Category Archives: Politics – Wisconsin

Administration Estimates $103 Million In Savings if State Self-Insures

Do it.

“Self-insurance allows us to get a taxpayer savings of $103 million with no changes to benefits to state employees,” Department of Administration Secretary Scott Neitzel said Friday during a press conference with Walker’s budget director Waylon Hurlburt and Deputy Insurance Commissioner J.P. Wieske.

The $103 million in savings includes the $60 million in general purpose revenue, a $22 million health insurer fee under the Affordable Care Act and $21 million worth of premium increases that would not materialize if the state self-insured, according to Hurlburt.

But critics say the Walker administration numbers are misleading because bids for health plans aren’t due until June 30, so the figures are based on assumptions.

Um… budgets are always based on assumptions…

 

JFC Advances Measure to Require Work for Welfare

It’s a move in the right direction.

The state Legislature’s budget-writing committee voted on Thursday to require some Wisconsin residents using food stamps and receiving public health care to be tested for drug use and to meet work requirements in exchange for benefits.

The Joint Finance Committee, the state’s budget-writing panel, voted 12-4 to approve Walker’s plan that would make Wisconsin the first state in the nation to make drug tests mandatory for Medicaid recipients and would impose tests on adult food stamp recipients without dependent children seeking coverage through the state’s BadgerCare program.

Some parents with children over the age of 6 who are enrolled in the state’s FoodShare program, which administers federally funded food stamps in Wisconsin, also would be required to work or look for employment for at least 80 hours per month under another measure proposed by Walker that the panel approved Thursday. The work requirement currently only applies to FoodShare recipients without children.

The panel scaled back the governor’s proposal by applying the work requirement to parents using food stamps in certain regions of the state between April 2019 and June 2020 and not allowing the requirements to be applied statewide until an evaluation indicates it should be.

New School Board Member Selected in West Bend

He certainly seems qualified. Hopefully his experience can help balance a very green board. Hat tip to the Washington County Insider.

May 24, 2017 – West Bend, WI – Tim Stellmacher was selected during a special meeting tonight to fill an open seat on the West Bend School Board. The term runs 1-year.

The seat opened after Therese Sizer resigned her post March 20.

Stellmacher was one of five people who submitted an application for the open seat. Others included Pat Seghers, Amy Swanson Kieser, Bob Miller and Tina Hochstaetter.

Stellmacher is 70 years old and has lived in West Bend since 1979.  Stellmacher said he is retired. His LinkedIn profile shows he works as a school business management consultant and previously worked in the Waupun Area and Hustisford School Districts.

Wisconsin Republicans Lean Toward Spending Increase

Why does it seem that on every issue the Wisconsin legislative Republicans are tilting toward the most anti-conservative position?

Gov. Scott Walker has proposed freezing tuition next year, cutting tuition by 5 percent in the 2018-19 school year and providing $35 million in taxpayer funds to the UW System to cover the lost tuition revenue from the tuition cut.

Walker also is proposing $42.5 million in new performance-based funding to be divvied up among the UW campuses, $11.6 million for UW employee raises and $50 million to restore some of the $250 million in cuts the System absorbed in the two-year budget cycle that ends June 30.

Assembly Republicans oppose cutting tuition, said finance committee co-chairman John Nygren, R-Marinette. They would prefer to use some of the $35 million on financial aid for low-income students.

I’m not a big fan of Walker’s proposal. While a tuition decrease would be welcome, back-filling it with more state funds merely shifts the burden without correcting the problem. The problem is that the university system spends too dang much and has made itself unaffordable for a lot of middle class Wisconsin families. But at least Walker’s proposal is spending neutral.

Legislative Republicans apparently just want to spend more. They want to spend the additional $35 million on UW not as an offset to a tuition decrease, but just to spend more money. Instead of subsidizing kids who can’t afford to attend a UW school, how about they focus on bringing down the cost so that we don’t feel a need to subsidize so many kids?

Repeal the Minimum Markup Law

My column for the West Bend Daily News is online. Here you go:

West Bend has been enjoying something of a retail renaissance in the past few years. Unfortunately, Wisconsin’s Unfair Sales Act, A.K.A. “Minimum Markup Law,” is preventing consumers to reap the benefits of such an upsurge in competition.

Just in the last year, Kwik Trip opened in West Bend, the Shell on Paradise upgraded with a car wash and Mad Max built a shining new gas station on South Main Street. Pizza Ranch is planning a new store on Washington, Morrie’s Auto Group is planning a new Honda dealership in town and Russ Darrow is already building a new Nissan dealership. The big news last week was the opening of a huge Meijer grocery store and Pick ‘n Save is planning a major upgrade to its stores.

The natural result of so much competition is to drive the price of identical goods down for consumers. After all, if one can buy the same gallon of milk for a dollar less at Meijer than at Pick ‘n Save, why would a consumer pay more? Sure there are other factors that consumers consider like convenience, service, etc., but everything else being equal, consumers will buy from the lower cost retailer.

Sometimes, businesses will use the practice of a loss leader to attract consumers in the hope those consumers will buy other products, too. This is where a business will sell one product for a price dramatically less than their competitors and often below their cost. It is a practice that cannot be sustained over time without risking bankruptcy, but it can be used as a temporary lure for consumers.

Wisconsin’s Minimum Markup law was passed in the 1930s when Progressives held majorities in Madison to prevent just such business practices. As the preface of the law states, “The practice of selling certain items of merchandise below cost in order to attract patronage is generally a form of deceptive advertising and an unfair method of competition in commerce.”

While the Minimum Markup Law was written in an anti-capitalism spasm of socialist protectionism, the modern justifications for keeping it are essentially two-fold. First, proponents argue it protects consumers by preventing “big business” from moving into a community, selling below cost until the competition fails and then jack up prices. Second, proponents argue by guaranteeing a profit, the Minimum Markup Law protects a diversity of competition by ensuring that small retailers can

compete with larger ones.

The problem with both of those arguments is neither are true. There is no evidence of large retailers using loss leaders to bankrupt competition and then increasing prices in the long term. The reason is economies are dynamic and consumers are mobile. If Wal-Mart in West Bend, for example, were to sell all of its goods at significantly below cost for a period of time, some other retailers may go bankrupt. But as soon as Wal-Mart raised their prices, consumers could travel to a neighboring town and another store could easily move into West Bend with lower prices. Market pressures keep Wal-Mart’s prices – and other retailers’ prices – competitive.

A study recently released by the Wisconsin Institute for Law and Liberty disproves the second argument. The study was co-authored by WILL’s William Flanders and the Cato Institute’s Ike Brannon. The study looked across all 50 states. Slightly less than half of the states have a minimum markup law similar to Wisconsin’s and a few have it just for gasoline. The rest of the states have no such law.

WILL’s study found there was no statistical difference in the number of small retailers or gas stations between states with a Minimum Markup Law and those without. For all of the proponents’ rhetoric about protecting Wisconsin’s small businesses, there is no evidence that in more than 80 years Wisconsin’s Minimum Markup Law being in effect it stops anything other than Wisconsinites from getting a good deal.

Wisconsin’s Minimum Markup Law is an antiquated anti-consumer law rooted in a discredited economic theory. It does not accomplish the goals it purports to achieve and forces consumers to pay more than necessary for essential goods. It is time to repeal Wisconsin’s Minimum Markup Law once and for all.

Nass Pushes Back on Taxpayer Bailout for UWO Foundation

Nass is spot on.

Sen. Steve Nass (R-Whitewater) on Thursday released a letter he wrote to Cross that states he’s aware of efforts to reach a deal that potentially would use public funds “to assist in what would be a bailout” of debts of the UW-Oshkosh Foundation.

“I am aware that such a bailout might need action by the Legislature to include elements of a deal in the 2017-’19 biennial budget,” Nass wrote. He said he hoped no one involved planned to “rush a bailout that benefits the private foundation and the banks/investors involved at the expense of the taxpayers or students.”

He urged Cross “to keep your commitment that the public won’t be forced to fund the inappropriate decisions of two campus administrators and the failed oversight of the System.”

[…]

At issue is the fact UW-Oshkosh’s private fundraising foundation does not have enough cash to cover $14.5 million in debt for several real estate projects under investigation by the state Department of Justice.

The Department of Justice is negotiating the settlement on behalf of the UW System and Board of Regents.

The UW-Oshkosh projects were the subject of a suit the UW System filed in January against former Chancellor Richard Wells and his chief business officer, Thomas Sonnleitner, for allegedly funneling millions of dollars in university money into real estate projects through the private foundation to push that work despite a weak economy.

The UW System ideally wants the UW-Oshkosh Foundation to remain solvent so that its assets are not frozen or at risk. That includes scholarship support for students. The UW-Oshkosh Foundation in fiscal 2016 provided $1.3 million in scholarships.

Note that despite the name, the UW-Oshkosh Foundation is a private organization that raises money to support UWO. There’s no good reason for the taxpayers to be on the hook for their bankruptcy.

David Clarke Joins Dept. of Homeland Security

Good for Clarke!

Sheriff David Clarke will be leaving his position as Milwaukee County Sheriff (a position he’s held since 2002) to take a position with the Trump administration’s Dept. of Homeland Security as a multi-agency and local law enforcement liason.  Listen to my exclusive interview w/Clarke here:

Sheriff Clarke retires  

To learn more about the division Sheriff Clarke will oversee, click HERE.

Clarke says he hopes to be able to help fill the gaps between local law enforcement needs, local and federal intel and the federal government.  He says he told Gov. Walker some months ago he was likely to leave, but said he has not had a conversation w/Walker about his replacement.

Read more: http://newstalk1130.iheart.com/onair/vicki-mckenna-29300/exclusive-clarke-makes-announcement-on-my-15839681/#ixzz4hOAXF0dZ

Republicans Get Wobbly on Tax Relief

Wisconsin Republicans seem to have lost the will to actually make bold reforms. Some want to nibble around the edges and some want to be Democrats. Complacency is a sure path to returning to the minority.

Gov. Walker wants to eliminate the tax, which is the last remaining portion of the state property tax. However, Joint Committee on Finance Co-Chairs, Senator Darling and Representative John Nygren, said there is division in their caucuses whether or not to do that.

“I think there’s some in our caucus that have concerns about the funding that the mill tax – things it funds with forestry – especially when you get into more rural parts of the state, but we also know it’s been a little bit of a slush fund,” Nygren said.

Nygren said he agrees with the governor on eliminating the tax. Darling said lower property taxes is a shared priority between the governor and legislature, but was less committal about where she stands on the issue.

“I think if you ask the regular person, what’s the most onerous tax? They’d say the property tax,” Darling said. “So that’s why we have it as a priority, and why it’s going to be a big issue of whether to accept the governor’s proposal on the forestry mill tax, or to have an alternative.”

Release of the Walker Trilogy

My column for the West Bend Daily News is online. Here you go:

In perhaps the most anticipated, but least surprising, announcement in Wisconsin politics, Gov. Scott Walker told fellow Republicans at the state Republican convention in Wisconsin Dells he is ready to serve a third term as governor.

Although he has said that, he will withhold an official announcement until after the budget is passed, there is little doubt that Walker will ask the voters to elect him as their governor for the fourth time.

One could not help but contrast Walker’s 2017 Wisconsin GOP convention speech to the one he made to the same audience last year. By the time the Wisconsin Republicans convened in 2016, Walker’s presidential campaign had been dead for nearly eight months, but Walker was clearly in no mood to talk about the presidential campaign or his future. In a speech that did not mention the Republican presidential nominee once, Walker focused on getting Republicans to focus on re-electing Sen. Ron Johnson.

The focus and mood were very different this year. Walker delivered a rousing highlight reel of his record as governor and enjoined the Republican stalwarts in the audience to rally to his campaign. Judging from the reaction of the crowd, Walker will have no problem turning out his base of supporters again. And while many conservatives became frustrated with Walker when he uncharacteristically flirted with nonconservative positions during his run for president, his record in less than seven years as governor is truly unmatched in advancing conservative principles and issues. Of course, Walker had the support of a Republican Legislature for much of his tenure, but those Republicans have been increasingly conservative thanks in large part to Walker’s leadership.

Most people place Act 10 at the top of the list of Walker’s achievements. Act 10 was a reorientation of the government paradigm that continues to pay dividends to Wisconsin’s citizens. It deserves to sit atop the list, but that list, taken in its totality, dwarfs Act 10.

Since Walker assumed office, Wisconsin has passed concealed carry legislation, required voters to present a picture identification, made Wisconsin a right-to-work state, expanded school choice,

frozen tuition at Wisconsin’s public universities and much, much more. Walker and the Republican Legislature also funded the state’s rainy day fund, cut billions of dollars in taxes and turned Wisconsin into a state that repeatedly runs surpluses instead of the perpetual deficits we saw under Gov. Jim Doyle.

The results speak for themselves. Wisconsin’s unemployment rate is the lowest it has been since President Bill Clinton was in the White House. At the same time, Wisconsin has one of the highest percentage of people in the workforce. And the average annual wage for private sector workers is up more than 11 percent since Walker was elected. Wisconsin is working.

It is small wonder why Walker would want to run for a third term. Most governors would be proud to run on one or two of Walker’s achievements. No governor in America can run on such a chockfull record of success.

The Democrats appear to agree. Walker’s impressive record and bursting campaign coffers has already scared away most serious contenders. The Democrats are scraping the edges of their party and the private sector for anyone willing to charge the Walker windmill and finding few takers. The Democrats will eventually find someone to run and will attempt to sell them to the voters as the second coming of FDR, but Walker will be exceptionally formidable even in a year when national trends point to Democratic wins.

The next gubernatorial election is still 18 months away, but it is difficult to envision Walker not sticking around as governor well into the next decade.

Regulations With An Expiration Date

I like this idea.

Under the proposal from Assembly Majority Leader Jim Steineke, R-Kaukauna, and Sen. Alberta Darling, R-River Hills, new regulations would expire after seven years unless in the year before an expiration date a state agency flagged the regulation for review.

Legislators on certain committees would be able to object to rules being extended, which would then require the rule to be rewritten and go through the normal rule-making process.

Existing regulations would sunset on a timeline to be set by the Legislature’s Joint Committee for Review of Administrative Rules. The bill also requires agencies to eliminate the use of words and phrases that are outdated or that are now understood to be derogatory or offensive.

The bill would effectively flip the onus for cleaning up the state’s hundreds of pages of administrative rules from legislators to state agencies, Steineke said. Rather than legislators combing through the administrative code for rules they want to eliminate, agencies would have to keep tabs on which rules they want to keep.

There are oodles of regulations that are outdated, unenforced, unenforceable, or downright stupid. This would weed those out and leave only the important regulations in place.

Bill to Make “Stealthing” a Crime

Interesting bill.

Under the legislation, if a person were to remove or tamper with a sexually protective device during intercourse without the partner’s permission, state law would say there was no valid consent for the act.

[…]

According to the article, the women interviewed who had experienced “stealthing” said they did not consider it to be directly equivalent to sexual assault, but one referred to it as being “rape-adjacent.” The article also cites men who write online about their experiences in “stealth” condom removal and share tips on how to do it successfully.

Although Brodsky’s article focuses primarily on women who were “stealthed” by men, she notes men can also be victims of the practice.

The types of devices covered under Sargent’s bill include “a male or female condom, spermicide, diaphragm, cervical cap, contraceptive sponge, dental dam, or any other physical device intended to prevent pregnancy or sexually transmitted infection.”

It would not cover a situation in which a woman lied about being on birth control or a man tampered with a woman’s birth control pills. The bill deals strictly with physical contact, Sargent said.

I did not know that “stealthing” was a thing. On the issue, it makes some sense. After all, if a couple decides to have sex under the condition of using some sort of birth control, then it seems like there should be some consequence if one of the parties unilaterally violates that condition. But proving such a case seems like a fruitless exercise unless the offending party is bragging about it online.

On the other hand, there is an assumed risk of pregnancy and STDs whenever you have sex. Even the best chemicals and devices are fallible. If someone gets a disease or gets pregnant, it would be difficult to prove whether it was due to a failure of the protection, intentional disuse of the protection, or unintentional misuse of the protection. Such a law seems like an invitation for people to blame and punish their partners when a sexual encounter results in an undesirable consequence.

Finally, I think the exclusion of a woman, or a man for that matter, lying about taking a chemical form of birth control to be inconsistent. It is still a situation where one person violated the conditions of sex and it potentially led to an undesired result. And that result has life-long consequences for both participants. If tampering with a contraceptive sponge (a device only used to prevent conception and not to prevent STDs) is covered, why not cover all forms of birth control?

In the end, this bill is interesting and potentially necessary, but I can’t think of a way to draft it in a way to avoid a lot of negative consequences. Perhaps the current rules of the road are best: if you are going to have sex, be prepared to accept any and all of the consequences.

Walker To Run Again

The biggest non-secret in Wisconsin politics is out.

Gov. Scott Walker plans to tell Republicans at their annual convention Saturday that he is “ready” for four more years, eliminating any question about whether the governor would seek a third term.

“I’m ready. I’m ready to help lead Wisconsin forward for four more years. But I need your help,” Walker plans to tell Republicans, according to excerpts of his speech provided to the Wisconsin State Journal by his campaign.

Walker has repeatedly signaled he would seek a third term but has said he will not formally announce his decision until after the 2017-19 state budget process is complete later this summer.

“We won in 2010 with a grassroots army of volunteers. We won with an even bigger force during the recall election in 2012. And we won with another grassroots flurry in 2014,” Walker plans to say. “Now, we need your help again.”

 

Free Speech Hearing Not So Free?

Talk about your lazy reporting.

A public hearing on a Republican bill to prevent students at University of Wisconsin campuses from disrupting controversial speakers wasn’t exactly a model of the pro-free speech sentiment espoused in the proposal, said some critics who waited hours to have their say.

“I’m here to testify against it, and it’s been like five hours and we haven’t heard testimony from one person who’s against the bill,” said Savion Castro, who will be a UW-Madison senior in the fall. “The chair, I’m assuming, has discretion over who can speak, who doesn’t speak and in which order they speak. So I think it is kind of ironic.”

Apparently, the reporter, Steven Elbow, didn’t think it was worth looking into the process used for speakers to validate or refute the student’s accusation of bias. I’ve been to a government hearing or two in my time. Typically, people sign up to speak as they get there and then the speakers are called in the order they were received. Sometimes, various government officials get dibs to speak first, but the general public speakers are usually brought forth on a first come, first serve basis. Was there a different process followed here? Mr. Castro seems to think so, but the reporter never checks.

As it stands, it looks like the hearing drug on for hours and hours and mostly everyone got to say their piece. What’s the issue?

Walker Rejects Splitting Transportation From Budget

Good.

Gov. Scott Walker and Senate Majority Leader Scott Fitzgerald on Thursday rejected an idea put forward by the Republican leaders of the Legislature’s budget committee to take up transportation funding in a separate bill outside the normal budget process.

Sen. Alberta Darling, R-River Hills, and Rep. John Nygren, R-Marinette, said they support the option, which could extend debate about how to fund transportation beyond the July 1 start of the 2017-19 biennium.

It could also change the political dynamics of how a deal on transportation is reached, allowing minority Democrats who otherwise wouldn’t vote for a majority Republican-authored budget to boost one of the GOP factions on the contentious issue.

Here’s what Speaker Vos and others are up to… they want a tax increase for transportation. They know that they will not get that passed through the Republican caucus and Democrats won’t vote for the budget. So the tax increase is DOA. But if they split off transportation from the rest of the budget, they think that they can cobble together the tax-increasing group of Republicans and just enough Democrats get a tax increase passed.

But beyond political concerns, it does not make any sense to split off transportation from the rest of the budget. The whole purpose of writing a budget is to balance priorities against each other within the confines of limited resources. Splitting off a massive portion for separate consideration obliterates the budgeting process.

Education Over Conservation

Good.

A bill to create a new taxpayer-funded college scholarship for Wisconsin’s brightest students would have another big outcome — decimating a popular program that uses tax dollars to buy natural areas for public use.

When the bill’s GOP authors announced the bill Tuesday, they didn’t highlight its effect on the Knowles-Nelson Stewardship Fund, which expands outdoor recreation opportunities and protects environmentally sensitive places.

After three years, the bill would leave the fund unable to purchase any of the high-value land it currently targets.

It’s no secret that I despise the way Wisconsin manages the Stewardship Fund. Essentially, here’s how it works today… the DNR is authorized to borrow million of dollars every budget for the purpose of buying land, and then the taxpayers pay off the debt. Note that the entire program is driven by the mandate to spend the money. It is not based on the need to buy specific land parcels or conserve particular ecosystems. The DNR has a pile of money that they must spend to buy land.

It is a horrible program for a few reasons. First, it is not based on actual needs. The DNR will buy the land because it needs to spend the money. This leads to all sorts of bad consequences including overpaying for lands, likely corruption and sweetheart deals, and sloppy management.

Second, every piece of land the government buys is another acre that some private owner is not paying property taxes on. The more land the government owns, the more concentrated the tax burden becomes in the people who continue to own property. This makes it difficult to fund local governments and schools – particularly in rural areas where the population density is low.

Second, the program is not designed to achieve any specific goal. Essentially, how much land should the government own to achieve the goal of “conservation?” According to Communists, the government should own all of the land and private ownership would be outlawed. As designed, that’s where the Stewardship Fund is headed since there isn’t a goal or cap on government ownership. I don’t think that’s the goal, but then what is it? Right now, the governments at various levels own about 17% of all of the land in Wisconsin. Is that the right number? 20%? 12%? Until we know the goal, we are just spending money to spend money.

A properly run stewardship program would allocate money to acquire land on an ad hoc basis after a thorough review by a legislative body of the need and local economic impact of the acquisition. And there would be a target of the maximum allowable amount of land the state should own in each county to be agreed upon with local elected officials.

I would prefer that the legislature just scrap the Stewardship Fund as it exists and make a more sensible program, but starving it to pay for kids’ educations is not the worst thing in the world.

A rough road

My column for the West Bend Daily News is online. Here you go:

After weeks of speculation and trial balloons, the Wisconsin Assembly leadership released a plan called “Road to a Flat Tax.” The plan was primarily authored by State Rep. Dale Kooyenga and cobbles together some 30 ideas with the promise of fixing the state’s long-term transportation funding issues and cutting taxes.

It has become fashionable in Washington, and now in Madison, to tackle every issue with these massive omnibus bills that are just complicated and opaque enough to provide politicians cover from contentious political issues. The Road to a Flat Tax plan is no different. It packages some truly terrific and transformative proposals with a few policy and political duds with the hope of convincing legislators to pass the package with the excuse that most of it is good.

Let us start with the great parts of this proposal. The Road to a Flat Tax does just that. It would eliminate the state property tax, as Gov. Walker has proposed, and gradually move Wisconsin to a flat 3.95 percent income tax over the next decade. It does so by eliminating and changing several major tax credits and phasing out four of the five tax brackets. Wisconsin would end up with a fair and flat income tax. Wisconsin’s Republicans are not ambitious enough to eliminate the state income tax like seven other states, but a flat income tax is the next best thing.

The Assembly Republicans’ plan also repeals Wisconsin’s prevailing wage law for state projects, which would save taxpayers at least $300 million per biennium, according to a 2015 study by Wisconsin Taxpayers Alliance. The plan eliminates 180 positions from the Department of Transportation, which does not save any money yet, but gives the department more flexibility to reduce spending in the future. It reduces the state’s minimum markup law as it applies to gasoline (more on that later), lowers the gas tax, imposes a moratorium on roundabouts, imposes a fee on electric and hybrid vehicles and eliminates the ability of local governments to enact new wheel taxes.

Then there is the bad part of the proposal. The Road to a Flat Tax includes an intricate change to the way the state taxes gasoline that results in an overall tax increase. For the first time, the state would impose the state sales tax on gasoline. This is estimated to generate about $600 million in revenue over the biennium. In order to offset some

of that increase, the state would reduce the gas tax by 4.8 cents, thus shaving off $278 million of the increase. It would also change the minimum markup law to a mandatory 3 percent markup instead of the combined 9.18 percent. This would save consumers another roughly $50 million at the pump while cutting into the profits of gasoline retailers and wholesalers.

The end result after all of those changes is that Wisconsinites would see a tax increase of about $330 million per biennium. The increase in funding would be directed to paying down Wisconsin’s debt. Bear in mind, however, that funds that go into the Transportation Fund are fungible. Although the tax increase is allocated to debt reduction, that means that the money that would have been spent on debt service without the tax increase will now be spent on current transportation projects.

The tax increase to be spent on transportation has long been the ambition of Assembly Republican leadership and it at the heart of this proposal. Packaging it with a bevy of other tremendously positive initiatives appears designed to pull the tax increase through a reluctant Republican caucus. Rep. Kooyenga should be commended for advancing so many great ideas. Repealing the state’s prevailing wage law, implementing a flat income tax, eliminating the state property tax, and many other parts of the Road to a Flat Tax would be tremendously beneficial for Wisconsinites. But there is no rational reason, other than for political brinkmanship, to amalgamate all of these ideas into a single “take it or leave it” proposal. The legislature should take up each piece of the Road to a Flat Tax as separate bills and then vote on them based on their merits. Good legislation that would benefit Wisconsinites should not be weighed down by legislation that would not pass on its own.

Toll Roads Coming to Wisconsin?

Maybe.

State Assembly Republicans late this week unveiled their biennial state roads budget proposal. One part of that proposal, according to legislative memos, includes a plan to ask the federal government to ease restrictions that prevent the state from implementing toll roads on major Interstate highways.

In the same proposal, Assembly Republicans call for the state to apply for enrollment in two federal pilot programs to study the costs and benefits of tolling and determine whether any major highways in Wisconsin would be suited for toll roads.

State lawmakers involved in the proposal say they’re far from writing any hard plans into the state’s 2017-19 budget to pursue toll roads in Wisconsin, and it’s not clear if the toll roads proposal will gain enough support among state lawmakers to remain part of the roads budget as talks roll out this spring.

Toll roads seem to get floated every time politicians want more money for roads. It’s kind of a “give us more money or we’ll have to create toll roads!” kind of threat. Although many states have moved to install toll roads to help pay for them, Wisconsinites are culturally opposed to them.

Personally, I don’t mind toll roads. The technology has gotten to the point of making the experience virtually painless and I generally support the notion of shifting the majority of the cost for roads to the people who use them. The gas tax is an indirect way of doing that. Toll roads are a direct way of doing the same thing. Obviously, the government still needs to have a general transportation budget to pay for necessary, but lightly traveled roads. But there are some places where toll roads are quite sensible.

What I oppose is implementing toll roads just to increase transportation spending. If the state want to make I94 between Milwaukee and Madison a toll road and lower transportation taxes accordingly, then fine. If they want to make it a toll road and just increase spending, then no thanks.

Legislature Moves on “Dark Store” Theory

Good.

Communities around Wisconsin have expressed frustration to state lawmakers over the 2008 Wisconsin Supreme Court property assessment decision that includes the “dark store” theory. Some large retail chains have been fighting and winning tax reassessment cases that deal with the level of property taxes they pay on properties that formerly housed their businesses which are now “dark” or vacant.

In a news conference Wednesday in Madison, Rep. Rob Brooks (RSaukville), Sen. Roger Roth (R-Appleton) and Sen. Duey Stroebel (R-Cedarburg) unveiled legislation regarding the “dark store theory.” The theory is a tax argument being used by a variety of big-box store chains to argue their stores are over-assessed for tax purposes. Under their argument, the operating business within a building should not factor into assessment; the assessment that decides a store’s property taxes should be determined by recent sales of comparable, vacant properties.

In 2008, a Wisconsin Supreme Court case, Walgreens vs. city of Madison, sided with Walgreens, saying the store’s taxes should be based not on the store’s lease agreement, but on what the landlord could get if the drugstore moved out of the buildings, which are generally developed and built to the store’s particular specifications.

“The court overstepped its bounds and we need to bring it back to where it always was prior to 2008,” Stroebel said. “Our taxation system is based on fair-market value. The Constitution has a uniformity clause which says all property has to be assessed the same and that is by fair-market value. In 2008, the courts hijacked the valuation process or real estate as it pertains to a certain — generally what they call the Walgreens or other similar kinds of stores.

I admit that I waffle with this a bit. On the one hand, I agree with Walgreens and the big box stores to an extent. We base our property taxes on the fair market value of the property. That value is generally what the owner could reasonably sell the property for in the open market and would fluctuate with market conditions. That is how we do it for residential properties. The tax assessors look at a residential property, its neighborhood, its general condition and specifications, and then make an educated guess on what the home would sell for in the current market. We could argue over how accurate those assessments are, but the intent is certainly to peg the value of the home at, or near, what the owner could sell it for. Why should we do it any different for businesses?

On the other hand, businesses are different than residential homes. The buildings are often purpose-built and have a drastically reduced value for any other businesses. This is why we see so many big box locations sit empty for years when the business closes. The value of the business is irreparably conjoined with the value of the property in which it resides. This is not true with all businesses – or even most. But with some, like Walgreens, it is undeniably true. So why shouldn’t those businesses pay taxes based more on what the property is worth to them instead of what it might be worth to somebody else?

In the end, I support the proposed law because wherever one falls in this argument, I don’t think it is a matter for the courts. It is a matter for the local taxing authority. If West Bend wants to assess property taxes based on the “dark store” theory to attract businesses and the residents are willing to pick up the slack in the property tax levy, then so be it. If they don’t, then that’s fine too. The point is that it should be up to the local taxing authority to make that determination. As long as it is fair and uniform, then the courts should not be involved.

State REINS Act Moves Forward

Excellent!

The REINS bill is similar to legislation moving through congress, but with lower thresholds. It provides greater legislative oversight of the regulations adopted by state agencies. Any rule or regulation with an economic impact of more than $10 million would require legislative approval.

And it gives the legislature’s Joint Committee for Review of Administrative Rules more muscle. The committee would be empowered to request a public hearing earlier in the rule-making process and call for an independent review of the proposed regulation’s economic impact.

“Right now, regular citizens and businesses don’t have a proper voice in the rule-making process,” LeMahieu said. “This bill adds additional oversight by allowing the legislature to require a preliminary public hearing earlier in the rule-making process and request independent Economic Impact Analyses on agency cost estimates.”

The REINS Act, co-authored by Sen. Adam Neylon, R-Pewaukee, passed the Assembly last session. It is expected to do so this session. Gov. Scott Walker included the reform in his budget, but REINS was one of 83 “non-fiscal” policy items stripped from the Joint Finance Committee’s starting budget document.

If nothing else, it forces state officials to actually think about and measure the impact of their decisions before rendering them. It is easy to sit in Madison and pass regulations when you don’t have to be accountable for the impact.

McCabe to Run for Guv?

It’s kind of funny that McCabe has been held up in the media as an impartial government watchdog for years despite his obvious liberal bias. Now, at least, he admits his bias.

Former Wisconsin Democracy Campaign executive director Mike McCabe said Wednesday he’s mulling a gubernatorial campaign in response to a letter from 190 Wisconsinites urging him to run.

McCabe said he’s willing to run, but cautioned that an announcement wouldn’t come until after Labor Day and would depend on his supporters helping to organize a campaign.

“Obviously a lot of pieces would have to fall into place to make that happen,” McCabe said in an interview. “It’s not something that I’ve been planning for. So I really have to take the coming weeks and months to be able to pull everything together. That’s not something that can all be figured out today or this week.”

McCabe, 56, is founder and president of Blue Jean Nation, a nonprofit that engages citizens to challenge the political establishment. He was a founding member of the Wisconsin Democracy Campaign, which tracks campaign finance in the state, and served as director from 2000 to 2015. He previously worked for the Madison School District, Wisconsin Taxpayers Alliance and three Republican legislators.

McCabe said he doesn’t know if he would run as an independent or a Democrat, but acknowledged that it would be difficult to run a third-party campaign.