Archives for 2007-2009 Disability Budget Proposals

Budget Status (February 20, 2009)

Late on February 18, 2009 after many hours of debate, the state Assembly narrowly approved the budget repair bill (SB 62) introduced a week earlier by the Gov. Doyle and Democratic leaders in the Legislature.  The bill was approved by the Senate earlier in the day and was signed into law the next day by the Gov. Doyle (as 2009 Act 2). 

The bill begins to fill the estimated $600 million shortfall in the current fiscal year (2009) and the nearly $6 billion shortfall in the next two-year budget (2009-2011).  It reduces the FY 2009 two-year shortfall by about $183 million and the aggregate shortfall over the next couple of years by $561 million.  That still leaves a huge hole - but that's where the next two-year budget and federal stimulus funding come into play. 

The budget repair bill includes cuts or lapses of $38 million in FY 2009 and another $87 million in the next budget. (Far larger cuts are in the next budget.)  It also includes three significant sources of revenue:

1. Combined reporting – This treats corporations and their subsidiaries as a single, combined entity.  It limits their ability to move Wisconsin profits into subsidiaries that are located outside WI and beyond the reach of our taxes.  Combined reporting, which will now be law in 23 of the 45 states with corporate income taxes, reduces that sort of tax avoidance - netting the state an estimated $27.7 million in the 2008-09 fiscal year and $187.3 million in 2009-11.

2. Sales tax collections -- The streamlined sales tax and modifications to the tax on customized computer software (which address a tax loophole opened up last year by the Menasha Corp. Supreme Court ruling) will bring in $9.4 million in 08-09, and about $61 million in 2009-11.

3. Imposing a new assessment on hospital revenue -- The hospital assessment will generate about $925 million in tax revenue over a three-year period.  Most of that revenue will be used to increase Medicaid reimbursement rates for hospitals - thereby leveraging $916 million in federal matching funds.  But $303 million will be used to produce General Fund savings, which will be used in turn to fill the GPR hole in the budget for Medicaid and BadgerCare Plus (and enabling the state to proceed with BC+ coverage of childless adults in July). 

The bill approves the expenditure of $300 million on 47 identified highway projects, using funding from the federal economic stimulus bill.  It also creates a procedure for Joint Finance Committee review of the Governor's plans to spend other parts of the federal stimulus bill funding.

(Text above provided by Jon Peacock of WCCF)

Budget Status (January 16, 2009)

The 2007 – 09 State Budget was signed into law in October 2007. It was signed into law late due to differences between the two houses of the legislature and the governor. This budget covers the period of July 1, 2007 to June 30, 2009. In March 2008 the Legislative Audit Bureau announced that there would not be enough funds to cover all of the expenses in the budget. The Wisconsin state constitution requires that the budget be in balance. But this budget was going to be about $527 million short. Because of that, the governor called a special session of the legislature to address the budget shortfall. In June 2008 the legislature passed a budget repair bill. During the fall of 2008, both the state and federal economies experienced sharp declines. Consumers began to spend less and this resulted in fewer tax revenues being collected by the state. As a result, the budget once again experienced a shortfall at the end of 2008. Once again the legislature will have to address the shortfall before the budget ends on June 30, 2009. The expectation is that the state will receive federal stimulus funds to help cover some or all of the deficit. If the federal funds are not enough to cover the deficit, the introduction of a hospital bed assessment, a tax on oil companies, and closing some tax loop holes are some ideas that have been mentioned to address the shortfall. To make matters worse, the next two-year budget is already projected to be about $5.4 billion short. The governor will introduce that budget around the middle of February 2009. It should be signed into law by June 30, 2009.

Budget Shortfall Update (June 16, 2008)

Because revenue collections have not kept up with the rate of spending, the current 2007-09 state budget had an estimated shortfall of about $527 million.  Governor Doyle sent the legislature a bill to repair the budget shortfall.  It was amended by both the Assembly and the Senate.  Leaders in the Assembly and Senate agreed to a compromise bill and sent it back to Governor Doyle, who vetoed some provisions. 

The following are some of the details of the bill signed into law:

• Unspent funds transfer:  Requires state agencies to cut $270 million in unspent funds and transfer it to the general fund.  This is in addition to the $200 million already cut in the 2007-09 budget.  About $100 million of the new cuts would come from the Department of Transportation which would be made up with an increase in federal funds.
• Medical Assistance program:  Reduces funding for MA by $10 million in state funds and $14.4 million in federal funds to reflect savings expected to be generated in the program.  This should not affect current benefits.
• Tobacco securitization:  Generate $209 million by bonding future tobacco settlement funds and use it for the Medical Assistance (MA) program.
• Tobacco use control grants:  Increase funding for the grants by $250,000 in 2008-09.  (Current base is $15 million annually).
• Four-year-old kindergarten:  Requires the program to be available to all eligible pupils if a school district chooses to offer the program.  Allows existing programs to phase-in over the next five years.
• Child care subsidies:  Provide $18.6 million for direct child care subsidies under the Wisconsin Shares program.  The money fills an anticipated shortfall in the program.
• Statutory balance:  The amount remaining in the state’s “rainy-day” fund is about $106 million.

The bill does not include a tax on hospitals which was favored by the governor. More detailed information about the compromise agreement can be found on the Wisconsin Council for Children and Families web site.

Budget Shortfall (April 1, 2008)

Governor Doyle introduced his 2007-09 state two-year budget in February 2007. The budget is for the period from July 1, 2007 through June 30, 2009. After much debate and delay the budget bill, Senate Bill 40 (SB 40), was signed into law by Gov. Doyle on October 26, 2007.

The Legislative Audit Bureau recently announced that the budget is out of balance and will experience a shortfall of about $527 million before June 30, 2009. The Wisconsin state constitution requires that the budget be in balance.

The legislature ended their regular session on March 13, 2008. But since this budget situation needs to be fixed, Gov. Doyle called the legislature back into special session to address it. Gov. Doyle and both houses of the legislature have proposed ideas on how to fix this budget shortfall. A new budget bill has been introduced, SS AB 1. There is some agreement among the plans but there is much disagreement too. Some plans find more revenue sources through a hospital tax and closing tax loopholes on businesses. Others cut state spending and delay payments to schools.

An agreement will have to be reached soon between the various plans or else the budget shortfall will probably get worse.

You can access the current budget information under the "Issue Summary" section and read how the budget changed through the process and what the "Final" result turned out to be.

Biennial Budget 2007-2009

• Issue Summary Of The 2007-2009 State Biennial Budget
• Survival Coalition 2007-2009 Budget Paper
• QEC Conference Committee Memo
• QEC Budget Recommendations
• Joint Finance Budget Hearings
• Overview of the Buget Process
• Autism Society of Wisconsin Budget Position
• Family Voices of Wisconsin
• Wis. Council on Children and Families Budget Essentials

Please  see this page for informatoion about the 2005-2007 budget.