As Others See It

Matt Pommer • Wisconsin Newspaper Association

State general fund status linked to our tax returns

The Legislature is waiting for us to file our state tax returns.

Those returns will help determine how much money is available to spend for the 2015- 2017 budget cycle. At first blush, it appears the state will be short of cash in both its general and transportation funds for the upcoming biennium.

But hope springs eternal, especially for the elected folks in the State Capitol. Regardless of party, they’re hoping that by early May the Department of Revenue will provide news that revenue estimates are higher than expected in Gov. Scott Walker’s budget plan.

A word of caution. The numbers are estimates. Some people and companies will have received permission to delay filing beyond April 15. The DOR numbers will include estimates of how much money its agents will collect from audits.

Walker’s budget includes authorization to hire additional tax agents whose efforts should increase tax revenue. You dispute that analysis only if you believe Wisconsin citizens and businesses are pure and clean as the driven snow.

The request for a bigger state staff occurs as the U.S. Internal Revenue Services has been downsizing its auditing and collection crew.

In January, state general-fund revenue estimates came in about $500 million below last year’s forecast. The governor’s budget bill expects the state to collect an additional $1.9 billion in general revenue taxes in the upcoming biennium. But much of that already has been earmarked for earlier-approved programs.

“About half the amount is needed to permanently fund current spending, previously paid with one-time surplus,” noted Todd Berry, president of the nonpartisan Wisconsin Taxpayers Alliance.

The Legislature has a number of especially difficult budget problems that could require more money – in fact, a lot more money. Education is probably the main concern. The governor’s budget would cut $150 per pupil in state aid to public school districts. Scores of school boards have expressed their concern to legislators.

The public school picture is further complicated by plans to expand charter and voucher schools. School districts could find some of their funds diverted to private-school operations. The last Legislature added an incometax break for parents who send their children to private elementary schools and high schools. That break was projected to cost the state $30 million for the 2014 tax year.

But the private school folks also are complaining that the state budget bill as presented by Walker fails to provide enough money for them to dramatically expand.

Walker’s budget would cut $300 million from taxpayer support of the University of Wisconsin system. The Walker plan would make the university an authority, giving it more autonomy to save money. But the Legislature seems unwilling to create such a broad authorization.

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