Wednesday, December 28, 2022

State budget update - new plans for shared revenue and road funding? Same ol story on Medicaid?

From Wispolitics' budget blog, we got a couple of recent tidbits on what may be part of the spending side of the state budget debate. Assembly Speaker Robbin' Vos gave a hint of what the Legislature might try to do when they receive the budget bill in February (it's odd to me how Vos always claims to be speaking for the "Legislature", while Senate GOP Leader Devin LeMaheiu never seems to).
During a virtual event this month hosted by the nonpartisan Wisconsin Policy Forum, Vos suggested using 1 percent of the state sales tax to replace shared revenue. As sales tax revenue increases, so too would funding for local government, the speaker said.

Meanwhile, the guv earlier this year announced plans to increase shared revenue by $91.4 million, a boost of 4 percent in each year of the biennium. He also pledged another $10 million in a new state aid to help address EMS, police and fire costs.

The state took in nearly $7 billion in sales taxes during fiscal year 2021-22. Dedicating 1 penny of the state’s 5-cent sales tax to shared revenue would’ve generated $1.4 billion in the 2021-22 fiscal year.
That $1.4 billion would double the amount of funds dedicated to shared revenues this year. But if it's 1% of of all sales taxes, then it's only around $70 million. I don't see if that is specifically in addition to the $700 million a year, or to "replace" some other type of shared revenue funding.

Do we trust this guy at face value?

But let's give the benefit of the doubt to this plan, and assume that it would come in addition to current shared revenue funding. If so, there's only about a $20 million difference to cover, and all communities would benefit. It's a good start.

That's one of the items to look for in the budget debate. As for Governor Evers, he'll give another try at getting the Legislature to agree to save state tax dollars by....allowing more Wisconsinites to access health care.
*[Evers'] budget will again call for expanding Medicaid through the Affordable Care Act. Republicans have rejected it twice before, and Evers said he will rely on the public to pressure GOP lawmakers to come around on the issue. Wisconsin is one of 12 states that haven’t accepted federal funds to do the expansion. The Department of Health Services included the proposal in its budget request, estimating it would save the state $1.5 billion over the upcoming biennium.

“We can’t be the last state in the nation to take Medicaid expansion,” Evers said.
Given that Vos keeps saying he will "never" accept Medicaid expansion and rejecting it no matter how much sense it makes, I'm not going to count on this one going through. And the huge state surplus gives GOPs more cover to keep up this idiocy, as there's no need to save tax dollars in order to pay for tax cuts and balance the budget.

While that situation hasn't changed since Evers' first took office in 2019, the road funding situation certainly has. There are now hundreds of millions in additional federal dollars heading to the state as part of the Bipartisan Infrastucture Act to pay for projects, and the state's huge General Fund surplus is another way that the state's Transportation Fund can be beefed up without having to pay more at the pump.
[Evers] doesn’t see including a gas tax increase in this budget. Four years ago, he proposed raising the gas tax 8 cents to 40.9 cents a gallon and tying it to inflation. He also called for eliminating the minimum markup on fuel, arguing that would offset the impact of the tax increase. But Republicans rejected the move.  

Evers said he will propose putting some of the state’s projected surplus into transportation. He also said there needs to be a long-term conversation on how to pay for transportation costs as more drivers switch to electric vehicles. That could include going to a miles-driven tax. Evers said that conversation will be down the road.
Evers mentioning a "miles-driven tax" is an interesting nugget, as that is something that reduces the reliance of gasoline consumption to pay for road funding. Which makes sense when you consider that vehicles are increasingly fuel-efficient, making the gas tax a less steady source of paying for road repairs and other transportation-related funding.  

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