Wisconsin tax collections are more than $281 million short of estimates, nearly 2 percent less than anticipated.Huh, who could have predicted something like that?
The state Department of Revenue on Thursday released the figures for the fiscal year that ended in June. Those figures show the state collected $281.2 million less than was anticipated by the nonpartisan Legislative Fiscal Bureau in January.
You can check out the details on this shortfall for yourself by clicking this link. How did we get here? The big culprit is the Koo-Koo tax cuts of 2013 and further cuts passed at the start of this year, which not only reduced tax rates, but also changed the withholding tables, meaning that less money came to the DOR from people’s paychecks. The cynical idea is that this would make voters more likely to back the Republicans this November with a few more dollars in their pockets (key word- few), and much of these withholding table changes will be counteracted by what you don’t get in tax refunds over the next 2 years (basically, your refund will be less, so the state “keeps” more. Conveniently, this doesn’t happen until after the November elections).
What does this do for our budget situation? Well, the State Journal rundown has one side of the story.
However, the budget was expected to have a roughly $724 million cushion by July 1, making emergency action now unlikely.BUUUUUT, there’s another side of that ledger. I will assume all other expenses and revenues remain the same, and the rate of revenue growth in 2014-15 to stay the same - even with the reality of a shortfall in Medicaid due to Walker’s TeaBagging of Obamacare, and the $25 million that the Potawatomi refused to pay the state in response to Walker’s shakedown of the tribes regarding the Kenosha casino. These are based on the LFB’s May projections, after the Koo-Koo tax cuts were passed into law.
Gov. Scott Walker's spokeswoman Laurel Patrick says the state will finish the two-year budget cycle with a positive balance. She says, "As we have done in the last several years, we will continue to manage the Wisconsin taxpayers' money well and keep the state's fiscal house in order.”
Wisconsin Gen Fund budget after revenue shortfall
Opening balance +$759 million
Taxes and other revenues +$14,529 million
Net Appropriations -$14,865 million
2014 ENDING BALANCE +$443 MILLION
Opening balance +$443 million
Taxes (3.49% growth) and other revenues +$14,994 million
Net Appropriations -$15,843 million
ENDING BALANCE -$406 MILLION
Required reserves -$65 million
TOTAL TO BE MADE UP BY 6/30/15 $471 MILLION
Sorry, Laurel Patrick, but we are far from on pace to finishing this budget with “our fiscal house in order.” I understand honesty isn’t a Walker Admin official’s top priority, but couldn’t you at least run the math before you try to BS people?
And the revenue shortfall means things get significantly worse in the next budget. I’ll continue to use the LFB projections from May, including their assumptions of no changes of revenue or spending through growth, just current law.
Taxes and other revenues +$15,116 million
Net Appropriations -$15,732 million
ENDING BALANCE -$616 MILLION
Taxes and other revenues +15,038 million
Net Appropriations -$15,744 million
ENDING BALANCE -$706 MILLION
This means a budget deficit of $1.322 BILLION lying in wait for the next 2-year cycle. And if we see any more slippage in this year (very possible with low job growth and higher expenses being revealed by the day), this number grows higher.
So we’ve now seen a repeat of the Tommy Thompson and George Bush idiocy of 2001, where a one-time surplus has been blown by short-sighted tax cuts, and now we have a widening budget deficit as a result. It also blows apart a major theme Gov Walker has tried to repeat during this campaign- that his austerity budget moves and tax cutting has left the state better off fiscally. It has not, and in fact, our hands are tied much more than they were when Walker took office in 2011.
That reality has yet to sink in to many Wisconsin voters, as shown in yesterday’s Marquette Law School Poll. Check out the responses of Registered Voters to this question.
Would you say the state's budget is in better shape now than it was a few years ago, about the same or in worse shape now?
Better shape 44.9%
About the same 26.4%
Worse shape 22.5%
Don’t Know/Refused 6.1%
Interestingly, 48% of that same poll’s respondents correctly noted that Wisconsin is growing jobs slower than the rest of the nation, a higher number than in previous Marquette polls. Somehow I’m thinking if the Dems and Mary Burke gave them this budget information in an ad blitz similar to their recent “last in the Midwest for jobs” meme, that 45% who wrongly think our budget is in better shape would be reduced significantly. And that would be especially true of the low-info or “mis-info” types that would be the most likely to desert Walker over the next 10 weeks if they could find out that it really isn’t working.
So there are your numbers. Pass em on and TELL THE TRUTH.