Despite record surplus, Republicans again reject childcare help for Wisconsin families

Gov. Tony Evers’ special session bill has been replaced with another tax cut geared toward higher incomes. Evers is responding with funding that will keep the childcare assistance coming into 2025.

Republican legislators have dashed any remaining hopes that a fall legislative session would address critical workforce issues in Wisconsin—doing to Gov. Tony Evers’ proposal what they did to his state budget bill: trash it in its entirety and replace it with a bill for tax hikes geared toward higher-income households. Evers has responded with a new plan that will keep a critical childcare program operating into 2025. 

Senate Republicans on Friday afternoon filed a substitute amendment to Evers’ special session bill that would have used about $1 billion from the state’s record $7 billion budget surplus to fund childcare provider assistance, provide additional funding to the University of Wisconsin System, and set up several workforce development programs in industries facing worker shortages.

A substitute amendment replaces all of the language in the original bill with entirely new language—in this case, language that would spend around $2.5 billion to reduce the tax bracket for incomes up to $304,000 and increase the current childcare tax credit for parents to $5,200, according to reporting from the Wisconsin Examiner.

“This is an embarrassing response after Republicans have had over two months to consider Gov. Evers’ comprehensive workforce plan to prevent a looming child care crisis—a plan they refuse to support for reasons they won’t publicly explain,” said Evers’ spokesperson Britt Cudaback. “This is a completely unserious proposal from Republicans who are wholly out of touch with the challenges and needs of our state.”

Evers gave a more specific response on Monday afternoon by announcing the allocation of $170 million in emergency funding for the Department of Children and Families to continue the Child Care Counts program, which was originally funded with federal pandemic relief funds. Federal funding is scheduled to run out in January, but Evers will keep the program going until June 2025 with federal money that had reimbursed Wisconsin for expenses incurred while responding to the coronavirus pandemic as well as money saved from pandemic response expenses that were lower than anticipated.

The Child Care Counts program has provided $650 million in direct assistance to more than 4,400 childcare providers since 2020, keeping 22,000 childcare professionals employed and continuing care for more than 113,000 children.

In both his original state budget bill and the special session bill under consideration, Evers has made the argument that the state budget surplus provides the opportunity to fund something that keeps childcare centers operating, keeps childcare affordable for parents, and reduces the number of employers losing good workers who have to choose to stay home due to the lack of affordable, quality care options.

On Monday, the Legislative Fiscal Bureau sent out final figures for the two-year state budget period that ended on June 30, showing the state ended the period with a surplus of $7,073,240,000. The state’s “rainy day fund” is also at a record high of $1.8 billion.

“I’ve said from the beginning that with this historic surplus comes historic opportunity and responsibility,” Evers said in a statement. “Today, we can afford to do more. While we’ll continue to stay well within our means, we also have a duty to invest in needs that have long been neglected—and that includes finally addressing our state’s generational workforce challenges and preventing the looming child care crisis that will only make our workforce problems worse.”

Instead, Republicans have made the centerpiece of their replacement a cut to the income tax rate for the state’s second-highest tax bracket from 5.3% to 4.4%. While Republicans will note the bracket would provide relief all the way down to a household income level of $27,000 for single filers, it’s a bracket that also goes past $300,000—and an analysis of a similar GOP plan from earlier this year showed that the wealthiest 20% of taxpayers in the bracket would get about two-thirds of the total tax savings.

The GOP proposal moves beyond childcare to increase the tax deduction for parents who send their children to private schools. And the amendment also contains a hodgepodge of other Republican bills designed to punish the unemployed and the state’s professional licensing agency, even though Evers has vetoed them before.

Not only have Republican senators replaced Evers’ bill—after taking testimony about it in a public hearing last week—they announced Friday a committee vote on the newly-amended bill would take place Monday morning, without any discussion of the GOP proposal. Also, the vote would be taken by paper ballots instead of in a committee meeting where Democratic senators could ask questions or make statements about the killing of Evers’ childcare plan.