Wisconsin state budget

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Wisconsin was rated by the Pew Center on the States in November 2009 among the top ten states with budget problems, citing the practice of taking money from the transportation fund (then borrowed to cover the transportation budget) to fill gaps in education and day-to-day operations, and running negative balances in the general fund for five straight years, before the recession. State Sen. Alberta Darling (R-River Hills) said the Pew analysis hit the mark in identifying the consequences the state faces for spending more money than it collects and adding programs while the overall economy is in a recession. Total spending in the 2009-'11 budget is up 6.2%, to roughly $65 billion, a level of spending "that is unsustainable," Darling said. "It's practically a textbook case of how not to engage in fiscal policy and budget-making," Mordecai Lee, professor of government affairs at UW-Milwaukee, says in the Pew report. "Structurally, we are around the corner of becoming like California."^[1]

Gov. Jim Doyle signed the 2009-2011 biennium budget June 29, 2009, vetoing a 0.65 percent sales tax in Milwaukee County and killing the proposed transit authority for the county passed by the Wisconsin State Legislature. Overall, the new state budget cuts overall spending by $3 billion, doing so while cutting 1,000 state employees, imposing across-the-board budget cuts for state agencies and the rolling back of 2 percent pay raises for state employees that were to take effect this month. State agencies also are directed to review all service contracts to reduce personnel costs.^[2]

The Pew report pinned Wisconsin's budget problems, in part, on the loss of 140,000 jobs and one-eighth of its manufacturing workforce in the current recession. The lagging economy drove down tax collections 11.2%, comparing the first quarter of 2008 with the first quarter of 2009, according to the report. Gov. Jim Doyle and the state Legislature began the 2009-'11 budget process with a $6.6 billion shortfall. They filled the hole with $2.1 billion in tax and fee increases, $2.2 billion in federal stimulus dollars and cuts in state agency spending and aid to local governments and schools. The report predicts the 2011-'13 budget will start with a structural deficit of $2 billion, and the slow economy is not likely to produce tax revenues to fill that gap. State numbers show tax revenues from July through September trailed the collection a year ago by 8%.^[3]

The Pew report noted:^[4] "The budget would have fallen short even without the national economic crisis, although the recession made the state deficit much larger than expected, said Andrew Reschovsky, professor of public affairs and applied economics at the University of Wisconsin at Madison. Federal stimulus funds of $2.2 billion helped plug some budget shortfalls this year. For the rest, lawmakers raised taxes on the wealthy, hospitals and smokers, and cut spending by $3 billion, mostly by cutting salaries for state employees.286 Experts predict Wisconsin could face a $2 billion deficit during the next biennium, which starts July 1, 2011, after the federal stimulus runs out."

Summary of 2009-11 Appropriations and Authorizations^[5]

[edit] Budget Background

Wisconsin operates on a biennium, covering two fiscal years at a time. A fiscal year begins on July 1 and ends on June 30 of the following year with the biennium starting July 1 of odd-numbered years. Agency budget requests are submitted in September of even-numbered years. During the following months, the Governor meets with the departments and agencies to hear their budget proposals for the following fiscal year. Following the hearings the Governor issues a budget recommendation for the upcoming fiscal year to the Legislature. Both the State Assembly and the Senate are required to make any necessary changes or adjustments to the budget until the bill is passed in both houses. ^[6] When the Lesgislature passes the bill the Governor approve of the bill as a whole, veto the entire bill or execute line-item vetoes. ^[7] Gov. Doyle signed the FY 2010-2011 biennial budget (covering July 1, 2009 to June 30, 2011) with 81 vetoes.^[8]

[edit] Budget figures

The following table provides a history of Wisconsin's expenditures and gross domestic product (GDP).

• NOTE: The figures for FY 2009 won't be finalized until the end of the fiscal year.
• See Wisconsin state budget (2008-2009) for more information.

[edit] Accounting Principles

The Wisconsin Legislative Audit Bureau is a non-partisan legislative service agency created to assist the Legislature in maintaining oversight of state operations. The director of the Legislative Audit Bureau is Janice Mueller the State Auditor, who is appointed by the Legislature's Joint Committee on Legislative Organization. The Bureau conducts objective audits and evaluations of state agency operations to ensure financial transactions have been made in a legal and proper manner and to determine whether programs are administered effectively, efficiently, and in accordance with the policies of the Legislature and the Governor. The results of these evaluations are provided to the Legislature, along with recommendations for improvements in agency operations. The Legislative Audit Bureau was created by Chapter 659, Laws of Wisconsin 1965. Prior to the creation of the Bureau, financial audits were performed by the Department of State Audit, an executive branch department created in 1947. The Legislative Audit Bureau is organized into four sections: Financial Audit, Program Evaluation, Information Systems Support, and Administrative Services.^[10]

The Institute for Truth in Accounting (IFTA) rates Wisconsin “Timely” in filing the state’s Comprehensive Annual Financial Report (CAFR) – The annual report of state and local governmental entities. IFTA rated 22 states timely, 22 states tardy, and 6 states as worst. IFTA does not consider Wisconsin's CAFRs, and those of the other states, to be accurate representations of the state’s financial condition because the Generally Accepted Accounting Principles (GAAP) basis does not include significant liabilities for the pension plans and for other post employment benefits, such as health care.^[11] Wisconsin's CAFRs are publications of the Wisconsin Department of Administration, Division of Executive Budget and Finance, State Controller's Office. Stephen J. Censky is State Controller. Michael Morgan is Secretary of Department of Administration.^[12]

[edit] Accounting transparency checklist

Comprehensive Balanced budget Timeliness Usability

[edit] The good

• The website has Comprehensive Annual Financial Reports (CAFR) dating back to 1995.^[14]
• An independent auditor’s report is published on page 16 of the document.^[15]
• It provides supplements to the budget workup, starting on page 157.
• The budget is posted using organized and consistent methods of financial reporting.
• Wisconsin law requires a balanced budget, but a deficit is permitted.^[16]
• It includes all costs incurred by the government, including long-term liabilities, starting on page 22 of the document.^[15]
• The CAFR compares estimated and actual budgetary numbers, such as on page 158 of the document.^[15]

[edit] The bad

• The Wisconsin office was somewhat tardy in submitting the budget.
• The CAFR is posted in a PDF format, so it’s not searchable online.

[edit] Economic Stimulus Package

Wisconsin is expected to receive $3.8 billion from the $787 billion dollar economic stimulus. ^[17] All told, the federal stimulus plan would create or save 70,000 jobs in Wisconsin, based on White House estimates. ^[18]
For more information on how the federal stimulus funds are being used in the state of Wisconsin, visit the state recovery website.

According to preliminary reports Wisconsin is expected to receive: ^[17]

• $1.2 billion towards Medicaid
• $107 million for the Clean Water State Revolving Fund
• $529 million for highway funding
• $81 million for transit
• 27 million for homelessness prevention
• $55 million towards the state energy program
• $144 million towards weatherization
• $9 million towards Head Start
• $717 million towards the education stabilization fund
• $180 million towards Title I education for the disadvantaged
• $8 million for education technology

[edit] Budget transparency

Wisconsin currently has no government-sponsored state spending database. As mentioned below, Milwaukee residents have some level of transparency, thanks to the independent transparency site hosted by Citizens for Responsible Government (CRG).

Sign up for Show Me The Spending's weekly transparency e-updates. As transparency news about Wisconsin becomes available, it will be sent out by email and posted on this page.

[edit] Website evaluation

Budget Usability Elected Officials Administrative Officials Ethics Audits Contracts Lobbying Public records Taxes

Wisconsin.gov is the website for the state of Wisconsin.

• Main article: Evaluation of state websites

[edit] The good

• Site has a search function and is fairly easy to navigate.
• Budget^[19] and annual financial audit reports are published.^[20]
• State tax information is available.^[21]
• State employees can be found in phone and email searchable databases.^[22]
• State ethics information posted.^[23]
• Current statewide contracts are available.^[24]
• Information on lobbying is provided.^[25]

[edit] The bad

• Information on how to make open record requests under the Wisconsin Open Records Law does not appear to be available.

[edit] Legislation

• Assembly Bill 143 was introduced in March 2009 by Rep. Cory Mason, Rep. Dean Kaufert, Rep. Gordon Hintz, Rep. Jeffrey Wood and Rep. Terese Berceau. The bill was cosponsored by Sen. Alan Lasee. The bill essentially calls elimination of the Legislature's exemption from the state's open meeting laws.
• Assembly Bill 142 was also introduced in March 2009 by a total of 20 representatives, including the main author of the bill Rep. Mark Gottlieb, and cosponsored by Sen. Sheila Harsdorf, Sen. Luther Olsen, Sen. Robert Cowles and Sen. Dale Schultz. The bill, if accepted would prohibit state elected officials from fundraising during state budget deliberations.
  • On July 8, 2009 the organization Common Cause in Wisconsin announced their support for both Assembly Bill 143 and 142 following the adoption of the Wisconsin state budget. The best time to reform the state budget, said the organization, is immediately following the end of the budget process. And the best way to start reforming the process is with the two Assembly Bills, they said. "The closed-door, secretive budget process is a problem that stems from the fact that the legislative partisan caucuses in which most of the important budget decisions are debated and decided are exempt from the Wisconsin Open Meetings Law, enacted in 1976," the group stated in a press release.^[26]
• In March 2009, keeping with Sunshine Week, Wisconsin Representative Louis Molepske, Jr. re-introduced the Open Government Act, which would allow the public more access to drafts of legislative bills. Molepske has introduced the act several times before, but he feels the time is ripe, and the bill necessary to restore the public's trust in elected officials.^[27]
  • See main article: Wisconsin Rep. Molepske re-introduces Open Government Act

[edit] Government tools

The following table is helpful in evaluating the level of transparency provided by a state spending and transparency database:

[edit] Economic Stimulus Transparency

• The Economic Recovery and Reinvestment Act of 2009 designated $787 billion to be spent throughout the U.S. Of that $787 billion stimulus package, it is estimated that 69%, or over $541 billion, will be administered by state governments.^[28]

• Wisconsin will receive an estimated $2,495,140,902.^[29]

• The economic recovery website to show how legislators and government officials in Wisconsin are spending Federal funds is available here.

[edit] Error in ARRA

On November 16 and 17, 2009, many errors were found in the $747 billion American Recovery and Reinvestment Act that showed the plan set aside money for districts that do not exist. According to Recovery.gov, the plan shows its funds will go to 884 Congressional Districts, though there are only 435.^[30][31]

Recovery.gov show it sent $2,209,169 to six districts in Wisconsin that don’t exist: the 00th, 9th, 10th, 14th, 39th, and 55th congressional districts.^[32]

[edit] Support for creation of the database

State Representative Bill Kramer announced his intention to re-introduce a comprehensive transparency bill to the Wisconsin State Legislature.

[edit] Independent transparency sites

The Citizens for Responsible Government (CRG) group sponsors the Government Accountability in Spending Project, a movement to place all of Wisconsin’s government spending online in a searchable database format. Currently, the group is focusing on the Milwaukee area, and has a database of agency expenditures and vendors. Most recently, thanks to CRG efforts, information from the Milwaukee Public Schools is available. As of September 15, 2008, the Milwaukee Area Technical College District financial data has been placed online.^[33]

[edit] Public employee salary information

The City of Appleton posts public employee salary information here.

[edit] See Also

Wisconsin taxpayer-funded lobbying

[edit] External links

[edit] Additional reading

• State of Wisconsin,"Governor Doyle’s State of the State Address," January 29,2009
• Wisconsin State Journal,"Plug new Wisconsin budget shortfall without tax hikes," May 8, 2009

[edit] References

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