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.

WIB State Budget Agenda: 2015 – 2017 State Budget

WIB Priorities

We have completed our preliminary analysis of Governor Walker's 2015-2017 state budget recommendations. This review was based upon publicly available information from the Department of Administration (DOA), the Legislative Fiscal Bureau as well as testimony by Cabinet Secretaries during the state agency briefings before the Joint Finance Committee.

Governor Walker's budget plan addresses several priority issues of interest to WIB and its members. Outlined below is a brief summary of these initiatives.

Fiscal Policy Priorities

1. Property Tax Relief – School Levy Tax Credit Increase

The school levy credit is one of the three tax credit programs where credits are paid to municipalities and shown on property tax bills. School levy tax credits are distributed based on each municipality's share of statewide levies for school purposes.

The Governor's 2015-2017 state budget plan recommends increasing the distribution amount for the school levy tax credit by $105,600,000 beginning with property taxes levied in December, 2015. WIB supports the Governor's recommendation. Property taxes in Wisconsin are among the highest in the country and nearly 24% above the national average according to the most recent data from the United States Census Bureau. Although the amount of property tax relief is modest, it is relief nonetheless.

WIB favors broad-based tax relief by that we mean tax relief that is provided to the most taxpayers. The School Levy Tax Credit is a broad-based tax relief mechanism whereby all Wisconsin property owners benefit.

2. An Adequate, Equitable and Sustainable Transportation Funding Plan

Wisconsin's transportation network includes roads (114,800 miles), bridges (13,700), rail lines (3,600 miles), airports (131) and commercial ports (29). The cost of building and maintaining this integrated network exceeds $2.5 billion annually. Ongoing construction, repair and maintenance costs continue to rise but the revenues necessary to fund needed transportation projects have not.

Going into the next two-year budget cycle, the Wisconsin Department of Transportation faces a $974 million deficit. The perfect storm is now at our doorstep. The State of Wisconsin cannot borrow its way out of the problem, more aid for Washington is unrealistic and the primary revenue source to pay for transportation infrastructure improvements is not generating the necessary funds.

The Governor's 2015-2017 state budget plan recommends $1.3 billion in bonding for state highway construction projects. State aid for state highway maintenance and local transportation projects and services is held at current levels. WIB has concerns with the Governor's transportation funding recommendations. In particular, we are concerned with the proposed borrowing. It is the highest in 20 years. Transportation-related debt service is projected to reach 25% of state transportation revenues if the Governor's plan is approved. That's an unsustainable level of borrowing.

WIB is a member of the Transportation Investment Coalition (TIC) –  a coalition that includes private sector employers, local units of government, chambers of commerce and economic development organizations. Along with our TIC partners, we are asking lawmakers to come up with a more adequate, equitable and sustainable transportation funding plan.

3. Increased Funding for Broadband Expansion Grants

Two years ago, lawmakers created the Broadband Expansion Grant Program administered by the Public Service Commission (PSC). This program provides reimbursement for equipment and construction expenses incurred to extend or improve broadband telecommunications service in underserved areas of the state.

The Governor's plan provides $6.0 million in new funding for Broadband Expansion Grants and creates an ongoing funding source for these grants. WIB supports the Governor's recommendation. Access to high-speed Internet service is a “must have” tool of commerce.

Unfortunately, for many small, independent businesses in northern Wisconsin (north of Highway 64) and western Wisconsin (Platteville northeast to Eau Claire), there are very few broadband service providers. Furthermore, we view investments in infrastructure as a wise use of taxpayer dollars.

Non-Fiscal Policy Priorities

1. Increased Penalties for Unemployment Insurance (UI) Fraud

State law imposes a civil penalty against UI claimants who commit fraud in connection with state or federal UI programs. The penalty is 15% of the amount of UI benefits obtained by fraud. State law also dictates that any person who knowingly makes a false statement or representation to obtain UI benefit payments may be fined not less than $100 and not more than $500 or imprisoned for not more than 90 days, or both. Each such false statement or representation constitutes a separate offense.

The Governor's 2015-2017 state budget plan recommends increasing the monetary penalty from 15% to 40% of UI benefits erroneously paid to a UI claimant as a result of one or more acts of concealment. Furthermore, his plan recommends increasing the criminal penalties for a person who knowingly makes a false statement or representation to obtain any UI benefit payment. The graduated fines and criminal penalties are based on the value of fraudulently UI benefits obtained.

WIB supports the Governor's recommendations. UI benefits are provided to workers who have lost their job through no fault of their own. To preserve and protect UI benefits for honest, law-abiding workers, stiffer penalties should be imposed on those individuals who seek to defraud the program. A 2013 study by the St. Louis Federal Reserve found that in 2011 $108 billion in UI benefits were paid nationally, of which $3.3 billion was obtained fraudulently. The largest share of fraudulently obtained benefits was attributed to individuals who continued to claim UI benefits after returning to work.

2. Suitable Work Definition for UI Claimants

Under current state law, a UI claimant may refuse work for good cause and maintain eligibility for UI benefits if the new work involved wages, hours, or other conditions that were significantly lower or less favorable than similar work in the locality, and the UI claimant had not had reasonable opportunity (up to six weeks) to find a new job substantially in line with the individual's prior job.

The Governor's 2015-2017 state budget plan recommends that the Wisconsin Department of Workforce Development (DWD) define, by administrative rule, what constitutes suitable work for UI claimants, including to specify different levels of suitable work based upon the number of weeks that a UI claimant has received benefits in a given benefit year.

WIB supports the Governor's budget recommendation. Over the past few years, state lawmakers have taken steps to provide greater clarity to the enforcement of existing UI laws and regulations. This is another step in the right direction.

3. Drug Testing for UI Benefits

States may test UI claimants who were terminated from employment because of the use of controlled substances. Under Wisconsin law, a UI claimant who is terminated for the use of controlled substances may be disqualified for UI benefits if the use of controlled substances is found to be misconduct. States may test a UI claimant for whom suitable work is only available in an occupation that regularly conducts drug testing. The United States Department of Labor will determine, by regulations that are not yet final, which occupations regularly conduct drug testing.

The Governor's 2015-2017 state budget plan recommends that DWD establish a program to require certain UI claimants to submit to tests for the unlawful use of controlled substances. Furthermore, the Governor's budget plan allows employers to voluntarily submit to the DWD the results of a test for controlled substances that was conducted as a pre-employment screening. If the prospective employee fails the drug test or refuses to take the drug test, the prospective employee may be ineligible for UI benefits.

WIB supports the Governor's budget recommendations. In order to receive UI benefits, a claimant must be ready and able to work. That's not possible when they are abusing drugs. Drug use in the workplace is inherently dangerous. An employee who is under the influence of a controlled substance can harm themselves, other employees as well as customers and clients. Responsible employers who want to minimize or mitigate this risk can take advantage of these programs to create and promote a safer workplace.

Programmatic Priorities

1. Office of Lean Government

In the private sector, companies use lean manufacturing to reduce costs by streamlining and\or eliminating those activities and processes that do not add to the value of the products and services sold. Executive Order 66, signed by Governor Scott Walker in July 2012, requires each of Wisconsin's cabinet agencies to participate in a Lean Government Initiative to improve customer satisfaction, reduce the cost of government, improve the working environments for our state employees and change government culture.

The Governor's 2015-2017 state budget plan recommends the creation of an Office of Lean Government to establish and administer programs for state agencies “to increase the value of goods and services that state agencies provide with the fewest possible resources.” The Office would also conduct research and analysis and develop policy and program proposals related to efficiency and continuous improvement practices in state government.

WIB supports the Governor's budget recommendations to create an Office of Lean Government. In January 2012, the Governor's Commission on Waste Fraud and Abuse recommended the creation of a Lean Enterprise Solutions Unit called the Center for Excellence within the Department of Administration staffed by trained Lean consultant(s). The Governor's proposal is wholly consistent with the recommendation of the Governor's Commission on Waste Fraud and Abuse. In fiscal year 2013, the Wisconsin Department of Transportation (DOT) saved more than $800,000 pursuant to the directives set forth in Executive Order 66. The Wisconsin Department of Agriculture, Trade and Consumer Protection (DATCP) utilized Lean Government principles to improve the processing of food safety lab samples which has resulted in better customer service and additional savings.

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.

New DOT Secretary: Audit Signals We “Must Change the Culture, Be Transparent”

Wisconsin’s new transportation secretary vowed Tuesday to “change the culture” at the Department of Transportation after an audit found it underestimated highway project costs by more than $3 billion, in part by failing to account for inflation.

Dave Ross’ comments came during a legislative hearing on a recent state audit of the DOT highway program. Lawmakers said the audit raises broad questions about DOT management, including whether lawmakers must oversee highway projects more closely.

Lawmakers and Ross signaled they will adopt recommendations in the audit, which Ross called a “template” to improve the agency.

Ross replaced Mark Gottlieb as DOT secretary in January. Acknowledging the audit found “inefficiencies,” Ross told members of the Joint Legislative Audit Committee that DOT must become more transparent and “break down silos” between its regional offices.

“We need to become more performance-driven. We need to become more accurate,” Ross said. “We need to build back up DOT’s confidence in your eyes.”

As examples of where the department must improve, Ross highlighted cost overruns on two Dane County projects: expansion and reconstructions of Verona Road and the Madison Beltline, and of Interstate 39-90 from the Beltline to the Illinois state line. Since lawmakers approved both projects in 2011, the Verona Road price tag has soared from $150 million to $283.3 million and the I-39-90 cost rose from $715 million to $1.2 billion.

Lawmakers hinted at the implications the audit findings could have for the state’s next transportation budget, debate on which is expected to be contentious.

The audit, in addition to project cost overruns, also found the DOT could save money by taking steps to curb engineering and construction costs. The findings have become a rallying cry for lawmakers, who say DOT must find more cost savings before they contemplate increasing gas taxes or vehicle fees. That includes some conservative GOP lawmakers and Gov. Scott Walker, whose 2017-19 budget proposal holds the line on taxes and fees.

“Giving (DOT) more money would be absolutely the wrong thing to do at this point,” Sen. Chris Kapenga, R-Delafield, said.

Others, such as Rep. John Nygren, R-Marinette, see it differently. He, along with fellow Assembly GOP leaders and legislative Democrats, is open to tax or fee hikes to resolve the transportation-funding imbalance.

Nygren noted the audit findings also say Wisconsin’s highway conditions are deteriorating and compare poorly to neighboring states. “Even after we make those reforms (outlined in the audit), we’re still in a position where, I believe, there’s a shortfall,” Nygren said.

The bill draft circulated before Tuesday’s hearing would require DOT to account for inflation and other factors, such as environmental studies, engineering or land acquisition, in future project cost estimates.

It also has recommendations for actions by DOT, including providing more information to lawmakers about highway project costs and compiling such information, including explanations for major cost increases, in a central location.Sen. Rob Cowles, R-Green Bay, co-chairman of the panel, said he expects the panel to watch the DOT closely in coming months to see how it responds to the audit.

“This committee is going to have to have ongoing dialogue … back and forth with the agency,” Cowles said.

States may have Best Plan to make Health Care Affordable Again

As President Donald Trump, Republican, and Democrats in Congress wrangle over the future of Obamacare and its replacement, the answer to how to make health care affordable for all Americans may not come from another contentious health reform battle in Washington.

Instead, we may follow Trump’s ideas on Medicaid and education reform. Let the states derive their own solutions, particularly when it comes to cost containment.

Gallup says that 26 percent — or more than 1 in 4 health care dollars — are completely wasted. These dollars are spent on defensive medicine or when physicians order more tests, procedures, and medications than are clinically necessary. I see it every day as my colleagues order everything from x-rays, blood work, MRIs, CT scans and a host of other unnecessary procedures to protect themselves from a potential lawsuit.

The impact of wasteful spending by physicians –known as defensive medicine — is astounding. Consider this:

  • BioScience Valuation, a health care economics firm, says that doctors ordered $487 billion in defensive medicine in 2015. That, of course, results in higher premiums, co-pays, deductibles and out-of-pocket expenses for consumers and employers.
  • A 2015 survey conducted by the Congress of Neurological Surgeons found that 75 percent of neurosurgeons said they practice defensive medicine to protect themselves from litigation.
  • A 2014 survey of hospital administrators conducted by Jackson Health care, one of the nation’s largest medical staffing firms, found that 32 percent of costs generated in a hospital could be attributed to wasteful, defensive medicine.

According to the Centers for Medicare and Medicaid Services (CMS), health care spending is expected to consume more than 20 percent of our nation’s GDP by 2025, up from 17.5 percent today. In 2015, federal, state and local governments spent $1.5 trillion. In the same year, the private sector spent $1.7 trillion on health care, according to CMS. Spending will continue to skyrocket if we don’t offer incentives for physicians to change their behavior when it comes to defensive medicine.

That’s why we may need to look to six states that are aggressively working to contain costs. The Florida, Georgia, Alabama and Tennessee legislatures are considering a proposal to eliminate defensive medicine by abolishing each state’s medical malpractice system and replace it with a no-blame model similar to workers’ compensation. Two other states are also examining the concept.

When doctors are no longer the target of litigation, they would be less likely to order unnecessary tests, medications and procedures.

Under the proposal known as the Patients’ Compensation System, a patient could still file a claim if a physician had injured them. But the claim would no longer go through the traditional legal system and instead would be heard by a state administrative panel of health care experts. This administrative system, similar to workers’ comp, would hear a claim in a matter of months instead of the years it takes to litigate a case. Compensation would be identical to awards in a legal system. Patients with smaller injuries could also be compensated for a loss.

But completely abolishing the malpractice system and replacing it with a no-blame model would change the behavior of our nation’s physicians. It would result in annual savings of $115 billion in Medicare and $133 billion in Medicaid, according to BioScience Valuation. In the private sector, employers could save 11 to 22 percent in health care costs for each employee annually– as premiums, co-pays, deductibles and out-pocket costs drop with the elimination of defensive medicine, according to BioScience.

No matter how swiftly Congress acts to repeal and replace Obamacare, there is no doubt that waste in our health care system has to be a top priority. Eliminating defensive medicine with a new state-based solution may just be what’s needed to make health care affordable again for all of us.