Robbing Peter to pay Paul

Over the past couple of weeks, I have enjoyed providing you with factual information on the 2009-11 state budget plan that was recently signed into law by Gov. Jim Doyle.

This week I will be reviewing the transfers – or raids – from various segregated funds.

As a reference, I am again using an analysis that was recently published by the non-partisan Legislative Fiscal Bureau (LFB) that specifically identifies segregated funds in the 2009-11 budget that are being used for purposes other than those for which the funds were generally established.

As a part of the 2009-11 budget, Gov. Doyle and a majority of the legislators have approved raiding the following funds to balance the budget:

• $65.8 million was taken from the Transportation Fund, which was created to improve and maintain Wisconsin’s transportation infrastructure network. The Transportation Fund receives revenue from gas tax collections and vehicle registration fees.

• $54.3 million was raided from the Petroleum Inspection Fund, which assists businesses and individuals dealing with the cost of cleaning up pollution from leaking petroleum storage tanks. This fund receives revenue from a 2 cent per gallon tax above and beyond the Wisconsin gas tax.

• $37.8 million was transferred out of the Recycling Fund, which provides grants to county and municipal governments for implementing recycling programs and other state solid waste reduction programs. The Recycling Fund receives revenue from a surcharge placed on Wisconsin businesses and farmers.

• $33 million was raided from the Environmental Management Account and Nonpoint Account of the Environmental Fund, which provides funding for contaminated land cleanup, groundwater management, state-funded environmental response actions, brownfield site assessment grants, and nonpoint pollution cleanup. The Wisconsin solid-waste tipping fee, also known as the garbage tax, provides revenue to these funds.

• $25 million was taken from the Universal Service Fund (USF), which provides assistance to lowincome customers, customers with disabilities, non-profit groups, medical clinics and public health agencies and areas of the state needing access to pay telephones. The USF receives revenue from taxes on all landbased and cell phone lines.

• $20.3 million was transferred out of the Wireless E-911 Fund, which was intended to help local municipalities cope with emergency cell phone calls. This fund received revenue from a tax added onto every cell-phone bill over the past few years.

• $3 million from the Agricultural Management Fund and Agricultural Chemical Cleanup Fund was used to balance the budget. Farmers pay a variety of fees and taxes on fertilizers, commercial feed, pesticides, and farm equipment to provide revenue for these funds.

In addition to these specific transfers, the final version of the budget contains a provision that requires the Secretary of the Department of Administration to transfer an additional $289 million from segregated funds, which have not yet been determined and will not have to be approved by the Legislature.

A complete listing of segregated fund transfers in the final version of the 2009-11 state budget can be accessed at the following Web page: http://www.legis.state.wi.us/lfb/2009-11Budget/2009_07_15_Use% 20of%20certain%20funds.pdf.

One of the reasons why I voted “no” on the budget was because it used a large amount of money from segregated funds to bring it into balance. These taxes or fees were created with the understanding that the revenue generated would be used for specified purposes. This is no longer the case. In addition, using these one-time transfers for ongoing state expenditures will either add to future budget deficits or encourage similar raids in the future. Our budget should not be balanced on the fiscally irresponsible practice of robbing Peter to pay Paul.

As always, it has been a pleasure communicating with you. Please remember to communicate with me and share your input by calling (888) 295-8750, writing to me at P.O. Box 7882, Madison, WI 53707-7882, or by e-mailing me at Sen.Leibham@legis.wi.gov. You can also logon to the 9th Senate District online office at www.leibhamsenate.com.

It is an honor representing the residents of the 9th District in the State Senate.