The new Wisconsin state budget won’t be ready on time—is that okay?

In some states, failing to pass a new budget on time can have the same outcome as what happens with the federal government: a shutdown.

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Happy New (Fiscal) Year! Unfortunately, the guest of honor isn’t ready yet. The new state budget is late.

The new fiscal year began on July 1 and there’s a tentative bipartisan agreement on a new state budget, but that new plan isn’t done yet—Republicans who control the Wisconsin Legislature had been tied up in knots, trying to agree among themselves on what should be in the state’s two-year spending plan—which collects taxes and fees and then allocates those dollars for schools, roads, health care, infrastructure, and more. 

The 2023-2025 budget expired on June 30, and a 2025-27 budget was supposed to be passed by both houses, signed into law by Gov. Tony Evers, and ready to go into effect on July 1.

The lack of any sense of alarm reflects a backstop built into our state’s budget process: No government shutdowns. Some other states may see operations stripped down to basic services and non-essential state workers furloughed until a budget is passed—but here in Wisconsin, if there’s no new plan, the budget that was supposed to expire stays in effect. It means no interruption in services, but it also means no improvements in funding, no new programs, no new hiring, and lots of uncertainty for local governments around the state.

Why the delay? It came down to Republican disarray, similar to what had been happening in the US Capitol. In both cases, GOP lawmakers face sharp internal disagreements on making spending cuts—not whether to make them, but whether to make them sting a bit or deeply painful. In politics, there is an invisible line between so-called fiscal conservatism and overshooting the mark to the point where there is voter backlash. The trick for Republicans is to guess where the line is. The alternative — working with Democrats — appears to be a bipartisan action useful to them only in political emergencies.

State budget math (Votes, not just dollars)

State Senate Republicans have an 18-15 majority, leaving room for only one of them to vote no on the budget without needing to seek Democratic votes. But three Republicans indicated they weren’t on-board with whatever the rest of their caucus wanted, so leadership negotiated with Evers and legislative Democrats to reach a deal.

“We know that we’re not going to get everything that we want,” said Sen. LaTonya Johnson (D-Milwaukee). “The whole objective is to make sure that our voice is at that table and we get something.” 

Johnson and Roys say Democrats were merely asking for the things that were requested over and over at a series of public hearings on the budget: support for childcare providers, no cuts for the Universities of Wisconsin System, and using part of the $4 billion surplus to address years of underfunding public schools. Unfortunately, Roys said, Republicans on the Joint Finance Committee had voted earlier for motions that are “really horrendous.”

“It continues this horrible cycle where our schools get shortchanged and then property taxpayers have to raise their own taxes to make up the difference and to keep our schools’ doors open,” Roys said, pointing to a net $0 in state general school aid. “At a time of rising costs, that’s functionally a budget cut.”

That’s alright with some Republicans. Sen. Chris Kapenga (R-Delafield) wrote on social media Monday that he would be comfortable if it took months to evaluate the entire state budget in order to root out waste and fraud. Kapenga has been in the Legislature since 2011 and did not offer specifics of what budget items have escaped his attention for the past 14 years.

What’s next for the state budget?

The tentative deal must go through votes in the Assembly and Senate before going to the governor for his signature and any partial vetoes—but for now, government services continue as the budget process enters what many hope is a brief overtime period.