News of the Day

Customers of Wisconsin utilities are projected to save more than $275 million from the new lower rate for federal corporate taxes, based on estimates compiled by the Citizens Utility Board of Wisconsin and the Wisconsin Industrial Energy Group.

The corporate tax rate was lowered to 21% from 35% as part of the recent tax reform and tax cut legislation. Projected taxes are included as an expense when setting utility rates and the cost is passed onto customers.

The state’s utilities were required to file their projected tax savings with the Public Service Commission last month. Matthew Spencer, a spokesman for Public Service Commission, said the commission is expected to decide this year on how to apply the savings to customers’ bills.

Based on the PSC filings, the initial annual savings from the lower tax rates are:

• We Energies electric customer – $97 million
• We Energies natural gas customers — $20 million.
• WPS electric customers — $41 million.
• WPS natural gas customers — $7 million.
• Madison Gas & Electric — $6 million to $9 million for electric customers and $2 million to $3 million for natural gas customers (1.2% to 1.9% average reduction).
• Alliant electric customers — $40 million to $50 million
• Xcel electric customers — $25 million to $30 million.

The projected savings range roughly from 1% to 4% of customers’ bills, depending on the utility.

Wisconsin Attorney General Brad Schimel is leading a multi-state legal challenge to the Affordable Care Act.

Schimel and Texas Attorney General Ken Paxton filed the lawsuit Monday in a federal court in northern Texas. The lawsuit represents 20 states, including Wisconsin.

The U.S. Supreme Court upheld the health care law in 2012, ruling the penalty on individuals without health coverage was a tax and allowed under the Constitution.

But Schimel said that legal foundation no longer applies.

“In the tax relief bill, the Congress eliminated the tax penalty,” he said. “So that left the individual mandate hanging out there all by itself.”

The lawsuit argues the entire law should now be struck down.

“The Obama administration lawyers argued during the course of the case in 2012 in the Supreme Court that without the individual mandate, the rest of it doesn’t stand,” Schimel said. “Now that the tax penalty’s gone, the individual mandate can’t stand, which means the rest of it can’t stand.”

Walker spokeswoman Amy Hasenberg told the Milwaukee Journal Sentinel that Walker authorized the lawsuit “because it questions the constitutionality of Obamacare.”

But she added that “as long as (the ACA) remains, Wisconsin will work within the confines of that law to help Wisconsin families.”

Critics said overturning the law would hurt Wisconsin residents.

Protect Our Care Campaign Director Brad Woodhouse said in a statement that, if successful, the lawsuit “could take health insurance away from 416,600 Wisconsinites, raise premiums, and end the Medicaid expansion, which has been critical for combating the opioid epidemic and keeping rural hospitals afloat.”

The State Assembly voted on Thursday on a proposal to prevent local governments from adopting mandatory labor-peace agreements and other requirements related to employment laws.

Assembly Bill 748 seeks to put in place statewide rules for occupational licensing, overtime and other employment matters. Supporters of the legislation say it would prevent the state from having employment requirements that vary greatly from one government jurisdiction to the next. Uniformity, they argue,w ill make it easier for companies to know what rules they have to follow when doing business in Wisconsin.

The provision concerning labor-peace agreements, for instance, would prevent local officials from requiring employers to sign onto these sorts of agreements before doing municipal work. Employers who sign labor-peace agreements agree to not resist employees’ unionization attempts.

Beyond that, the bill would:

• scrap local governments’ ability to set minimum-wage requirements for contractors who are working on local public-works projects; and
• prohibit local governments from enforcing occupational-licensing requirements that are stricter than those set by the state;
• set a statewide standard for regulations concerning employee scheduling, hours and overtime;
• establish uniform statewide regulations for employee benefits;
• make it clear that employers throughout Wisconsin have the right to ask job applicants for salary information;
• prevent local governments from establishing a wage-claim process that is separate from the one set by the state.

The legislation had once called for the setting of a statewide standard to determine when employment discrimination had occurred. But an amendment introduced earlier this week scrapped that provision.

To become law, AB 748 still needs the state Senate’s approval and Gov. Scott Walker’s signature. Lawmakers in the Senate have said they plan to convene in March for the final time this legislative session.

Legislation that that could decrease contractors’ legal costs and liability has received a boost that could have it before the Wisconsin Assembly on Thursday, the last day lawmakers in that chamber plan to meet this legislative session.

The proposal, Assembly Bill 773, calls for a series of changes to the state’s civil-litigation rules. Among other things, it would curtail the state’s construction statute of repose, which contractors commonly invoke when defending themselves against personal-injury lawsuits alleging negligent design. Current law bars lawsuits involving injuries that occurred more than 10 years after a given construction project had come to an end. AB 773 proposes reducing that window to six years.

Although enjoying support from industry groups like the Wisconsin Builders Association, the proposal had appeared to be stalled in the Assembly Judiciary Committee with little chance of being sent to the full Legislature for a vote. But, late on Monday, lawmakers arrived at a compromise that will seemingly allow the bill to advance and the bill was scheduled for a vote before the Assembly Judiciary Committee.

Among the proposed changes to the bill is one that would give plaintiffs an additional year to sue contractors over allegations of negligent designs. Rather than six-year limit in the current version of AB 773, the amendment would allow lawsuits to be filed within seven years of a project’s wrapping up.

The committee adopted that amendment on Tuesday and voted 6-3 to give the bill a favorable recommendation.

The bill’s next stop is the Assembly. Should it pass there, AB 773 still needs to be voted on by the full Senate and signed by Gov. Scott Walker.

Separately from the construction statute of repose, the proposal would make various changes to procedures used to gather information during litigation, placing time limits on depositions, restricting how many depositions could be requested and changing rules governing what electronically stored information parties must either retain or produce.

Although these changes appear unrelated to construction, supporters of the bill have contended they could cause contractors who are involved in litigation to spend less money and time responding to discovery requests.

Home sales in Wisconsin rose 2.8 percent in January, compared to January of 2017, according to the Wisconsin Realtors Association’s latest report.

The number of home sales rose despite a sharp decline in listings. The inventory of homes for sale in the state was down 16.4 percent in January to 24,607. That represents a supply (the time it would take to sell all of the homes on the market at a given time) of just 3.5 percent. That is a seller’s market. A 6-month supply is considered a balanced market.

The number of new listings in January was down 4.5 percent in the state, compared to January of 2017.

“Tight inventories dominated Wisconsin’s housing market throughout 2017 and that challenge has continued into the first month of the new year,” said WRA chairman Peter Sveum. “Strong economies typically translate into strong home sales. The only factor holding us back from an even stronger housing market is lack of supply.”

With rising sales and declining inventory, home sale prices continue to rise. The median home sales price in the state was up 6.8 percent in January, compared to a year ago, to $168,500.

“Rapid price growth is a result of high demand, fueled by a great economy and very low mortgage rates,” said WRA president and CEO, Michael Theo. “The good news is low mortgage rates, combined with solid income growth, have kept our housing affordable, even as home prices have grown at a rapid pace,” “One big concern, however, is that the strong economy has begun to generate more inflation, and the threat of inflation is what causes long-term interest rates to move up, which will further erode our affordability.”

The Assembly signed off on a package of special session welfare bills to set new requirements for various government assistance programs including food stamps. All but two of the bills passed on 62-35 party-line votes.

Initial combined cost estimates of the bills from the Department of Health Services and Department of Children and Families showed the legislation would collectively cost more than $90 million annually — excluding one-time start-up costs. But an updated overall figure isn’t yet available following the adoption of a series of amendments with the bills.

The package includes:

*SSAB 1, which would up the work requirement for FoodShare to 30 hours from the current requirement of 20 hours.

*SSAB 2, which would require expand work requirements for food stamps that now apply only to able-bodied adults to those have school-aged dependents.

*SSAB 3, which would create asset limits for food stamps, W-2 or Wisconsin Shares.

*SSAB 4, which would add drug screening to the application process for those seeking public housing.

*SSAB 5, which would create a two-year pilot program to make monthly payments to those who received the Earned Income Tax Credit rather than waiting until after they’ve filed their tax returns to send them a lump sum.

*SSAB 6, which would require DHS and DCF to create performance-based payment systems for W-2 and food stamps vendors.

*SSAB 7, which would allow DOA to contract with a private vendor to create a “pay for success trust fund.” Those with a proposal to address an issue with social, employment or correctional services provided to individuals could bring it to the state and then negotiate an incentive based on the expected budget savings. That money would be set aside and the state would only pay the vendor if the goal was achieved.

*SSAB 8, which would cut off from Medicaid those able-bodied adults who refuse to cooperate with a paternity test or comply with a child support order.

*SSAB 9, which would create a savings account program for Medicaid.

*SSAB 10, which would add photo IDs to food stamp cards.

The bills now head to the Senate.