The fact is that we are at a time of economic slow down as a nation and Wisconsin has been hit less than other states but we are not immune. This slowdown has caused a gap in the state budget because of slowed collections of sales tax and other planned state revenues.
The passage of the past Legislative budget was painful. Political posturing ruled out over compromise for far too long and we had significant delays. We will face the same challenges with this budget repair on smaller a scale. With a split house, we must exercise civility and will have no choice but to compromise. I believe that the Senate Budget passed this week is just that, a solid compromise between what Governor Doyle proposed and what the Assembly passed. Elements of both proposals are a part of the Senate plan and I think a really good place to start.
The governor's budget, the Assembly budget, and the Senate budget all have areas of similarities.
• All of the budgets tighten the state belt and make cuts to state agencies through lapses in agency spending to be determined by the Department of Administration. This is the most responsible way to make the cuts without political interference. There are disagreements about the amount of lapse and where they can come from, but we have some agreement and should build on it. Protecting our most vital state services like SeniorCare, police, fire, health care for vulnerable people, and public schools needs to be a priority.
• Both the Senate and Assembly take funds from the state reserves, although the Senate budget takes significantly less from the rainy day fund.
• Both the Senate and Assembly budgets do not makes cuts to the transportation fund.
• Both the Senate and Assembly budgets make a delay in school aid payments; a compromise for those that want cuts to education spending.
• The Senate and governor's budgets contain the Hospital Tax Assessment. Recently garnering the support of the Wisconsin Hospital Association and Wisconsin Manufacturers and Commerce, this is a responsible way to draw down more federal funds to help pay for Wisconsin Medicaid patients.
• The Senate and governor's budget both close a loophole in the law that stops companies like Wal-Mart from pretending to rent their own buildings back to themselves so they can avoid taxes(also known as REITs).
The Senate Budget plan does also contain some elements not included in either the governor's or the Assembly's budget.
• The Senate plan funds a shortfall in the state childcare program that provides child-care assistance to low-income working families. Filling $18 million in the Wisconsin Shares program will make sure that our states lower paid workers with small children can have access to affordable child care while they work. Child care costs are rising at about twice the rate of inflation. The average cost for an infant care in Wisconsin is $11,855 a year.
• The Senate plan rewards good Wisconsin businesses by lowering the corporate tax rate. This is paid for by closing the Las Vegas Loophole. Closing corporate loopholes that are abused by large, profitable out-of-state companies will enable us to lower taxes for those Wisconsin businesses that play by the rules and make the tax code fairer for everyone. Between 2000 and 2003, Wal-Mart had about $852 million in profits in Wisconsin but only paid $3 million in Wisconsin taxes because they exploit the Las Vegas Loophole. That may be great for Wal-Mart, but in-state business in Wisconsin and Wisconsin families pick up the tab for their use of state services including publicly supported health care BadgerCare.
• The Senate plan includes Streamlines Sales Tax for collection of internet sales taxes. When out-of-state businesses sell products over the internet without collecting sales taxes, Wisconsin businesses, which employ Wisconsin residents are, at a disadvantage. The Department of Revenue estimates that Wisconsin will lose approx. $156 million in 2008 without streamlined sales tax in place. Twenty-two states have already enacted streamlined sales to level the playing for businesses in their state.
While there are differences that we will have to work on as a Legislature with all three versions of the repair, there are many similarities we can build on as well. I am very hopeful we will be able to find solutions and move ahead quickly with this budget plan. If you would like more information on the budget repair process or bills please contact my office at (608) 266-6670 or (888) 549-0027.
- State Sen. Jon Erpenbach, D-Waunakee,
represents the 27th State Senate District, which includes Green County.
The passage of the past Legislative budget was painful. Political posturing ruled out over compromise for far too long and we had significant delays. We will face the same challenges with this budget repair on smaller a scale. With a split house, we must exercise civility and will have no choice but to compromise. I believe that the Senate Budget passed this week is just that, a solid compromise between what Governor Doyle proposed and what the Assembly passed. Elements of both proposals are a part of the Senate plan and I think a really good place to start.
The governor's budget, the Assembly budget, and the Senate budget all have areas of similarities.
• All of the budgets tighten the state belt and make cuts to state agencies through lapses in agency spending to be determined by the Department of Administration. This is the most responsible way to make the cuts without political interference. There are disagreements about the amount of lapse and where they can come from, but we have some agreement and should build on it. Protecting our most vital state services like SeniorCare, police, fire, health care for vulnerable people, and public schools needs to be a priority.
• Both the Senate and Assembly take funds from the state reserves, although the Senate budget takes significantly less from the rainy day fund.
• Both the Senate and Assembly budgets do not makes cuts to the transportation fund.
• Both the Senate and Assembly budgets make a delay in school aid payments; a compromise for those that want cuts to education spending.
• The Senate and governor's budgets contain the Hospital Tax Assessment. Recently garnering the support of the Wisconsin Hospital Association and Wisconsin Manufacturers and Commerce, this is a responsible way to draw down more federal funds to help pay for Wisconsin Medicaid patients.
• The Senate and governor's budget both close a loophole in the law that stops companies like Wal-Mart from pretending to rent their own buildings back to themselves so they can avoid taxes(also known as REITs).
The Senate Budget plan does also contain some elements not included in either the governor's or the Assembly's budget.
• The Senate plan funds a shortfall in the state childcare program that provides child-care assistance to low-income working families. Filling $18 million in the Wisconsin Shares program will make sure that our states lower paid workers with small children can have access to affordable child care while they work. Child care costs are rising at about twice the rate of inflation. The average cost for an infant care in Wisconsin is $11,855 a year.
• The Senate plan rewards good Wisconsin businesses by lowering the corporate tax rate. This is paid for by closing the Las Vegas Loophole. Closing corporate loopholes that are abused by large, profitable out-of-state companies will enable us to lower taxes for those Wisconsin businesses that play by the rules and make the tax code fairer for everyone. Between 2000 and 2003, Wal-Mart had about $852 million in profits in Wisconsin but only paid $3 million in Wisconsin taxes because they exploit the Las Vegas Loophole. That may be great for Wal-Mart, but in-state business in Wisconsin and Wisconsin families pick up the tab for their use of state services including publicly supported health care BadgerCare.
• The Senate plan includes Streamlines Sales Tax for collection of internet sales taxes. When out-of-state businesses sell products over the internet without collecting sales taxes, Wisconsin businesses, which employ Wisconsin residents are, at a disadvantage. The Department of Revenue estimates that Wisconsin will lose approx. $156 million in 2008 without streamlined sales tax in place. Twenty-two states have already enacted streamlined sales to level the playing for businesses in their state.
While there are differences that we will have to work on as a Legislature with all three versions of the repair, there are many similarities we can build on as well. I am very hopeful we will be able to find solutions and move ahead quickly with this budget plan. If you would like more information on the budget repair process or bills please contact my office at (608) 266-6670 or (888) 549-0027.
- State Sen. Jon Erpenbach, D-Waunakee,
represents the 27th State Senate District, which includes Green County.
