State Republicans would need to dig out of an estimated $3.4 billion hole in Wisconsin’s 2021-23 biennial budget if they eliminate Gov. Tony Evers’ proposed tax increases and Medicaid expansion, according the nonpartisan Legislative Fiscal Bureau.
Republicans who control the state’s powerful budget committee plan on Thursday to eliminate from Evers’ budget hundreds of items the committee’s GOP co-chairs have described as “excessive spending, pet projects, tax increases and divisive non-fiscal policy.”
By striking those items from Evers’ proposal, the GOP would eliminate about $1 billion in tax revenue over the biennium and cut out the state’s ability to collect $1.6 billion in one-time federal aid over the next two years for Medicaid expansion, which was included in the latest federal stimulus package passed after Evers crafted his budget.
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All told, the GOP proposal would create a roughly $3.4 billion difference between the governor’s proposed plan and the starting point for the Republican budget, according to a memo from the fiscal bureau.
Budget committee member Rep. Evan Goyke, D-Milwaukee, said by taking billions of dollars in revenue and federal dollars out of the budget discussion, the committee will have to make cuts elsewhere to balance the budget.
“Because this motion fundamentally alters the amount of money coming to the state from the federal government and the amount of money the state will have as revenues for the next two years, it reverberates into the decisions moving forward,” Goyke said.
Republicans say one major unknown factor is the $3.2 billion in federal dollars provided to the state in the latest stimulus. While Evers has provided some insight into how he plans to allocate those funds, he has said federal guidelines are needed before all those dollars can be spent. The governor has sole discretion over the use of those funds.
Republicans on the state’s budget committee plan to vote Thursday to remove 15 pages containing hundreds of items from consideration from the budget as they craft their own version to be sent to Evers this summer for his signature. Items already planned for elimination include a proposed expansion of Medicaid, restoration of public employee bargaining rights and marijuana legalization.
The provisions Republicans plan to remove include more than 190 non-fiscal policy items, a figure Republicans say is double the number Evers included in his last budget proposal two years ago and the most in at least 30 years.
“It’s really a budget that was built on sand with reckless tax increases, way too much spending and a lot of policy changes that are just not right for the state of Wisconsin,” committee co-chair Rep. Mark Born, R-Beaver Dam, said during a Wisconsin Manufacturer’s and Commerce webinar on Wednesday.
Republicans also plan to nix the governor’s proposals to increase the state’s minimum wage from $7.25 per hour to $10.15 by 2024; scaling back a manufacturing tax credit, which would have provided $487 million more in revenue over two years; and repealing the state’s “right-to-work” law, which prohibits employers and unions from requiring the payment of monthly dues from nonunion members at unionized worksites.
It remains to be seen what the Republican-authored budget will entail, but budget committee co-chair Sen. Howard Marklein, R-Spring Green, expressed interest Wednesday in working in “some kind of a tax cut.”
“I think that’s going to be on the table,” he said.
Evers still holds partial veto power, something he used in 2019 to make more than 70 partial vetoes, including one to boost K-12 spending by $87 million.