Smart Budgeting
This week Republicans once again put taxpayers first. The Joint Committee on Finance, which I co-chair, passed the necessary reductions in state spending in order to keep our budget in balance. These reductions, known as lapses, were part of the state budget that we passed this last summer. The lapse mechanism isn't new; it's used each budget cycle to help the state deal with fluctuations with the economy. In the last two-year state budget, lapses topped $600 million. However, this was the first year that legislators were given the opportunity to approve the lapse plan. I believe the action taken this week in the Joint Finance Committee will have a positive impact across the state. We're keeping our spending in check and not increasing taxes on working families to close any budget hole.
The lapses totaled $123 million for this year. The UW System sustained $46 million of the reductions. UW Madison Chancellor David Ward has said that they can "handle the lapse." The decisions were made with that premise in mind. The areas that could deal with the reductions were given many months notice that the lapses were possible during this budget year. The Department of Administration said the areas were protected included K-12 education, tech schools, Medicaid, corrections systems and segregated accounts. Republicans on the Joint Finance Committee agreed as we approved the lapse plan without alterations.
Last week, the non-partisan Legislative Fiscal Bureau (LFB) announced that because of the lapses taken, the state would end the first fiscal year with a positive $11.7 million balance. The LFB also announced that projections for the next year aren't as good as first expected. With slower growth on the horizon, it's now estimated that the state may end the budget cycle under the statutory amount required. It's actually not surprising and pretty typical considering the current state of the economy. Officials with the National Conference on State Legislatures report that 29 other states, more than half of our country, have to contend with budget shortfalls in the 2013 fiscal year. Keep in mind, these are projections that hopefully will improve. However, it will help guide us in our budgeting matters.
The Department of Justice recently received $140 million in settlement money from a lawsuit with the banks mainly responsible for the foreclosure crisis. More than $100 million of the settlement will go toward relief to foreclosed homeowners and residents struggling with mortgage debt. A small portion will help the state deal with the struggling economy, which was a direct result of the foreclosure crisis. The DOJ noted that these dollars to the state were part of the settlement negotiations. This revenue will go toward helping the state provide essential services, like health care coverage for our most vulnerable citizens.
Hopefully, nothing these past few weeks is a surprise to you. We have always said that you, the taxpayer, come first. When it comes to our budget, we will continue to make sound fiscal decisions without raising taxes. In just this past year, we reduced a $3.6 billion deficit and curtailed the expected increase on property taxes. Once again, we're reducing government spending and we're doing it honestly with transparency. It's what we'll continue to do; it's simply called smart budgeting.
Mining Bill Update
The Assembly Mining Bill moved forward Friday with a public hearing in the Joint Committee on Finance. This comes after news that the Senate Majority Scott Fitzgerald dissolved the special committee on mining in that chamber. The bill was then referred to the Joint Finance Committee. This jobs bill updates the state's archaic mining laws. It's possibly the largest jobs bill in our lifetimes for the state of Wisconsin. If an iron ore mine is created in Northern Wisconsin, thousands of high paying jobs also would be created.
- 3,000+ construction jobs,
- $2 billion short-term economic impact,
- Up to 5,600 long-term mining jobs,
- Tremendous secondary impact on businesses for associated manufacturers.
The Joint Finance Committee is expected to vote on the measure next week. The goal is to have final passage of the bill in March.
Record Ag Exports
Wisconsin had a record year for agricultural exports in 2011. According to the Department of Agriculture, Trade and Consumer Protection (DATCP), Wisconsin’s agricultural exports increased by 18 percent from 2010 to 2011. The total value of Wisconsin’s agricultural exports in 2011 was $2.85 billion. Overall exports increased by 11.4 percent to $22 billion.