Tuesday, June 30, 2015

Budget delay won't mean much short-term....and apparently it's short-term

Unlike what’s going on to our south, Wisconsin government won’t shut down when the 2015-16 fiscal year begins tomorrow without a budget in place. As the Wisconsin State Journal’s Molly Beck explains, things largely stay “business as usual” for the short-term.
... .State spending will continue at the same rate as it is now.

“No one in our state knows the difference between June 30 and July 1,” said Legislative Fiscal Bureau director Bob Lang….

Local governments aren’t expecting a lump sum of money on Wednesday, said Lang, and if a budget is passed later than the deadline, then the periodic payments agencies receive throughout a budget cycle are adjusted at that time.

[State Sen. Luther] Olsen said public schools could have been affected if general funding levels were different than last year’s budget, but they are likely to be held flat.
However, the later timetable does mean those adjustments to payments and funding amounts will suffer a more drastic change the longer this plays out, and that’s what I want to touch on with this post.

In comparing the base-year budget for Fiscal Year 2015 vs the amount Governor Walker has recommended for 2016 (starting with Appendix 3 of the Budget in Brief), here are the agencies facing the biggest changes in expenses, and therefore the ones that may need to make larger and more sudden adjustments as the budget drags on.

Biggest increases in GPR Spending
Dept of Health Services +$263.0 million
Dept of Children and Families +$44.9 million
Dept of Revenue +$14.8 million
High Education Aids Board +$3.9 million

The higher DHS costs are largely the result of increasing Medicaid expenses. There is likely plenty of money from the Feds to keep up with the increases on a short-term basis, but problems would likely come in if the budget is dragged out for another month or two. Same seems to be the case for DCF. DOR’s problem is that the Walker budget had $25 million in extra funding to hire additional auditors, and $1.75 million to expand the Statewide Debt Collection program. If there is no budget, the positions and funding aren’t available to hire those agents, and that puts into doubt the Walker Administration’s projections of recapturing nearly $125 million from these measures over the two years of the budget if it takes longer to get off the ground.

Biggest decreases in GPR Spending
UW System -$145.6 million
Dept of Public Instruction -$111.1 million
Dept of Corrections -$46.1 million
Dept of Natural Resources -$19.8 million
Environmental Improvement Program -$15.9 million

As Sen. Olsen mentioned, the FY 2016 drop in DPI funding was mostly restored by the Joint Finance Committee (albeit there is still a loss of $18.6 million to vouchers and virtual charter schools), so delayed payments and cash-flow crunches would be more likely to be the larger concern for K-12 schools if there is a budget delay, barring any changes in the final budget in the Assembly and/or Senate. The cuts to the UW System and Dept. of Corrections have been slightly reduced, but are still significant, and both of these organizations will likely have to perform layoffs and other cost-cutting measures before the budget is passed, to prevent an even larger disruption later this Summer. Likewise, the director of the DNR’s Science Services Bureau at the DNR wasn’t willing to stick around to deal with the expected cuts in his area that the Joint Finance Committee approved of a few weeks ago, and he announced his retirement last week.

Another area that will feel the sting of a delayed budget is the Department of Transportation. The DOT’s total budget was slated to increase in total spending of nearly $270 million, with almost all of that being related to extra borrowing in the Transportation Fund for the Zoo Interchange. However, GOP legislators’ concerns over high levels of borrowing in Gov Walker’s budget mean that they are looking at cutting $800 million in highway projects from Walker’s budget. That’s a huge difference, but with construction season already underway, you’d think much of those cuts wouldn’t be seen for a few months, with projects that haven't had much work started on them.

A wild card with transportation is the federal Highway Trust Fund runs out of money at the end of July, and any changes that might result from a new bill could greatly affect the amount of total money available for the state to use. Perhaps that’s a reason why it may be prudent to delay the non-GPR parts of the DOT budget until a later time, when both the state budget and federal transportation funding have been decided. In Governor Walker’s budget, GPR only makes up 3.75% of the total costs for the DOT ($123.4 million), so any adjustments that would have to be made to the final total to make the General Fund balance shouldn’t be a big deal for the DOT’s operations.

So while the delay in this budget shows a lack of WisGOP leadership and the result of trying to place bubble-world policies into real life, there likely won't be much of a day-to-day change in Wisconsin government operations for at least the next couple of weeks. But expect the anger to grow even larger if this drags out even more, or if new items are snuck in at the last second as favors to campaign contributors or other self-interested scum (as predicted by State Rep. Andy Jorgensen last week).

EDIT: And of course as I write this, this hits the wire.

Ruh roh....they gotta give 24 hours notice to have Joint Finance meet, so they'll meet Thursday. Keep your eyes peeled for the goodies and other giveaways that likely WON'T be mentioned in tomorrow's WisGOP press conference.

Monday, June 29, 2015

Hoops news pt. 2- new Bucks arena bill is out

Late this afternoon, we finally got a look at the new Bucks arena bill, and the Legislative Fiscal Bureau's rundown of it. Here are a few quick reactions.

It looks like much of the responsibility of the bonds to build the new arena have been transferred from the state (who was going to borrow $220 million and pay it back in the original Bucks bill) to a newly-expanded Wisconsin Center District (WCD). The WCD would sell $203 million in bonds, with the breakdown being as follows:

$55 million from the state
$55 million from Milw County via the state (I’ll explain below)
$93 million from the WCD

The state and county part will be paid off over 20 years, at a total price tag of $80 million for each part. Interestingly, the state will be paying more in 2016-17 than the $2.8 million they were projected to in the original version of the budget bill, as a trade-off for a flat amount of payments over those 20 years to significantly lower payments in future budgets. Also worth noting is that there are now funds to fix up the Bradley Center in its last few years of hosting NBA basketball. I didn’t see a reference in the old bill to paying $10 million for maintenance and repairs to the Bradley Center, so that’s an extra $10 million that’s being paid in this budget.
a. Two separate, GPR sum certain appropriations and provide $4,000,000 GPR in each appropriation in 2016-17 to make payments to a local exposition district to assist in the development and construction of the district's sports and entertainment home arena facilities. One of the appropriations is related to the Milwaukee County debt collection provisions in the bill, although it would not be statutorily tied to those provisions. Specify that both appropriations would be repealed on June 30, 2036. Require that the appropriation that is not related to the Milwaukee County debt collection provisions under the bill be limited to a cumulative total of $80,000,000.

b. A biennial appropriation funded at $10,000,000 GPR in 2016-17 for the payment of grants to the Bradley Center Sports and Entertainment Corporation. Specify that the appropriation would be repealed on June 30, 2017.

c. An all moneys received appropriation from debts collected pursuant to a state debt collection agreement with Milwaukee County to be distributed to the County that certified the debts. Specify that the first $4,000,000 annually in monies received would be transferred to the general fund, and the remaining balance would be distributed to the County, except those amounts agreed upon by the County and DOR to be held in reserve in this appropriation account for future payment to the County or to transfer to the
state general fund. Estimate $4,000,000 in 2016-17 in general fund revenue associated with this provision. Specify that on June 30, 2036, this appropriation would be repealed and recreated to distribute all funds to the County certifying the debts.
The county’s piece of the puzzle is where a big risk comes in, because some have questioned whether there is $4 million a year in County debts that can be recovered, and if not, then another provision mentions that the County’s shared revenues gets cut by however much the state falls short in getting the $4 million back. Also worth noting is that Milwaukee County gives up its ownership of the Marcus Center for the Performing Arts, as it gets taken over by the new Sports and Entertainment District.

The possibility of the PAC changing hands generated a lot of anger from County Board officials in a Parks Committee meeting a couple of weeks ago. Looks like they had a reason to be suspicious, as the County Board is cut out of the decisions involving the Bucks arena, as the power to give away the Marcus Center and sign the debt collection agreement goes solely to County Executive Chris Abele. This bill is clearly another excuse for an Abele power-grab/selloff, and should be yet another reason he needs to go next Spring.

The WCD's side is a bit iffy as well. Not only are they the entity that is issuing the debt, and have to get payments from the state (and the payments the state gets from collecting the County's debt), but the WCD also is likely to take on higher debt costs.
....It is anticipated that WCD would have to issue more than $203 million in bonds, as allowed under the bill, for the following amounts: (a) amounts to pay issuance or administrative expenses; (b) to make deposits to reserve funds; (c) to pay accrued or funded interest; and (d) to pay the costs of credit enhancement. The accrued or funded interest would include any potential capitalization of interest associated with zero coupon bonds that are expected to be issued by WCD. It is likely that WCD would have to issue zero coupon bonds because its current tax revenues are needed to retire the district's existing bonds [which is projected to go through 2032], and thus, would not be fully available to pay debt service on any new bonds until that current debt is retired.
As a result, the LFB estimates that the expanded WCD will have to pay a total of $217.25 million to fully pay everything off, and it means that Milwaukee County's extra 0.5% food and beverage tax along with the WCD's share of room and car rental taxes will stay longer than originally planned. Theoretically, a new Bucks arena would drive more people to be in a place to pay that tax, but there's no guarantee of that, as the new arena may displace other entertainment, tourism and restaurant spending.

One improvement in the new Bucks arena bill is that it seems the amount of property tax write-offs has gone way down from the original bill, which would have made numerous blocks of development exempt from property taxes, which Bruce Murphy at Urban Milwaukee estimated would cost local governments as much as $629 million over the 30-year life of the arena. Now it only seems to involve the arena and related buildings, and any bars or eating places would have to pay the same taxes as the existing places on 3rd Street, Water Street and other parts of downtown Milwaukee.
Expand the current law property tax exemption for a local exposition district to include sports and entertainment arena facilities, except that any portion of the sports and entertainment arena facilities that is used, leased, or subleased for use as a restaurant or for any use requiring a license for the retail sale of alcoholic beverages and is regularly open to the general public at times when the sports and entertainment arena is closed to the public would not be exempt.
There is also TIF language that seems to make it more likely to have currently-existing TIFs near the arena be more likely to go fully onto the tax rolls, which would take some pressure off of the City and County of Milwaukee.

If the bill was in isolation, I'd probably be ok with it (the County's part is my main concern). But with all of the other damage being done to Milwaukee in the budget bill, particular with the proposed takeover of MPS, reductions in funding to UWM, and the state's refusal to raise aids for local roads and local transit, I can't get behind this thing until the city that the Bucks play in is taken care of first. And I hope the Dems in Milwaukee that are being leaned on to get this bill through as a standalone would demand the same.

Hoops news pt. 1- Bo retires!

I was a bit surprised to see the news coming down from 1440 Monroe Street today, but not blown away by it. Bo's in his late 60s, and after 30+ years of coaching winning basketball at UW schools throughout the state, I think this guy's got a right to choose how and when to go out.

15 years ago, I could only hope that my friends that attended and supported Indiana University could respect our basketball program as something other than a doormat. And now, UW is the program IU wishes they had in the 21st Century- a team that wins with guys who play the game intelligently and with class. Oh, and all IU fans and basketball fans with decency around the country will be forever grateful because of this.

I would never have dreamed my alma mater would have hoops teams that were envied throughout the country, and that's exactly what this UW basketball program is today, because of what Bo Ryan has built it into. And it'll never be allowed to be a doormat again. And it's not like Bo can't win a lot of games next year with Nigel, Koenig and a very good frosh class coming in.

As for a successor, I'm good with the idea of Greg Gard taking over- Gardo's more than qualified for a head coaching job (and likely has passed up a few in recent years), and given that he's recruited and coached these guys the last few years, it's not like there'd be a jarring change in philosophy or major transfers to deal with. However, if Tony Bennett wants the job, I'd be OK with trying to work that out. We got time to get this decided, and there isn't a lot that needs to be replaced in 2016-17 (unless Nigel or Koenig go pro), so recruiting issues shouldn't be much of a concern.

Sunday, June 28, 2015

Deconstructing GOP budget lies pt. 2- we're worse off today

In part 1 of this post, I deconstructed the dishonesty behind Scott Walker and the Wisconsin GOP regarding 2011's state fiscal "crisis" that really wasn't a crisis, and how to disprove their zombie lies. Now flash ahead to how we got into the budget mess today, which was set up by bad decisions of Walker and WisGOP, and how we are likely in a worse spot today than we were 4 years ago.

The state and country benefitted from higher tax revenues as a result of the Obama Recovery in 2012 and 2013, but instead of banking most of those extra funds or restoring more of the 2011-13 cuts to the UW System and K-12 education (cuts that were allegedly to be offset by Act 10's decrease in benefit costs, but in most cases did not), Walker and WisGOP gave that away with Koo-Koo tax cuts that mostly benefitted the rich and corporate. The result? When baseline growth in taxes reverted back towards the historical norm in 2014, the tax cuts led to a revenue shortfall.

Combine that with a 38th-in-the-nation standing for job growth in 2014, and the Legislative Fiscal Bureau estimated in January that the state had a $283 million deficit for the fiscal year that ends on June 30. So did the Walker Administration and WisGOP call for another budget repair bill, since there was a larger hole than there was 4 years ago? OF COURSE NOT. This time they claimed that things would work themselves out, and waited for better revenues while making moves behind the scenes such as skipping a $108 million debt payment in May, and covering Medicaid deficits with one-time gimmicks like using $47 million in money from settlements with drug manufacturers, which means those settlement funds aren't available in future years.

However, there wasn't a May upside revenue surprise like we saw in 2011, as the Fiscal Bureau said revenues would stay at the same projections that we saw in April. Interestingly, the Wisconsin Department of Revenue has delayed releasing the May revenue figures, which was a month in which Wisconsin lost more jobs than any other state in the U.S. Given that a bad May would likely result in a year-end deficit, and drive down base revenues for the upcoming 2015-17 budget, you can see where the current and future budgets could be endangered.

And the Federal Reserve of Philadelphia said late last week that things aren't expected to get better in Wisconsin over the next few months.

That pink is not a good thing for Wisconsinites, and the negative economic outlook can't help for either the 2013-15 budget or the next one.

The 2015-17 budget was already its own disaster, with large cuts to education, state parks and the science areas of the Department of Natural Resources, just to make the numbers add up. This would likely cause increases in unemployment and drops in economic activity due to the lack of investment. In addition, there are also $700 million in undesignated lapses in the second year of the budget, which means there are other areas that will likely be looking at cuts in the near future, but the GOP doesn't want to tell people where that will be at this moment.

In addition, state employees are also set to take another cut in take-home pay. These are the same employees who already had money taken out of their pockets to pay a higher share of health care and pension costs in Act 10, but Walker and WisGOP backers indicated this was a one-time deal, and that state workers would benefit from a more stable budget in future years. THAT AIN'T HAPPENING. State employees are not slated to get increases in pay for the next two years, and they also will lose additional take-home pay through higher out-of-pocket expenses for health care and related "savings" to make Walker's budget balance. Needless to say, these public employees will likely not be able to spend as much at local businesses, which continues the downward spiral of austerity that has hampered the Wisconsin economy for the last four years.

An additional problem in 2015 that didn't exist in 2011 is that unlike what we had 4 years ago the state's Transportation Fund also has fiscal problems in 2015. Gov Walker's refusal to raise taxes or stop spending on expressway projects means that there is $1.3 billion in borrowing in this budget and an exploding of debt service costs that will have to be paid in future years if those plans stand. But this is unacceptable to many in the Legislature, including Gov Walker's own Republican Party, and it's why we stand 2 days away from the end of the fiscal year with no budget agreement close to being in place. The catch is that Walker insists he will not raise taxes or registration fees (in a shameless pander to GOP bubble-world for the 2016 presidential race), which means there would be projects delayed and a need for added expenses in future years to take care of the backlog.

Scotty's not planning to be around for the economic mess and fiscal disaster that will continue with this budget, and will likely go off in another year, but you can tell that the GOPs in the Legislature are feeling the heat. However, they are trapped by their dogmatic insistence on not raising taxes in most areas, so we will see the end of fiscal year 2015 pass without a budget, even with the GOP in charge of all branches of state government. And with the one-time gimmicks on spending like Act 10, and the revenue-hampering tax cuts staying in place, this means Wisconsin will be facing fiscal and economic deficits for several years, and it can only start to be fixed by throwing this crew out of power.

Deconstructing GOP budget lies pt. 1- we weren't broke in 2011

The Number 2 guy in the State Assembly really stepped in it on social media this month, and it allows us a chance to revisit the first days of the Age of Fitzwalkerstan, when bombs were dropped and everything started to go wrong in this state. This incident relates to a whinefest of tweets and claims from GOP Rep. Jim Steineke on June 18 relating to the Bucks arena issue and related budget issues. You may recall that it included this race-baiting classic (since erased from Steineke's page).

MN also has a first class city that isn't a drain on the rest of the state. #DemLeadership #MKEinCrisis https://t.co/3S0hw4QDyo

— Rep. Jim Steineke(@jimsteineke) June 18, 2015

I suppose former mulleted deadbeat and DUI convict Jim Steineke might know something about what a "drain on the state" is, but that's beside the point. What I want to discuss is another tweet Steineke sent out in that meltdown, where he stated "WI was literally broke when [the GOP] got here [in 2011]." The right-leaning Journal-Sentinel's Politifact looked at this claim, and with Steineke refusing to answer Politifact's request for follow-up information on why he said that, they gave Steneke's claim a "false," . Here is part of their reasoning why.
When we cracked a dictionary to look up the word "broke," we found listing that included: "having no money; bankrupt" and "without money, penniless."

But numerous experts told us the state wasn't teetering on the brink of bankruptcy or insolvency and, under federal law, could not make such a declaration. In January 2011, Moody's -- which studies and rates debt issues by governments and corporations -- had said Wisconsin fared well when compared with other states.

What's more, the state had numerous tools available to deal with any shortfall -- even if some of the options, such as tax increases, were declared off-limits by Walker and Republicans.
And with that in mind, let's go back to the Legislative Fiscal Bureau's revenue estimates that came out in January 2011, which showed that there were sufficient revenues to handle the current-year expenses as they stood on January 31. Sure, there were likely extra expenses that had to be handled, such as $176.5 million of Medicaid expenses that hadn't been budgeted for, but notice how that was handled in the actual budget repair bill that later became Act 10. It was NOT done by lowering the expenses the state paid out for benefits (those savings came in the 2011-13 budget), but instead came from kicking the debt down the road.
Provide $165,000,000 of general obligation refunding bonding for the purpose of restructuring $165,000,000 in outstanding principal on GPR-supported, general obligation debt that would otherwise be paid off in May, 2011. The bill would authorize this bonding by increasing a current refunding authorization from $309,000,000 to $474,000,000 (an increase of $165,000,000) of state public debt that may be issued to refund any unpaid indebtedness relating to tax-supported or self-amortizing facilities. These bonds cannot be issued after June 30, 2011.

Although this bonding could be used to restructure both tax-supported and self-amortizing bonds, the administration indicates that only GPR-supported bonds would be restructured. Based on information from the administration on the potential structure of these refunding bonds, this provision would: (a) increase GPR-Lapses by $165,000,000 in 2010-11 from GPR debt service appropriations to reflect the reduced GPR principal payments to be made from those appropriations in that year; and (b) increase anticipated GPR debt service costs in the 2011-13 biennium by $29,570,000 to reflect the initial principal payment ($15,560,000) associated with the expected ten-year amortization of the $165,000,000 in deferred principal and the initial interest payments ($14,010,000) due on that principal.
Those who voted for Act 10 also reduced lapses to the General Fund by $79 million, meaning those cuts didn't have to take place, and the budget was still in balance for the rest of the fiscal year without those lapses taking place.

And as we found out later, the State Legislature didn't even need to take those steps. The state's economy had been improving as Gov Walker came to power in January 2011, and the state's budget reaped the benefits of that strength with higher revenues that were revealed in May 2011.
Based on our review of the collections data and the new economic forecast, we now believe that general fund tax revenues will be higher than the previous estimates by $233 million in 2010-11, $204 million in 2011-12, and $199 million in 2012-13. The three-year increase is $636 million, or 1.6%. Over the three-year period, the income tax estimates have been increased by $910 million, and the sales tax and corporate tax projections have been reduced by $240 million and $68 million, respectively. Smaller revisions have been made to the estimates for other taxes....

In the months since the January estimates were released, total income tax collections have increased by approximately 28% over the same four-month period last year, and year-to-date growth through April has improved to 12.3%. The main source of strength has been in amounts collected with income tax returns filed this spring for the 2010 tax year. In the last four months, payments remitted with returns have increased by almost 35% compared to last year, and refunds are 7.3% lower. Together, this has resulted in additional revenues of $228 million over the amount collected during the same period last year. The most likely reasons for this strength are the large gains in the stock market since early 2009 and improved business profits of pass-through entities (partnerships, limited liability companies, and subchapter S corporations) that are taxed under the individual income tax.
So that increase of $233 million in revenue for 2010-11 would have taken care of all of those extra Medicaid expenses, without having to kick that $165 million in borrowing (and extra debt payments) into the future budgets. But Walker and WisGOP had to pretend there was a budget crisis in order to try to justify the union-busting of Act 10.

This shows that the budget situation Scott Walker and the Wisconsin GOP inherited in 2011 wasn't nearly as dire as right-wing GOPper-ganda tried to portray it as at the time, or as GOP Majority Leader Jim Steineke falsely claimed it to be earlier this month. As Scott Walker tries to peddle to out-of-state rubes that he somehow saved Wisconsin from fiscal disaster, the facts and events of the future show that many of the fiscal issues for 2011 and the 2011-13 budget was going to be fixed by the Obama Recovery regardless of what Scotty did, which means the severe, crippling cuts that have damaged schools, local government and infrastructure in the four years since could have been minimized if the Fitzwalkerstanis would have chosen to do so.

It's those irresponsible policy decisions that Walker and his WisGOP minions in the Legislature made that has put Wisconsin into the budgetary mess with slow growth that we have today, and I'll discuss that part of the equation in Part 2 of this post.

Saturday, June 27, 2015

Dumping the flag only a first step

It was amazing how fast that GOP politicians backed off of their Confederate dog-whistles once white supremacist Dylann Flood massacred 9 black parishoners in a church in South Carolina. Faux News' lame attempts to trot out a token to say that Flood was trying to attack Christianity was quickly given a "HELL NO" by the vast majority of people outside of bubble-world, and there does seem to be a sense that this incident has driven a lot of people to say "NO MORE" when it comes to blowing off the Confederate flag as merely "Southern heritage," and instead recognizing it as the racist symbol which promotes white supremacy that it is, and always has been.

But it's still not enough, and South Carolina Governor Nikki Haley's support for taking down the flag is a whole lot different than having the State Legislature follow through. Which is why it took an everyday person to take matters into her own hands today, climb the flagpole atop the Confederate Soldier Monument at the South Carolina Statehouse, and take the flag down herself.
Bree Newsome, 30, dressed in climbing gear and helmet, removed the flag just after 6 a.m., about four hours before a pro-Confederate flag rally was set to take place at the monument.

Newsome and James Ian Tyson, 30, also of Charlotte, were taken into custody by Department of Public Safety officers as soon as Newsome touched ground. The two were later charged with defacing a monument. Tyson was inside the wrought-iron fence surrounding the 30-foot pole helping Newsome climb....

The group that helped organize the climb said in a release that it was an effort “to do what the SC legislature has thus far neglected to do.”

“We removed the flag today because we can’t wait any longer,” Newsome said in the statement. “We can’t continue like this another day. It’s time for a new chapter where we are sincere about dismantling white supremacy and building toward true racial justice and equality.”
And building toward true racial justice and equality goes well past just getting rid of the "Stars and Bars" in public. This was eloquently summed up by State Rep. (and the newly-elected 1st Vice-Chair of the Democratic Party of Wisconsin) David Bowen. Bowen is a Milwaukee native and former Milwaukee County Board Supervisor who has witnesses first-hand the effects of the racist overtones frequently given out by Governor Scott Walker, the Wisconsin GOP, and their spokespeople on AM radio. Bowen also notes what people like Dylann Flood said was his motivation for committing mass murder didn't sound very different than what is frequently heard from GOP politicians and talk radio hosts.
Unlike most of the perpetrators of mass violence in recent years, the killer behind last week’s shooting was very clear what his motivation was. He was quoted as saying to one of his victims, “You rape our women, and you’re taking over our country. And you have to go.” The manifesto he posted online contained similar thoughts, like “[African-Americans] are stupid and violent. At the same time they have the capacity to be very slick.” While we don’t often see such sentiments expressed so nakedly, the ideas behind them are all around us, while advocates against them have been ignored. Those ideas show up in rhetoric of mainstream conservative media, and they are reaffirmed by our elected officials.

For example, when conservatives in the media refer to our nation’s first black President, Barack Obama, as the "Food Stamp President" and politicians treat FoodShare recipients like they’re drug addicts trying to game the system, it reaffirms the idea that black people are lazy but slick. When unarmed black residents are treated differently than their white counterparts by law enforcement--and many times killed—and politicians seeking to be tough on crime are arresting protestors calling for change, it reaffirms the idea that black people are "lawless" and "thugs". When they tell stories of people being driven up from Chicago by the busload to vote in our elections in order to pass unnecessary voter ID legislation to make it harder to vote, it reaffirms the idea that black people are stealing the country away from law-abiding white people. And when the leaders of our state blame Milwaukee for Wisconsin’s budget problems and call it a drain on the rest of the state, it reaffirms the idea that black people are not just a burden to our state but to the larger narrative that black people are destroying this country. Once we are honest about how much of the Charleston killer’s rhetoric is reflected in conservative policy and conservative Fox News talking points, then we can move forward to ensure we all are willing to stand up to hate that kills black people praying in a church. This request for accountability also includes liberals who fail to call out and act against racism at every chance they can. Gov. Walker did the right thing by donating $3,500 of campaign funds from the leader of the racist hate group that inspired Dylann Roof's manifesto. The Republican Governor of South Carolina did the right thing by finally proposing to take down the confederate flag. But they are short-sighted if they truly believe this is the end of their contribution to this discussion and action to reconcile this hate. The next steps must include taking a hard look at policies, lack of resources, and rhetoric that oppress black people and devalues the contributions of their ancestors to build this nation. Racist ideas and oppressive messaging don’t need to inspire a mad man with a gun to hurt people. They can do just as much damage in the long run by encouraging politicians to pass oppressive policy.”
RIGHT ON THE FUCKING MONEY. Now is not the time to settle for the taking down of the Confederate flag in public, but to demand true equality and respect for African-Americans in all walks of life. That includes calling out the racism that is part and parcel of the GOP's electoral strategy and policy choices, standing up to the voices of right-wing hate that pollute AM radio and political discourse, and to send the message that going along with this regressive garbage will make you pay a heavy price at the polls.

A few GOP legislators in Wisconsin responded by trying to claim fauxtrage over Bowen's accurate remarks, but methinks those GOPs are protesting a bit too much (hi there, Adam Jarchow! I hear what you're whistlin'!). I think the events in Charleston has led to a heightened sense with the average American that the GOP is a racist party that wants to play "divide and conquer" to gain political advantage, no matter what damage it does to the country economically or socially.

A frequent Dem mistake is to let things drop in the desire to seem like nice people. But there's nothing nice about allowing repression and bigotry to go unanswered, and even though Dems don't have 9 hours a day on the public's airwaves to pound home the message that GOP Confederates are racist bastards, that still shouldn't stop them from speaking up at every turn, and exposing the double-standards that allow for Scott Walker's Wisconsin to micro-manage what food stamp recipients can purchase, but will allow $124 million in taxpayer dollars to go out the door to corporates without adequate oversight.

If the opinion that "GOPs = racist, bigoted views of the past" clicks with voters, and there should be plenty of opportunity to do so as GOP presidential candidates like Scott Walker are openly using Confederate "states rights" language to court bigots, the GOP will be wiped out in the 2016 elections. And they definitely would deserve the ass-kicking.

State Rep. Andy Jorgensen helps break down how screwed up things are

Here's a really good and wide-ranging interview between radio host John "Sly" Sylvester and State Rep. Andy Jorgensen (who's great and deserves an even more prominent role that he has). It starts with Jorgensen talking about the recent meeting he had in Gov Walker's office to go over state budget issues and seeing what the Dems could get in return for some concessions or support for some of the Governor's initiatives. This caused some headlines this week when Jorgensen claimed the Governor needed Dem votes outside of the City of Milwaukee on the Bucks arena, which Scotty's office tried to weasel out of admitting.

3:20 Jorgensen says Walker did not have a formal Bucks bill or plan written down on paper, which Jorgensen found to be "very unusual," and that the details on the Bucks bill are still being worked out in the GOP caucus. Later on (around 7:00), Jorgensen says Walker doesn't care whether the Bucks arena bill is or is not in the budget, just that it gets done. This prompts Sly to remind Jorgensen about the bitter fight 20 years ago regarding the Miller Park funding for the Brewers, and that former Gov Tommy Thompson was so angry about what he felt was deception by Bud Selig about the Brewers' situation that Tommy has never stepped foot in Miller Park as a result!

10:00 Sly brings up the interesting sidelight that there was a Journal-Sentinel report indicating the Bucks arena wouldn't even be multi-purpose, and that the Admirals (or any future NHL team) wouldn't even play there.

11:30 Jorgensen says Walker told him that the I-39/90 expansion south of Madison and the Zoo Interchange are "on the same plane," but that "delays are inevitable.", If that's true, then why is Walker also saying he'll defer to the DOT's plans where the Zoo Interchange is not part of any cut, while the I-39/90 expansion, which the Legislative Fiscal Bureau says will be delayed if the amount of spending is reduced... which would have to happen if borrowing is reduced because Walker is insistent on not raising taxes or registration fees to fund transportation. So our Governor is either disconnected from reality, or he lied to Jorgensen's face about the two projects being equal priorities.

15:45 Jorgensen says Walker stated there was a "long list" of vetoes he is considering (not gonna do it, just gonna think about it), and then Walker seems to equate the skill of teaching is no different than someone explaining what they do to their kids on career day. And you wonder why Gov Dropout sucked at school?

20:00 Jorgensen relays the story of State Rep. Mary Czaja telling her constituents up North that her bill to reduce teacher licensing standards came from "leadership." This leads to some very interesting talk about how things work inside the party caucuses on how much influence the leadership gets over individual members on votes.

23:00 Some damning statements on how the is really working in the Capitol, including Sly charging that Robbin' Vos tells legislators how to vote, and shakes down both legislators and lobbyists for money and "controls everything." And Jorgensen notably doesn't deny it when Sly calls former State Rep. Michelle Litjens is Vos's girlfriend and has undue influence inside the Capitol (she certainly gets a lot of attention for being a one-term state legislator and current "self-employed lobbyist.") Around 27:00 Sly adds that "a lot of people don't like Speaker Vos," due to his bullying and crookedness, including many Republicans.

Around 28:20 begins some tough talk from Sly where he mentions that Dems ran both houses of the Legislature after the 2008 elections and didn't use that opportunity to pass non-partisan redistricting, anti-corruption measures, and other moves that would have pre-empted many of the abuses of power we've seen from WisGOP over these last 4 1/2 years. He then follows up by asking Rep. Jorgensen why Dems aren't being harsher on the failings of WEDC, as he worries that not enough people know just how crooked WEDC is, and that they don't realize how many millions of taxpayer dollars have been pissed away on this slush fund. It culminates around 34:15 where Sly says "What business would run themselves like this without going to jail?"

At the end around 38:00- Jorgensen says to watch for the Omnibus motion at the end of the Joint Finance Committee's last budget meeting (whenever that is), as it will feature plenty of "surprises", and not in a good way. And once that ends, the two houses of the Legislature will try to jam through the budget bill at "lightning speed."

It's well worth the listen, and it shows that despite the fiscal year ending on Tuesday, this budget has a whole lot of remaining questions left in it. Which demands that we raise, and not lower our vigilance as we wait for decisions to be made and policies to be put in place.

Friday, June 26, 2015

The folks up North are biggest winners in Obamacare decision

You may know that over 6 million people dodged a bullet with the U.S. Supreme Court’s King v. Burwell decision on Thursday, which allowed tax credits for policies bought on the Affordable Care Act’s federal exchanges to stay legal. What you may not know is that the people in Wisconsin that benefit the most from this decision aren’t in the two largest cities in Wisconsin (Milwaukee and Madison), but instead live in the 920 and 715 area codes.

As this analysis from Families USA shows, it’s actually the districts represented by anti-Obamacare Republicans Sean Duffy and Reid Ribble that have the state’s highest amount of recipients of tax credits for insurance from the Obamacare exchanges.

This makes some sense when you think about it, because those on the exchanges are people who make above the poverty level, so they don’t qualify for Medicaid under Wisconsin’s current thresholds. But they also don’t make enough so that they are disqualified for the tax credits, or that the tax credits are so small it’s not worth it (the website “Obamacare facts” has this calculator that allows you to play out scenarios). So despite the right-wing trope about how Obamacare is some kind of "giveaway to inner-city minorities on welfare", those who were most likely to be endangered by the right-wing’s Supreme Court lawsuit were the small-town working poor in Northern Wisconsin.

And our Gov is still willing to cause major uncertainty and peril to these constituents today, with his continued calls to “repeal and replace” the “destructive” ACA, one of many issues that Scotty seems to be behind the 2015 reality on for this week. If I was a Dem strategist, I might remind a lot of folks in that part of the state about how their Governor and their Congressmen were willing to throw away a great stabilizer in their lives just to score political points.

The New York Times’ Paul Krugman reflected on the upholding of the status quo for the Affordable Care Act, and noted that opponents such as Gov Walker have been continually wrong in their predictions of “Obamacare calamity” over the last 5 years.
What about costs? In 2013 there were dire warnings about a looming “rate shock”; instead, premiums came in well below expectations. In 2014 the usual suspects declared that huge premium increases were looming for 2015; the actual rise was just 2 percent. There was another flurry of scare stories about rate hikes earlier this year, but as more information comes in it looks as if premium increases for 2016 will be bigger than for this year but still modest by historical standards — which means that premiums remain much lower than expected.

And there has also been a sharp slowdown in the growth of overall health spending, which is probably due in part to the cost-control measures, largely aimed at Medicare, that were also an important part of health reform.

What about economic side effects? One of the many, many Republican votes against Obamacare involved passing something called the Repealing the Job-Killing Health Care Law Act, and opponents have consistently warned that helping Americans afford health care would lead to economic doom. But there’s no job-killing in the data: The U.S. economy has added more than 240,000 jobs a month on average since Obamacare went into effect, its biggest gains since the 1990s.

Finally, what about claims that health reform would cause the budget deficit to explode? In reality, the deficit has continued to decline, and the Congressional Budget Office recently reaffirmed its conclusion that repealing Obamacare would increase, not reduce, the deficit.
In other words, Obamacare is doing exactly what it was intended to do- expand accessibility to health insurance for many Americans while controlling premium costs and maintaining the current private insurance company model of coverage. It’s not everything I’d want (which is single-payer Medicare for all), but it’s an improvement over what we had.

And keeping Obamacare in its current form is a helluva lot better than the chaos and lack of controls on insurance companies and insurance costs that would result if someone like Scott Walker became president (STOP LAUGHING!) and had a GOP Congress wipe this law off the books. So please, Scotty- continue to try to run on “repeal and replace” for a law that’s working well, and has if anything, improved economic outcomes for people in this country.

Thursday, June 25, 2015

Onto the next level for Sam and Frank

I could talk about today's historic court decision upholding Obamacare's subisidies on the federal exchanges, and how it bails out to "no-idea on health care" Republican Party- you know, if they were smart enough to STFU and stop appealing to the anti-Obama bigots with a "repeal" posture that'll never happen, and never be accepted by above-ground voters.

But this evening belongs to two guys who represented my alma mater with great pride and dignity in recent years, and now they likely will be the people that make Badgers history for having two Bucky hoopsters going in the 1st round in the same year.

Kick some ass at the next level, Sam and Frank. U RAH RAH!

Wednesday, June 24, 2015

GOP budget blundering continues

Here's a quick glance around at another day of GOP bumbling about the state budget.

We still have major conflicts showing within the GOP caucus about the transportation budget, with other WisGOP Assembly members chiming in today in opposition to Gov Walker's plans. To start, here's State Rep. and Joint Finance Committee member Mary Czaja.
Asked on Wisconsin Public Radio's "Central Time" Tuesday whether she'd support options like raising taxes or vehicle fees, Czaja said she'd support raising the gas tax.

"It's actually a user fee," she said. "You know, if you're going to use our roads, you need to help pay for them. And by raising the gasoline tax maybe three to five cents, we're also capturing out-of-state money."
Czaja was also one of the 33 outstate Assembly Republicans who sent a letter demanding that any highway cuts include the Zoo Interchange and other Milwaukee-area projects. Czaja's stances go in clear contrast to the wishes of Gov Walker, who not only is opposed to any increases in fees and gas taxes, but also wants the Zoo Interchange project to remain fully funded in this budget.

But it wasn't just outstate GOPs that are speaking up against Gov Walker's budget these days. Waukesha Rep Scott Allen penned this column yesterday laying out his thoughts on the DOT budget. While Allen supports keeping the Zoo Interchange project on track, he also takes issue with Walker's "no increased taxes or fees" pose.
In a recent district-wide survey, residents of the 97th district gave me their opinion. Of the 481 people who answered the transportation fund question, 37% of people said that we should increase the gas tax, 30% said we should increase the vehicle registration fee, 20% said we should implement some kind of user mileage fee, and only 13% said that we should increase borrowing...

Prudence would call for a scaling back of the road re-building budget and enhancing the revenue that comes into the transportation budget. Personally I support the notion that those that use an asset or a service should pay for the use. Our vehicle registration fees are the lowest in the Midwest, by far. It is amazing to me that it costs more to purchase tickets and pay for parking at Six Flags Great America for one day of use of the park than it does to purchase unlimited use of Wisconsin highways for an entire year. Why our Governor, who I support, refuses to recognize these gross disparities and do something about it, I don’t know.
Walker seems to be disconnected from what a lot of his fellow GOPs are dealing with these days. While Scotty was telling reporters today that he expected a budget deal to be finished within a few days, Assembly Speaker Robin Vos had a slight difference of opinion from the Governor on that.

I'll go with the guy who's actually been in Wisconsin most of the days this month on that one. And Wispolitics.com gives another reason I'm not going to buy Gov Walker's happy talk about the budget getting done any time soon
The Joint Finance Committee will not meet tomorrow, according to Co-chair Rep. John Nygren's office.

There is no additional information about when the JFC will reconvene, according to the Marinette Republican's office.
Senate Majority Leader Scott Fitzgerald explained why there's no need for the JFC to meet, as there is no agreement within the GOP caucus on several outstanding issues, and Fitz even met with 3 Senate Democrats from Milwaukee today in an attempt to work out some kind of agreement on the Bucks arena, in case that bill gets pulled out of the budget (an option that looks more likely by the day).

What a total mess. And I don't get the impression Walker gives a damn about it.

Despite document dump, still smells like a cover-up at WEDC

Gov Scott Walker made a couple of rare in-state appearances today, and I don't think they did much good in helping his plummeting poll ratings. He first appeared to give a wet kiss to the NRA by signing a law removing a waiting period to buy handguns (nice timing on that one). But it was at a second appearance at a photo op (promoting major events in golf that will be coming to Wisconsin in the next 5 years) where Scotty had to answer some real questions regarding the recent revelations about the Wisconsin Economic Development Corporation (WEDC), an agency he created in 2011 and on whose board he is the chair.

You may remember that WEDC revealed on Friday afternoon that it improperly gave out $124 million in loans in its first 18 months of existence, including many alleged projects that fell far short of the promised amount of job creation. Remarkably, our usually timid media tried to follow up with the Gov on this story today, and as he usually does when he's got to say something off the cuff, Scotty flailed around making excuses and sounding foolish.
Walker, speaking at an unrelated event in Hartford, defended the embattled Wisconsin Economic Development Corp. by insisting it "didn't cut corners."

“Obviously there’s been a few cases where they weren’t as highly effective as we’d like,” Walker said.
Actually Scotty, the report says that corners WERE cut. That's why $124 million was listed by WEDC as being inappropriately handed out. And "they weren't as highly effective"? On what metrics? The fact that these projects promised to add 6,100 jobs and it only added 2,100? That you were supposed to hand out more money to corporations?

Or perhaps Scott Walker is pulling a Freudian slip, and that the laws of WEDC were intended to have money handed out without oversight or evaluation of the business plan, and not get noticed by auditors and open records requests. Scarily, this is a possibility, and that's a whole lot more damning.

And our Governor sure didn't seem very Unintimidated when it came to talking about the WEDC slush fund, literally walking away from confronting the issue.

The two Democratic members on the WEDC Board, State Rep. Peter Barca and State Sen. Julie Lassa, are demanding changes at the top at WEDC, asking that CEO Reed Hall resign, as the two Dems said they had no confidence in Hall's leadership. Barca and Lassa said the document dump on Friday afternoon was actually a further cover-up, because while giving the impression of releasing information, the WEDC release didn't give all the details that were asked for.
We were not informed that a formal underwriting process had not been conducted for these awards or any awards that came before the board, and we certainly were not informed of the fact that officials from at least one of the companies had apparently made tens of thousands of dollars in contributions to the Governor’s campaign committee.

“The awards the Governor’s spokesperson referred to amount to only three of the 27 awards that we recently learned did not receive formal staff underwriting. The three awards we did approve – without any knowledge that they lacked underwriting – were Enterprise Zone designations, the only kind of award that ever received board review at the time. The board only received information in closed session regarding the companies and projects involved, how large the award would be, and how many jobs the company had promised to create or retain....

“This kind of response demonstrates once again that WEDC and the Governor are more concerned about using misinformation to manage their PR crisis than they are about getting to the bottom of the problems with this agency.

“Instead of again misleading the public, we would rather WEDC and the Governor focus their energies on quickly getting us all the records we requested – including any awards they made over the objections of underwriters, Community Development Block Grant activity under WEDC and now the Department of Administration, and details of loans under $200,000 that were approved without staff review.”
The reactions of Walker, Barca and Lassa reiterate that WEDC will not fix its many problems on its own, and the Walker Administration and Attorney General Brad Schimel will avoid taking anything but baby steps and misdirection to keep the heat off of a slush fund that has benefitted many of their donors. That's why there must be a full-fledged FEDERAL investigation into the WEDC slush fund, and the alleged cover-up by WEDC staff in releasing information to the Dem board members makes it all the more apparent that there has been some huge levels of fishiness going on at the Tommy Thompson building, with a whole lot more details that need to be brought to the public's attention.

Tuesday, June 23, 2015

An update on WisGOP's transportation bind

Yeah, I wouldn't count on the state budget being done when this current fiscal year ends one week from today. A look at developments in recent days on the state's Transportation Fund indicates that not only are the Wisconsin Republicans still not close to an agreement, but they seem to be moving further apart, instead of getting closer.

These cleaves in the Republican caucus were very apparent in a letter signed by numerous GOPs in the Assembly and sent yesterday to GOP leadership in both houses of the Legislature. The letter demanded that any cuts in transportation projects be spread throughout all parts of the state, and pointed the finger directly at Scott Walker's borrow-and-spend policies for putting the state in this bind.
This legislature has made tough choices to ensure our state's finances are in order (Hey! Stop laughing!) We find the level of transportation bonding in the Governor's budget proposal to be untenable. Currently, $0.17 of every $1.00 of transportation spending goes to debt service. Under the Governor's budget, $0.25 of every dollar would go towards debt service. This path is simply not sustainable. If a long-term solution cannot be achieved in this budget, we support the alternative of reining in the state's transportation spending and delaying projects until the required funds are available.

However, we want to be abundantly clear that the decision to make responsible budgeting choices should have a shared and equal impact statewide. The discussion of excluding the Southeast [Wisconsin] Megaprojects (including the Zoo Interchange) from any cuts or timeline delays would disproportionately affect our constituents and taxpayers outside the Milwaukee area.

As you know, safe and reliable transportation infrastructure is critical for commerce and safety across Wisconsin. We cannot allow a singular focus on Milwaukee to bring detrimental effects to industry, tourism, and ultimately the taxpayers of Wisconsin.
The letter was signed by more than half of the Assembly GOP caucus, and it did not include one legislator in the 414 or 262 area codes. It reiterates the public argument from last week between the two Co-Chairs of the Joint Finance Committee, where the outstate GOPs are clearly at odds with the ones from the suburbs and small towns near Milwaukee, Racine and Kenosha.

The Legislative Fiscal Bureau has documented which projects are slated to be built outside of SE Wisconsin, and which ones will be hit through the reductions in spending. The amount of these major highway projects outside of the SE Megaprojects are estimated at $836.1 million, and Gov Walker set aside $623 million for the SE Megaprojects, which would all go to the Zoo Interchange project in this 2015-17 budget.

So what would happen with an $800 million cut in DOT spending, which is the number that Assembly Speaker Robbin' Vos has thrown around as a goal when it comes to reduced borrowing. The LFB notes that $500 million of the cuts would likely be split by taking $300 million away from the major highway projects, and $200 million for regular maintenance (I mentioned some of the outstate projects that would be delayed in this post). Bad enough, but if the Legislature follows the wishes of the outstate GOPs and includes the Zoo Interchange in the cuts, the LFB says there would be a double-whamy where the Zoo Interchange project drags on for another year, and they STILL can't come up with the $300 million in cuts.
DOT was asked how it could best absorb a $100 million to $200 million cut to the Zoo Interchange project. The Department indicated that if such a cut were required, that it would prefer to delay the north leg of the Zoo Interchange project (USH 45) by one year, which would reduce the amount of funding needed in 2015-17 by an estimated $155 million. [Alternative #A2] DOT believes that delaying this project component would result in an estimated $6.3 million increase in costs due to inflation. Because of the project timing, the timing of design completion for this project could be slowed down to eliminate the need to update future specifications based on the potentially revised project schedule. However, this alternative would result in the need to fund the remainder of this project in addition to ongoing costs associated with the I-94 North-South freeway project in 2017-19.
And in that scenario, there would still be $145 million in cuts or tax increases that would have to be figured out, on top of the reality that there would be extra costs in the next budget to pay for a Zoo Interchange project whose completion would be delayed into 2019.

Of course, an easy answer when it comes to filling the gap without borrowing would be to raise taxes and/or fees that go into the Transportation Fund. The LFB estimates that raising the state's gas tax by a mere nickel a gallon would add $318.6 million to the Transportation Fund in the next two years, so only half of that would be needed to make up for that last $145 million that would get to Vos's goal of $800 million in reduced borrowing. It means any gas tax increase could be put off until July 2016 conceivably, or the Legislature could be inventive and only have the raise happen in the tourist-driven months between April and October, which lessens the burden borne by Wisconsinites that live and work in the state year-round. Raising the registration fees for all cars and trucks under 4 tons by $20 a year would also fill in that $145 million hole, if the GOPs want to weasel their way out, and claim they didn't raise "taxes" (a trick they've already done with camping and other DNR-related fees for next year).

But then that would be defying Walker's promise not to raise gas taxes or registration fees, as part of the pose he strikes to the bubble-world oligarch purists that he wants to kiss up to in the 2016 presidential campaign. And so Wisconsin GOP legislators that have to face Wisconsin voters next year are stuck in a massive pickle, which means the budget remains stuck in neutral, with regional and ideological differences being apparent, and very little progress being made as our fiscal year grinds to a close.

Monday, June 22, 2015

Wisconsin economy back to the end of the line

I wanted to revisit the awful jobs numbers that came out for Wisconsin in May (8,600 jobs lost, 6,100 in the private sector, and April revised down by more than 3,000) now that the Bureau of Labor Statistics has also released the state-by-state jobs report for May. This will show that Wisconsin is largely isolated in its awful performance in jobs for 2015, and the gap between us and the rest of the Midwest has grown even more in recent months.

It's bad enough that there's this passage in the state-by-state report .
In May 2015, nonfarm payroll employment increased in 37 states and the District of Columbia, decreased in 12 states, and was unchanged in Montana. The largest over-the-month increases in employment occurred in California (+54,200), New York (+42,700), and Texas (+33,200). The largest over-the-month decrease in employment occurred in Wisconsin (-8,600), followed by North Dakota (-5,300) and South Carolina (-4,900).
But job losses in March, flatlining in April and additional losses in May mean that Wisconsin has barely added anything during 2015, while our Midwestern neighbors have still been seeing benefits of the Obama Recovery.

Private sector job growth, Dec 2014- May 2015
Ohio +41,400
Mich +33,500
Ind. +29,400
Ill. +26,000
Minn +20,700
Iowa +9,800
Wis. +7,200

If you put together those figures with the recently-released "gold standard" QCEW jobs report, Wisconsin doesn't just stay in last place for private sector job growth, but we fall further behind everyone else.

These recent job declines also have driven down Wisconsin standing in today's release of the Philadelphia Federal Reserve's Coincident Index of all 50 states. This index looks at numerous economic statistics to evaluate the strength of the economies in all 50 states, and you'll see that while Wisconsin has not had its economy contract in the last 3 months, like the (GOP-voting) states in red, we're not too far above 0 either.

In fact, Wisconsin's economy is clearly the worst in the Midwest in the three months since Scott Walker introduced his budget earlier this year.

Change in coincident index, Feb-May 2015
Mich +1.56%
Ind. +1.00%
Iowa +0.82%
U.S +0.68%
Minn +0.59%
Ill. +0.36%
Ohio +0.26%
Wis. +0.12%

So we've got the worst job growth in the Midwest over the 4 1/2 years of the Age of Fitzwalkerstan, the worst economy in the Midwest in the last 3 months, and a state budget that's so screwed up that Scott Walker's own party cannot get a budget done on time, and may not have one for quite a while. Go ahead Scott Walker, you run for president on your record of "turning the state around." Because you sure have, but not in a way you want people to think.

Yet again, Jon Stewart > Chuck Todd on real news

Not that we didn't know Chuck ("It's not my job to give the facts") Todd was a disgrace to journalism. But he took it to a whole new depth this weekend when he tried to blow off the motivations of the white supremacist who shot up a black church in Charleston, S. Carolina and killed 9 parishoners. Instead of discussing what type of hate might drive someone like 21-year-old Dylann Roof over the edge and ask why GOP politicians and right-wing radio have at the very least condoned such a destructive mindset, Chuckles decided to defuse the race part of the Charleston shooting... by showing black criminals talking about the gun crimes they committed!

Not only is it a borderline racist segment and a sickening attempt at false equivalency for a despicable hate crime, but it's not even the right journalistic angle to take. This is a story about racial hate and the violence that resulted from those hateful thoughts, the prevalence of guns (while a problem) are a very minor part of this story. The fact that Chuck Todd and this crew has judgment like that and are in charge of the highest-profile show on NBC News is disgraceful, and the great Charles Pierce hit it out of the park on just how bad this was.
Of all the things that weren't "hidden" this past week, I'd say "the consequences of gun violence" are at the very toppermost of the poppermost. Translation from the Original Weaselspeak: we knew this segment would goose the ratings, particularly that portion of the audience susceptible to the reasoned argument: "What about the blacks who kill people? How come they don't get covered? Huh? Huh? Gubba, gubba!" And then, of course, the piece derp resistance.

[Chuck Todd speaking] As I say to all audiences, Meet the Press should make all viewers uncomfortable at some point or we are not doing our job.

No, goddammit. NO! If you want to know how one of our two major political parties has gone insane, there's your answer. If you want to know why its nominating process has become the ghoulish farce that it is, there's your answer. If you want to know why climate denial, creationism, and all the forms of anti-science and weaponized ignorance continue to survive in the 21st century, there's your answer. The weekend after nine African Americans are slaughtered at prayer by a racist barbarian is not a point at which to "make all viewers uncomfortable" by running a segment that can do nothing except enable the people who want to make the massacre about anything but race. This was beyond moronic. People should be fired. Programs should be cancelled.
Yes Charlie, they should.

Compare Chuck Todd's blowing off of this massacre with how a "less legitimate" newsman handled it, Jon Stewart. And notice how the crowd at "The Daily Show" gets it, and turns as serious as Jon continues on his thoughts.

I honestly have nothing other than sadness that, once again, we have to peer into the abyss of the depraved violence that we do to each other and the nexus of a just, gaping racial wound that will not heal, yet we pretend doesn’t exist,

I’m confident, though, that by acknowledging it — by staring into that and seeing it for what it is — we still won’t do jack shit. Yeah, that's us....

9 people shot in a church- "Whaddya gonna do? Crazy is as crazy is." That's the part that I cannot for the life of me wrap my head around. And you know it, you know it's going to go down the same path, "It's a terrible tragedy", they're already using the nuanced language of lack of effort for thus. This is a terrorist attack, this is a violent attack on the Emmanuel Church in South Carolina, {which} is a symbol of the black community, it has stood in that part of Charleston for a hundred-and-some years and has been attacked viciously many times, as many black churches have.

And to say that - I heard someone on the news say "Tragedy has visited this church," this wasn't a tornado. This was a racist. This was a guy with a Rhodesia badge on his sweater.....I hate to use this pun, but this one is black and white. There's no nuance here.
- Jon Stewart
To me, this begs the question- why is a "comedian" like Jon Stewart making the obvious point that this is a racist attack and to ask questions about why these attacks happen, but Chuck Todd and a number of other "serious news people" don't want to?

Sunday, June 21, 2015

Koo-Koo's new scheme- spreading out hotel tax

If we ever get back to state budget negotiations, we might get a look at yet another tax scheme from Rep. Dale (Koo-Koo) Kooyenga, after his first plan to abolish the Alternative Minimum Tax for rich Wisconsinites was quickly shot down. This time Koo-Koo wants to stick it to travel agencies, and make those businesses (and the individuals who use them) have to pay additional tax to make up for other tax cuts.
"The revenue picked up will go towards reduction of other taxes," said Kooyenga, a member of the Legislature’s Joint Finance Committee. "In part, we are doing this by ‘broadening the base,’ a solid principle of tax reform and creates fairness between hotels and the out-of-state booking companies."
The article goes onto to explain what Koo-Koo is trying to “fix”, where a booking agency like Orbitz gives $80 of the $100 it collects to the hotel, while keeping $20 as its commission for having someone buy through their site. Apparently that $20 isn’t charged sales or local taxes, but instead is taxed later under the travel agency’s profits.

Needless to say, the travel agencies aren’t too pleased about this.
The Travel Technology Association disputes Kooyenga’s pitch, calling it flat out wrong. The trade group based in Washington, D.C., includes Orbitz, Expedia, Priceline, Airbnb and other online travel sites. The additional sales tax on the service fees charged by those businesses, and bricks-and-mortar travel agencies like Adelman Travel Group, represents a form of double taxation, said Philip Minardi, a spokesman for the Travel Technology Association.

Here’s why, the association says: Orbitz and other travel agencies pay business taxes or income taxes on the revenue from their service fees. That income would be taxed twice if the businesses also had to pay a sales tax.

“The concept that online travel agents are taking advantage of a loophole is 100 percent false,” said Steve Shur, the president of the Travel Technology Association. "The argument that Wisconsin needs to ‘close a loophole’ is simply a veiled attempt at passing new taxes onto the backs of in-state travelers, small businesses and the entire travel and tourism economy."
And you can see where putting that additional tax onto a travel agency’s commission is a problem, because this will likely raise prices that people pay when they book a room (unless you think the travel agency will casually take the hit to the profits, HAH!), and/or give an advantage to the hotel for booking people directly. It also could discourage people from staying at hotels due to the higher prices, or not finding out about certain Wisconsin hotels because they don't want to have their prices seem higher, which would also cut into the profits of the online bookers.

There is no LFB analysis to see how much would be raised through Koo-Koo’s plans to “broaden” the sales tax, nor how much in income and business taxes that might go away. Which also means there is no guarantee as to whether this amount will totally offset the losses in revenue that would come from changing tax rates for married people or the AMT, which is what Koo-Koo claims he’s still looking at doing.

Needless to say, this is one of many potential twists and turns that still need to be ironed out in this budget, with less than 2 weeks to go in the fiscal year. Sure, the state won’t shut down if the budget isn’t done on time (everything stays at the same levels they were before), so it’s not as urgent as it may seem at first glance. But this bill is quickly becoming an even bigger mess for the Wisconsin GOP than we already knew it was, and last-minute goodies and "adjustments" that people like Koo-Koo are trying to hand out may make things even worse. Stay vigilant.

Milwaukee city officials right to be cautious on Bucks arena

Even though the new Bucks arena bill has yet to be printed at the state level (and likely will not be debated until after the state budget passes, whenever that is), we did get some good detail from Milwaukee Mayor Tom Barrett’s office this week on how the city’s part would work. The city plans to spend $47 million on construction and gifts of land, which will go toward creating a public plaza next to the new arena, and in building a new parking garage across the street.

There are also plans for a new tax incremental district (TID) to help encourage development around the arena site, and the Milwaukee Business Journal explains where that district would be.
The boundaries of the new district extend north of the Park East corridor to West Vliet Street between North Dr. Martin Luther King Jr. Drive (Third Street) and North Sixth Street. The district also follows Old World Third Street between Juneau and West State Street and encompasses property east to the Milwaukee River.

Also in the district are the Milwaukee Journal Sentinel headquarters property, a county-run surface parking lot south of Milwaukee Area Technical College and the site of the BMO Harris Bradley Center, which is to be demolished after the new arena opens.

The tax incremental districts will not only help fund the arena and parking but also spur additional development, Barrett and [City Development Commissioner Rocky] Marcoux said. The Milwaukee Bucks owners have established a separate company that they say will invest $400 million in the Park East corridor over a nine-year period.
With the use of TIF as part of the city’s side of the project, let’s review the state of Wisconsin’s guide on how Tax Incremental Districts work, and how they affect city finances.
When a TIF district is created the aggregate equalized value of taxable and certain municipal owned property is established by the Department of Revenue (DOR). This is called the Tax Incremental Base. The municipality then installs public improvements and property values grow. Taxes paid on the increased value are used to pay for projects undertaken by the municipality. This is the Tax Increment. It is based on the increased values in the TID and levies of all the taxing jurisdictions that share the tax base.

The municipality, county, school districts, and other taxing jurisdictions do not benefit from taxes collected on value increases in the district until project costs have been recovered. After that, the added value is included in the apportionment process and everyone gains.

The underlying assumption of the TIF Law is that no new development would have taken place if the municipality had not created the TID. Public improvement costs needed to develop or redevelop the area would have been too prohibitive for the municipality and/or developer to do alone. So the necessary public works would not have been done. TIF provides a way for all entities benefiting from the expanded tax base to help pay the costs of promoting it.
It basically puts taxes into a separate account until the original amount of the TIF that is paid off. The idea is that the property values grow and then the full amount of that property is taxed at a future date, which takes pressure off of everyday property owners.

So note the timetable in the Milwaukee Business Journal’s write-up of the city’s financing plan.
The city conservatively estimates that recovering the first $12 million that the city grants to the new arena will take 15 years, Marcoux said. The remaining $8 million from the new tax incremental district will be paid off by 25 years after the district launch, he said.
I cannot tell for sure whether this TID would include the developments that the $400 million in development the Bucks owners say they will do in coming years, or not. Obviously, that makes a huge difference in how much in increased tax base the city, county, MPS and other local governments would be able to use out of this, and when taxpayers across the Milwaukee area would see a benefit on their tax bills, instead of having to pony up for costs related to arena improvements.

On a related note, there aren't any of these proposed developments that will be built and operating from at least a couple of years (along with the arena), with any assistance to the tax base coming much later than that. After all of the empty promises of all the companies that got kickbacks taxpayer-funded loans from WEDC and barely delivered 1/3 of the jobs that were expected, why should we believe that a new Bucks arena is a magic pill that leads to all of this new development? Maybe we should stop giving money to these rich folks up front, and instead of incentives, give rewards that kick in only AFTER they add something to the area. Just a thought.

In addition, with UWM facing serious funding cuts and MPS being gutted in the current state budget bill, is a sports arena really something that deserves priority and tax breaks over investment the generators of talent and quality of life that a high-level educational system bring (or even more concerning, the damage that results from NOT investing in that educational system)? Does it matter if we have a shiny new Bucks palace if the city and the nearby economy go to shit before it gets built? But I digress…

With those concerns in mind, this city financing plan is not going to be rubber-stamped by the Milwaukee Common Council. Patrick Small at Urban Milwaukee summed up a recent meeting of the City’s Steering and Rules Committee where Council members asked Mayor Barrett and other city officials about the arena plan and the city’s part. Small’s article indicates that the Bucks will keep a sizable portion of the revenues that come from the new $35 million parking garage, while the city will likely never get its money back on that part of the investment, and will have to pay more to get rid of the current parking facility it operates across from the Bradley Center.
The Bucks will nominally contribute $8 million for the parking facility and land it sits on, but under the deal that amount will later be returned to the Bucks from property taxes collected in a tax incremental financing (TIF) district the city will create for the Bucks project. In short, the Bucks will have no out-of-pocket costs the for parking facility while the city would take on $35 million in bonding to build it, yet would only get half the income, with the other half going to the Bucks. The city’s estimated take of $350,000 a year means it would take 100 years (and that would be with zero percent interest) to pay off the bonds. By that time there may be at least two more new arena projects, given the current average life span of NBA arenas.

Adding more costs for the city, it has agreed to tear down a city-owned parking structure just a block away from where the new facility would be built. The city paid $30 million in 1988 to build this 980-space garage on N. 4th St., to serve Bradley Center patrons and garner revenue. Committee member, [Ald. Nik] Kovac, was incredulous that the city would agree to tear it down, and then borrow $35 million to build a new one a block away. The mayor defended the scheme by saying that building a parking garage is what’s expected each time Milwaukee builds a new arena. Kovac pointed out that the current parking garage is a perfectly adequate parking facility, one that is paid for. Marcoux affirmed its life span was “not insignificant.” Kovac concluded that “we don’t really need to tear it down; we just have a new development plan that wants it torn down.”

No mention was made of demolition costs or who would pay them, but Barrett’s chief of staff Patrick Curley told Urban Milwaukee that this, too, will be a city cost, probably totaling $1.2 to $1.5 million.
There are also concerns about whether the proposed “entertainment mall” would hurt businesses that currently operate near the BC, and while the concept sounds pretty sweet, I don’t see how this is much different than what’s already on 3rd Street a few blocks away.
Some information was revealed about what the Bucks envision for their “entertainment destination” — it would be several floors of bars and restaurants facing the arena. Owner Wes Edens has said it would include the “biggest outdoor sports bar in the country” and he imagines Packer fans watching games on giant screens in cold weather. Marcoux told the committee the Bucks “don’t want this to be Anywhere USA,” yet the Bucks are promising only “25 percent local vendors” in the bar mall. In other words, three-fourths of the annex will be chain-franchised bars, restaurants and other retail common to other cities, competing with the mostly locally-owned businesses.
This is why the July 2 hearing of the Redevelopment Authority of Milwaukee and future action from the Common Council may be the biggest keys to the fate of the Bucks arena bill, because the city is the entity taking on the most risk and spending the most up-front money if this thing gets built, while having no guarantee that all the bigtime promises from developers ever come to fruition. The Bucks’ owners do have a guarantee regardless of how this plays out, either one from the NBA to buy the team for a $25 million profit if no arena is built, or to have the arena built, and join in with every other team in sharing the benefit of a huge increase in TV and digital money with a new deal that starts next year.

By comparison, the city faces the prospect of likely losing the Bucks if the arena is not built, or being left to hold the bag with massive debt costs and subsidies from a new arena, without getting any benefit in additional taxes for several years…if ever. Not a good set of choices.

Friday, June 19, 2015

Connections count- aka $124 million in WEDC cash

I had a couple of casual budget-related items ready to go on this Friday night. Then I was riding home with the wife around 4:30pm, and flipped by The Wheeler Report (a great source of state headlines if you don't use it) to see if anything had dropped in the last hour. I then saw that there was a release from the Wisconsin Economic Development Corporation (WEDC), dated at 4:24pm. On a Friday. Needless to say, I clicked the link.

It dealt with the scandal where $500,000 was loaned out by WEDC to Building Committee Inc (BCI), a business owned by someone who gave Scott Walker's campaign a max donation, and the taxpayers never got their money back (more on that scandal here) . But WEDC also dumped all of their other records regarding its loans, and it shows that BCI was not alone in having a lack of oversight.
In addition to the BCI loan files, WEDC also today provided the board with the results of a review of 371 awards that WEDC made from July 1, 2011, and June 30, 2013. That review uncovered 26 awards that were made without a formal Staff Review by our underwriting department – all of which took place in the first 15 months of WEDC’s existence.
26 awards were made without a formal Staff Review??? Jaw-dropping to be sure, but then we got to find out just how much improperly went out when the Milwaukee Journal-Sentinel's Jason Stein tweeted this out about 30 minutes later.

$124 MILLION IN TAXPAYER DOLLARS HANDED OUT IMPROPERLY?? This is where I remind you that Scott Walker is the Chair of the WEDC Board, and that one of his first acts as governor was to create WEDC as a public-private hybrid, to allow for "greater flexibility" in offering financial incentives to companies to expand in Wisconsin. And now they're handing out $124 million without adequate oversight? Tell me more, Mr. Stein.
The awards included incentives given to major Wisconsin companies such as Spectrum Brands, Kestrel Aircraft Co. Plexus Corp and Kohl's - a department store Walker has woven into his campaign talks by saying the company's business approach would be a good economic model for the country.

The incentives were supposed to create 6,165 jobs, but so far only 2,106 jobs have been created, according to the records In most cases, however, the companies still have years to meet those job creation targets.

The 27 awards included grants, loans and tax credits. The biggest one, worth $62.5 million, went to Kohl's. Coming in second was Kestrel at $18 million (which has not built one plane in Superior in the 3 1/2 years since it got its award), and Plexus at $15 million (who promptly outsourced 116 jobs instead of creating them) .
The Journal-Sentinel article goes on to mention how top Walker officials tried to find creative ways to get WEDC money into the pockets of BCI and other businesses, and went over the heads of lower-level workers who questioned the abilities of BCI and other companies to deliver on their promises.

This story's got serious legs, and you have to wonder how many WEDC grants are tied up with what's being discussed in the John Doe investigation, which the Wisconsin Supreme Court has suspiciously refused to release a ruling on despite hearing the case several weeks ago. And you have to wonder if all funding for WEDC should be taken out of the still-to-be-completed state budget. A Walker scheme that would have allowed WEDC to give away another $55 million and to be exempt from certain open records requirements was nixed by the Legislature's Joint Finance Committee last month, and now we have a good idea why Scotty wanted to pull off that scheme- to hide further shenanigans like this from becoming public.

The fact that Gov Walker was the creator of WEDC's unaccountable system of operations and chaired the WEDC Board as all of these awards were handed out means the corruption and cronyism point right to Scotty. And it also points to the need to have an independent FEDERAL investigation of this slush fund, with a full release of all papers involved from this organization, and firings and charges brought against all personnel who approved of this funneling of taxpayer dollars into Walker donors and cronies. And to have WEDC shut down and replaced with an agency similar to the former Department of Commerce, staffed by civil servants who might have priorities other than serving as an outgrowth of Scott Walker's campaign fundraising committee. Nothing less than that is acceptable, and it's well past time the national media turn up its microscope on this scandal.