-$145,648,9
Snapshots
of the 2015-17 Wisconsin state budget
$68.3 billion
WisconsinWisconsin
TaxpayersTaxpayers
AllianceAlliance
Todd A. Berry,04.10.2015
PhD
Todd A. Berry, PhD
▪
CESACESA
10 ▪ 10
04.10.2015
Snapshots outlined
l Process and mechanics
l How we got here
l Key numbers
l Key issues, with education focus
l
First . . . WISTAX
Wisconsin Taxpayers Alliance
04.10.2015
Todd A. Berry, PhD
CESA 10 ▪
Budget basics: Pieces, process
l
l
l
l
l
Two years, two budgets, one ‘train’
Early steps: June, Sept, Nov 20
Gov. meets, LFB estimates, Gov. talks
Bill intro’d; JCF works:
briefings, hearings, decisions
To assembly/senate:
caucuses, floor, conference
l
Gov. vetoes, signs; enactment
Wisconsin Taxpayers Alliance
04.10.2015
Todd A. Berry, PhD
CESA 10 ▪
Getting to 2015-17: Reminders
l Economy cycles
Wisconsin Taxpayers Alliance
04.10.2015
Todd A. Berry, PhD
l Forecasting is art
CESA 10 ▪
. . . to 2015-17: Surpluses used
l
May ‘11: Phased corp. tax cut
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May ‘13: 2x gov’s income tax cut
l Fall ‘13: $100m school buy-down
l Jan ’14: Large projected surplus:
W/holding change, bottom rate;
$406m tech tax buy-down
Wisconsin Taxpayers Alliance
04.10.2015
Todd A. Berry, PhD
CESA 10 ▪
Getting to now: Surplus to deficit
Surplus/Deficit at Fiscal Year Start ($ mill.)
836
800
759
582
600
517
400
342
327
200
105
154
131
86
0
4
*
-200
-400
Wisconsin Taxpayers Alliance
04.10.2015
Todd A. Berry, PhD
-282
-283
CESA 10 ▪
Getting to now: Creating imbalance
Structural Imbalance (Revenues less expenditures, $ mill.)
500
250
381
215
345
268
248
58
148
93
0
-125
-250
-69
-261
-329
-369
-500
-750
*
-663
-800
-1,000
Wisconsin Taxpayers Alliance
04.10.2015
Todd A. Berry, PhD
CESA 10 ▪
Dissecting the ‘swing’: Cuts or goofs
State Gen’l Fund Tax Estimates at Various Dates
Date
F14
F15
13-15
6/13
$14.01b
$14.51b
$28.52b
1/14
14.40
15.02
29.42
Rev. reest. up
28.95
3/14 tax cuts/
spdgincreases
28.42
Rev. reest. down
5/14
14.23
14.72
1/15
13.95
14.47
Wisconsin Taxpayers Alliance
04.10.2015
Todd A. Berry, PhD
Detail
$650m inc. tax
cut already done
p +0.9
q
q
-0.5
-0.5
CESA 10 ▪
2014-15 ‘tech tax’ implications
Tech.
College Levy
Chgs, Levy
2014-15
Distribution
of School
Changes, 2014-15
Wisconsin Taxpayers Alliance
04.10.2015
Todd A. Berry, PhD
CESA 10 ▪
The 2015-17 budget: Writ very large
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All-funds spending:
$36.0 b + $32.4 b* = $68.4 b
Net gen’l fund spending (GPR):
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$15.6 b + $16.3 b* = $31.9 b
Total new GPR tax rev’s ~ $2 b
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Bonding: $1.56 b (but)
Wisconsin Taxpayers Alliance
04.10.2015
Todd A. Berry, PhD
CESA 10 ▪
The 2015-17 budget: Key numbers
Carryover Surplus
Rev’s – Approp’s
Gross Bal’s:
$m and % Spending
Wisconsin Taxpayers Alliance
04.10.2015
Todd A. Berry, PhD
CESA 10 ▪
The borrowing debate: Less?
Wisconsin Taxpayers Alliance
04.10.2015
Todd A. Berry, PhD
CESA 10 ▪
The ‘other’ 2015-17 numbers: GAAP
05 06 07 08 09 10 11 12 13 14 15 16 17
0
-1
-1.38
-2
-1.96
-1.96
-2.12
-3
-2.99
Wisconsin Taxpayers Alliance
04.10.2015
Todd A. Berry, PhD
CESA 10 ▪
Why care? Cash budget’g, not GAAP
WI
30
30 No. > WII
8
20
9
15
13
WI
WI
10
30
28
7
AA
Aa2
7
6
0
Moody's
Rating > WI
Wisconsin Taxpayers Alliance
04.10.2015
Todd A. Berry, PhD
S&P
= WI
WI
AA
Fitch
< WI
4
2001 ?
CESA 10 ▪
The ‘big’ issues [possible changes]
l Medicaid, always [$350m fed?]
l Transportation [bonding vs. fixes
gas tax vs. vehicle registration fees]
l UW autonomy, cuts and context
l Big ‘fix’: The May rescue (problem?)
Wisconsin Taxpayers Alliance
04.10.2015
Todd A. Berry, PhD
CESA 10 ▪
K-12 changes at 20,000 feet
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Overview: Gov./leg. history; 15-17
Rural school changes
Transportation/sparsity aid
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Rev. limits, gen’l
l Gen’laid and
categ’l per student wrinkle
l . . . and school levy credit
l Choice? Charter?
Wisconsin Taxpayers Alliance
04.10.2015
Todd A. Berry, PhD
CESA 10 ▪
Quick look at new research
l
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Prevailing wage: history, rationale
Current Wis. method: flawed survey,
bias correction? wage avgs, co. diff ’s?
WISTAX study backgr’d/goals
Topline findings: Wages > fed. avgs for
same job types; wages ≠ local mkts;
strange timing/job anomalies;
$200m-$300m cost – hurts outstate
Wisconsin Taxpayers Alliance
04.10.2015
Todd A. Berry, PhD
CESA 10 ▪
Thoughts on state finances: Mobius, huh?
Economy slows; tax collections
fall; no state reserves; cuts loom.
Surplus gone:
Use tricks, debt
to continue fun.
Budget
crisis:
tax, cut
New term
on discipline
and goodies.
Save, huh?!
Re-election looms
Spend more, tax less
Revenue surprises,
surpluses appear
‘Outs” win on fiscal
Keep promises
discipline
Retrench
Wisconsin Taxpayers Alliance
04.10.2015
Todd A. Berry, PhD
Econ/Budget
Improves
CESA 10 ▪
Thank you . . . And questions?
wistax.org
Over 80 years of independent
policy research and citizen education.
Wisconsin Taxpayers Alliance
04.10.2015
Todd A. Berry, PhD
CESA 10 ▪
The 2015-17 state budget: Balanced?
l
FY 2015 (14-15)
▪ Gross: + $0.3 m [-$283 m?!]
less stat. reserve (-$65m NB)
▪ Net:
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- $64.7 m
FY 2016 Gross/Net:
+$92m/+$27m
l FY 2017 Gross/Net:
+$123m/+$58m
Wisconsin Taxpayers Alliance
04.10.2015
Todd A. Berry, PhD
CESA 10 ▪
Wisconsin Taxpayers Alliance
04.10.2015
Todd A. Berry, PhD
CESA 10 ▪