Governor Doyle: Calls for Special Session to

Ethnie Groves, Governor Doyle’s Office,

Governor Jim Doyle today called on the Legislature to meet
in special session on Wednesday, January 12, 2005 to approve a refinancing
of state debt that will save Wisconsin taxpayers an estimated $11 million.
The legislation would allow the state to achieve savings on bonding by
obtaining a lower interest rate. The economic refunding of about $350
million of general obligation debt would allow for about $11 million in
savings. While this would typically be included in a budget proposal,
maximum savings can be achieved by acting as soon as possible on the

“During the last two years, we’ve made great strides in
putting our fiscal house in order – from rebidding costly state contracts to
trimming the state’s vehicle fleet to where it was a decade ago,” Governor
Doyle said. “Now, we have a small window of opportunity to save taxpayers
about $11 million by refinancing our debt when interest rates are low.”

Following a decade of fiscal mismanagement, the Doyle
Administration has made restoring fiscal responsibility to state government
a priority. Last year, the Doyle Administration reduced contracting by $32
million – the first reduction in at least a decade. Since then, $93 million
was saved on a single contract under the state’s Medicaid program, and $46
million on one for information technology. The estimated savings will also
help the state address its $1.6 billion budget deficit.

“Just as any homeowner would do, the state has the
opportunity for significant savings if we act quickly to move from a higher
interest rate to a lower interest rate,” Governor Doyle said. “Interest
rates are on the rise, and we have a short time frame to save Wisconsin
taxpayers’ money. I urge the Legislature to join me to get the best deal
for our citizens.”

Economic refundings for savings, such as this proposal, are
generally considered a positive by rating agencies due to lowering the
transaction costs of government. Savings from this proposal would be
recognized in the 2005-07 budget biennium.