the wisconsin taxpayer

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tax wis New Legislative Directory See Page 8 S ince the 2010 elections, Re- publicans have controlled both houses of the state legislature. Heading into the November 2016 elections, they held a 19-14 majority in state senate and a 63-36 advantage in the assembly. In what many believed was supposed to be a good year for Democrats, Republicans surprised by adding a member to each house and continue their total control of state government. As is always the case with a new legislature, one of its first— and arguably biggest—jobs will be crafting a 2017-19 state budget. Is- sues likely to dominate discussions include: transportation finance; school funding; Medicaid; and the U.W. System. Lawmakers may face an unexpected challenge when they begin budget deliberations in Feb- ruary: Recent state tax collections appear to be slowing. 2016 ELECTIONS In November, voters in Wiscon- sin re-elected Ron Johnson (R) to the U.S. Senate, and chose, for the first time since 1984, the Republican presidential nominee. They also chose representatives in all 99 as- sembly districts and in 16 of 33 state senate districts. While many citizens think elec- tion season is limited to the fall, for many candidates it started, and effec- tively ended, much earlier. Candidates During the first five months of 2016, three state senators and seven state representatives officially an- nounced retirement. Numbers were down significantly from 2014 when seven senators and 22 representa- tives retired. Pending legislative vacancies often trigger a rush of potential can- didates trying to get on the ballot. However, with nearly all legislators running for re-election, the number of total candidates (224) declined to its lowest level since at least 2000 The 2016 elections yielded some surprises. Republicans gained a seat in each house and now hold majorities of 64-35 in the assembly and 20-13 in the senate. Many races featured little competition: In 41 of 115 seats up for election, one candidate was on the ballot; in another 21, major party candidates had only third party or no post-primary competition. Legislative focus in the first half of 2017 will be crafting the 2017-19 state budget. Also in this issue: Wisconsin Legislative and Congres- sional Directory New Legislature, Same Issues? Transportation, School Funding Top Budget Debate Vol. 84, Number 12 | December 2016 A service of the Wisconsin Taxpayers Alliance

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Page 1: THE WISCONSIN TAXPAYER

taxwis

New

Legislative Directory

See Page 8

Since the 2010 elections, Re-publicans have controlled

both houses of the state legislature. Heading into the November 2016 elections, they held a 19-14 majority in state senate and a 63-36 advantage in the assembly.

In what many believed was supposed to be a good year for Democrats, Republicans surprised by adding a member to each house and continue their total control of state government.

As is always the case with a new legislature, one of its first—and arguably biggest—jobs will be crafting a 2017-19 state budget. Is-sues likely to dominate discussions include: transportation finance;

school funding; Medicaid; and the U.W. System. Lawmakers may face an unexpected challenge when they begin budget deliberations in Feb-ruary: Recent state tax collections appear to be slowing.

2016 ELECTIONSIn November, voters in Wiscon-

sin re-elected Ron Johnson (R) to the U.S. Senate, and chose, for the first time since 1984, the Republican presidential nominee. They also chose representatives in all 99 as-sembly districts and in 16 of 33 state senate districts.

While many citizens think elec-tion season is limited to the fall, for many candidates it started, and effec-tively ended, much earlier.

CandidatesDuring the first five months of

2016, three state senators and seven state representatives officially an-nounced retirement. Numbers were down significantly from 2014 when seven senators and 22 representa-tives retired.

Pending legislative vacancies often trigger a rush of potential can-didates trying to get on the ballot. However, with nearly all legislators running for re-election, the number of total candidates (224) declined to its lowest level since at least 2000

The 2016 elections yielded some surprises. Republicans gained a seat in each house and now hold majorities of 64-35 in the assembly and 20-13 in the senate. Many races featured little competition: In 41 of 115 seats up for election, one candidate was on the ballot; in another 21, major party candidates had only third party or no post-primary competition. Legislative focus in the first half of 2017 will be crafting the 2017-19 state budget.

Also in this issue:

Wisconsin Legislative and Congres-sional Directory

New Legislature, Same Issues?Transportation, School Funding Top Budget Debate

THE WISCONSIN TAXPAYER

Vol. 84, Number 12 | December 2016

A service of the Wisconsin Taxpayers Alliance

Page 2: THE WISCONSIN TAXPAYER

Page 2 The Wisconsin Taxpayer

(see Table 1). A drop in the number of open seats was part of the reason for the decline from 2014. However, candidate numbers in 2014 were the low-est since 2006.

Redistricting, the rise in the number of “safe” seats, and the incumbency advantage of political ca-reerists may help explain the lack of candidates over the last two cycles.

Pre-November VictoriesWhile the November election made it official,

many candidates were effectively elected in the Au-gust primary—or even before. In 41 of 115 districts up for election in 2016, only one candidate was on the ballot. Thus, about 35% of legislative hopefuls were effectively elected upon filing nomination papers.

In another 21 districts, major party candidates had no post-primary opponents or only third-party competition. In other words, nearly half of all state legislative contests were decided by the August pri-mary, when voter turnout was less than 20%.

November TurnoutVoter turnout is highest in fall elections during

presidential years. While still higher than in non-presidential years, this year’s turnout (about 67%) was lower than that of prior presidential elections (70% in 2012, 69% in 2008, and 73% in 2004). However, it was about the same as the 1980-2012 average of 66.5% (see Figure 1, page 3).

THE NEW LEGISLATUREWith only three new senators and nine new mem-

bers of the assembly, the 2017-18 state legislature will look very much like the last one, but with a little more experience. The 2015-16 legislature had 27 members with no prior experience in the legislature and another 30 with two years or less.

Assembly Members of the assembly serve two-year terms.

Republicans held a 60-39 majority in each of the 2011-12 and 2013-14 sessions, before expanding it to 63-36 in 2015-16. In November, they captured 64 seats, extending their majority by one and making it their largest since 1957.

For the first time in several elections, turnover in the lower house was relatively modest; the new

Table 1: State Legislative CandidatesCounts by House and Party, 2000-16

THE WISCONSIN TAXPAYER

2016 Wisconsin Taxpayer Index (Vol. 84)

Month Title

January The Property Tax No One Knows

February In Their Own Words: Wis. Supreme Court Candidates

March 100 Years and Counting: Wisconsin’s Income Tax

April The Ups and Downs of State Fiscal Health

May Has Legal Gambling Plateaued in Wisconsin?

June/July Wisconsin’s Migration Challenge

August County Government in Wisconsin

September TIF: The Municipal Development Tool

October Getting to the Heart of School Finance

November State Tax Growth Outpaces Local Increases

December New Legislature, Same Issues?

December 2016 Vol. 84 Number 12Publication Number USPS 688-800Periodical postage paid at Madison, Wisconsin

Subscription Price: $17.97 per yearPublished each month, except July, by the Wisconsin Taxpayers Alliance, 401 North Lawn Avenue, Madison, Wisconsin 53704-5033

Postmaster:Send address changes to The Wisconsin Taxpayer, 401 North Lawn Avenue, Madison, Wisconsin 53704-5033Phone: 608.241.9789 Fax: 608.241.5807Email: [email protected] Website: www.wistax.org

Officers and Board of Directors:T. L. Spero, Chair, Milwaukee; K. D. Nunley, Vice-Chair, Milwaukee; D. L. Hughes, Secretary-Treasurer, Milwaukee.

J. L. Adams, Beloit; C. D. Fortner, Milwaukee; J. J. Kita, Milwaukee; Carol Ward Knox, Fort Atkinson; R. A. Meeusen, Milwaukee; H. C. Newell, Mosinee; T. M. Rettler, Neenah; J. R. Riordan, Madison; C. A. Rooks, Milwaukee; D. R. Schuh, Stevens Point; M. D. Simmer, Green Bay.

Staff:Todd A. Berry, President; Dale Knapp, Research Director; David Callender, Communications Director; Alex Richter; Gina Staskal, Business Manager.

Reproduction:Media is encouraged to quote contents, with credit to WISTAX. Electronic reproduction or forwarding is prohibited unless prior permission is granted. Send requests to [email protected].

THE WISCONSIN TAXPAYER

House/Party 00 02 04 06 08 10 12 14 16

Assembly 203 216 229 207 244 273 261 208 193Senate 35 36 39 36 25 41 36 38 31

Republican 122 130 127 115 111 171 118 133 96Democrat 105 102 121 119 146 117 164 104 124Other 11 20 20 9 12 26 15 9 4Total 238 252 268 243 269 314 297 246 224

Party

House

Page 3: THE WISCONSIN TAXPAYER

Vol. 84, Number 12 | December 2016 Page 3

Gender ShiftThe number of women in the state legislature has

stayed within a fairly narrow range since 1995. After reaching 36 in the 1993-94 session, the number has varied between 29 and 35 of the 132 legislative seats. After rising from 29 in 2009-10 to 33 in the past two sessions, female representation declined by two to 31 this year (see Figure 2).

Experience GrowsSignificant turnover in the state assembly during

2010-14 resulted in a relatively inexperienced body heading into last session. With turnover cut in half this year, the assembly will be more experienced. Two years ago, it convened with 26 new members; this year, only 10 lack state legislative experience. More significantly, 40 have at least five years of experience this year, compared to only 18 two years ago. That experience could be beneficial as lawmakers craft the 2017-19 state spending plan.

LeadershipParty leadership in both the senate and assem-

bly is mostly unchanged this year. Scott Fitzgerald (R-Juneau) remains senate majority leader, a position he has held since the Republicans reclaimed the upper house in 2011. He will be assisted by Leah Vukmir (R-Wauwatosa). Roger Roth (R-Appleton) replaces retiring Mary Lazich (R-New Berlin) as senate president. Jennifer Shilling (D-La Crosse) remains senate minority leader.

In the assembly, Robin Vos (R-Burlington) returns as speaker, a position he has held since 2013. Jim Steineke (R-Kaukauna) continues as majority leader. Assembly Democrats are again led by Peter Barca (D-Kenosha).

There will be several new committees during 2017-18, and committee assignments also change with a new legislature. A full list is printed in the new 2017-18 Legislative and Congressional Directory prepared by the Wisconsin Taxpayers Alliance. The directory

assembly has just 10 new faces, compared to 26 in 2015, 25 in 2013, and 30 in 2011.

Incumbents, both here and nationally, are often difficult to defeat. In 2016, only one incumbent representative lost: In the 92nd assembly district, Representative Chris Danou (D) was defeated by Republican Treig Pronschinske.

SenateState senators serve four-year terms, with 16 of

33 seats contested in 2016. Republicans regained a majority in 2010 and have maintained it since. This year, they expanded their advantage by one seat to 20-13.

As in the assembly, only one incumbent was defeated. In the 24th senate district, Democrat Julie Lassa lost to newcomer Republican Patrick Testin.

Figure 1: Election Turnout Lowest Since 2000

Fall Election Turnout in Presidential Years, 1980-2016

67.0%

70.1%

69.2%

73.2%

67.0%

58.0%

69.0%

61.0%

63.4%

67.4%

0% 25% 50% 75% 100%

2016

2012

2008

2004

2000

1996

1992

1988

1984

1980

3531

3632 31 30

3335 34

30 2931

33 3331

0

10

20

30

89 91 93 95 97 99 01 03 05 07 09 11 13 15 17

Figure 2: Number of Women Legislators DownNumber of Female Legislators, 1989-2017

Senate Majority Leader Scott Fitzgerald (R)

Assembly Speaker Robin Vos (R)

Page 4: THE WISCONSIN TAXPAYER

Page 4 The Wisconsin Taxpayer

Dist. Rep. (Party) Phone

1. Kitchens, Joel (R) ............... 266-5350

2. Jacque, Andre (R) .................. 266-9870

3. Tusler, Ron* (R) .................... 266-5831

4. Steffen, David (R) ................. 266-5840

5. Steineke, Jim (R) .................. 266-2401

6. Tauchen, Gary (R) ................. 266-3097

7. Riemer, Daniel (D) ............... 266-1733

8. Zamarripa, JoCasta (D) ........ 267-7669

9. Zepnick, Josh (D) .................. 266-1707

10. Bowen, David (D) ................. 266-7671

11. Fields, Jason (D) .................... 266-3756

12. Kessler, Federick P. (D) ......... 266-5813

13. Hutton, Rob (R) ..................... 267-9836

14. Kooyenga, Dale (R) ............... 266-9180

15. Sanfelippo, Joe (R) ............. 266-0620

16. Young, Leon D. (D) ............... 266-3786

17. Crowley, David* (D) ............. 266-5580

18. Goyke, Evan (D) .................... 266-0645

19. Brostoff, Jonathan (D) .......... 266-0650

20. Sinicki, Christine (D) ............ 266-8588

21. Rodriguez, Jessie (R) ............ 266-0610

22. Brandtjen, Janel (R) .............. 267-2367

23. Ott, Jim (R) ............................ 266-0486

24. Knodl, Dan (R) ...................... 266-3796

25. Tittl, Paul (R) ......................... 266-0315

26. Katsma, Terry (R) .................. 266-0656

27. Vorpagel, Tyler (R) ................ 266-8530

28. Jarchow, Adam (R) ................ 267-2365

29. Stafsholt Rob* (R) .............. 266-7683

30. Zimmerman, Shannon* (R) ... 266-1526

31. Loudenbeck, Amy (R) ........... 266-9967

32. August, Tyler (R) ................... 266-1190

33. Horlacher, Cody (R) ............. 266-5715

34. Swearingen, Rob (R) ............. 266-7141

35. Felzkowski, Mary (R) ............ 266-7694

36. Mursau, Jeffrey L. (R) ........... 266-3780

37. Jagler, John (R) ...................... 266-9650

38. Kleefisch, Joel (R) ................. 266-8551

Members of the 2017 Wisconsin State Senate and Assembly

1. 1, 2, 3 Lasee, Frank (R) .......................... 266-3512

2. 4, 5, 6 Cowles, Robert (R) ........................ 266-0484

3. 7, 8, 9 Carpenter, Tim (D) ......................... 266-8535

4. 10, 11, 12 Taylor, Lena C. (D) ........................ 266-5810

5. 13, 14. 15 Vukmir, Leah (R) .......................... 266-2512

6. 16, 17, 18 LaTonya Johnson* (D) ................... 266-2500

7. 19, 20, 21 Larson, Chris (D) .......................... 266-7505

8. 22, 23, 24 Darling, Alberta (R) ...................... 266-5830

9. 25, 26, 27 LeMahieu, Devin (R) ..................... 266-2056

10. 28, 29, 30 Harsdorf, Sheila (R) ....................... 266-7745

11. 31, 32, 33 Nass, Steve (R) ............................... 266-2635

12. 34, 35, 36 Tiffany, Tom (R)........................... 266-2509

13. 37, 38, 39 Fitzgerald, Scott (R) ....................... 266-5660

14. 40, 41, 42 Olsen, Luther S. (R) ....................... 266-0751

15. 43, 44, 45 Ringhand, Janis (D). ...................... 266-2253

16. 46, 47, 48 Miller, Mark (D) ............................ 266-9170

17. 49, 50, 51 Marklein, Howard (R) .................... 266-0703

18. 52, 53, 54 Feyen, Dan* (R) ............................. 266-5300

19. 55, 56, 57 Roth, Roger (R) ............................. 266-0718

20. 58, 59, 60 Stroebel, Duey (R) ......................... 266-7513

21. 61, 62, 63 Wanggaard, Van (R) ...................... 266-1832

22. 64, 65, 66 Wirch, Robert W. (D) .................... 267-8979

23. 67, 68, 69 Moulton, Terry (R) ......................... 266-7511

24. 70, 71, 72 Testin, Patrick* (R)......................... 266-3123

25. 73, 74, 75 Bewley, Janet (D) ........................... 266-3510

26. 76, 77, 78 Risser, Fred A. (D) ......................... 266-1627

27. 79, 80, 81 Erpenbach, Jon (D) ........................ 266-6670

28. 82, 83, 84 Craig, Dave (R). ............................. 266-5400

29. 85, 86, 87 Petrowski, Jerry (R) .................... 266-2502

30. 88, 89, 90 Hansen, Dave (D) ........................... 266-5670

31. 91, 92, 93 Vinehout, Kathleen (D) .................. 266-8546

32. 94, 95, 96 Shilling, Jennifer (D) ..................... 266-5490

33. 97, 98, 99 Kapenga, Chris (R)......................... 266-9174

PhoneAssm.Dist.

Sen.Dist. Senator (Party)

STATE ASSEMBLY DISTRICTS

Dist. Rep. (Party) Phone

39. Born, Mark L. (R) ............... 266-2540

40. Petersen, Kevin (R) ............... 266-3794

41. Ballweg, Joan (R) .................. 266-8077

42. Ripp, Keith (R) ...................... 266-3404

43. Vruwink, Don* (D) ............... 266-3790

44. Kolste, Debra (D) .................. 266-7503

45. Spreitzer, Mark (D) ............... 266-1192

46. Hebl, Gary (D) ...................... 266-7678

47. Anderson, Jimmy* (D) .......... 266-8570

48. Sargent, Melissa Agard (D) ..... 266-0960

49. Tranel, Travis (R) .................. 266-1170

50. Brooks, Ed (R) ....................... 266-8531

51. Novak, Todd (R) .................... 266-7502

52. Thiesfeldt, Jeremy (R) ........... 266-3156

53. Schraa, Michael (R) ............ 267-7990

54. Hintz, Gordon (D) ................. 266-2254

55. Rohrkaste, Mike. (R) ............. 266-5719

56. Murphy, Dave (R) .................. 266-7500

57. Stuck, Amanda (D) ................ 266-3070

58. Gannon, Bob (R) ................... 264-8486

59. Kremer, Jesse (R) ................. 266-9175

60. Brooks, Robert (R) ............... 267-2369

61. Kerkman, Samantha (R) ........ 266-2530

62. Weatherston, Tom (R) ............ 266-0731

63. Vos, Robin J. (R) ................... 266-3387

64. Barca, Peter W. (D) ................ 266-5504

65. Ohnstad, Tod (D) ................... 266-0455

66. Mason, Cory (D) .................... 266-0634

67. Summerfield, Rob* (R) ...... 266-1194

68. Bernier, Kathy (R) ................. 266-9172

69. Kulp, Bob (R) ........................ 267-0280

70. VanderMeer, Nancy L. (R) .... 266-8366

71. Shankland, Katrina (D) ......... 267-9649

72. Krug, Scott S. (R) .................. 266-0215

73. Milroy , Nick (D) ................... 266-0640

74. Meyers, Beth (D) ................... 266-7690

75. Quinn, Robert Romaine (R) .. 266-2519

76. Taylor, Chris (D) .................... 266-5342

STATE SENATE DISTRICTS

*Newly elected. Notes: Numbers are for legislative officers, area code 608. Senator email: sen.(insert last name)@legis.wisconsin.gov Representative email: rep.(insert last name)@legis.wisconsin.gov(For Ed and Robert Brooks insert last name and first initial.)

Page 5: THE WISCONSIN TAXPAYER

Vol. 84, Number 12 | December 2016 Page 5

Members of the 2017 Wisconsin State Senate and Assembly

Dist. Rep. (Party) Phone

39. Born, Mark L. (R) ............... 266-2540

40. Petersen, Kevin (R) ............... 266-3794

41. Ballweg, Joan (R) .................. 266-8077

42. Ripp, Keith (R) ...................... 266-3404

43. Vruwink, Don* (D) ............... 266-3790

44. Kolste, Debra (D) .................. 266-7503

45. Spreitzer, Mark (D) ............... 266-1192

46. Hebl, Gary (D) ...................... 266-7678

47. Anderson, Jimmy* (D) .......... 266-8570

48. Sargent, Melissa Agard (D) ..... 266-0960

49. Tranel, Travis (R) .................. 266-1170

50. Brooks, Ed (R) ....................... 266-8531

51. Novak, Todd (R) .................... 266-7502

52. Thiesfeldt, Jeremy (R) ........... 266-3156

53. Schraa, Michael (R) ............ 267-7990

54. Hintz, Gordon (D) ................. 266-2254

55. Rohrkaste, Mike. (R) ............. 266-5719

56. Murphy, Dave (R) .................. 266-7500

57. Stuck, Amanda (D) ................ 266-3070

58. Gannon, Bob (R) ................... 264-8486

59. Kremer, Jesse (R) ................. 266-9175

60. Brooks, Robert (R) ............... 267-2369

61. Kerkman, Samantha (R) ........ 266-2530

62. Weatherston, Tom (R) ............ 266-0731

63. Vos, Robin J. (R) ................... 266-3387

64. Barca, Peter W. (D) ................ 266-5504

65. Ohnstad, Tod (D) ................... 266-0455

66. Mason, Cory (D) .................... 266-0634

67. Summerfield, Rob* (R) ...... 266-1194

68. Bernier, Kathy (R) ................. 266-9172

69. Kulp, Bob (R) ........................ 267-0280

70. VanderMeer, Nancy L. (R) .... 266-8366

71. Shankland, Katrina (D) ......... 267-9649

72. Krug, Scott S. (R) .................. 266-0215

73. Milroy , Nick (D) ................... 266-0640

74. Meyers, Beth (D) ................... 266-7690

75. Quinn, Robert Romaine (R) .. 266-2519

76. Taylor, Chris (D) .................... 266-5342

Dist. Rep. (Party) Phone

89. Nygren, John (R) ................ 266-2343

90. Genrich, Eric (D) ................... 266-0616

91. Wachs, Dana (D) ................... 266-7461

92. Pronschinske, Treig* (R) ....... 266-7015

93. Petryk, Warren (R) ................ 266-0660

94. Doyle, Steve (D) .................... 266-0631

95. Billings, Jill (D) ..................... 266-5780

96. Nerison, Lee A. (R) .............. 266-3534

97. Allen, Scott (R) ...................... 266-8580

98. Neylon, Adam (R) ................. 266-5120

99. Duchow, Cindy (R) ............... 266-3007

Dist. Rep. (Party) Phone

77. Berceau, Terese (D) ............ 266-3784

78. Subek, Lisa (D) ...................... 266-7521

79. Hesselbein, Dianne (D) ......... 266-5340

80. Pope, Sondy (D) .................... 266-3520

81. Considine, Dave (D) ............. 266-7746

82. Skowronski, Ken (R) ............. 266-8590

83. Wichgers, Chuck* (R) .......... 266-3363

84. Kuglitsch, Mike (R) .............. 267-5158

85. Snyder, Patrick* (R) .............. 266-0654

86. Spiros, John (R) ..................... 266-1182

87. Edming, James W. (R) ........... 266-7506

88. Macco, John (R) .................... 266-0485

Sample Maps From WISTAX’s Legislative Directory See Back Page for Ordering Information

Page 6: THE WISCONSIN TAXPAYER

Page 6 The Wisconsin Taxpayer

includes a complete list of 2017-18 senators and rep-resentatives, contact information, and district maps (see back page for details).

Session ScheduleThe 2017-18 session officially runs from inaugu-

ration on January 3, 2017 through the first week of January, 2019. However, legislators do not spend all that time in Madison debating legislation.

Legislative leaders have scheduled 94 days to meet in regular session, with the last in early May 2018. Nearly half (46) of the regular floor days will be during the first six months of the two-year session, when the legislature develops a 2017-19 state budget.

Following a summer recess, the legislature will meet for 19 days from mid-September through early November of 2017. It will wrap up its regular business with 29 days on the floor from January through early May 2018. After that, campaign season returns.

BUDGET CHALLENGESAs with prior legislatures, the largest (and

most important) task the 2017-18 edition faces is approving a state budget for the next two years. Governor Walker (R) presents a budget proposal to the legislature in early February. From there, the legislature takes over, altering the bill to their liking and returning it to the governor—as early as late June—for his signature. Obstacles this year could be lagging tax revenues and disagreement on transportation finance.

Revenues Now . . . and For 2017-19The amount of money the state will have available

for 2017-19 depends on at least two factors: (1) the carryover surplus from 2015-17, and (2) economic conditions over the next several years.

2016-17 Revenues and Balances. Wisconsin has a history of budgeting small ending balances; the 2015-17 budget was no different. When enact-ed, the Legislative Fiscal Bureau (LFB) projected the state would end fiscal 2017 with a balance of $131.4 million, or just 0.8% of 2017 spending. Over the next several months, that number rose to $164.5 million.

However, as economic conditions weakened in late 2015, the LFB reduced by $158.2 million its estimate of biennial tax collections. In response,

the governor and legislature shifted some borrowing costs into the future, reducing 2016 debt spending and increasing it in the future.

This past November, the Department of Rev-enue (DOR), in the statutorily required “November 20” report, estimated tax collections for 2017 and for the 2017-19 biennium. For 2017, the depart-ment’s estimates were about $220 million less than estimated in January 2016 by the LFB. That leaves the state with a projected ending balance for 2017 of just over $100 million.

Recent collection reports from DOR suggest the ending balance may be less. While the “November 20” report forecasts 2.3% tax growth in 2017, actual collections were up just 1.2% during the first five months of the fiscal year. At that pace, the state could face a 2017 deficit.

2017-19 Revenues. Each of the past two revenue forecasts—January 2016 and November 2017—have trimmed prior ones, an unsettling sign for 2017-19. The most recent DOR forecast shows revenues grow-ing 2.9% in 2018 and 3.0% in 2019. Compared to 2017 (assuming collections meet DOR’s expecta-tions), lawmakers will have about $1.2 billion in new tax revenue over the two-year budget cycle.

Estimates at this early stage of the budget process should always be viewed cautiously. However, for this budget cycle, there is additional uncertainty about future economic growth due to:

� The length of the current expansion, which is beyond the post-WWII average, increasing the likelihood of recession;

� The U.S. Federal Reserve raised interest rates in December 2016 and is likely to raise them again in 2017. Higher interest rates can slow eco-nomic growth;

� A new president and the resulting changes to federal tax and spending policies will likely impact the economy; the question is, in which direction?

General Fund SpendingRevenues represent only half the state budget

picture; spending is the other part. Agency requests are the only expenditure figures available before the governor proposes his budget. The governor can ac-cept, reject, or modify any agency requests.

Requests. The “November 20” report showed agency requests were about $693 million more than

Page 7: THE WISCONSIN TAXPAYER

Vol. 84, Number 12 | December 2016 Page 7

expected ongoing revenues over the next two years; that gap drops to $588 million if the state uses its anticipated $105 million ending balance.

Most of the requested new spending comes from two agencies. The Department of Public Instruction is asking for $447 million in new spending author-ity, mostly for K-12 school aids. The Department of Health Services wants to spend $336 million more over the next two years, mostly for Medicaid.

K-12 Schools. As always, one of the major issues will be state support for K-12 schools.

At more than $4.6 billion, general school aid is by far the largest state appropriation. Since 1994, it has been tied to school property taxes through revenue limits. If the state keeps revenue limits unchanged, any increase in general aids is fully offset by reduced school taxes. This is what occurred in 2016-17, when net general aids rose about $83 million but revenue limits were unchanged.

With these limits left unchanged for two con-secutive years, lawmakers are likely to allow some increase. However, the amount will be governed by how much they can add to general school aids.

Medicaid. Medicaid is a second issue that arises in every budget. Health insurance for poor and dis-abled individuals, Medicaid is the fastest growing major state expenditure. It has climbed from 9% of general fund spending in 2009 to more than 17% in 2016. During 2009-16, half of all new state spending was for Medicaid.

The $336 million in new spending requested for Medicaid is smaller compared to past budgets. How-ever, there is inherent uncertainty with Medicaid as its costs rise when the economy slows. Moreover, the fate of the federal Affordable Care Act could affect on Medicaid spending.

A Fiscal Cushion? Other general fund programs will be debated over the coming month, too many to discuss in this limited space. But one historic area of weakness in state finances is financial cushion.

Recent revenue slowing should remind legisla-tors of the importance of having adequate budget reserves. Public finance experts often suggest states set aside, at minimum, 5% of spending. Wisconsin’s rainy-day fund currently has less than $300 million, with nothing added over the past several years. Add-ing the estimated $100 ending balance for this year, and the state has reserves of about 2.5% of spending.

The Badger State historically has one of the smallest rainy day funds of the 50 states.

Two important budget questions lurk: Will law-makers leave a sufficient ending balance in case revenues lag, and will they add to the state’s “rainy day fund” as insurance against recession?

Transportation DilemmaMost state budget discussion typically focuses on

the general fund. This year, however, it may center on the separate transportation fund.

Past actions present lawmakers and the governor with a dilemma. During 2003-11, state general fund budgets were balanced by using $1.4 billion from the segregated transportation fund. The state borrowed to replace most of the transfers and then continued to borrow.

As a result, debt service is now claiming more than 20% of transportation fund spending. While the state typically borrows for some road construc-tion, high debt service makes additional borrowing less viable. Moreover, these costs could rise should interest rates move up.

Less borrowing means more transportation spend-ing must be funded with ongoing gas taxes and vehicle registration fees. However, those revenues, particu-larly the former, have grown modestly over the past decade. During 2006-16, gas taxes rose an average 0.6% per year. Growth was minimal because: cars are becoming more fuel efficient, so drivers purchase less fuel; the number of miles driven in the state has changed little; and in 2006, the state eliminated index-ing (inflation adjustment) of the gas tax. The tax has since remained at 30.9 cents per gallon, and on of the top 15 nationally.

With high-cost reconstruction projects underway in southeast Wisconsin, few good options exist. The governor and some lawmakers do not want to increase the gas tax or vehicle registration fee, and would in-stead focus on cost savings. However, transportation officials say that, without these increases, existing project delays are likely to grow.

Others would prefer to keep these projects “on time,” and, in addition to cost savings, view some tax or fee increase as a viable alternative.

DATA SOURCES:Wisconsin Departments of Administration, Public Instruction, and Revenue; Wisconsin Elections Commission; Wisconsin Legislative Fiscal Bureau.

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County

Page

Adams

8, 16

Ashland

12

Barron

12

Bayfield

12

Brown

14

Buffalo

10

Burnett

10, 12

Calumet

14

Chippewa

10

Clark

10, 12

Columbia

6, 16

Crawford

8

Dane

4, 6, 16

Dodge

6, 16

Door

14

Douglas

12

Dunn

10, 12

Eau Claire

10

County

Page

Florence

13

Fond du Lac 16, 18

Forest

13

Grant

8

Green

4, 6, 8

Green Lake

16

Iowa

6, 8

Iron

12

Jackson

8, 10

Jefferson

4, 6

Juneau

8

Kenosha

4, 5

Kewaunee

14

La Crosse

8

Lafayette

8

Langlade

13

Lincoln

13

Manitowoc

14

County

Page

Marathon 10, 12, 13

Marinette

13, 14

Marquette

16

Menominee

13

Milwaukee 18, 20

Monroe

8

Oconto

13, 14

Oneida

13

Outagamie 14, 16

Ozaukee

18

Pepin

10

Pierce

10

Polk

10, 12

Portage

8

Price

12

Racine

4, 5, 18

Richland

8

Rock

4

Find your legislator by county County

Page

Rusk

12

St. Croix

10, 12

Sauk

6, 8, 16

Sawyer

12

Shawano

13, 14

Sheboygan 14, 18

Taylor

12

Trempealeau

10

Vernon

8

Vilas

13

Walworth 4, 5, 18

Washburn

12

Washington

18

Waukesha 4, 6, 18

Waupaca

14, 16

Waushara

8, 16

Winnebago

16

Wood

8, 10, 12

Legislative & Congressional Directory

The 2017-18 Legislative & Congressional Directory includes names, district maps, office phone numbers, home addresses, and most recent

election results for all 132 members of the legislature. Information on state lawmakers begins on page four, congressional information on back.

2017-18With Current

District Maps

24 Sen. Testin (R)Assembly Districts 70. Rep. VanderMeer (R) 71. Rep. Shankland (D) 72. Rep. Krug (R)