News of the Day

U.S. state spending topped $2 trillion for the first time in fiscal 2018, with Medicaid expenditures rising the most along with a significant increase in transportation spending, according to a report released on Thursday.

Total expenditures grew an estimated 4.8 percent compared to 3.8 percent in fiscal 2017, the National Association of State Budget Officers’ (NASBO) annual state expenditure report said. The annual report focuses on the seven top state spending categories, which are elementary and secondary education, higher education, public assistance, Medicaid, corrections, transportation and “all other.”

Each category saw some growth in fiscal 2018, with public assistance rising the least at 0.7 percent and Medicaid, the state and federal healthcare program for the poor, growing the most at 7.3 percent.

Growth in state spending of federal funds outpaced spending of state-generated revenue, including from general funds, the report found.

Medicaid continued to account for the bulk of federal dollars flowing to states. The program made up 29.7 percent of total state expenditures in fiscal 2018, compared to 20.5 percent a decade earlier.

Elementary and secondary education expenditures, which rose 4.6 percent, remained the largest area of state general fund spending.

The report also highlighted a 6.5 percent increase in transportation spending, which represents 8 percent of total state expenditures. The rise indicates a growing focus on infrastructure.

A state bill that would give tens of millions of dollars in incentives to Kimberly-Clark Corp. to keep its Cold Spring facility open will take a step forward Wednesday, but still faces obstacles.

Lawmakers will hold another public hearing on the legislation on Wednesday.

Sen. Roger Roth (R-Appleton), a co-sponsor of the bill, admits that the legislation faces a bumpy road to get to the floor later this month for a vote.

“I know how tough it is to get any piece of legislation passed. It’s always an uphill battle on you name the issue. But tomorrow will be telling,” he said Tuesday afternoon.

Roth will speak at the hearing, as will Rep. Mike Rohrkaste (R-Neenah) and union, company and WEDC officials.

Rohrkaste is a co-author of the bill and a member of the Joint Finance Committee. If he were an oddsmaker, he said he’d give the bill a 50-50 chance at passage.

“I get the arguments on both sides, but it’s a way to keep good-paying jobs in the area. If people don’t vote for this, they’re being short-sighted. It’s going to negatively impact 500 families in the Fox Cities,” Rohrkaste said.

The legislation, as written, sought to give tax breaks to K-C if it kept two Fox Cities plants open and retained 610 jobs.

K-C indicated it was willing to consider incentives for the Cold Spring plant in Fox Crossing, but told Fitzgerald that it will still close its Neenah Nonwovens facility and cut its 110 jobs. Both plants had been put on the chopping block in January as part of the company’s global restructuring plan to close or sell 10 plants and eliminate up to 5,500 jobs.

Democratic Gov.-elect Tony Evers has tapped his first key staffers to oversee his transition into the governor’s office.

While much of the state focused on the remarkably close gubernatorial race Tuesday, voters also expressed resounding opinions on ballot measures regarding school referenda.

Voters overwhelmingly approved school referenda across the state, agreeing to raise taxes by well over $1.37 billion. In all, 82 separate referendum questions were up for debate in Wisconsin. Ultimately, 77 had passed and five failed.

Of the additional spending approved by voters, the vast majority will come in the form of new debt—$1.2 billion. Another $140.6 million will be one-time spending by school districts, and $26.1 million will be recurring spending above revenue limits.

The Wheeler Report was the first to report full results Wednesday morning. 

Of the five referendum votes that failed, the largest was in Viroqua Area, where voters turned down the question of a $24.9 million debt for a district-wide school building and improvement program. A West Salem referendum question for $7.6 million in one-time spending for educational programming failed, as did $2.25 million for Goodman-Armstrong. 

Voters in Wittenberg-Birnamwood also turned down a $4.4 million debt question for a new high school gymnasium. However, the same voters also agreed to issue $13.1 million in debt for a district-wide facility improvement plan.

In a night when multiple elections appeared to come down to slim margins, most of the school district referendum questions were handily approved.

A federal judge blocked the controversial Keystone XL oil pipeline Thursday, saying the Trump administration’s justification for approving it last year was incomplete.

In rejecting the permit, Judge Morris relied mainly on arguing that State, the agency that analyzed the project, didn’t properly account for factors such as low oil prices, the cumulative impacts of greenhouse gases from Keystone and the Alberta Clipper pipeline and the risk of oil spills.

“The major spills that occurred between 2014 and 2017 qualify as significant. The department would have evaluated the spills in the 2014 [environmental review] had the information been available,” wrote Morris, whom Obama nominated to the court.

The judge also said that State didn’t properly justify its switch from rejecting the pipeline in 2015 under the Obama administration to approving it in 2017 under Trump.

TransCanada and State did not respond to requests for comment. The Canadian company had planned to start construction work next year.

The Trump administration or TransCanada could appeal Morris’s ruling to the San Francisco-based Court of Appeals for the Ninth Circuit.

Republican Assembly Speaker Robin Vos said Wednesday he is open to looking at ways to limit the power of incoming Democratic governor Tony Evers before he takes office in January.

Vos told reporters that in a lame duck legislative session later this month or next, he would consider bills that would “rebalance” powers of the executive, without saying what limitations he’d be open to considering. Vos said he wanted to discuss it with Senate Republican Majority Leader Scott Fitzgerald, who was meeting with GOP senators on Thursday to elect leaders.

Evers spokeswoman Britt Cudaback said it was “unfortunate” that Vos was “doubling down on division just hours after Governor-elect Evers called on Speaker Vos and Majority Leader Fitzgerald to set aside differences and work together on the pressing issues facing our state.”

As governor, Evers will propose a state budget, the Republican Legislature will be able to rewrite it. Evers has extensive veto power and Republicans don’t have large enough majorities to override him.

Evers ran on the promise to scale back much of the conservative laws Walker and Republican lawmakers enacted over eight years. That includes reducing tax credits for manufacturers and restoring collective bargaining rights lost under Act 10 for union members who backed him.

The GOP turned back every Democratic challenger in both the Assembly and Senate with one race still too close to call Wednesday. What’s more, the GOP flipped a Senate seat that Democrats had won in a special election this summer. As of Wednesday, unofficial returns showed the GOP with a 63-35 Assembly advantage and a 19-14 Senate edge.

In a stunning upset of the political order in Wisconsin, Democrat Tony Evers won the governor’s race Tuesday ousting two-term Republican incumbent Scott Walker.

Unofficial results show Evers beat Walker by about 29,000 votes, or just over 1 percentage point, out of more than 2.6 million votes cast. State law only permits recounts for losing candidates who are within 1 percentage point.

State law triggers a free recount of the results if the margin between the candidates is 0.25 percent or less and the candidate who lost the initial count by that margin requests one. If margin is more than 0.25 percent but no more than 1 percent, the losing candidate may petition and pay for a recount.

Evers’ win means control of state government will be divided for the first time since the 2007-09 session. Republicans gained back a Senate seat in a district they had lost during a special election over the summer. Otherwise the composition of the Assembly remained unchanged.

Wisconsin exports were essentially flat in the first nine months of 2018, even as the state’s imports grew faster than the country as a whole, according to new U.S. Census Bureau data.

The state’s companies exported $17.36 billion in goods and services through the end of September, down 0.1 percent from the same period in 2017. The decrease was among the slowest growth rates in the country, which increased exports 9.1 percent.

Imports into Wisconsin, however, were up 12.3 percent to $22.47 billion, outpacing the overall increase in the U.S. of 9.4 percent.

Beyond tariffs, Wisconsin’s sluggish export numbers are also partially the result of large shipments to Saudi Arabia in 2017. More than $720 million in goods were shipped to the Middle Eastern kingdom through September last year, compared to $142 million this year.

Shipments to Asia are down 10.3 percent, including a decline of 5.5 percent to China and 6.2 percent to Japan.

Despite rising trade tensions through the early part of the year, exports to Canada and Mexico, the two largest destinations for Wisconsin goods, are up 3 and 5.2 percent respectively.

Today, the Department of Workforce Development (DWD) encouraged the public to submit comments about the state’s Worker’s Compensation (WC) program to the Worker’s Compensation Advisory Council (WCAC).

The Council is taking public comments on suggested reforms to the state’s WC laws through December 3, 2018. The comments will help form the Council’s legislative agenda during the following year.

Comments may be submitted by email to WCAdvisoryCouncil@dwd.wisconsin.gov or via the U.S. Postal Service to:

Worker’s Compensation Advisory Council
Attn: Frank Lasee, Chair
201 East Washington Avenue, RoomC100
Madison, WI 53703