MADISON – Joined by local officials, business and education leaders and Wisconsin citizens, Governor Jim Doyle signed into law today a state budget that builds upon the state’s commitment to expand access to affordable health care coverage, invests in Wisconsin businesses that will create jobs and lead to future growth, and continues to protect priorities like education and police and fire protection, in the face of unprecedented national economic challenges. Today, for the first time since 1977, the budget will be enacted before the start of the new biennium.
“Throughout this process, I have believed that the choices we make will reveal clearly who we are and what we value,” Governor Doyle said. “I knew that if we came together, worked hard and made the right choices, we could pass a budget that protected priorities like education, health care and public safety. I knew we could avoid irreparable harm to our services – and our people – by making sure we made responsible cuts that took the path of least destruction. I knew we could still invest in our future to strengthen Wisconsin for generations to come. We have done just that, and on time.”
Protecting What is Most Important to Wisconsin
The budget Governor Doyle signed today protects Wisconsin’s priorities by strengthening schools, maintaining police and fire protection, and expanding access to affordable health care coverage.
“Education has always been my top priority,” Governor Doyle said. “There is no better route to success for individuals and us as a state than solid educational opportunities. While cities are also forced to make cuts, another major goal of mine was to ensure funding for police and fire services that protect our citizens. We accomplished that. This budget ensures that Wisconsin families have affordable access to health care, and allows us to maintain our status as a model for the nation.”
From federal and state funding, schools will see an increase of $107 million over the next two years. The budget permits school districts to exceed revenue caps for energy efficiency costs immediately, and for school safety, nurses and transportation costs in two years.
The budget continues to invest in the Governor’s BadgerCare Plus program so all children continue to have access to health care and support program expansions covering low-income families and adults, thereby ensuring that 98 percent of Wisconsin citizens will now have access to affordable, high-quality care. It also requires insurance companies cover treatment for autistic children and mental health treatment by additional licensed providers.
Cutting What is Not Essential
The Governor’s budget makes the deepest cuts the state has ever faced.
“Nobody enjoys making deep cuts, particularly during a time when people need services most,” Governor Doyle said. “But just as Wisconsin families and businesses cut back, so can state government. When times are better, we can restore what is necessary and we can invest to make our state stronger. These cuts – over $3 billion – are painful and frustrate me personally because we have been forced into this by national and international economic forces that are not in our control.”
State spending is cut by over $3 billion in this budget. It cuts from existing state programs over the next two years by:
· Imposing across the board cuts of 1 percent for state agencies and many agencies and programs were cut by an additional 5 percent or more.
· Rolling back the 2 percent state employee raises that were to be effective this month.
· Directing state agencies to review all service contracts to reduce personnel costs.
· Laying off at least 1,000 state employees.
Overall, general fund spending in this budget is 3 percent less than in the last biennium.
Protecting the Middle Class against Tax Increases
The budget does not raise taxes on middle class families, it does not increase the gas tax and it does not include a sales tax increase.
“I am proud to say that we have a bill here today that does not include a gas tax increase,” Governor Doyle said. “I am also proud that legislators agreed with me that we couldn’t close the budget gap by raising taxes. This budget does not include a sales tax increase and does not raise income taxes on middle class families.”
Property taxes will be held in check by maintaining tight limits on municipal and school district levies and increasing the first dollar credit on property tax bills. Taxpayers will pay one percent more on any earnings above $300,000 a year. If you are like 99 percent of Wisconsin, you will not be affected.
Leaving this State in Better Shape than it was Before
The budget builds on the Governor’s commitment to strengthen the state’s financial position and make key investments to our state. The Governor worked hard to ensure that the state finishes the biennium with $270 million in reserve.
“Wisconsin is definitely open for business,” Governor Doyle said. “Despite challenges, I am very confident that we made the right investments and decisions to move toward an economy that is stronger than ever and built around the things we value: education, entrepreneurship, manufacturing, agriculture and science and technology that create the good-paying, family-supporting jobs we need in this state -- real things that we can count on to make life better.”
The budget:
· Cuts business taxes by over $130 million during the next four years through tax credits for research and development, job creation, and new business venture investments.
· Expands eligibility and access to tax credits to attract new business and create jobs by:
o Tripling the Accelerate Wisconsin tax credit for angel and venture investors in support of start-up technology companies;
o Creating a capital gains tax exemption for investments of up to $10 million in new businesses;
o Consolidating five existing tax credit programs (development zones, enterprise development zones, agricultural development zones, technology zones and airport development zones), increasing the ability to target those credits to businesses that create jobs, invest capital, provide training and retraining to new and incumbent workers, and retain jobs in companies with corporate headquarters in Wisconsin;
o Encouraging the continued growth of Wisconsin's agricultural economy through the creation of two new income tax credits for the modernization of dairy manufacturing and meat processing facilities;
o Awarding a refundable tax credit equal to 10 percent of payroll after new jobs are created;
o Awarding a refundable tax credit equal to 10 percent of significant capital investments in an enterprise zone;
o Increasing the states commitment to worker training; and
o Awarding tax credits for companies that significantly increase their commitment to research and development and exempting equipment from the sales tax, just as it is for manufacturers.
· Improves access to and the quality of higher education by:
o Increasing the amount of financial aid in the State of Wisconsin by $20 million;
o Ensuring that families with incomes less than $60,000 won’t face tuition increases and keeping tuition increases modest for all other students and families;
o Providing $25 million for the Wisconsin Covenant to augment private funding already invested in preparation for the incoming class of fall 2011; and
o Investing in the Wisconsin Institutes for Discovery at UW-Madison, the Great Lakes Bio-energy Research Center, the Wisconsin Genomics Initiative, and providing $240 million in bonding to support new facilities to advance UW-Milwaukee’s research and teaching agenda.
Additional Resources
· For Governor Doyle’s full veto message and the full 2009 - 2011 budget visit: http://www.doa.state.wi.us/debf/execbudget.asp?locid=3 .
