Wisconsin state budget stalled; Assembly, Senate may each write own versions

Patrick Marley Jason Stein
Milwaukee Journal Sentinel

MADISON – State budget talks stalled Monday, prompting the Senate's top leader to warn his house might break off discussions with the Assembly and pass its own financial plan instead. 

Gov. Scott Walker speaks during a news conference Monday in Madison calling on his Republican colleagues in the Legislature to pass a state budget.

Republicans who control the Legislature had hoped to have the budget-writing Joint Finance Committee meet Tuesday but were unable to reach enough consensus to take votes. It remains unclear if the panel will meet later in the week. 

"I'm hoping this is just a little bump in the road that we're not meeting (on Tuesday)," Senate Majority Leader Scott Fitzgerald (R-Juneau) told reporters. "If they don't meet Thursday, then we're in a rougher spot than I thought we were."

GOP Gov. Scott Walker and Republican lawmakers have struggled to come to terms on the state budget in recent weeks. Underlining their challenges, an Assembly leader said Monday that he's prepared to be "pretty stubborn" about getting changes to Walker's bill to help rural school districts.  

Fitzgerald said that if the budget committee is unable to meet this week, Senate Republicans may put together their own tax and spending plan without the help of the Assembly. Fitzgerald said he hoped to avoid the scenario, which could mean even bigger delays as the Senate and Assembly will still have to come to terms eventually. 

"I want this budget done by 1 July," when the state's new fiscal year starts, Fitzgerald said. 

He said he still believed it was possible for Joint Finance to complete its work by the middle of the month, with the full Legislature signing off on the budget around July 1.

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Walker told reporters Monday he thought the budget may be delayed by a couple of weeks but not enough to hurt state operations. State funding continues at current levels if lawmakers miss their budget deadline of June 30.

"A week or two really is not much of a delay," Walker said. 

Divided on roads

The governor spoke from a liquor store parking lot just off Highway 151 to urge lawmakers to accept his transportation plan. That's needed to make sure work continues on projects such as the Verona Road segment of Highway 151 between Fitchburg and Madison, he said. 

The governor and lawmakers are deeply divided on transportation, with Assembly Republicans saying Walker isn't doing enough to keep projects on schedule over the long haul. They want to raise taxes on gasoline so more money can be put toward highways and then offset that tax increase by deeply cutting income taxes that pay for other programs and services.

Walker strongly opposes increases in gas taxes or registration fees. He has highlighted key projects he wants to keep on track but plans to delay others for years. 

Senate Republicans have not released a specific plan, but Fitzgerald repeated his interest Monday in seeking eventual federal approval for toll roads to help pay for long-term needs such as massive interstate projects in southeastern Wisconsin. GOP senators have "very little enthusiasm" for other new sources of road funding, he said. 

That doesn't please Democrats, who say Walker and Senate Republicans are being unrealistic about how much the state can do with its current resources.

"(Walker's) mismanagement of transportation already delayed the Verona Road project until 2020, causing significant economic harm to the area businesses he used as props this morning," Rep. Terese Berceau (D-Madison) said in a statement.

After a budget panel discussion held by the website Wisconsin Health News, Sen. Alberta Darling (R-River Hills), the co-chair of the Joint Finance Committee, acknowledged that she was worried about budget delays.

“I don’t want to go to Fourth of July parades and have people say why don’t you get your job done?” she said.

Education spending

Another flash point is education. Walker wants to put $649 million more toward public schools over the next two years, and key Senate Republicans have rallied behind that plan. 

Assembly Republicans are working on their own plan that would spend about $90 million less in state funding for public schools than what Walker has proposed spending. The plan would also allow certain local schools that spend less than other districts to raise property taxes by more than $90 million. 

Rep. John Nygren (R-Marinette), the co-chairman of the Joint Finance Committee, said he’d be "pretty stubborn" about the need to fix what he sees as an unfair situation for low-spending rural districts. 

“We haven't solved what I see as the biggest discrepancy in education funding,” he said.

In another point of contention, the Assembly plan would not lower property taxes as much as the governor wants. Walker has said he wants property taxes on the median-value home to be lower than they were in 2014 and pledged Monday to use his veto powers to ensure that.

Nygren said that this property tax goal is being hampered by a $30 million setback in the budget because the state lottery didn't take in as much as expected and taxpayers' costs were higher than anticipated for voucher schools.

Last, Fitzgerald wants the state to start phasing out a more than $250 million property tax on personal property, which is levied mainly on businesses for their equipment and furnishings. The Senate leader said the property tax is cumbersome to enforce and could be eliminated in part using money that Walker had set aside in his budget for an income tax cut. 

"It's unjust, overburdensome and has way too much paperwork," Fitzgerald said of the tax. 

Nygren said he'd also like to eliminate the personal property tax. But he said he was reluctant to drop the governor's proposed income tax cuts, which would benefit most taxpayers, in favor of the tax cuts for select businesses. 

Rep. Gordon Hintz (D-Oshkosh), who sits on the budget committee, said the Republican infighting was emerging because they had not adequately addressed transportation funding during the six years they've had complete control of state government. 

“Something’s got to give, and to be honest with you, the governor should be a piece of this, too," Hintz said. "Sitting back and firing off tweets and holding press conferences is not going to be helpful.”