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WPT Capitol Report, January 23, 2017


News from the Capitol and around Wisconsin

Members, As always, we hope your weekend was relaxing and that your work week is off to a great start, despite the Packers' season coming to an end in Atlanta last night. We would like to take a moment to congratulate President Trump on his inauguration as 45th President of the United States on Friday. We would like to take this opportunity to wish President Trump much success in his new role as our nation's leader. We would also like to thank former President Obama for his years of service to our country. This week's WPT Capitol Report will focus on Governor Walker's newly-announced public benefit reform, our state's new revenue estimates, President Trump's first executive action, a nuclear plant in Wisconsin owed a big tax refund, and as always, the latest developments in the ongoing transportation funding impasse in Madison. We would also like to remind members that our Capitol Reports, Newsletters, and helpful resources are available on our website at www.WPTonline.org under the Current Members tab. Just enter the member password wpt2016 and enjoy all of the latest news and information in one easy spot. As always, we hope you find the Capitol Report to be interesting and informative. If there are any topics you would like to share, or if you have any questions or comments, never hesitate to reach out to us directly at info@wptonline.org. Have a great week, WPT, Inc.

Last week at WPT

By: John Jacobson

Last week, I penned an op-ed that I will share below, which outlined our organization's thoughts on the "dark store" loophole. The loophole is being used by giant big box retailers in Wisconsin courts to lower their property tax bills, and it's leaving local communities wondering where those millions of dollars are going to come from. If local units of government were flush with cash at this point, if all of our roads and county trunk highways were paved, and if schools weren't increasingly asking local homeowners and small businesses every year for more money through referenda, the use of this loophole might make a little more sense. If you are like me, you know that taxes can be a burden to small businesses. Every family, homeowner, and small business owner receives the dreaded property tax bill in the mail, wondering if they will see increases, or sometimes wonder if they'll even be able to pay at all. But one thing is for sure; families, homeowners, and small business owners don't have the ability to pay fancy lawyers, sue against their assessments, and try to get out of maintaining their local communities- which is exactly what local property taxes are. I had a great conversation with a fellow advocate in Madison last week on this very subject. She said, "John, if you believe that property taxes maintain local quality of life, why have you worked to reduce property taxes" "Because the state isn't paying it's share to invest in communities . If the state invests more locally, property taxes will go down," I replied. I recently got my W-2 statement in the mail. I looked at the federal and state amounts and couldn't believe it. Where the heck does all of this money go? It just goes off to Washington, D.C, and Madison, and we don't always really know where it gets spent. But when we receive our property tax bills, we see exactly where the money goes, and it stays local, right outside of your front door. Line by line, it's listed on there for you. Of course some of the numbers are higher than we'd like. Of course we question some of the items. But we see exactly where the money goes. This is what convinces me that the "dark store" loophole needs to be filled, and last week, I looked into the issue more, and it's become totally and utterly evident: YOU are going to pay the price for Menards, Lowe's, ShopKo, Walgreens, and other stores who decide they should pay what an empty, shuttered property pays. Right now, that's the message they are sending to every single one of us- how very little they value investing in the community, and its people. The same people, by the way, who have driven these stores' success in the first place. Yes companies have to make a profit, but local companies should not abandon their obligations to their communities in order to do so. Something for Menards to ponder; If local consumers pay more property taxes, will they still be able to spend as much at Menards? I would urge anybody who reads this to get in touch with their lawmakers' office and urge them to support closing this loophole. You can find your lawmaker by visiting http://legis.wisconsin.gov/ and typing in your address. Send a quick e-mail, make a quick call, and express your concerns. It could end up saving you a lot of money. Below is a copy of my article. I received word from a couple of publications that will be running it in different parts of the state- most recently the Janesville Gazette. I hope you'll take a moment to read, and then shoot me an e-mail at jjacobson@wptonline.org. Do you agree with me? Disagree? What other topics are you interested in? Just drop a quick line and share your thoughts. -----------------

Opinion: Lawmakers Need to Act, Close Dark Store Loophole

By: John Jacobson, WPT Legislative Director

It's no secret that giant companies like Menards have fiduciary obligations to their shareholders, board, and other high ranking officers within their respective companies. Companies need to make smart investments, continue to monitor their ever-evolving markets, and make sure they remain in the black. So, it makes sense that a store would use a legal loophole to pay less property taxes and keep their profit margins high.

Property taxes in Wisconsin are already high. In fact, our state generally ranks in the top ten nationally. It's a sore subject for many homeowners and small business owners around the state, who at times, already have a hard time making ends meet. Factor in our state's workforce skills gap, and a jobs market dominated by low-skill, low-wage jobs, you begin to understand how the average Main Street homeowner might struggle just to pay a small residential property bill.

Why is it that a company like Menards uses this loophole- a company whose success was built by the same middle-class consumers they now seek to undermine locally? Very simply, because they have forgotten about their fiduciary obligation to its patrons, the local community. They have clearly forgotten that the dollars they invest locally through their property taxes directly benefit the people who stop in the store to pick up lumber for an addition on their home, or a new ceiling fan for those hot Wisconsin summer days. They have forgotten that suing their communities, they are raising property taxes on everybody else.

Property taxpayers in Wisconsin foot the bill for a huge majority of local spending. In fact, when local governments run out of money, the first people they usually rely on to "pick up the slack" are property taxpayers. From funding schools, to local roads, libraries, tech colleges, drinking water, sewage, you can thank anybody who owns property in your community.

Yes, homeowners complain about high property taxes. But if you are like me and have traveled to nearly every corner of the state, talking with homeowners and small business owners, you quickly realize that despite any gripes or grievances about assessments or bills, residents still mail in their checks because they know that their communities and their infrastructures depend on the Average Joe doing his part.

Now it is time for the state legislature to do its part, and close the so-called dark store loophole. With revenue and spending caps already effectively in place, local budgets will rapidly become unsustainable if this trend continues, and the cost of some of Wisconsin's biggest retailers skirting the rules will continue to fall squarely in the laps of Wisconsin's middle-class families and small businesses.

John Jacobson is the Legislative Director for Wisconsin Property Taxpayers, Inc., a statewide nonpartisan lobbying, and watchdog group in Madison, representing nearly 18,000 small business and home owners throughout Wisconsin.

Gov. Walker rolls out "Wisconsin Works for Everyone" reform

Governor Walker today announced an expansion of 1996 public benefit reforms enacted by then-Governor Tommy Thompson. Calling it "Wisconsin Works for Everyone," Governor Walker said "like Governor Thompson's original W-2 initiative, [the plan] is based on the fundamental principle that work is dignifying and connects individuals to society and to its values. We believe our public assistance programs should ask able-bodied adults to take steps toward self-sufficiency through work, while also providing comprehensive tools to help them get a job." The plan will be included in the upcoming budget, which will be introduced by Governor Walker sometime next month. The proposal will "increase investment in job and skills training for the unemployed and underemployed, reduce barriers to work and increased earnings, and expand programs that incentivize employment." Also, according to a statement by Governor Walker's office, the plan will include a work requirement pilot program for working-age, able-bodied adults receiving housing vouchers. "This set of initiatives is focused on helping those disconnected from employment realize their potential in the workforce," Governor Walker said. "We have very intention of leading the nation when it comes to helping people create better lives for themselves and their families through work." Governor Walker will travel to Milwaukee, Green Bay, Eau Claire, and Madison to highlight the proposal, and will be joined by Governor Thompson today in Madison. You can read Governor Walker's full statement here.

Wisconsin sees projected deficit shift into surplus

The nonpartisan Legislative Fiscal Bureau last week released it's latest numbers, and shows projected tax revenues growing. As Governor Walker prepares to roll out his next two-year state budget next month, what was initially projected to be a $693 million deficit is now a predicted $21 million surplus. According to the fiscal bureau's director, tax revenues are expected to be $455 million higher than was originally predicted late last year by the Department of Revenue. Additionally, lower Medicaid enrollment meant that spending is expected to drop by $226 million by the end of this fiscal year, which ends on June 30. Over the past two years, the state has also delayed about $200 million in debt payments, which also helped improve the state's finances on paper. All told, if this newly-projected surplus comes to fruition, it gives Governor Walker more wiggle room as he makes budgetary promises to significantly increase K-12 funding, cut UW tuition, among others.

In first executive actions, President Trump withdraws US from Trans-Pacific Partnership and more

In a move that put his campaign rhetoric into action, President Trump signed an executive action that withdrew the US from the Trans-Pacific Partnership. The TPP was negotiated under President Obama, much to the disliking of many Democrats and Republicans alike, but was never ratified by Congress. Withdrawing from the deal will not have any real effect on the US economy, although it demonstrates that Trump's outlook on US trade involvement will look drastically different from many of his predecessors, in both parties. The President will spend much of the day today signing executive orders, and meeting with business leaders. Additionally on his schedule, is a meeting with union leaders and blue collar workers. In other executive orders signed today, Trump issued a five year lobbying ban for anyone who works in the executive administration, and froze all federal employee hiring and raises. President Trump also reinstated the so-called Mexico City Abortion Rules, which say that any non-government clinic or organization receiving federal funding cannot promote abortions in any way. The policy has nothing to do with Mexico City itself, but was named for the city because it was announced at the United Nations conference in Mexico City. The rules are reinstated and rescinded every time a US president switches parties. President Trump has also reaffirmed his plans to renegotiate NAFTA.

Speaker Vos: $300 million needed for state highways over next two years

Assembly Speaker Robin Vos last week called for spending $300 million on state highways over the next two years. The plan would include $300 million for state highways over the next two years, by offsetting gas tax or registration increases with reductions in income or property taxes. Currently, the gas tax sits at 32.9 cents per gallon. By raising it 4.5 cents per gallon, the $300 million could be raised. Vos made the comments almost immediately after the nonpartisan Legislative Fiscal Bureau announced that the state would have substantially more tax revenue than previously anticipated. Vos also emphasized that this is not a tax increase, "At worst, it's neutral," he said. Governor Walker did not openly support the plan, however his spokesperson said that the Governor looks forward to hearing more details. As it sits, Governor Walker will not support any increases in taxes or fees, but his plan does rely on more borrowing to meet the infrastructure needs. This has put him and some Republican leaders, namely Vos, at odds. In the State Senate, Majority Leader Scott Fitzgerald has stood next to Governor Walker. In a statement last week, Fitzgerald basically said it's up to the governor to decide if Vos' plans fit the criteria for increasing taxes in one spot, but reducing in others.

WPT Weekly Member Poll Results: Property tax errors, special session on heroin in Wisconsin, legalizing the possession of CBD oil, and cream puffs

Last week, we talked about DPI's proposal to loosen licensing rules in order to help alleviate a shortage in some areas around the state, including those in rural areas. We also talked about Senator Tammy Baldwin's proposal in the Senate, the DAIRY PRIDE Act, which would bar plant-based products from labeling themselves as "milk" or "cheese," and we brought you news on two more wheel tax proposals around the state, and the recent FBI study that showed Wisconsin's meth usage has tripled in the past four years. So let's get down to your feedback! DPI is considering loosening the licensing rules to become a teacher in Wisconsin, in order to help fill a shortage in some areas. Do you think this is a good idea?

About 42 percent of respondents said they support it. 34 percent said they do not. "In some circumstances, people with decades of experience in reality can be better mentors than freshly minted college information providers." "I live in a rural area, and actually qualified to get a temporary license for subbing purposes when I was unemployed, but there was no area school district interested in sponsoring me so I could obtain a license. They all stated after the state passed "Act 10" there was a glut of newly retired teachers that were subbing for them. I know several of these retired teachers and they basically work when they want and have their pension income besides, must be nice to double dip, I would have appreciated the income at a difficult time for my family. DPI has too many barriers for obtaining the license because they want to protect the formally trained educators, it is like a "good ole boys club" because of their brainwashed ideas about unions." "I worked for the public education system. I know many teachers. My in-laws are teachers... It is said that people who can't do anything else teach, and those who can't teach end up teaching teachers. This is true.... I'm not trying to slam our public education system, but finding people who can teach has nothing to do with degrees and learning at universites. Some people, like my sister in law who is a special education focus, are amazing because of their schooling. Most are just OK. I've met, good, bad and ugly.... But finding people who can teach, and know how to teach, and allowing them to teach... I do like that..." "NOT SURE YET." "Unfair to those who have had to comply with present rules." "You devalue those that have paid the price to attend college by doing this." "All licensing is created around legitimate goals and standards, whether that be for doctors, plumbers, or elevator repairmen. So ask yourself, what is the impetus to loosen teaching standards? Easy to answer: it's the supply of teachers that've gone down, not the job requirements. If the supply of doctors was down, would you loosen the standards so more -- previously viewed as not-competent -- people could practice medicine? Would you let less proficient dentists work on your teeth? The answer might be yes if techniques and technology had decreased the skills necessary. Has that happened in education? Certainly not, teaching is harder today than it was last week. Teacher supply is down because teacher compensation (not to mention respect) is down and it's easier to lower standards than increase funding in Wisconsin." "Quality teachers are needed!" "Because there is a shortage." Senator Baldwin introduced the DAIRY PRIDE Act in the Senate, which would stop plant-based products from labeling themselves as "milk" or other dairy product names. Good idea or bad idea?

More than 90 percent of respondents think Senator Baldwin's proposal is a good idea. "Aside from some products that have been around for decades (coconut milk...The actual unrefined liquid inside a coconut)...Milk is a substance mammals produce!" "We are a dairy state, known for our dairy products. Good idea to make them stop using the word Milk on their product." "This may be first time I have ever agreed with Senator Baldwin! I appreciate what she has said on this issue and support her efforts. I am a former dairy farmer and know all too well the hard work and regulations it takes to produce a healthy, safe product for the consumer. I am discounting the alternatives we now find in the market place, but let's at least call them milk substitutes or alternatives, as Senator Baldwin states, the dairy milk replacements are not "milked" from the contributing source of the liquid being sold. We do not take a cow, sheep or goat and crush it to pieces to get the liquid we are provided for consumption." "You also need to make legislation that states that the milk has to all come from Wisconsin dairies, too. I know a very large dairy near Neilsville that brings in bulk California butter, ads a little Wisconsin made, and then relabels the whole as Wisconsin Product. NOT alright in my book." "Call these other "milks" beverages, i.e. almond beverage." "I think that there are a lot of folks switching due to alternate sources due to allergies or intolerance to fluid dairy products. I know this is the reason I don't drink milk any longer." "These are NOT milk products" "I totally agree that milk is milk and there is nothing that can replace it, therefore label the plant based products as something else." "This is governmental silliness. People will buy what they want to buy and influencing them via vocabulary is dumb." "At a time when people want everything labeled, lets get milk products labeled correctly." "Calling another product milk gives the impression it has the same nutrition as milk. It does not. Have you read the label, what's all that stuff in it?" "It's not dairy."

A couple more communities have pending wheel tax proposals. If your town proposed a $20 wheel tax, and you had to vote right now, do you support it or oppose it?

54 percent of respondents would oppose a local wheel tax, and 46 would support it. "Wheel taxes are restricted to automobiles and light trucks...Big rigs cause more wear on roads...yes their registration is more...Some wheel taxes are for winter maintenance...Big rigs operate in winter too." "With more electric and high mpg cars, there is less money in the gas tax fund. Our township has only been able to pave about 1 mile of road every other year, meaning it will be nearly a century before those roads are all repaired." "Sounds like a workable plan at the outset, and may actually go to fix roads for the first couple of years. Then someone will find a way to funnel the wheel tax to some other budget shortfall and then they'll be coming back to us (the taxpayers) looking for yet another new tax." "It's one way to get our road fixed." "Well, it leaves out a lot. It's not necessarily fair. How about the one ton trucks with half ton licenses? What about farm use vehicles that never see farm use? Maybe vehicle registrations should be based on GWVR. Or how about making all bicycles and horse drawn buggies carry licensing? Or how about all tractors that ruin roads running overweight all the time?" "Reluctantly, yes" "IF it's used for roads and not something else!" "There should be enough funds from the gas tax we all pay." "It's another tax...if the funds for roads wasn't robbed prior to the law that prevents this, we'd not have this issue. Return that money fro the funds that robbed it." "Put more tax on gas the more you drive the more you pay" "More taxes, no thank you." "I'd support it, although I'd rather it be on the prop tax rolls, as it'd then be federally tax deductible. We need funding to repair our roads, full stop." "Wrong town or city often put on car registration." "Our state needs to address the road budgets shortfall now. The governor needs to work on this immediately. That promise to not raise fuel and registration tax is causing a slow death of our infrastructure." "A gas tax that covers the state would be better." "Next they'll tax our lawn tractor tires, atv's etc." "Increase the license plate fee and send the extra money to areas the plate is registered at." An FBI study showed that meth use in Wisconsin has tripled in four years. Has this drug impacted your community?

More than 50 percent of respondents said their communities have been impacted by meth use. "Not aware of specifics, but I'm sure it has impacted by community." "If they are missing teeth, you know they are meth users." "I know very few communities that don't have an issue anymore..." "This is an epidemic and effects everyone. This is serious and needs federal and local attention!!" "More thefts/crime in our area caused by method dealers, makers and users. Although Polk county has been very aggressive and combating this problem, but it is still out there." "Other drugs have, not so much meth." "The paper says so, thank God, I don't see it." "I really don't know because I don't get involved with these kids of people." The Packers will take on the Falcons in Atlanta on Sunday. How do you feel?

It looks like 55 percent of respondents were, rightfully, nervous about last night's game. "History has shown us over and over again - if we score more points than the Falcons, we'll win!" "The defense is so depleted, and Matt Ryan has been looking pretty good. If the Packers as a team could just play all four quarters, they will win, but haven't seen all aspects of this years team do this yet this season! One mistake, like taking the ball out of the end zone on a kick off return and only going 9 yards will not fly if they are going to win the games left in this season. I've been more frustrated watching the Packers play this year because it seems not everyone gives 100% for 4 quarters." "Worry about no shutdown corners & M. Burnett's injury." "Just like that last 2 games, they won but what a nail biter!" "Aaron Rodgers is the "Magic Man" but the defense has got too many injured players to hold ask the powerful Atlanta offense. I am looking forward to great game again." "Our offense is very strong (even without Jordy). Our secondary needs a lot of help, we still believe they can hold them off and get to Superbowl 51. Go Pack Go!" "Being a non-Packer fan, nervous that this nightmare won't end and I'll have to endure yet another Packer Superbowl." "Weak pass defense." "The Packers have delivered a great product year in and year out." "If no injuries, they will win!" "Anybody can win or loss on a given day. NERVOUS" "Aaron Rodgers is unstoppable. Just wish his momentum picked up a little earlier." "I said whoop the falcons but by just a little. They are on a roll now that I'm thinking falcons are nervous not packers."

Sonny Perdue likely to serve as US Ag Secretary

He's a man who many people on both sides of the aisle laud as an admirable man. And if he's confirmed by the Senate as USDA Secretary, he will be only the third Ag Secretary in US history who lived and worked in agriculture as an adult. Sonny Perdue, who was chosen by President Trump last week to head up the nation's Department of Agriculture comes from a farm in the small town of Perry in Central George. He went on to serve in the Air Force, work as a veterinarian, but eventually returned to the agriculture lifestyle, where he has been involved in careers in grains, eggs, fertilizer, and exports. He also served as Georgia's governor for two terms, and was actually the first Republican Governor of that state in 130 years. Perdue has spoken with the newly-inaugurated President regarding his views on agriculture, trade, and ways to ensure that American farmers are not at an international disadvantage. According to an interview with the New York Times, Mr. Perdue said that Trump "believes that we in the U.S. have been sort of patsies over the years in the way we've dealt with our foreign competitors and international trade." Environmentalists are opposed to Perdue's nomination, citing the hundreds of thousands of dollars in federal subsidy dollars received by Mr. Perdue, which went to assist chemical companies and large agribusiness, "at the expense of small farmers and the environment." If confirmed, Mr. Perdue will be in charge of the entire USDA, and its $150 billion budget.

Kewaunee nuclear plant owed nearly $12 million in overpaid property taxes

Dominion Energy Kewaunee, Inc. will be receiving a $12 million settlement in the form of tax refunds and credits from the Kewaunee School District, Kewaunee County, and Northeast Wisconsin Technical College. The payment is the likely-settlement in a case involving the shuttered nuclear plant, which paid property taxes on an overestimation, according to sources close with the case. It still needs to be agreed to by a judge overseeing the case. Dominion sued over the assessment in 2015, and then sued the town in 2016, in an attempt to cut the property valuation from $457 million to around $1 million. The plant at one time had over 600 employees, but has not produced power in nearly four years. One way or another, local officials are scrambling to figure out how this will impact their bottom lines with tax collection. Some estimates are a $250,000 loss for the school district, and $800,000 for NWTC. The immediate impacts on local units of government are unclear at this time, but similar situations have left local communities with big tax deficits to make up.


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