Heading into the most challenging re-election race of his 25-year political career, Gov. Scott Walker sought to win working voters Wednesday by proposing a $100 per child tax credit and investments in schools and health care.
In his eighth state of the state address in the Assembly chamber, Walker spoke for more than an hour and called for the $122 million a year child tax credit that would be paid to parents even if they have no state income tax liability. It’s another step by Walker to rally fellow Republicans and move to the middle after the party’s recent loss in a Senate special election.
The credit would be paid for by using the state’s expected budget surplus, which was projected last month to come in $138 million better than previously thought.
“As promised, when we have a surplus, we will give it back to you, the hard-working taxpayers,” said Walker, who was joined on the rostrum by children and their parents. “You see, this is your reform dividend. You deserve it.”
Over the two-year budget, the tax credit as proposed by the governor would be paid out twice and cost about $244 million. Without the credit, the state is currently expected to end the current budget in June 2019 with $385 million in its main account.
If lawmakers approve the credit and other recent proposals by Walker, the state would be left with a budget cushion of less than $100 million—an amount that the state can run through in a matter of days.
Assembly Minority Leader Gordon Hintz, D-Oshkosh, said that he would need to review the child credit but that as a candidate Walker was too late in making his proposals.
“It sounded more like a going-out-of-business sale,” Hintz said of the speech. “After seven years, the governor is finally taking up some of these proposals in desperation because he knows he’s in the political fight of his life.”
Senate Majority Leader Scott Fitzgerald, R-Juneau, said he supported the child tax credit but wasn’t sure if other GOP senators would. Assembly Speaker Robin Vos, R-Rochester, said he backed a tax cut but stopped short of endorsing the child credit.
“I support the idea of sending the money back to the citizens who overpaid it,” Vos said.
This spring, the per child credit would be paid in the form of a sales tax rebate that parents would have to claim separately from the filing of their regular income tax return. The credit would be paid out for any child younger than 18 as of Dec. 31, 2017—about 671,000 families with 1.22 million children are expected to qualify.
Next year, the program would become an income tax credit that parents would claim on their regular state tax return.
Senate Minority Leader Jennifer Shilling, D-La Crosse, said Walker couldn’t erase his record.
“Every time we drive over a pothole or cast a ballot for a school referendum, voters see the underfunding of our roads and local schools. As other states have rebounded from the Great Recession, Republican policies have shrunk Wisconsin’s middle class, shifted more costs onto working families and created an 111,000 jobs deficit,” Shilling said, referring to a finding by the left-leaning group Center for American Progress that Wisconsin lagged in job creation.
Walker, 50, served nearly nine years in the Assembly and almost eight as Milwaukee County executive. He went on to win three campaigns for governor, including the 2012 recall.
The governor can tout a 3 percent unemployment rate in Wisconsin—a tie for the record low, which was last reached in the summer of 1999. He can point to a six-year freeze on in-state tuition in the UW System, property taxes below 2010 levels on the typical home and the up to 13,000 jobs that Foxconn Technology Group says it’s bringing to Racine County.
But he also has a field of nine Democratic challengers who are criticizing his record on education and questioning the up to $4 billion in public money for Foxconn’s flat-screen plant.
To help bridge a $3 billion budget shortfall in 2011, Walker and lawmakers cut state aid to schools but also cleared the way for cuts to teachers’ benefits to make up for that.
Since then, Walker has increased education funding and state aid to schools in this budget is just over $700 million higher than it was at its previous peak in the 2007-09 budget. But the school aid hasn’t kept pace with inflation over that period and now accounts for about 33 percent of overall spending from the state’s main account, down from 38 percent a decade ago.
Walker also proposed Wednesday:
- Using $200 million in state and federal money to stabilize the state’s Obamacare insurance market and hold down rising insurance premiums. The governor, a frequent critic of the Affordable Care Act, has said he’s seeking state action since Congress has not moved to repeal the law.
- Committing $50 million by June to expand existing state jobs programs in rural areas under a definition that would include 56 of the state’s 72 counties.
- Seeking permanent federal approval for the state’s SeniorCare prescription drug plan, which in the past Walker sought to scale back.
- Providing additional funding for low-spending school districts as well as districts in sparsely populated rural areas.
- Requiring able-bodied parents of children on food stamps to work or get training to receive more than three months of benefits.
- Replacing the state’s troubled juvenile prison, Lincoln Hills School for Boys, with five regional facilities that would be located closer to the teenage offenders’ home communities.