Senate leader signals possible compromise on medicinal marijuana rather than full legalization. Lawmakers and governor staking out early ground on other state budget ideas.
Despite successfully passing a bipartisan COVID-19 bill last week, the Republican-controlled Legislature isn’t any more likely to embrace Gov. Tony Evers’ proposed biennial $91 billion budget proposal, including some provision such as legalization of recreational marijuana use.
A state budget bill covers a wide swath of topics and priorities. Evers’ budget plan also calls for rolling back components of Act 10, the union-busting legislation passed by Republicans 10 years ago, increasing the minimum wage, reforming the criminal justice system and calling for the troubled juvenile centers—Lincoln Hills and Copper Lake—to be closed, investing heavily in K-12 and UW System campuses, and a $200 million investment to keep struggling small businesses afloat.
Evers told WKOW-TV’s Capital City Sunday that while Republicans have already balked on the proposed 10% spending increase and $1 billion in new taxes in his budget proposal, he argues it’s warranted by the pandemic and economic crisis.
“I understand that the numbers might be jarring but the fact of the matter is we have an obligation as a state to help our economy move forward,” Evers said. “If we want to bounce back from this pandemic we need to put the money on the table.”
Evers pointed to last month’s Legislative Fiscal Bureau (LFB) report, which showed the state was in better shape than anticipated, giving it a bit more breathing room to handle this current crisis. The LFB estimated the state will have almost $1 billion in its rainy-day fund by this summer and a $1.8 billion balance in its general account.
“We have been doing things all the way along during the pandemic getting us to this spot,” Evers said.
“I’m not concerned about the balance sheet at all. I think we’re going to be in good shape.”
Evers said he hoped that last week’s bipartisan COVID-19 relief bill was a sign of things to come, but Wisconsin Republicans have largely spoken out against the governor’s proposed budget, particularly on its spending increases.
Senate Majority Leader Devin LeMahieu (R-Oostburg) said,” I think there are some good things in the governor’s budget, but there’s so much divisive policy.”
“We look forward to, through the [Joint] Finance Committee, once again taking out all that divisive policy and making sure we pass a responsible budget,” LeMahieu said, even though Republicans have also stuffed past budget bills with non-fiscal items.
One thing he objected to was the proposed rollback of the ”Manufacturing and Agriculture Tax Credit,” a massive reduction in corporate taxes passed by Republicans when they first took control of the Legislature in 2011 .
“That has been a Godsend for our state,” LeMahieu said. “Our manufacturers and our farming is the backbone of the state. We can’t start raising taxes on them.”
However, studies have shown very little of the credit goes to small farmers and manufacturers. One LFB report shows less than 10% of the credit has gone to agricultural businesses. The Wisconsin Budget Project reported a 2019 example where just 21 tax filers—each with earnings over $30 million that year—each received a nearly $ 2 million tax break. Studies have shown no noticeable impact from the credit on job creation which, in 2019 alone, cost the state $283 million.
Another proposed revenue source from Evers involves raising taxes on capital gains for individuals who earn more than $400,000 per year and $533,000 for married couples who file jointly. Meanwhile the budget would cut taxes for seniors and adults with disabilities and create a tax-preferred savings account for first-time home buyers.
LeMahieu also said he is opposed to allowing counties and cities to implement sales taxes, expanding Medicaid, and legalizing recreational marijuana, even though a 2019 Marquette poll found that 83% of Wisconsinites support legalizing medical marijuana and 59% support recreational legalization. He said his decision was based on conversations with manufacturers who are concerned that workers will come to work high and with law enforcement.
“Law enforcement around the state have all taken stances that it’s really dangerous to be legalizing marijuana recreationally at this point,” LeMahieu said.
LeMahieu said Legislative Republicans are open to discussions on medical marijuana and decriminalizing marijuana possession, but he wants those efforts to go through the legislative process, not the budget. Sen Dale Kooyenga (R-Brookfield) made a similar argument on WISN’s UpFront regarding juvenile justice reforms in Evers’ budget.
Sen. LaTonya Johnson (D-Milwaukee) vouched for a reform that would require the state to treat 17-year-olds as juvenile offenders, pointing out that children in the juvenile system have more access to education and other programming that can reduce recidivism, compared to what they would receive in the adult system.
“Making sure we treat those children as children is extremely important,” Johnson said. “Because they need to have access to those additional services and programs that they’re entitled to as a juvenile and that should help adult incarceration.”
Kooyenga was supportive of such measures, but he wanted to see them go through the legislative process.
“The question is, should this be in the budget?” Kooyenga said. “I think the position of the Republicans will be, we want to look at that, we’re serious about reforms, but that should be looked upon outside the budget process.”
Johnson said it has a place in the budget because a bill she’d proposed to raise the age limit on juvenile offenders didn’t get any traction because county executives didn’t have the funds to relocate them.
“Putting it in the budget not only ensures that it has the opportunity to pass but it’s also providing the funds to make sure that we pay the counties the cost that’s associated with raising the age,” Johnson said.