WPT Capitol Report, July 31, 2017

News from the Capitol and around Wisconsin

Members, We hope your Monday has been good, and that you were able to enjoy the last day of July 2017! This week, we will focus on the Foxconn deal, local unemployment numbers, UW's lawsuit with Apple Inc., school vouchers, the Wisconsin State Fair, and more! As always, we hope you find this weekly report to be interesting and informative. If there are ever any issues that you would like to see included, or if you ever have any questions or comments, please reach out to us at Have a great week, WPT, Inc.

Last week

Last week, I wrote about the impact of the Senate budget proposal on education, and laid out some numbers. I also referenced some numbers about school vouchers. I then received some responses from members who asked me to get a bit more specific about school vouchers and what they would cost, and who pays. I'm happy to lay out some of the figures, as they relate to the Senate proposal, using the nonpartisan legislative fiscal bureau's numbers. First, you should know, there are three private school voucher programs in Wisconsin. The Senate Republican plan would increase funding for all three, by about $60 million. And as various outlets have reported, the cost would be paid increasingly by property taxpayers. The LFB numbers show that the proposal would spend about $560 million on the three programs- Milwaukee, Racine, and Statewide Parental Choice Programs, over the biennium, but more than one third of that amount, or $210.6 million, would be paid for by cuts in state aid to the school districts, equal to the amount of voucher students in that community. That means that school districts would have to reduce their budgets or increase taxes. Which do you think they'll choose to do? The Racine program and the Statewide Voucher Program would cost $145.6 million, which means that property taxpayers will directly pick up $82.6 million. That's a 55% jump from the last budget. Right now, there are about 34,000 students in the program, but there could be more. As of last week, Republican leaders could not agree on where the percentage of income for eligibility for the program should fall. Some would like to see the income level rise, meaning more people would be eligible. Some lawmakers would like it to stay the same, and some would like to see it lowered. If it's raised to 220% of the federal poverty level, the enrollment could increase by over 500 students in the program. As I say in almost all of these pieces, none of this is a certainty right now, and anything is possible. This is just the latest, and I'll be sure to keep you posted as anything new comes out. Thanks.

Foxconn 101

By now, you have heard most of the details. Foxconn technology last week, one of the largest tech manufacturers in the world which employs over 1 million people globally, alongside Governor Walker, Speaker Paul Ryan, Senator Ron Johnson and others, announced its intentions to invest $10 billion in Wisconsin. Some of the quick details of the massive plan: The new 20 million square foot facility (11 Lambeau Fields) construction alone would need 10,000 workers over four years. The plant would manufacture LCD panels for 8K 6G technology, the first type of facility in North America. The plant would eventually employ 13,000 workers, who would be paid, on average, $53,875 per year plus benefits. The facility would also generate an estimated $181 million in revenues, both local and state, and $60 million in property taxes. Take into account the type of economic development that would take place subsequently, and many people are comparing this new proposal as a small village in size. There would most certainly be new housing, restaurants, retail shopping, and various other types of services. The down side? Many people are skeptical at the price tag to Wisconsin taxpayers, which equals about $3 billion over the next 15 years. Not only is Foxconn going to get a chunk of cash from Wisconsinites over that period of time, but various other perks came along with the memorandum of understanding (MOU) that was signed between Governor Scott Walker and Chairman Gou of Foxconn. Among those perks were lifting caps for local TIF deals, and allow them to continue for longer periods of time. Government reviews and permitting processes would be expedited, along with environmental regulations, and the enterprise zone tax credit would be expanded for the company. Keep in mind, those types of tax credits are refundable- so they'd get a refund check from the state if they don't owe taxes already. With many pros and cons emerging, seemingly daily, there is still a long way to go until the process is completed and ground is broken on the facility. In order to move the process along, Governor Walker today has called a special session of the legislature in order to pass the Foxconn deal. He also last week assured the public that Foxconn will not see any of the $3 billion unless they create 13,000 jobs. Make sure to share your thoughts on the project in this week's WPT Weekly Member Poll.

Local unemployment numbers released

The Department of Workforce Development last week released the US Bureau of Labor Statistics estimates of unemployment and employment numbers for metro areas, major cities, and counties in Wisconsin. The estimates include May 2017 and preliminary numbers for June 2017, but are not seasonably adjusted. Metro Areas: Unemployment rates decreased in all areas when compared over the year to June 2016. The largest 12-month decline was 1.3 percent in Racine. The rates ranged from 2.7 percent in Madison to 4.2 percent in Racine. Municipalities: Unemployment rates decreased in the state's 32 largest municipalities when compared to the year prior ending in June. The rates ranged from 2.7 percent in Fitchburg, Madison, and Sun Prairie to 5.2 percent in Beloit. Counties: Unemployment rates decreased in all 72 Wisconsin counties in the year prior, ending in June. The largest over the year decline was 2.4 percent in Menominee County. The latest ranges were 2.6 percent in Dane and Lafayette Counties to 6.5 percent in Menominee County. in other good workforce and economic news: - Labor force participation rate was 68.9 percent, well above the national average of 62.8 percent, and at all time highs - Wisconsin's seasonally adjusted employment change of 76,500 year over year is the largest since July 1995 - Wisconsin's 3.1 percent unemployment rate for June is the lowest level since October 1999

Apple ordered to pay UW-Madison

With all of the talk of Foxconn, a major tech supplier for iPhone, Apple also sparked news in Wisconsin in another way. A judge last week ordered Apple Inc. to pay $506 million to UW-Madison, for infringing on a patent owned by UW-Madison's patent licensing department. This judgement was also more than double the damages that Apple was initially ordered to pay by a jury. The judge added an extra $272 million onto an initial award of $234 million by the jury because Apple continued to infringe the patent until it expired in 2016. The company plans to appeal. The processor in question was designed at UW, and it involves improving processor performance by predicting what instructors a user will give the system in the phone. Computer science professor Gurindar Sohi and three of his students obtained the patent for the technology in 1998. Apple denied any infringement, and urged the U.S. Patent and Trademark office to look further into the patent's validity, but that request was denied.

WPT Weekly Member Poll Results:

Eliminating income tax cuts for transportation funding, registration surcharges on electric vehicles, State of Emergency declaration, public assistance fraud savings, and Kwik Trip

Gov. Walker has proposed eliminating his original income tax cuts and instead using the $200 million for transportation (as a way to reduce/eliminate borrowing). Do you think this is a...

Our town roads need help. Choose any road, it's obvious. Roads...Hwy 23. Income taxes are too high in the state, but our roads need help. I've lived without the extra in the cuts would give me, so just put that money to good use once! Sometimes it takes shuffling the money rather than cutting tax coming in. I also think that there needs to be better cost controls on multi-year projects. Should pay as you go. Use that money to eliminate personal property tax and spur economic growth. Good move for this budget cycle, but need to keep taxes under control. Wisconsin has to stop cutting taxes, being fooled by politicians who say we can have our cake and eat it too. We have to do something about the roads. If the Assembly is screaming for a tax hike, but the Governor and Senate want a tax cut, how in the world is this not an easy compromise. I'm not sure it's the best answer, but it finally seems to be a reasonable answer.

One lawmaker is proposing a $125 annual surcharge on electric vehicle registration. Good idea or bad idea?

I drive a pickup. All who use the roads should help maintain roads. No. Government wants us to cut pollution and energy use yet they tax you for it! Don't drive an electric car. I do not own an electric nor hybrid car, but these vehicles do use the roads, and should contribute to the cost of them since they are not paying the gas tax. Road repairs. They buy less fuel. Have to make THAT up somewhere. No, pay for more electric. The heavy farm machinery needs to contribute and not be exempt. Smug tax. I like it. I'll keep driving my gas guzzler and contributing to the economy. I don't have a hybrid, but I'd like to know how they came up with the $125 number. Yes/No These environmentally minded individuals need to start paying their fair share. No, that's why I leaned this way.

Gov. Walker declared a state of Emergency in 17 Wisconsin counties. Did your community or property suffer any damage or impact from the torrential rain the past few weeks?

Flooded roads--rivers subsiding. We fortunately dodged most of the heavy rains and bad weather. Our hearts go out to those who have suffered as a result of the weather. Thankfully the Fox and Wolf rivers are pretty much at normal levels. Some land too wet to plant, got corn and beans in late, parts of fields look bad, late hay making resulting in lower quality

$51 million was saved in 2016 alone, and $150 million since 2011, in public assistance fraud prevention and detection. DO you think this is a large portion of the overall fraud potentially taking place in Wisconsin?

People get food from the pantry and then sell their EBT card. Employees who work just long enough to "injure" themselves, then are off for months and months golfing and hunting, but aren't able to work? That should be stopped with no penalty to employer when they fire them while on disability. People taking food from food banks. I think there is a lot more fraud that we haven't touched. Obviously this is a problem and great job by Walker for going after the problem. Washington needs to pay attention and do more to prevent fraud in social security, medicare, medicaid, disability, and the list goes on. Too big to catch the fraud unfortunately in many cases. Maybe stiffer penalities and fines would help, like being like being banned from receiving any sort of assistance if caught, forfeit social security/medicare benefits, etc. UC: Man says he is retiring. Uses his 2 weeks vacation. Files for UC. When we said he said he was retiring, he denied it and collected UC. WC: Man says he has to quit. Last day on the job, he stumbles and sprains his ankle. Goes to hospital, has knee surgery, gets WC for 8 months. Let's talk unfair! I consider it fraud when people hit up businesses that are not advertising that they are hiring. I personally know people that ran out of benefits in my area and moved to where more was available.

Yes. They are good stores. Clean and good quality food. Super clean bathrooms. Just gas. I buy gas, milk, eggs and glazers from Kwik Trip. I love Kwik Trip because of their good prices, cleanliness and friendly staff. A pound of butter at Kwik Trip is half the price of the local grocery store. Half! A good place for a quick meal. Love their chicken salad sandwiches but wish they were on croissants again. Pizzas are great too. We have two stores in this town and they are both busy most of the time. They need more parking for large trucks. Milk in opaque containers (bags). Fluorescent lights oxidize the milk in translucent/transparent containers...resulting in a foul taste. Stop frequently- love the friendly staff and reasonable prices along with the quick service. Kwik Trip offers many more shopping options than other gas stations/convenience stores at much cheaper prices. I like them. Kwik Trip clean, well supplied with variety, is our favorite gas stop--but few groceries purchased. I go to Kwik Trip for milk, bananas, eggs, butter, sweets, meats. Love Kwik Trip. Occasionally we use Kwik Trip for gas and their food. Do not like the taste of their milk. Have soured on using them somewhat because their gift cards do hold their balance, they take away from them so be careful. A bit of everything you asked, would be yes. I always go to Kwik Trip. Like their milk the most. People are nice and helpful. We use Kwik Trip the majority of the time as a business and personally. Favorite things: friendly staff, pay inside, diesel gas, good coffee, great prices on eggs, bananas, butter, etc...clean and visually appealing stores. In small towns, Kwik Trip can devastate local grocers. They are a great place to stop, lots of healthy food choices and the best dairy products, the ice crea, is da bomb! Never go there. I only use convenience stores on a trip. I buy my groceries at the store. Kwik Trip rocks! I'm there often for coffee and groceries...and gas. I have a Kwik Trip near my workplace...I appreciate the high quality of their store and service. And the donuts of which they are cheap and awesome. Yes, we use Kwik Trip. It is the best. Very clean rest rooms. No grocery store close so we get milk, eggs, butter, donuts, etc. there. PS Brancels are having a Hereford sale this fall. I never Kwik Trip! they tried to manipulate me out of a lease one time so they could kick me out! Cost me $20,000 in legal fees to stop this from happening. I understand they have tried tactics before with other businesses! Bad company!! Please don't shop there! At my wife's insistence, we stop at Kwik Trip whenever we can. They have clean and welcoming facilities and great selection and prices on food items. I also hear that the condition of the ladies rooms is another selling point.

Wisconsin's Reince Priebus out as White House Chief of Staff

Former Wisconsin GOP chair, Republican National Committee Chair, and Wisconsinite, Reince Priebus got the boot from President Donald Trump on Friday, ending a rocky six month tenure in the White House, and ushering in the age of Homeland Security Secretary John Kelly, who will take over the roll. Priebus told CNN that the president wanted to go in a different direction, and said that the president has every right to "hit a reset button. I think it's a good time to hit the reset button. I think he was right to hit the reset button." "I'm always going to be a trump fan. I'm on Team Trump and I look forward to helpign him achieve his goals and his agenda for the American people," he said. Priebus said he submitted his resignation on Thursday

Wisconsin State Fair begins Thursday

The Wisconsin State Fair, held in Milwaukee's suburb of West Allis, opens on Thursday and runs through Sunday, August 13th. The 11 day fair is one of the biggest places where Wisconsinites get together to enjoy some wacky foods, good music, and celebrate Wisconsin's appreciation and recognition of the agriculture industry in our state. Oh, and eat nearly a half a million cream puffs...that's over 200,00 eggs, 14,000 gallons of whipping cream, and 350 pounds of unsalted butter. Last year, the State Fair topped one million people in attendance over the 11 day period. That's even bigger than the world's largest outdoor music festival- also held in Milwaukee- Summerfest! The fair goes back 166 years, in the fall of 1851 in Janesville. At that time, the fair was only two days, and was sponsored by the state agriculture society, which threw the fair in an attempt to get more paying members in their organization. The first year saw somewhere between 8,000 and 12,000 attendees. Believe it or not, that was the largest reported gathering in Wisconsin up to that point. Another thing that might be hard to believe; one Milwaukee Sentinel newspaper description read; "The fair is an orderly affair without a single intoxicated man in the crowd." The fair grew each year in both anticipation, size, and success. The fair also did not stay in Janesville, but moved around for 41 years. It was held in other places, including Watertown, Fond du Lac, Madison, and more than one location in Milwaukee. In 1892, it landed at its current home in West Allis. Also, a little-known fact is that the fair has been cancelled five times. War was the cause of cancellation four times, and also canceled in 1893 due to the World's Colombian Exposition in Chicago. The Wisconsin Cream Puff wasn't introduced until 1924, and the original Cream Puff Pavilion is still standing, though not for long. In 1948, the fair was 23 days long to celebrate the 1000th birthday of Wisconsin, and it drew 1.8 million people, with an admission fee of 50 cents! If you have the time and means to travel to the Milwaukee area, make sure to get down to the Wisconsin State Fair. It's a great family event with something for everybody to enjoy, and now you know some of the interesting and unique history behind the massive annual celebration of the Cheese State!