Educate All Students: Larry Miller's Blog

May 11, 2011

Wisconsin Finding More Money That Could Go Toward Education But Republicans Say No

Filed under: Scott Walker — millerlf @ 4:26 pm

State tax revenues to grow $600 million more than expected by 2013

By Jason Stein and Patrick Marley of the Journal Sentinel May 11, 2011

Madison — The state learned Wednesday that it is expected to receive roughly $200 million more annually in tax money over three years – enough to cover some but not all of a massive budget shortfall.

The revised tax revenue estimates by the Legislature’s nonpartisan budget office said the state would receive an extra $636 million through June 2013, a period covering the current state fiscal year and the next two. The projections by the Legislative Fiscal Bureau showed an increase in expected income tax payments that outweighed weakness in both corporate and sales tax revenues.

Gov. Scott Walker said in a Capitol news conference he wants to put the money toward paying off debt and perhaps restoring some cuts that he proposed when the state’s finances looked worse. Walker is proposing cutting school aid by $841 million over two years, but he expressed skepticism at the idea of using the new money to make the school cuts smaller.

He said he also wants to continue to proceed with plans to make public employees pay more for health care and their pensions and eliminate much of their ability to collectively bargain.

Lawmakers approved those changes in March, but they have not taken effect because of a court challenge. Republicans have said they would put pass them again as part of the state budget if a court doesn’t rule in their favor in the coming weeks. Walker stressed his support for that plan, despite the new money.

“Those (collective bargaining) reforms are imperative,” he told reporters. “One way or another, those need to be in there.”

Walker said he wants to use some of the new money to restore $200 million, plus interest, to a medical malpractice fund lawmakers illegally tapped into to balance the 2007 budget. He also wants to pay more than $50 million to Minnesota for a now-scrapped tax reciprocity deal.

He would use some of the money to pay off other debt, though he didn’t specify how much.

The remainder could be used for concerns his fellow Republicans who control the Legislature have raised about his budget plans, he said. Walker didn’t say what those would be, but legislators have complained about his plans to make changes to the SeniorCare prescription drug plan, eliminate recycling subsidies and reduce aid to municipalities for their roads.

GOP lawmakers cautioned that even with the new money, the state still faces a roughly $3 billion shortfall over the next two years.

“This is not a whirlwind of new money,” said Sen. Alberta Darling (R-River Hills), co-chairwoman of the Joint Finance Committee. “Tough decisions remain.”

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