Members, We hope you had an enjoyable weekend, and that you were able to find some time to relax. This week's Special WPT Capitol Report will center around the massive Assembly GOP Transportation & Tax Relief package that was introduced late last week. Because of the ongoing debate surrounding transportation, and the large scope of these proposals, we felt it necessary to focus only on this topic in our weekly report. A new weekly WPT member poll and last week's responses will still be included as usual. 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 email@example.com. Have a great week, WPT, Inc.
Last week, there was a massive alternative transportation and tax relief budget circulated by Republican leadership in the Assembly. While the Governor seems a bit skeptical about the transportation side, and the Senate Majority Leader has said he will take time to dissect the proposal and look at the goods, bads, and uglies, there is a very long way to go in this process. There are many things that people are upset about, and many things that people are happy about, included in this proposal. Even for our organization, there are some great aspects, and some ugly ones. So, for my column today, I want to talk briefly about the proposed changes, and how they would impact property taxes in Wisconsin. In short, property taxes would go up. First, this plan would eliminate the Property Tax/Rent Credit. Under current law, the state provides an income tax credit equal to 12% of property taxes paid on a principal residence or rent constituting property taxes on a principal residence. Rent constituting property taxes is 20% of rent if heat is included in the rent payment, or 25% of rent if heat is not included. The maximum credit is $300. Additionally, this plan completely phases out the First Dollar Credit. The first dollar credit is a property tax credit extended to each taxable parcel of land on which improvements are located. The credit is calculated by multiplying the property's gross school tax rate by a credit base value determined by DOR or the property's fair market value, whichever is less. For last year's property tax year, the base value was set at $6,700, and the average credit was estimated at $67. The credit funding comes from an annual $150 million appropriation from the state's general fund (sales tax, income tax, corporate tax). Compared to where we are currently, the elimination would increase property tax bills by $22 in 2019, $45 in 2020, $67 in 2021 and each year thereafter. Finally, this proposal reduces Governor Walker's proposed increase in the School Levy Tax Credit by $40 million. The Governor proposed raising that credit by $87 million, and this proposal increases it by $47 million. The average property tax hike compared to what Governor Walker's proposal would have resulted in, would be $12 higher per year. Note: that is not $12 higher than current. As WPT continues to analyze this proposal, we will keep you up to date. We will continue to bring your voice to the State Capitol, and advocate strongly against the proposals above that raise property taxes. Additionally, I would just like to remind you that Governor Walker has been a champion of property tax relief since his time as Milwaukee County Executive. Even if these proposals would make it through the final budget bill, our organization will lobby Governor Walker to the best of our ability to veto these provisions one-by-one. If you have any questions about the above list, or anything you read below, please reach out directly at firstname.lastname@example.org.
Assembly GOP introduces transportation and tax relief budget plans
Last week, high-ranking Assembly Republicans Dale Kooyenga, John Nygren, and Speaker Robin Vos introduced the "Road to Flat Tax" proposal, which is aimed at long term transportation funding, as well as reducing the overall tax burden in the state, and making substantial changes to Governor Walker's original budget. Overall, the transportation budget would reduce borrowing from Governor Walker's proposed $500 million, to $300 million in the new proposal. Under the new proposal, the balance of the state's general fund would see a net biennial increase of $15.4 million.
Some major points of the Transportation Plan:
Lowers minimum mark-up to 3%
Lowers Wisconsin gas tax by 4.8 cents per gallon (effective October 1st)
Adds sales tax to fuel ($300 million revenue)
Provides $70 million in general obligation bonds to be used for state highway rehab programs
Repeals prevailing wage
Eliminates 180 DOT engineer positions
Requires referendum for wheel tax
Allows local businesses to appeal to DOT if posted weight limits are lowered
Collects revenues from owners of hybrids and electric cars (hybrid $30, electric $125)
Requires roundabouts be approved by whichever local gov't has jurisdiction over that highway
Allows counties to enact 0.5% sales tax increase, but may not already have wheel tax
Requires Governor to seek a federal waiver to allow Wisconsin to pursue toll roads
Some major points of the Tax Reform Plan:
Shifts Wisconsin income tax to flat tax 3.95% rate over the next dacade
Eliminates First Dollar Credit beginning in 2019
Reduces Itemized Deduction Credit from 5% to 2%
Repeals capital gains income exclusion
Eliminates Marriage Credit
Eliminates Property Tax/Rent Credit
Eliminates Wisconsin Working Families Credit
Eliminates State Property Tax
Electronics Recycling Fee
Eliminates Alternative Minimum Tax
Eliminates Internet Tax
Taxes brown paper cigarettes at the same rate as other cigarettes
Other changes from Governor Walker's budget:
Eliminates income tax rate cuts
Eliminates the young adult employment assistance credit
Raises annual cap of Historic Rehabilitation Tax Credits from $10 million to $35 million
Eliminates Sales Tax Holiday for 2017, keeps it for 2018
Increases school levy credit by $47 million instead of $87 million
Toll road situation
One part of the transportation proposal is to ask the federal government to loosen some restrictions that currently prevent the state of implementing toll roads. The plan also requires the state to apply for two federal programs that study the costs and impacts of tolls in a state, and determine which highways would be the best fit for these types of roads. One of the two programs is the Interstate System Reconstruction and Rehabilitation Pilot Program, which permits up to three existing interstate facilities to be tolled to fund needed reconstruction or rehab projects on interstates. The next program is the Value Pricing Pilot Program, which is a congestion pricing method that is intended to reduce congestion in high traffic areas, by varying the toll price based on time or traffic volume. While our state is a long distance from seeing toll roads in the immediate future, this action is absolutely a precursor towards the implementation of tolling.
More hot topics
A few more hot button topics included in this giant proposal are the Manufacturing and Agriculture Tax Credit, Roundabouts, and Wheel Taxes. Let's go through a brief rundown of each: Manufacturing & Agriculture Tax Credit The current tax credit is equal to 7.5% of certain manufacturing and farm income derived from property located in Wisconsin. Under this proposal, beginning in tax year 2018, the credit rate for those who claim the credit under the individual income tax would be set equal to the income tax rates that are listed above. The 7.5% credit rate would be retained for corporate claimants. Limiting Roundabouts Under this proposal, the Department of Transportation and local governments would be prohibited from designing a roundabout on any state or local highway for a period of two years unless the roundabout is approved by the local government in which the project is located. This would apply to any projects which construction has not begun on the effective date of the budget. Wheel Tax This plan would eliminate the ability of a local government to enact a wheel tax unless approved by voters in a referendum. Local governments that have currently enacted wheel taxes would be able to retain the tax, however counties that have enacted a wheel tax would be unable to levy an additional 0.5% sales tax for transportation needs.
WPT Weekly Member Poll Results: Requiring referenda for wheel taxes, dairy trade dispute crisis averted, IRS scam targeting Wisconsin, wineries pushing for changes, and Packers draft selection.
Last week, we asked for your thoughts on requiring local referenda before mandating wheel taxes on Wisconsin drivers. We also wanted you to share your thoughts on the trade dispute with Canada, and whether or not this should remain a priority for Wisconsin officials. Wineries are looking to extend their hours of operation by changing Wisconsin law, and the Packers made their annual draft selection. Let's get down to it!
A proposal in the legislature would require all wheel tax proposals to go to local referendum, requiring voters to decide. What do you think?
About 80 percent of respondents think voters should have to decide whether or not a wheel tax is right for their community. 10 percent disagreed, and 10 percent didn't know or chose not to respond. "Should be input from the tax payers." "No, I don't pay wheel tax. No, I don't want a wheel tax. More taxation...More more more...When do people get to keep their earned income instead of being taxed to death?" "Yes I pay a wheel tax." "No I don't pay a wheel tax, but voters should decide on this." "No" "Hey, look, it's the 400th curtailment of local control by the GOP. When will people realize what hypocrites these guys are?" Nearly all of the displaced milk from the Canadian dairy trade dispute have found new purchasers, averting a crisis for those family farms for now. Does this need to remain a priority for elected officials from Wisconsin?
Nearly 80 percent think this should remain a priority for officials in Wisconsin. "Also the producers need to wake up, many have forgot about supply and demand. I'm a farmer making this statement." "I live in the MOST dairy-heavy area of Wisconsin. This is a HUGE deal. This is a MAJOR part of our economy." "WHY if grassland cannot find a market for their suppliers do they want to build a 5,000 cow CAFO in Dunn County?" "Now they can find work for the milk tank haulers."
A nationwide IRS scam is now targeting Wisconsin. With either this scam or any other kind, have you ever been the victim of any type of fraud?
Of course, we were glad to see that a big majority of respondents haven't dealt with fraud, but 35 percent is still way too much! "Computer repair fraud." "Credit card used in India." "Every time I am forced to use an in-network healthcare provider despite an out of network costs less." "Stole by debit card. Joke was on them." "Had calls, but was warned about this type of call, so hung up." "Online banking info" The number of wineries in Wisconsin has gone up ten-fold in the past seventeen years, and is still growing. A law in Wisconsin says that wineries must stop serving alcohol at 9PM, and now that industry is looking to change the law. Good idea or bad idea?
Over 60 percent believe that wineries should be able to sell their product after 9PM, like other adult beverage industries. About 25 percent said it's a bad idea. "Why not stop all alcohol sales at 9:00pm then?" "Depends if a winery is classified as a bar (class B license) or an off-premise retailer (class A license). If class A, yes. If class B, no." "Going over board on wineries." "My family and I were hit by a drunk driver going the wrong way on a 4 lane highway. BAD IDEA. Wisconsin ALREADY known for excessive alcohol consumption. Leave this at 9pm! DO NOT CHANGE IT."
"This question is misleading. Why is this a law? Small wineries don't have lobbyist?" Please e-mail us at email@example.com and explain how "GOOD IDEA OR BAD IDEA?" is "misleading" exactly.
"This singles out wineries, why should that continue? Micro brews aren't being singled out" "It's OK if it doesn't lead to more operating under the influence." "What's the difference if it's a winery or a bar serving? "Just cannot drink enough EH?" "Beer, other alcohol is sold later, why not wines. I don't drink wine." "The legislators better check with their corporate masters, the Tavern League, before voting!" Were you pleased with the Packers draft selections?
About 50 percent were pleased. Just under 10 percent though the Pack could have done better. Just over 40 percent weren't quite sure. "Be competitive until A-ROD gets hurt or retires. But I think TED should first" "Well Ted finally has his head out of the sand. Best job I have seen him do in years. Good job of trading up to the #1 pick in the 2nd round. Nice job Teddy!!" "They badly needed defensive help. I like the tall defensive backs, also Biegel. Don't know much about the 3 RBs. Would have liked them to take TJ Watt." "I could not care less...not a yuuuuge football fan." "Did the Patriots Superbowl victory make everyone stop caring about the NFL?"