Exclusively for WisBusiness Subscribers
Access the online version:
https://www.wisbusiness.com/category/subscriber-products/
Advertisement
Robert M. La Follette School of Public Affairs
— Assembly Republicans are trying again to reduce the state’s third-highest income tax bracket while pairing it with a new break on retirement income as part of a $2.9 billion cut.
They also rolled out plans to amend the Wisconsin Constitution to require a two-thirds majority to raise taxes.
A Capitol hearing on the plan is scheduled for today.
Dem Gov. Tony Evers this summer nixed GOP proposals to cut the top two tax brackets, arguing the reduction was unfairly geared toward the wealthy.
Assembly Republicans yesterday said reducing the third-highest tax bracket to 4.4 percent from 5.3 percent — which covers income between $36,840 to $405,550 for married couples filing jointly — is geared toward helping Wisconsin’s middle class.
It would amount to a reduction of nearly $1 billion a year, accounting for $2 billion of the overall price tag.
Joint Finance Committee Co-chair Mark Born, R-Beaver Dam, said the proposal is a “second chance to do the right thing” for the guv.
Evers’ vetoes left the state with a projected $4 billion surplus at the end of the 2023-25 biennium. The guv has suggested he would be open to pairing a tax cut with more state aid to child care providers.
But Born rebuffed the call.
“The Legislature is not interested in spending more money,” he said. “I know the governor is interested in spending more money. The money that’s left needs to be returned to the taxpayers.”
The guv’s office pointed to Evers’ veto message that raised concerns a tax cut as large as the one proposed yesterday could result in the state and local governments having to pay back federal COVID-19 funds.
The office also noted Evers wrote in his veto message after nixing the top two income tax reductions that “this approach is frankly fiscally irresponsible going forward and would put us in a position where we would almost certainly have to reduce funding and ongoing commitments to our schools, healthcare providers, local municipalities, and many other priorities in the next budget.”
Born said Assembly Republicans haven’t discussed their plan with the guv’s office and have had preliminary discussions with Senate Republicans. Sen. Rachael Cabral-Guevara, R-Appleton, joined the Capitol news conference to tout the proposed break on retirement income. She said her Senate GOP colleagues will caucus early next month to discuss the proposal.
The piece of the proposal geared toward retirement income would expand an existing tax break. Now, those 65 and older may subtract up to $5,000 of payments or distributions from qualified retirement plans and accounts from their income tax bill. It applies to individuals with adjusted gross incomes of less than $15,000 for individuals and $30,000 for married couples.
The bill would allow up to $100,000 in payments to be subtracted annually from an individual’s taxable income for those 67 and older. For married couples where both spouses are at least 67, the combined subtraction couldn’t exceed $150,000.
Income already exempt from the state income tax — including Social Security, military earnings and income from certain public retirement systems — wouldn’t count toward the cap.
Meanwhile, the proposed constitutional amendment that would require two-thirds votes is now being circulated for support, said co-author state Rep. Amy Binsfeld, R-Sheboygan. It would have to pass back-to-back sessions before it could go to voters for a referendum.
— The Evers administration warned the proposed tax cut could jeopardize $2.5 billion in federal COVID-19 funds sent to state and local governments in Wisconsin.
State Budget Director Brian Pahnke on Monday wrote a new memo for the guv and DOA Secretary Kathy Blumenfeld projecting the state could reduce taxes in 2023-24 by $113 million and by $319 million in 2024-25 before having to possibly pay back federal COVID-19 dollars.
Under the American Rescue Plan Act, states may not use the funds to directly or indirectly offset a reduction in net tax revenue. States that violate the requirement must repay money that was earmarked for state and local governments in an amount equal to the reduction in net tax revenue.
Pahnke wrote in the memo the administration believes the U.S. Treasury’s rules don’t allow the state to include its current $4 billion surplus in calculating how much it can cut taxes before triggering the recoupment provisions.
The Legislative Fiscal Bureau noted the provision in a June budget paper prepared for the Joint Finance Committee. The nonpartisan agency wrote it had asked the Treasury Department for clarification on how the state’s surplus was factored into the equation, but hadn’t received a response.
The agency also noted it was unclear whether the recoupment provision was enforceable after several court rulings. It also pointed out it was unaware that any state determined to be in violation of the Treasury rule had been subject to recoupment efforts.
Born said he’s not concerned the Assembly GOP plan could jeopardize the federal funds, noting there have been no enforcement actions against other states.
“I think these are things that they like to make threats on,” Born said of the Evers administration’s memo.
Read the bill:
https://www.wispolitics.com/wp-content/uploads/2023/08/230829Tax.pdf
Read the memo:
https://www.wispolitics.com/wp-content/uploads/2023/08/230829Memo.pdf
Read the LFB paper:
https://www.wispolitics.com/wp-content/uploads/2023/08/230829_LFB_Tax_Reductions_Overview.pdf
Read the constitutional amendment:
https://docs.legis.wisconsin.gov/2023/related/proposals/ajr66.pdf
— During a news conference in Milwaukee on the tax plan, Assembly Speaker Robin Vos, R-Rochester, said his caucus will take up a child care plan this fall, but not the one that Evers proposed.
The guv called a special session Sept. 20 to take up a host of workforce development proposals, including putting state money into subsidies for child care providers.
Vos said the Assembly GOP plan will be focused on regulatory reform to aid the creation of a more sustainable system, not an infusion of one-time cash that he said wouldn’t solve the problem long-term. Vos didn’t offer specifics of the GOP proposal other than it would seek to repeal some regulations and the licensing process.
He said putting more state money into subsidies isn’t sustainable and compared it to giving every worker in a grocery store an extra $5 an hour in the hopes it would bring down the cost of meat.
“It’s kind of preposterous that we would say we’re going to take taxpayer dollars from everyone to subsidize one specific industry like child care,” Vos said. “We are not going to increase wages for child care workers by having everyone else pay more.”
— The Department of Health Services is awarding more than $600,000 annually to five clinics focused on addressing drug use among Wisconsin youth.
DHS yesterday announced it plans to awarded five grants worth $120,919 each to three partners with the department’s Alliance for Wisconsin Youth program. The partners together operate five regional clinics across the state and each one works on awareness media campaigns, programs, and policy changes to limit access and availability of drugs and alcohol.
DHS Secretary Deb Standridge in a statement praised the partners’ work so far, adding “We can make a larger collective impact in developing and implementing efforts that create strong, healthy communities.”
Northeastern Wisconsin Area Health Education Center Community Advocates and Marshfield Clinic Research Institute are slated to see $241,838, equivalent to two separate grants, because each supports two regions.
Community Advocates, supporting the southeastern region, is expected to see one grant’s worth. The grants will got out annually over the next five years.
The funds come from the federal government’s Substance Abuse Prevention and Treatment Block Grant. Grants are meant to support efforts to curb binge drinking, opioid use for non-medical purposes and substance use among pregnant people, among other things.
See the release:
https://www.wisbusiness.com/2023/dept-of-health-services-grants-awarded-to-support-statewide-network-of-substance-use-prevention-coalitions/
Advertisement
Wisconsin REALTORS Association
TOP HEADLINES
– State Rep. Steve Doyle named vice chair of artificial intelligence task force
https://lacrossetribune.com/news/local/state-rep-steve-doyle-named-vice-chair-of-artificial-intelligence-task-force/article_fc824670-4698-11ee-8a6c-bb0939d5c50b.html
– The village of Boaz in Richland County has a history of blackouts. A new microgrid aims to change that
https://www.jsonline.com/story/money/business/energy/2023/08/29/boaz-microgrid-project-uses-batteries-to-improve-electric-power-resiliency/70610403007/
– Marcus Investments’ real estate arm raises $32 million for fund
https://www.bizjournals.com/milwaukee/news/2023/08/29/marcus-corp-marquee-investment-real-estate-fund.html
WisBusiness sponsors
 Madison Gas & Electric |
 Wisconsin Technology Council |
STORY TOPICS
EDUCATION ^top^
– Baraboo’s school bus drivers want company amid nationwide bus driver shortage
https://wiscnews.com/news/community/baraboonewsrepublic/baraboo-s-school-bus-drivers-want-company-amid-nationwide-bus-driver-shortage/article_8de64db2-4416-11ee-b162-9fa95b26a141.html#tracking-source=home-top-story
ENVIRONMENT ^top^
– Dane County to offer free PFAS testing for lower-income residents who use private wells
https://www.wpr.org/dane-county-offer-free-pfas-testing-lower-income-residents-who-use-private-wells
HEALTH CARE ^top^
– ThedaCare service, support workers plan to protest wages, staffing in Appleton
https://www.postcrescent.com/story/news/health/2023/08/28/thedacare-appleton-service-support-workers-protest-low-wages-staffing/70702774007/
LABOR ^top^
– Mercury Marine, labor union announce new five-year collective bargaining agreement
https://biztimes.com/mercury-marine-labor-union-announce-new-five-year-collective-bargaining-agreement/
– Illinois contractor sued by Department of Labor following violations at Waukesha job site
https://biztimes.com/illinois-contractor-sued-by-department-of-labor-following-violations-at-waukesha-job-site/
MANUFACTURING ^top^
– Waxxy Poodle vinyl pressing plant revives record-making in Wisconsin
https://captimes.com/news/business/waxxy-poodle-vinyl-pressing-plant-revives-record-making-in-wisconsin/article_6af860e2-df4c-50bd-992f-da07901de7db.html
REAL ESTATE ^top^
– Madison Plan Commission gives OK to raze 3 Capitol Square buildings for new history museum
https://madison.com/news/local/government-politics/madison-plan-commission-gives-ok-to-raze-3-capitol-square-buildings-for-new-history-museum/article_2aa55016-45f3-11ee-8116-2bbfa2db5029.html
– Tenants, organizers meet demanding investigation into Housing Authority as relationship frays
https://www.jsonline.com/story/news/2023/08/29/milwaukee-housing-authority-hacm-criticized-by-common-ground-tenants-public-housing-problems/70703712007/
– Physicians plan to convert former Brookfield bank branch into multidisciplinary clinic, outpatient surgery center
https://biztimes.com/physicians-plans-to-convert-former-brookfield-bank-branch-into-multidisciplinary-clinic-outpatient-surgery-center/
– Strike at Leinenkugel’s Brewery over
https://www.wqow.com/news/top-stories/strike-at-leinenkugels-brewery-over/article_6891a70a-4691-11ee-a481-1f31a4833dd1.html
RETAIL ^top^
– Buc-ee’s plans one of the world’s largest convenience stores near Madison–and the Dells
https://www.jsonline.com/story/money/real-estate/commercial/2023/08/28/buc-ees-plans-one-of-worlds-largest-convenience-stores-near-madison/70697977007/
– Talks with Dick’s Sporting Goods could bring House of Sport to Mayfair
https://www.bizjournals.com/milwaukee/news/2023/08/28/dicks-sporting-goods-house-of-sport-mayfair-mall.html
PRESS RELEASES ^top^
See these and other press releases:
https://www.wisbusiness.com/press-releases/
