Budget Feedback

As a member of the Joint Finance Committee (JFC), budget season is an extremely busy time for me and my staff. We are taking advantage of a little break in the action to provide a summary of the Committee’s Executive Session action. This week's update is Self-Insurance, Employee Trust Fund, and Department of Corrections. We will continue to send updates on actions as the budget progresses.

I want to extend a very special THANK YOU to everyone that has contacted my office regarding the budget! I am aware of all of your calls, emails, survey notes, and letters. I am not always able to personally reply to every inquiry, but I do receive and consider your input and keep your views in mind throughout the decision-making process.

Budget Update

June 15th

Self Insurance Contracts
Both the Assembly and Senate expressed concerns about the validity of the projected savings from the Governor’s proposed move to self-insurance for state employees. Legislative Fiscal Bureau (LFB) papers indicated savings would not be nearly as much as predicted. Additionally, the Group Insurance Board (GIB) has been accumulating more reserves than their adopted Board policy recommends, and there has been a lack of legislative oversight in the process.  For these reasons, the JFC unanimously rejected the proposed move to self-insurance. 

By rejecting the contracts, the Committee was required to fill a $64 million hole left in the state budget. The Committee adopted a motion that would realize these savings by:

1. Achieving savings of $22.7 million through negotiations with health plans
2. Drawing down reserves by an estimated $25.8 million
3. Plan design changes to find approximately $15.4 million in savings.

Additionally, the committee provided additional legislative oversight for future changes proposed by the GIB. The motion also requested an audit of the state’s group health insurance programs, including the GIB’s compliance with its reserves policy. 

Compensation Reserves
The Compensation Reserve exists to set aside funds for any increases in state employee salary and fringe benefit costs that may be required in the biennium. The Governor recommended providing state employees with two separate 2% pay raises during the next biennium. The Committee approved the Governor’s recommendation and also provided $4.2 million for market wage adjustments. Market wage adjustments are used to raise state employee pay to improve worker retention in job classifications significantly below market wages.

Employee Trust Funds
The Department of Employee Trust Funds (ETF) is responsible for the state-administered retirement program; group insurance programs; and other state employee benefit programs. The state provides state and local public employees with the option to enter into a domestic partnership for the purpose of extending certain employee benefits to partners and dependents of partners. The Governor recommended discontinuing this option. The Committee approved the Governor’s recommendation while also modifying benefits provided to domestic partnership through the duty disability benefits program.

Corrections -- Departmentwide
The Department of Corrections (DOC) is a large state agency that deals with the safe custody and supervision of offenders using effective correctional policies and procedures so citizens are protected, offenders succeed in the community, and new crime and the cost of corrections to taxpayers is reduced.

Overtime Funding
In addition the to 2% pay increases approved for all state employees, the Committee also approved an additional $8.25 million in increased funding for overtime payments for Corrections employees.

Employee Recognition Award
The Committee supported a motion that requires a one-time ‘recognition award’ bonus for DOC employees who have served 10 or more years. The amount of the award is increased incrementally based on how many years an employee has served. This award will work to boost employee morale and improve employee retention.

Corrections -- Adult Corrections
The Committee voted to increase investments in earned release programming and vocational training. Specifically, JFC modified the Governor’s recommendation to expand upon the earned release program at DOC’s correctional centers by increasing both funding and staffing for the program. Additionally, the Committee approved the Governor’s recommended increased investments in the Windows to Work program by $2 million over the biennium.  The Committee also voted to approve the Governor’s recommendation to increase investments in mental health staffing at certain institutions. These extra supports will help expand treatment and address recidivism among offenders who suffer from mental illness.

Corrections -- Community Corrections
Opening Avenues to Reentry Success
JFC voted to expand the OARS program to 5 new counties. This program works to reduce recidivism among offenders with severe mental illness.

OWI Rehabilitation Services
The Committee approved a motion directing DOC to implement an alcohol treatment initiative to address the expected increase in OWI incarcerations due to 2015 Act 371.

Corrections -- Juvenile Corrections
The two main facilities that house Wisconsin’s juvenile offenders are Lincoln Hills School (LHS) for boys and Copper Lake School (CLS) for girls. To help improve outcomes at these two schools, JFC voted to increase mental health supports at CLS and increased medical staffing at both CLS and LHS.

Two Bills Signed Into Law

This week, Governor Walker signed two bills I authored into law. Assembly Bill 25, the Teen Employment Act, is 2017 Wisconsin Act 11 and Assembly Bill 59, which is a technical update to Emergency Medical Services definitions is 2017 Wisconsin Act 12.

Act 11 eliminates the work permit requirement for 16 and 17 years olds and will eliminate an unnecessary layer of bureaucracy for these teens. Under current law, a minor must obtain a work permit prior to employment. The process of obtaining a work permit includes providing a signed letter or letters from the employer and the parent or guardian. All current state and federal laws related to hours and times of day a minor may work, and restricted or prohibited employment for minors are not being changed. Providing these young people with an opportunity for legal, gainful employment so they can complete their education and become self-supporting adults will reduce their risk for negative outcomes.  

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Act 12 updates statutory references for emergency medical technicians and first responders and aligns Wisconsin terminology with federal language and current practices.I became aware of Wisconsin using a different set of terms when working on a bill related to mobile integrated health and community emergency medical services. This bill modernizes these definitions and make our state statutes and future legislation easier to understand.

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 ICYMI: In Case You Missed It

Transportation News:

Click here for Milwaukee Journal Sentinel Editorial 

Click here for Beloit Daily News Editorial

Click here for Janesville Gazette Editorial

Click here for Beloit Daily News Article

Click here for Wisconsin Public Radio Article

Click here for Urban Milwaukee Article

My capitol office is here to help you with general inquiries as well as questions and concerns regarding legislative matters. Feel free to contact me or my staff. We are always ready to assist you in your needs. Please visit my website for press releases and other Capitol updates.

 If you have any comments regarding the subject of this E-Update, please feel free to contact me.   

Rep. Amy Loudenbeck 
State Capitol, Room 304 East
PO Box 8952
Madison, WI 53708

Toll-Free (888) 529-0031 or (608) 266-9967| |