From new prisons to tax cuts for parents, Wisconsin lawmakers are rushing to pass hundreds of millions of dollars in new commitments in their final days of work.
Some of these proposals may still fail to become law and others will take years for their full costs to be felt. But each represents a potential obstacle to keeping the state’s budget balanced going forward.
A tally by the Milwaukee Journal Sentinel found that lawmakers have voted for up to $678 million in one-time spending or tax cuts for an adult prison, child tax rebate, lockups for juvenile offenders and limits on welfare.
On top of that, legislators voted for roughly $220 million in ongoing yearly costs to lock up more repeat offenders, boost rural jobs programs, and hold down prices within the Obamacare insurance market. Republicans pushed the bills, though some Democrats also voted for some of them.
Assembly Minority Leader Gordon Hintz, D-Oshkosh, said Republicans were scrambling to boost their poll numbers and leaving the state with little cushion if the economy sours.
“This wouldn’t be enough to keep the state running for more than two or three days,” he said of the state’s budget balance. “(The spending) is a reflection of how politically desperate the landscape has become.”
Assembly Speaker Robin Vos, R-Rochester, said his party was reacting to better-than-expected state revenue projections. The tax rebate, he pointed out, was a one-time outlay.
“We’re spending the anticipated surplus,” he said. “This is out of our savings.”
Last month, the Legislature’s nonpartisan budget office predicted that the state’s main account would finish the current budget in June 2019 with a better-than-expected $460 million balance.
That helped spark a series of spending bills and tax cuts from Gov. Scott Walker and GOP lawmakers, who have watched with unease as Democrats have done well in a series of recent special elections in Wisconsin and other states.
The Assembly, for instance, on Thursday passed a one-time $100-per-child tax rebate and sales tax holiday bill.
The Senate could still amend that bill, but it currently would return $174 million to taxpayers. The Assembly also approved a bill to spend $50 million a year on rural jobs programs.
If approved by the Senate, those bills and several other minor ones would leave the state with $207 million in its main account in June 2019, or enough to run the state for four days.
In the next 2019-21 budget, the challenges would increase.
Last fall, the Legislative Fiscal Bureau estimated that in this next budget state spending would exceed taxes by $991 million.
The state has had bad projections like this before and they aren’t perfect—for instance they don’t account for how the economy could affect tax collections or the cost of ongoing state services. To help out, the state should also have $322 million in its rainy day fund by next year.
But these latest bills would make the state’s projected shortfall worse, not better.
That could still change. Senate Majority Leader Scott Fitzgerald,R-Juneau, said he doesn’t back all of the bills passed by the Assembly, even though most of them have Walker’s backing. The current version of the tax cut, for instance, doesn’t have close to enough Senate support, he said.
“They continue to cut deals between the governor and Assembly. I don’t know why they think that will result in bills becoming law,” Fitzgerald said.
But for now, here’s what the bills would cost:
$350 million in one-time costs to build a new adult prison. This legislation was passed by Assembly Republicans this week but still needs Senate approval. The legislation authorizes the state to borrow the money and then pay it back over many years. The state could still opt not to build the prison.
$80 million in one-time costs to replace the state’s troubled youth prison, Lincoln Hills School for Boys, with several regional facilities. This bipartisan Assembly bill still needs Senate approval and Fitzgerald signaled Friday that senators could still amend or drop it. The state could convert Lincoln Hills to become a second new adult prison.
Up to $42 million in one-time costs and up to $38 million in ongoing yearly costs to implement Walker’s proposed limits on welfare programs such as food stamps. The Senate sent these bills to Walker this week but it will still take more than a year to implement these changes.
Roughly $50 million a year in state money to hold down costs within federal Affordable Care Act marketplaces. This Obamacare bill now sits on Walker’s desk but its costs won’t kick in until July 2019.
An estimated $61 million a year to lock up hundreds more repeat criminal offenders and hire dozens more prosecutors around Wisconsin.
Up to $32 million in one-time commitments for ads to attract out of state workers and tweak the state tax code. An additional $14 million in ongoing commitments would go to rural schools and a plan to keep two paper plants from closing.
Walker now has Senate Bill 54, which would require state officials to initiate proceedings to revoke probation, parole or extended supervision for offenders charged with a felony or violent misdemeanor.
The Department of Corrections estimates the proposal would ramp up over two years and send nearly 1,800 more people to prison at an annual cost of $57 million a year.
By adding to estimates of future prison populations, the bill is also increasing the need to build a state prison.
Vos, the Assembly speaker, said he was not convinced the tough-on-crime legislation would increase state inmates and cost as much as projected.
But he said the Assembly was willing to provide $350 million to build a prison in case the need does arise. If it doesn’t, a new prison may be needed anyway to replace others that are more than 100 years old, he said.