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Behind the Scenes of the State Budget

This week the State Capitol was a little quiet compared to the last several months of activity. As we await the new state revenue numbers that are expected during the first week of May, the Joint Finance Committee (JFC) took a short break to work on motions, study our budget papers and prepare for non-stop budget work in May.

As we look toward the next several weeks, I thought it might be helpful to tell you about the “Behind the Scenes” happenings of the State Budget. Most residents of our state see very little of this complicated process that has huge impacts on each and every life in our state. I hope the following overview is helpful in your understanding of the process. You have a very important role to play!

The state budget is based on a two-year cycle, called a biennium, stretching from July 1 of odd-numbered years through June 30 of the next odd-numbered year. The current budget (passed in June, 2013) lasts from July 1, 2013 to June 30, 2015. The budget we are currently working on will be in effect from July 1, 2015 – June 30, 2017.

The current budget process statred during the fall of 2014. Late last year, all of the state agencies determined their funding and staffing needs for the next biennium. They also worked on major administrative and policy changes that have a fiscal element, which could be included in the budget proposal.

The requests and recommendations from each agency were submitted to the Governor. The Governor and his team analyzed all of the requests and ideas in combination with other priorities and initiatives statewide.
In February, the Governor introduced his budget to the legislature and gave his biannual Budget Address, in which he described many big-picture priorities and initiatives.

Once the budget was introduced, the bill was referred to the JFC for initial legislative consideration. As a member of this committee, I have the unique opportunity to make legislative changes to the budget.

The JFC receives a lot of education and input as we review the budget in its entirety. Since February, we have had agency briefings, in which each agency presents their budget and answers questions from legislators. The non-partisan Legislative Fiscal Bureau (LFB) also provides an objective overview of the budget proposal and answers hundreds of questions with amazing depth. The LFB is an awesome resource!

As many of you know, we held public listening sessions in each of our districts individually and four state-wide public hearings in locations throughout Wisconsin, including one in Reedsburg.

Each of us has been seeking input from stakeholders, citizens and leaders in our districts about specific topics and inviting our constituents to provide feedback with their concerns. We have sought input from experts and studied the bill in great detail.

Once the public hearings were concluded, all members of the legislature started working on Budget Motions. Motions are our opportunity to make changes to the Governor’s proposal. Each member of the JFC is paired with other legislators who do not sit on the committee. These are our “Budget Buddies” and we work with them to sponsor motions, move them through the process and offer our support during Executive Sessions.

I have authored more than 10 motions to address specific issues in the state budget. These motions span from reinstating the Wisconsin Fund for private septic systems to changing the licensing requirements for antique and vintage tractors. As these motions move through the process, I will highlight them in this column and via my weekly E-Update. To see what we have accomplished already, please visit my website and click on “State Budget Update”.

The next step in the process is a series of Executive Sessions. Executive Sessions are formal, public meetings during which the JFC and LFB discuss each piece of the budget and vote on specific changes presented in motions. We are able to weigh different options and find the best path forward both fiscally and for the benefit of the people of Wisconsin. Keep in mind that every change we make has a fiscal impact and we must balance additions with reductions in order to produce a balanced budget.

We will be in Executive Sessions nearly every Tuesday and Thursday throughout May until the budget is finished. We have already had three Executive Sessions in April.

Between Executive Sessions, members of the JFC work with our budget buddies and within workgroups to finalize ideas before they are brought for formal votes. There is a lot of discussion, study and research that occurs as each part of the budget is considered.

Once the Executive Sessions are completed, the JFC will submit their version of the budget to the full legislature for a vote. This year, the bill, Senate Bill (SB) 21 will go to the Senate first. Once the Senate approves it, it will be sent to the Assembly. If the Assembly passes it without changes, it will go to Governor Scott Walker for his signature. Our goal is to complete this process by late June. The Governor can veto all or part of the budget and his vetoes can be overridden by a 2/3 vote of both houses of the legislature.

As your State Senator, I am honored to be a part of the JFC and to have an important role in the future of our state. Even though we are well into the budget process, I welcome your input, ideas and concerns. Your personal experiences and ideas are a very important part of this process.

For more information and to connect with me, visit my website http://legis.wisconsin.gov/senate/17/marklein.

Do not hesitate to call 800-978-8008 if you have input, ideas or need assistance with any state-related matters.

In the District


UW-Platteville MBA Students from Nigeria Visit the Capitol!
Last week, I had the opportunity to visit with MBA students from Nigeria who are attending UW-Platteville. Lagos Business School (LBS) is the first institution in tropical Africa offering international classes in a continuous and stable way. The school, located in the cosmopolitan city of Lagos, delivers executive programs at top and middle management levels aimed at systematically improving the practice of general management in Nigeria. Executive education at LBS is comprehensive, drawing from the experiences of multinational faculty and participants.


Visiting with students from Lagos Business School (LBS) attending UW-Platteville


Helpful Information

Knowles-Nelson Stewardship Fund
The Wisconsin Legislature created the Knowles-Nelson Stewardship Program in 1989 to preserve valuable natural areas and wildlife habitat and expand opportunities for Wisconsinites to participate in outdoor recreation. These goals are achieved primarily through borrowing for the acquisition of land and providing local assistance for stewardship efforts through the Department of Natural Resources (DNR).

According to the DNR, publicly owned land for conservation now makes up 17 percent of all land in Wisconsin, and totals nearly 6 million acres. The Stewardship Program has acquired 627,600 acres of land in its 25 year existence. Over the past ten years $586 million in bonds were approved for Stewardship. Annual debt service on those bonds is rising fast. Currently, the state spends $1.6 million every week to repay this debt.

In the past ten years state General Purpose Fund Revenue (GPR) money going to debt payments through Stewardship has risen from $5.2 million to over $81 million per year. Without changes, the fund is expected to continue running exceedingly high debt payments.

In addition, since 1992, when the DNR acquires land the Department is required to pay aids to municipalities roughly equal to what would have been collected in property tax on the land. These are commonly referred to as payments in lieu of taxes (PILT). The PILT payments are intended to make school districts, counties, and municipalities “whole” as a result of the property coming off the tax rolls. These payments have also been rising quickly over the past ten years, further depleting the DNR of funds. Combined, debt service and tax payments now take up nearly 80% of GPR funds allocated to the DNR.

The following table shows the total segregated funds, GPR (General Purpose Fund Revenue), total Debt Payment, and Property in Lieu of Tax Payments (PILT), and the Total Tax and Debt Payments over the last several years.


Knowles-Nelson Stewardship Payments


Fiscal Year Segregated Funds GPR Total Debt Repayment PILT Total Tax & Debt Payments
2003-2004 $10,000,000 $5,258,812 $15,258,812 $6,125,967 $21,384,779
2004-2005 $10,000,000 $18,081,879 $28,081,879 $6,909,735 $34,991,614
2005-2006 $14,100,000 $19,701,675 $33,801,675 $7,936,835 $41,738,510
2006-2007 $24,100,000 $15,074,958 $39,174,958 $8,967,466 $48,142,424
2007-2008 $13,500,000 $28,592,121 $42,092,121 $10,158,196 $52,250,318
2008-2009 $13,500,000 $32,554,722 $46,054,722 $11,123,023 $57,177,745
2009-2010 $18,500,000 $6,516,432 $25,016,432 $12,411,875 $37,428,307
2010-2011 $16,000,000 $15,635,107 $31,635,107 $13,041,382 $44,676,489
2011-2012 $13,500,000 $13,163,861 $26,663,861 $13,461,337 $40,125,198
2012-2013 $13,500,000 $63,074,758 $76,574,758 $13,635,930 $90,210,688
2013-2014 $13,500,000 $72,102,624 $85,602,624 $14,277,975 $99,880,599
2014-2015 $13,500,000 $81,058,100 $95,558,100 $14,000,000 $108,558,100

*Source: DNR, Office of Management and Budget



Revenue Numbers: March 2015
The Wisconsin Department of Revenue (DOR) recently released a report detailing the general purpose revenue (GPR) taxes collected by the agency for the month of March. Year to date collections are for the first nine months of the fiscal year, which ends June 30, 2015.

Department of Revenue Collections, March FY2015
($ thousands)


Collections to Date

Revenue Source

FY 2014 FY 2015 % Change
Individual Income 4,888,823 4,871,832 -0.3%
General Sales & Use 3,032,673 3,206,457 5.7%
Corporate Income 722,733 717,164 -0.8%
Excise Taxes 466,942 458,763 -1.8%
Other 224,626 233,582 4.0%
Total GPR 9,335,797 9,487,798 1.6%

*Source: Department of Revenue




*Senator Marklein is pleased to provide this legislative E-Update to the constituents of the 17th State Senate District. Please feel free to share this update with other interested citizens and taxpayers. You are receiving this update because you have either subscribed or contacted Senator Marklein directly.

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State Capitol - Room 8 South - Post Office Box 7882 - Madison, Wisconsin 53707 - Phone: (608) 266-0703

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