Educate All Students: Larry Miller's Blog

June 5, 2013

Barca, Mason, Richards: GOP wraps up budget panel work spending money taken from school kids on tax break for the rich

Filed under: Wisc Budget Bill — millerlf @ 11:22 am

FOR IMMEDIATE RELEASE
Date: June 5, 2013
Contact: Rep. Barca, 608.266.5504
Rep. Mason, 608.266.0634
Rep. Richards, 608.266.0650

GOP wraps up budget panel work spending money taken from school kids on tax break for the rich
MADISON – Leaving several of the Gov. Scott Walker’s most damaging budget proposals until the last day of Joint Finance Committee action, Republicans on the budget committee actually made the budget even worse for Wisconsin’s middle class.

In its final hours, Republicans spent hundreds of millions of dollars more on a tax cut, targeting even more money toward the wealthy and creating a statewide private school system wasting the taxpayers’ money by forcing us to pay for a private school bailout in addition to public schools.  The Department of Public Instruction estimates that a statewide unaccountable private voucher school system could cost $1.9 billion annually.

“Late at night Republicans on the JFC took the terrible budget for the middle class that Gov. Scott Walker had put forward and unbelievably made it even worse,” Assembly Democratic leader Peter Barca (D-Kenosha) said.

In two massive omnibus bill votes, they took money from a surplus that was taken from classrooms of school children across Wisconsin last budget. Republicans, blaming a deficit, made historic cuts of $1.6 billion to Wisconsin public schools. Yet somehow they found plenty of money in that same budget to give $40 million more to private schools and billions away in tax breaks that will create a deficit.

“That funding needs to be returned first to the classrooms it was taken from,” Rep. Cory Mason (D-Racine) said. “School children all across Wisconsin are paying for a tax cut that primarily benefits the wealthy.”

Earlier in the day Republicans, on a party-line vote, passed a health care plan that will charge taxpayers more to cover fewer people on BadgerCare and could end up eventually kicking 29,000 children off their health care.

“In the past Republicans have claimed that health care should be cut because it was too costly – but taking the federal BadgerCare expansion money would save taxpayers more than $100 million,” Rep. Jon Richards (D-Milwaukee) said.  “Denying families the security that comes from knowing they can see a doctor and not worrying they are one health scare away from financial ruin is cruel. Charging the rest of the taxpayers more to do so is simply inexplicable.”

Republicans are destroying key building blocks of the middle-class such as education, health care and job training, at the same time they have failed Wisconsin on job creation. Under the leadership of Gov. Scott Walker and a Republican Assembly and Senate, Wisconsin has plummeted from 11th to 44th in job creation. The state is also among the bottom states in short-term job growth, long-term economic forecast, wage growth and places to do business, according to such reliable sources as the Bureau of Labor Statistics, Forbes Magazine and the conservative US Chamber of Commerce.

2 Comments »

  1. Milwaukee Public Schools will be spending about 45% less per-pupil on pension and retiree health care expenses by 2020, according to a report released Thursday that details how MPS has reduced its post-employment benefit obligations.

    The reason, the report says: Act 10, and the district using its authority under the controversial law to enact changes such as increasing employees’ deductibles and increasing the age and years of service necessary to qualify for retiree health benefits.

    “Without Act 10, MPS would eventually spend an additional $105 million – 9.2% of its entire budget – in 2020 due to the growth of retirement expenses,” says a statement released with the new summary report from the Thomas B. Fordham Institute, a right-leaning education nonprofit that analyzed costs and projected future retirement obligations in Milwaukee, Cleveland and Philadelphia.

    The law enables school districts to make such changes without having to negotiate them with unions, though MPS and the teachers union agreed to a different health care plan administrator in the current contract, which was signed before Act 10 became law and is set to expire in a few weeks.

    MPS district officials also pointed to another cost-saving move they made that was not mandated by Act 10: the closure of a supplemental early retirement plan for teachers that resulted in $15 million in savings over the next five years.

    The analysis for Milwaukee is based on the district’s most recent actuarial report for retiree health care, said co-author Robert M. Costrell, a professor of education reform and economics at the University of Arkansas.

    That actuarial report showed the Walker administration’s landmark union bargaining law helped MPS shave more than $1 billion from its long-term benefit obligations to retirees.

    The report from Fordham is rooted in an effort to take a more expansive look nationally at how much retirement costs will cost districts in the future, and how those costs might impact district spending when passed down to teachers and students.

    For Milwaukee, the Fordham summary report predicts:

    MPS will be spending $1,924 per-pupil on pension and retiree health care costs by 2020, down from a projected $3,512 per-pupil it was on the road to spending before the Act 10 reforms.
    Pension costs will drop to $845 per-pupil in 2020, down from original projections of $1,029 per-pupil.
    MPS will eliminate the rise in retirement costs; though high, those costs are prediced to hold steady.
    But the window into the future is not free of storm clouds, according to Costrell.

    The district’s pay-as-you-go policy for retiree health care is kicking the bill down the road, he said.

    That’s because MPS has an approaching wave of retirements, but with declining enrollment, fewer working employees to shoulder the costs of supporting the health care costs of retirees.

    “If you haven’t pre-funded the system, it’s a huge and growing burden,” Costrell said.

    But MPS officials said in an email exchange Thursday that they are, in fact, trying to pre-fund their liability. District spokesman Tony Tagliavia wrote that the district created a trust in 2011 for the purposes of funding the post-employment liability and has been contributing to it within the district’s ability.

    Milwaukee Teachers Education Association union President Bob Peterson did not return a call for comment on the report.

    The changes in the eligibility conditions for post-employment benefits, which the Milwaukee School Board began enacting in the fall of 2011, are a main driver behind the larger-than-usual wave of MPS educators retiring this year.

    Comment by Adam — June 10, 2013 @ 2:54 pm | Reply

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