Gov. Scott Walker mum on Wisconsin GOP lawmakers' roads plan, cautious on flat tax

By Patrick Marley and Jason Stein, Milwaukee Journal Sentinel

MADISON - Gov. Scott Walker signaled skepticism Wednesday of any quick approval of a proposed flat income tax even as he repeatedly held off on commenting on most parts of a larger tax and transportation plan from Assembly Republicans.

In an interview, Walker said he's waiting to see the full details Thursday on the sweeping GOP proposal to raise taxes on gasoline while slicing those on income. But when pressed, the governor hinted he may not be ready to embrace two of the plan's key elements: cutting the state's required price markup on gasoline; and putting the state on a path to a flat income tax.

"A flat tax is interesting to me. It's intriguing to me. It may be something we talk about in the future. I like the simplicity of it. But right now what we tried to do in this budget (is) build a stronger work force," Walker said in his Capitol office.

Instead, Walker pointed to his own proposals to help employers fill job openings by boosting tax credits for low-income workers and spending more on schools. On taxes, the governor called on lawmakers to eliminate a $90 million a year property tax paid by home and business owners statewide.

"If you want lasting property tax relief, you need to stop the state property tax," said Walker, who is worried GOP lawmakers could essentially use that money to fund roads.

The governor said his fellow Republicans in the Legislature should look at other ways to close a shortfall in road funding, such as paying for local buses out of the same state account used for schools and health care.

Also Wednesday, new details of the Assembly GOP transportation plan emerged, with lawmakers intent on limiting local governments' ability to impose wheel taxes, a funding mechanism that drivers dislike but that mayors and county executives say they need for essential services.

The proposal is being announced Thursday by Rep. Dale Kooyenga (R-Brookfield). Kooyengadeclined to comment Wednesday, but Assembly Speaker Robin Vos (R-Rochester) has said the proposal "certainly makes progress on a long-term solution" to funding roads.

Under the plan, a local government would have to get voter approval in a referendum to enact a wheel tax. Assembly Republicans have not decided what with happen with existing wheel taxes, with some of them wanting to require voters to sign off on them by 2022 to keep them in place beyond then.

Wheel taxes can be controversial, but local leaders have said they have few options to raise money because of limits on property taxes. Milwaukee County in November adopted a $30 wheel tax, half the amount County Executive Chis Abele had wanted. The City of Milwaukee has a $20 wheel tax.

Lawmakers are still finalizing their plan and details could continue to change.

Some of the other provisions expected to be in the Assembly GOP plan include applying the state's 5% sales tax to gasoline while offsetting part of that increase by lowering the gasoline tax.

Walker has strongly opposed raising gas taxes and has been willing to delay construction projects to avoid doing so. Senate leaders have not presented a specific plan but have leaned more toward Walker's approach.

To help offset their proposed tax increase on gasoline and drivers, Assembly Republicans want to reduce the state-mandated markup on gasoline prices. Rep. John Macco (R-Ledgeview) told the Wisconsin State Journal that under the overall plan he did not believe gas prices would change.

“If we do it right, the price at the pump will be exactly the same,” he said.

Walker Wednesday didn't rule out a repeal or rollback of this state "minimum markup" law but cautioned against assuming it would lead gas stations to lower their prices.

"If it’s being done on principle for a policy reason that’s one thing. If there’s an assumption being made that it’s going to drop the price of gasoline — repealing minimum markup doesn’t guarantee anything in terms of the price," Walker said.

Sen. Luther Olsen (R-Ripon) marveled at the complexity of the Assembly plan.

"Can you say the word, 'Rube Goldberg?' " he joked, referring to the cartoonist who depicted convoluted inventions.

Democrats called Wednesday for the creation of a bipartisan committee on funding roads.

"We can create a better deal for taxpayers and workers if we move beyond partisan posturing, special interest demands and counterproductive veto threats," Senate Minority Leader Jennifer Shilling (D-La Crosse) said.