WPT Capitol Report, January 30, 2017

News from the Capitol and around Wisconsin

Members, We hope you had a relaxing weekend and that your week is off to a productive start. This week's WPT Capitol Report will focus on the recently-released audit of the Wisconsin Department of Transportation, a federal court's ruling on the Wisconsin redistricting case, the latest numbers in the Manufacturing and Agriculture Credit, and more. We will also bring you last week's survey results. We would also like to remind members that our Capitol Reports, Newsletters, and helpful resources are available on our website at 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 Have a great week, WPT, Inc.

Last week at WPT

By: John Jacobson

Last week, I joined other representatives from statewide organizations in hand-delivering thousands and thousands of petitions to Governor Walker, urging him to repeal the personal property tax. If you are reading this column, chances are, your name was delivered to his staff. It was a productive meeting and included some good discussion about how our legislative coalition

moves forward with this request. We see this as necessary for the well-being and success of small businesses around Wisconsin. Some people in government see this as a loss of funds to their coffers, and will generate fake news in order to keep this outdated tax codified in law. Some organizations are telling people around the state that our coalition is trying to get homeowners to pay for the repeal of the personal property tax. That couldn't be farther from the truth, and it amounts to nothing more than a scare tactic that some local units of government and their representatives have conjured up in order to maintain the status quo of small businesses having to dig deeper and deeper into their pockets each year. As you know, each year, between the tax itself and the corresponding compliance costs, prevent you from reinvesting in equipment, hiring new employees, or giving your workforce a raise. From where I sit, I simply cannot believe anybody would advocate to keep it. In fact, our coalition has come up with and presented various options that would: first, exempt all new equipment purchases from the PPT in tax year 2017, and then begin a phase out of the tax for all remaining property over a decade. There would be no immediate fiscal impact to anybody if this repeal was passed in the upcoming budget. Further, through our official mission statement, our coalition has made it explicitly clear that we do not support any option that would shift this tax break onto real property taxes, and further believes municipalities should be reimbursed for lost revenue. I will make sure to continue to updated on the efforts to repeal the PPT, and how things progress. Last week, I also had an excellent conversation with a new Democratic lawmaker from Milton, Representative Don Vruwink. As new lawmakers were sworn in weeks ago, I have made efforts to meet with elected officials from both sides of the aisle to gauge their support in our efforts to reduce the tax burden on small businesses. Rep. Vruwink is supportive of small businesses in his community, and has even received a lifetime award from his local chamber of commerce- objectively not something you hear too often. Rep. Vruwink was born and raised on a dairy farm, and also sits on the Assembly Agriculture Committee. He is very interested in working on behalf of family farms around Wisconsin, and expressed interest in dairy check-off reforms, and other items on our agenda. I also sat down with several lawmakers regarding the energy efficiency exemption that school districts are using to move around revenue caps and spending limits. An earlier WPT Capitol Report featured an article on this very issue, and we wanted to be situated at the table while discussions were taking place in the Capitol on how to address the cost to property taxpayers that comes with the use of this tactic. Since its inception, I learned that this energy efficiency exemption has costed property taxpayers over $200,000,000, without any referendum or input. Last week, I also received a healthy number of calls regarding the DOT audit. Here's my two cents so far, as the details are still emerging; missing the mark by more than $3 billion is a pretty big oversight. Many of you have, in one conversation or another, told me that you believe government should operate more like a business. What would happen to your accountant if he or she underestimated a budget to that degree? I am looking forward to the DOT releasing updated financials on all of its projects, as Speaker Vos has requested, as I believe that will provide a much broader picture into the situation. I sincerely hope you all have a great week, and thanks for reading. If you want to share your thoughts, just shoot me an e-mail at I would love to chat, or hear your suggestions about a future article or topic for discussion.

DOT audit finds $3 billion underestimated in project costs

A newly-released audit of the Wisconsin Department of Transportation has uncovered that the costs of 16 projects around the state were underestimated by $3 billion. Additionally, the report found that Wisconsin's highways are in worse shape than neighboring states, and are deteriorating. According to the report, the DOT underestimated projects by missing the mark on inflation and other measures, which now adds a major layer of problems to the already-embroiled DOT budget and debate over long-term funding solutions for that department and the future of the state's highways. The report is already being used to call for raising the gas tax by some lawmakers in the Capitol, and leaving Governor Walker's commitment unchanged to not raise taxes. A spokesman for Governor Walker's office said that the state shouldn't think about raising taxes until every last cost savings is found. Assembly Speaker Robin Vos said that the DOT audit shows that delays in projects around the state are driving up costs while road conditions worsen, so a long-term fix is necessary. "It's clear Wisconsin is trying to do too much with too little, and taxpayers are not getting their money's worth," Vos told the State Journal. Republican Senator Rob Cowles of Green Bay, said that the legislature would not have approved some projects in the first place had DOT estimates been accurate in the first place. One project, for example, is Highway 10 in Central Wisconsin, which was approved about 28 years ago with a price tag of $125 million, and is still incomplete. Since the original approval, the cost has multiplied by nearly 4.5 times. With other projects around the state under review, the report found that of 2,247 project contracts, a mere 363 of them had only one bid submitted. As of today, Assembly Republicans have requested that the DOT updates its cost estimates for ongoing, future, and completed projects.

Federal court tells WI Republicans to redraw legislative maps for 2018 elections

In November of last year, a panel of federal judges in a 2-1 decision struck down Wisconsin's legislative maps for being "excessively partisan," and ordered that both partied submit proposals to remedy the problem. On Friday, in a unanimous decision, the same court ordered Governor Walker and Wisconsin Republicans to to redraw legislative maps by November 1st, so they can be used for the Fall 2018 elections. The court, however, struck down the democrats' request to have the courts draw the maps. The court found that in the 2012 and 2014 elections, the maps were some of the most heavily-skewed in the nation, going back over 40 years. They cited the fact that while statewide, Democrats received more votes that Republicans, the GOP was able to hold onto 60 of 99 seats in the State Assembly. Recently, those numbers have widened further, giving the GOP historic majorities in both chambers. Some organizations, such as the Wisconsin Institute for Law and Liberty, believe that this ruling will be overturned by the US Supreme Court, who will undoubtedly hear this case once Attorney General Brad Schimel files an appeal with the court. The judges in this case were Kenneth Ripple, appointed by President Ronald Reagan, William Griesbach, appointed by President George W. Bush, and Barbara Crabb, appointed by President Jimmy Carter.

Local employment and unemployment numbers released

Late last week, DWD released the U.S. Bureau of Labor Statistics (BLS) estimates of unemployment and employment statistics for metro areas, major cities, and counties in Wisconsin. The numbers include updates for November 2016, and preliminary estimates for December 2016. The numbers are not seasonally-adjusted. Here are some of the facts in the report: - December metro area unemployment rates decreased in all areas over 2016, compared with 2015. The largest year-over-year decline was 0.7 percent in Janesville-Beloit. - Municipalities' rates decreased in all of the state's 32 largest municipalities when compared with 2015. - Rates decreased or stayed the same in 71 of 72 of Wisconsin's counties. The largest decline from 2015 was a 1.9 percent decrease in Vilas County. Additionally, 2016 Unemployment Insurance (UI) claims were running at their lowest levels since 1988, and continuing unemployment claims in Wisconsin are running at their lowest level in at least the past 30 years. Our labor participation rate ranks higher than the national average by 5.7 percent, and Wisconsin was one of only 10 states with an annual average unemployment in 2015 than when the Great Recession began in 2007.

More than 10,000 Wisconsin businesses benefit from Manufacturing & Agriculture Tax Credit

Wisconsin Manufacturers & Commerce hit back at Democratic lawmakers last week, citing 10,000 businesses in Wisconsin that benefit from the Manufacturing & Agriculture Tax Credit (MAC). Recently, some Democratic lawmakers have proposed eliminating this tax credit, which they argue, has too big of a price tag, about $1.4 billion by 2019. According to the nonpartisan Legislative Fiscal Bureau, that number is higher than projected. "While pursuing a false narrative that pits one group against another, these legislators ignore the facts that the manufacturing and agriculture tax credit has stimulated the state's economy. Manufacturing jobs have an average compensation of $68,878 per year, which is 45 percent higher than the state's average income. Without the tax credit, countless middle class jobs could be lost," WMC said in a statement. Democrats in other states who have enacted similar measures as the manufacturing and agriculture tax credit, such as New York Governor Andrew Cuomo, who recently reduced their state's manufacturing tax rate to zero. WMC said that raising tax on manufacturers and agriculture would make Wisconsin less competitive. In the five years before the credit was enacted, Wisconsin lost 81,000 manufacturing jobs. In the five years since it was enacted, Wisconsin has added 34,000 manufacturing jobs. "The manufacturing and agriculture tax credit benefits small business and middle class workers- that is a fact," WMC's Senior VP of Government Relations said.

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 shared the news of Governor Walker's new public benefit reform initiative called Wisconsin Works for Everyone. We also touched on Speaker Vos' request for $300 million for state highways by perhaps offsetting income or property taxes. We also wanted your thoughts on the US leaving the Trans Pacific Partnership deal, and asked if you supported the state's action of delaying our debt repayments. So let's get down to your feedback! Governor Walker introduced a new public benefit reform today called "Wisconsin Works for Everyone." Do you support the plan for more public benefit reform?

Over 90 percent of respondents support the plan for more public benefit reform. "Welfare programs emphatically and historically have been designed for use similar to a trampoline, but have evolved and used as a hammock. This does not work in a free, tax-paying society. It's time to return to the original intentions for their existence." "It looks good on paper and sounds good in a speech. Please back up the good talk with a well-run, diligently-enforced, meaningful program." "If you're an able bodied person, you should have to get a job to continue to receive benefits, or limit benefits to 6 months!" "End the welfare culture!" "Doing anything has to be an improvement." "A hand-up is great! A hand out is not." Due to several factors (increased revenues, lower spending, and delaying debt repayment) Wisconsin is now projected to have a surplus going into the next two-year budget. Do you support our state delaying its debt repayments?

Two-thirds disagree with the state delaying its debt repayments, even if it translates to surplus. "If Wisconsin has the money, pay it- avoid paying more interest." "Delaying debt repayments just end up costing more in the long run." "Paying down debt is always a good idea, but our roads need work as well so you could talk me into spending part of it on roads." "State debt restructuring and related issues are above my pay grade. Hopefully those in Madison are getting good unbiased guidance from bond professionals." "Not sure the impact of delaying debt and/or interest payments as it relates to the entire budget." "I'm not sure how government does it, but every time I delay a debt repayment it becomes more expensive for me." "If you saw how I lived, you'd be surprised. If I have spare money, I pay off debt. The state needs to do the same. We all agree that in the end, having gas on hand is better than having debt...Time to see the state do the same as we all have to!" "It's just kicking the can down the road." "We should pay off debt and then not have the interest expense. That is what any smart business would do." "Put it towards roads." "This is an odd question." "The state is a business, in our business we at times had to also."

Speaker Vos is calling for $300 million for state highways, by increasing the gas tax or registration feels. Do you support the this increase if income or property taxes are reduced by the same amount?

Over 70 percent would support a gas tax increase if it meant reductions in income or property tax. "There will always be a way to increase taxes, haven't seen the day that any were reduced." "Too many vehicles not using gas, then at least charge them a higher registration fee." "There's more to it than contained in your question. I thought it also had to do with the state projected revenues being higher than originally thought." "It's a fairer approach to taxation, but may leave a void in the local level. Will this revenue source change to be distributed to WI communities as if it were property tax revenue?" "I would support it given the above parameters but how could anyone assure me that would be the case?" "I think the property tax is irrelevent. Bottom line is that we need highway funding that isn't able to be raided for other uses. No matter that there should be a gas tax increase for this very reason. Maybe add $2.00/tire sold in the state, too? Got to fund those roads..." "There again, if the $$$ stays in the road fund...I'm in on a gas tax." "As long as that money actually goes where it's supposed to." "No more than a nickel a gallon, and don't use it for anything else (like Doyle did.) "I support the increase through gas tax/registration fee increases. Robbing Peter to pay Paul is STUPID." "If you increase in one area and decrease in are you getting ahead?" Do you support the withdrawal of the US from the Trans-Pacific Partnership?

About 50 percent support the withdrawal of the US from the TPP. Nearly 40 percent said they didn't know if they supported it. "Fair trade deals need to be worked out and ENFORCED!" "Assuming some good bilateral pacts takes the place of TPP." "I've heard arguments for both sides but have not actually read the TPP proposal to be able to decide for myself." "From what I read it would have helped crop farmers because of higher exports." "Don't really know what's in it." "Most of the regulations were so that US intellectual property laws would be enforced in Asia. Now, not so much." "Not enough details." Now that the Packers season has ended, where will your sports attention turn?

46 percent of respondents are setting their sights on college hoops, while over 30 percent say that they only watch football. "Hockey" "Anxiously awaiting the Law Mower Racing Season. Can't wait to see how fast my kids can get the grass cut each week!" "Go Badgers! And NASCAR, then Baseball! Go Brew Crew + Twins!" "Go Badgers!" "Only the BADGERS!" "Badgers - Elite 8, Bucks make the playoffs."

Alice in Dairyland deadline approaching

Those interested in applying to become the 70th Alice in Dairyland better hurry. The deadline to apply is Monday, February 6th. Alice in Dairyland works with television, radio and newspaper professionals to share information about Wisconsin agriculture. She gives public speeches, takes industry tours, and makes many classroom presentations. She must be able to develop and execute marketing plans and develop professional relationships with industry professionals. According to the Department of Agriculture, Trade, and Consumer Protection, Alice in Dairyland is one of the most recognized communications professionals in Wisconsin agriculture, whose job is to educate Wisconsin children and adults about the value, economic impact, and future of the state's 88 billion dollar agriculture industry. "Applicants should have considerable knowledge or work experience with Wisconsin agricultural; at least three years of experience, education or training in communications, marketing or public relations; public speaking experience and a willingness to attend an extensive number of work-related events on evenings and weekends. Applicants must be female, Wisconsin residents and at least 21 years old," according to the DATCP description. The position is one year, and has a salary of $45,000. It includes holiday, vacation, and sick leave, as well as use of a sponsor-provided vehicle for official business. Reimbursement is provided for an individual health insurance premium, as well as travel expenses. The deadline to submit all materials is February 6th at 4:30PM. A cover letter, three professional references, and a summary of qualifications are required in addition to a resume. Submit materials to.

Fondy might mandate replacing lead pipes

Fond du Lac's City Council will decide on February 8th whether or not to mandate the replacement of private service lines to homes if they contain lead. Currently, about 4,500 homes, most built prior to 1950, still have pipes containing lead, which run from the water main in the street to each residence. The city is calling this a public health hazard, as lead is toxic to ingest. In the past, Fond du Lac has replaced service lines at the same time they are working on street projects, or fixing the current water mains, but the Wisconsin DNR's new guidelines that show that the water main could be disturbed when the private line is not replaced also. Residents would receive financial help, through a $300,000 safe drinking water loan that the city received. Individual houses are estimated to have a $3,000 price tag for the replacement. According to the city, they would pick up about $1,200 of the cost. Homeowners would have 45 days to comply with the new regulation, once the city assessed their property. Homeowners who choose not to comply would receive a citation.