’s (DOA) Division of Gaming. The agreement will be sent to the federal Bureau of Indian Affairs (BIA) and the Bureau has 45 days to review and approve the compact amendment.

If approved, the Oneida Nation can begin expanding operations to allow event wagering at Oneida Casino. The compact amendment also allows for remote event wagering on land owned by the Nation or held in trust for the Oneida Nation by the federal government that contains a commercial building owned or leased by the Oneida Nation. The Oneida Nation hopes to begin offering event wagering in time for the upcoming football season.

State Legislature Approves State Budget, Sends to Governor Tony Evers

The state Legislature has approved and sent the next two-year state budget to Gov. Tony Evers. The plan would spend billions less than the governor proposed.

The state Senate approved the spending plan Wednesday night, about 24 hours after it was passed by the state Assembly on a mostly partisan vote. The vote was largely along party lines in the Senate too, with three Democrats voting in its favor: Sen. Janet Bewley from Mason, Sen. Brad Pfaff from Onalaska and Sen. Jeff Smith from Brunswick. After the session, state Senate Majority Leader Devin LeMahieu, R-Oostburg, touted the passage of the most conservative budget in a generation.

The budget will move to Evers’ desk, where he could use his veto pen to make changes or veto the plan entirely.

The budget is the product of the Republican-controlled Joint Finance Committee, which made major changes to the spending plan proposed by the governor earlier this year. Overall, it would spend billions less than Evers called for and omit major proposals from the Democratic governor, including legalizing marijuana, expanding Medicaid and raising the minimum wage. It also includes a $3.4 billion tax cut the governor didn’t propose.

The governor hasn’t said whether he will sign or veto the budget. Evers has one of the most powerful veto pens in the country, with the ability to delete words, numbers and punctuation from the budget. For the last budget, he used his veto authority to increase school funding by about $65 million, along with about 75 other changes. 

Governor Evers Vetoes Bill That Would Have Ended Federal Unemployment Benefits Early

Gov. Tony Evers vetoed a bill on Tuesday that would have ended Wisconsin’s participation in federal pandemic relief programs that increase the amount of government assistance available for unemployed people. The supplemental assistance is set to expire on Sept. 6, but at least 25 states started phasing it out earlier this month.

The bill would have reduced the maximum weekly unemployment benefit in Wisconsin from $670 per week to $370 week. It also would have prevented the state Department of Workforce Development from waiving unemployment work search requirements for any reason related to COVID-19. It passed on party-line votes in both chambers of the Legislature.

“Eliminating this lifeline for many Wisconsinites will cause continued economic hardship for those impacted the most by the pandemic and create additional hurdles to return to family-sustaining jobs,” Evers wrote in his veto message. “As a result, the entire state economy likely would be negatively affected.”

“The Legislature needs to confront issues surrounding child care, wages, and workplace COVID-19 safety for those returning to the workforce,” Evers wrote. “Eliminating the supplemental federal benefits while simultaneously failing to address systemic problems faced by individuals remaining in and returning to the workforce is irresponsible.”

Sen. Howard Marklein, R-Spring Green, disputed Evers’ assertion that there is no link between the extra money and the state’s workforce shortage.

“Every single employer I have talked to is challenged to find workers. Hardworking employees, who have been stretched very thin, tell me that they are getting tired,” Marklein said. “From restaurants to manufacturers to city governments to state parks. Every single employer is competing with the government’s unnecessary enhanced unemployment checks.”

Unemployment insurance should be a “safety net,” not a “brick wall for employers,” Marklein argued. Assembly Speaker Robin Vos, R-Rochester, argued the veto only serves to add “one more hurdle” for businesses trying to recover from the pandemic.

Americans Leaving Unemployment Rolls More Quickly in States Cutting Off Benefits

The number of unemployment-benefit recipients is falling at a faster rate in the 22 other states canceling enhanced and extended payments this month, suggesting that ending the aid could push more people to take jobs.

The number of workers paid benefits through regular state programs fell 13.8% by the week ended June 12 from mid-May — when many governors announced changes — in states saying that benefits would end in June, according to an analysis by Jefferies LLC economists. That compares with a 10% decline in states ending benefits in July, and a 5.7% decrease in states ending benefits in September. Workers on state programs would lose the $300 weekly federal enhancement but could continuing receiving the state benefits.

Jefferies also found somewhat larger decreases in the number of people receiving benefits through pandemic programs in states curtailing benefits, though the data lags behind by an additional week. In many cases, those recipients will be cut off entirely when their state ends participation in the federal programs.

Other economists and many Democrats say other factors, including lack of child care and fear of Covid-19, are also keeping many potential workers out of the labor force.

Republicans to Vote This Week on $87.5 billion GOP-Authored Budget

The state Legislature this week will vote on the $87.5 billion GOP-authored biennial budget.

Republicans on the budget committee made use of an estimated $4.4 billion surplus to work more than $3 billion in tax cuts into the proposed 2021-23 biennial budget, but also stripped away several of Evers’ high-profile measures like Medicaid expansion and drastically reduced other proposals like the governor’s call for $1.6 billion in K-12 spending.

All told, the Republican biennial budget spends $87.5 billion in total, $37.3 billion of that in taxpayer money. Evers’ plan would spend $91.2 billion, with $38.6 billion of that from state taxpayers, according to a Thursday report from the nonpartisan Legislative Fiscal Bureau.

Assembly Speaker Robin Vos, R-Rochester, said last week the GOP-authored budget makes the most of the state’s unprecedented surplus, while also taking into account billions in federal stimulus funds, to provide more than $3 billion in tax cuts, including plans to eliminate the state’s more than 170-year-old personal property tax, which businesses pay on furnishings and equipment.

Governor Evers Announces More Than $140 Million for Wisconsin’s Tourism and Entertainment Industries

Yesterday, Governor Tony Evers announced more than $140 million in grants to businesses and organizations that play an integral role in Wisconsin’s tourism and entertainment industries. The new grant programs will be invested in industries hit hard by the COVID-19 pandemic, including live event venues, movie theaters, summer camps, minor league sports, and the lodging industry. Additional investments will be made in reopening Wisconsin historical sites and marketing support for Wisconsin’s tourism industry.

The investments announced by Gov. Evers today include:

• $75 million for lodging grants;
• $11.25 million for movie theaters;
• $12 million for live event small businesses;
• $2.8 million for minor league sports teams;
• $10 million for live venues;
• $15 million for destination marketing organizations;
• $8 million for summer camps;
• $1 million for the Wisconsin Historical Society to assist in reopening historical sites; and
• $7.5 million to increase marketing support for Wisconsin’s tourism industry.

These investments are being funded by the American Rescue Plan Act of 2021 (ARPA) and will be administered by the Wisconsin Department of Administration and the Department of Revenue.

Individuals and businesses interested in receiving more information about the grants, including application, should sign up to receive alerts here.

Congressional GOP Lawmakers Want Answers on Unemployment Fraud in Wisconsin

In a June 17 letter signed by every Republican member of Wisconsin’s congressional delegation, legislators asked Gov. Tony Evers, a Democrat, to respond to reports of unemployment benefits claimed by fraudsters. They cited a May memo from the Secret Service warning against a “massive” scheme by a “well-organized Nigerian fraud ring exploiting the COVID-19 crisis to commit large-scale fraud against state unemployment insurance programs.” That memo didn’t name Wisconsin as one of the states targeted by that specific scheme, but did note “it is extremely likely every state is vulnerable.”

A spokesperson with the state Department of Workforce Development, which oversees the unemployment system, said in a statement that “Wisconsin has been a national leader at detecting fraud.” The department has a variety of means to detect fraud and abuse, including but not limited to auditing employer records, comparing benefit claims to payroll records in Wisconsin and other states, exchange of information between agencies, complaints from employers and tips from the public,” wrote DWD communications specialist Tyler Tichenor.

Every year, states pursue some fraud cases against individuals who claimed funds they weren’t eligible for. What is new is the presence of large-scale scams by organized criminal syndicates, including those operating in other countries, to claim United States unemployment funds. In May, announcing a new federal Department of Justice task force on the issue, President Joe Biden said the issue was among the most serious oversight issues his administration had inherited from the administration of former President Donald Trump.

The unprecedented spike in new jobless claims in 2020 led to long backlogs and a skyrocketing total number of payments. But according to the DWD’s 2021 fraud report, both the number of cases of fraud and the total amount of fraudulently paid benefits actually declined in 2020. There were 4,734 fraud cases in 2019, and just 3,561 in 2020. It accounted for about $4.7 million in 2019 and $4.5 million in 2020, according to the department.

One interpretation of that data, said economist Noah Williams of the conservative Center for Research on the Wisconsin Economy at the University of Wisconsin-Madison, is that “fraud detection basically dropped to near zero” in 2020.

“We had a huge explosion in claims in 2020, but the actual cases in the state that were referred for fraud fell,” Williams said. “We don’t know how big the problem is, but … I wouldn’t have expected the absolute number of cases to fall.”

In a report Williams authored in May, he wrote Wisconsin “was one of the worst-performing states” by several metrics of measuring its unemployment insurance system.

Bill to Eliminate Wisconsin’s Personal Property Tax Passes Committee with Bipartisan Support

A bill to eliminate the state’s personal property tax, which businesses pay on equipment and furnishings, received bipartisan support in a Senate committee Tuesday.

The bill was recommended for approval by the Senate workforce committee 4-1, with Sen. Janis Ringhand, D-Evansville, the lone vote against the measure over concerns future Legislatures could stop providing local entities more state aid to make up for the lost revenue.

The budget committee last week voted to set aside about $202 million for such payments over 2021-23 biennial budget. However, officially eliminating the tax, which lawmakers described as an antiquated and unfair tax on businesses, would be done through separate legislation rather than through the budget process.

Both the budget and a standalone bill to end the tax are expected to come before the Assembly and Senate next week. “It’ll be a great day when we can finally get rid of this tax,” bill author Sen. Duey Stroebel, R-Saukville, said Tuesday.  Stroebel said the intent is to keep providing local taxing authorities with state money to compensate for the reduction in revenue.

Sen. Brad Pfaff, D-Onalaska, said he hoped that revenue to local jurisdictions would be included in future budgets.

“I too have heard from my small-business owners. I recognize the importance of this,” Pfaff said. “But I do want to make sure we keep whole our local units of government.”

More than 40 lobbying groups have filed in favor of eliminating the tax, including business groups and local chambers of commerce. The AFSCME International Union and the League of Women Voters of Wisconsin oppose the bill.

Eliminating the personal property tax through standalone legislation would limit Gov. Tony Evers’ ability to alter it through his partial veto power, which can only be used on bills that spend money, like the budget. But it also opens the door to the Democratic governor vetoing the legislation altogether.

Wisconsin Housing Market Strong Even as Inventories Remain Tight

Both existing home sales and median prices rose by double-digit margins in May compared to their levels 12 months earlier, when the economy was in lockdown. Housing supply remains very tight with just 2.8 months of available supply in the state. Inventory is tight in all regions, across all urban/rural classifications and across all price ranges

“Basic economics tells us that strong and growing demand in a world of tight supply is going to create significant price pressure, and that’s exactly what we’re seeing in the state housing market. Median prices through the first five months are up at an annual pace of 12.1%. Unless demand moderates or supply improves, neither of which is likely in 2021, we can expect to see more of the same price appreciation through the end of this year. The good news is that mortgage rates remain very low by historical standards, which has at least partially offset the impact of significant price pressure on housing affordability in the state.  Hopefully the inflationary pressures don’t intensify, which could cause mortgage rates to increase and lower affordability,” said Michael Theo, President & CEO of the Wisconsin Realtors Association.