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5/25/2007
It's not as easy as a "no tax increase" pledge
Last week, Owen Robinson, writing for his Boots & Sabers blog, asked Assembly Republicans to pledge not to vote for a budget that “includes any tax increases or any fee increases that aren’t directly related to the cost of delivering the service.”
So I responded to Owen that it was all well and good to ask legislators to swear to no tax increases. But at the same time, legislators – and we – must be asked what programs they – and we – are willing to eliminate or shrink. That’s the dilemma – we continue to want this program or that program (surely, every program has its advocates) - and without cutting back on services provided by the state, and without increasing taxes, we get into smoke and mirrors deficit budgets – and the governor moving money around like it was peas under walnut shells.
I absolutely agree – we’ve got to reduce Wisconsin’s tax burden. Yes. But reducing the tax burden also means we must also decrease spending, i.e., decrease the services provided by our governments.
There’s just no magic that reduces taxes and increases services. It just doesn’t work that way.
So Owen says yeah, I agree – look for my column next week.
Ok. So I looks. And Owen writes this column and says the decreases should come from scrapping shared revenue, scrapping 2/3 K-12 funding, cutting transportation spending by about 20% and forgetting about the Stewardship Fund.
I appreciate the message – and Owen, I appreciate you! But our legislators are supposed to eliminate shared revenues? (Yes, a terrible system) and 2/3 K-12 funding?
What?
No tax increases. Good. But cutting the spending always gores somebody’s ox – so it’s just plain tough.
So here’s my list. Easy for me to go on record – I don’t have to get re-elected! Depending on whom you talk to, only about ½ of Shared Revenue dollars are actually used to do what they were intended to do, that is to equalize spending for basic municipal services. So eliminate the other half. Yup, municipalities are going to be pretty mad at their legislators and will spread all kinds of venom. But the responsible argument, that Owen makes as well, is that if property taxes increase locally as a result, those local folks are the best folks to make those local decisions.
Two-thirds K-12 funding: It really bugs me that the state commits to funding a fixed percentage of whatever the districts want to spend. How about taking away state 2/3 dollars for all spending that is the result of a referendum and all spending that results from labor settlements at greater than the QEO? Property tax increases that result? See paragraph above…
Eliminate state funding for 4 year-old kindergarten.
Fund SeniorCare for the neediest seniors, require greater cost-sharing as assets and incomes increase – like most other states do.
Facilitate consolidation (or service-sharing) of school districts of less than say, 2,000 students.
Reduce transportation spending by 10%, requiring yes, bumpier roads for more years. We in Wisconsin have a tradition of paved, high quality roads, stemming from our roots that required milk to get to market in a timely way. Perhaps this is an expectation that needs to change.
Ok. Lots of folks can find fault with lots of these specifics. But the point is I went through the exercise – as did Owen. It’s not an easy one. And it’s not an easy exercise for our legislators to go through when we keep demanding more and more from a budget already in deficit – and when at the same time, we demand (which we should!) lower and lower taxes. There’s just no magic….
COMMENTS
This is where a TABOR like amendment comes in strong.
It recognizes the need for growth in spending. More people require more services – especially the basic ones we all agree on. What it does is to force legislators and executives to more seriously consider spending priorities.
We do not get into budget trouble during lean times & in times of recession, by then it is too late. We get into trouble during the fat times when money is rolling into the state coffers and our government seems like it is auditioning for a remake of Brewster's Millions (yes, the analogy only goes so far). When the recession hits and tax revenues dry up what do we do? Cut back on spending? Nope, resort to accounting gimmicks.

Mark A Framness (Fri May 25 10:04:12 2007)
Jo; I agree that shared revenue is a joke. We are better off at the local level to address our spending. Once the tax goes to the state we lose our influence on the rates and benefits. The argument you would get from some is that State tax is taken off your income rate, local is off the real estate value. So if you have a high value real estate and a low taxable income this move would cost you much more money. But if you are the other way around, you could see a real savings.
I think sending money to Madison for them to distribute to localities is a dumb idea. Just another middleman skimming off the top. The same goes for school taxes. Leave it local, let us handle it. As for the university funding, that should be from the state, the technical collages should also be funded locally.
One thing I will disagree with is road maintenance and repair. That is one area cutting is not a good idea. If you want to cut in that area, cut the new roads out. But cutting road maintenance is like skipping a paint job on the house for a few years. The savings on the paint will be eaten up when you have to replace the siding and window frames from the damage of the wood rotting. Painting would be a lot cheaper and makes sense. We could eliminate snow removal since just about everyone has a SUV on the road anyway. That would work! Besides we should decide that locally too. Good points all Norb. Thank you for your thoughtful response. I can see your point on transportation. Do you think every road need be paved? JE

Norb West (Fri May 25 17:05:16 2007)
Jo,
After reading the article about no increase tax pledge it reminded me of when I was working. We had a CFO who was deemed a genius, because he would take the expense ledger and make cuts. The problem was that he didn't apply any science to the cutting, and in some cases there were adverse effects.

Dennis (Fri May 25 7:20:16 2007)
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