Governor Scott Walker has introduced legislation to achieve a balanced the budget by the end of the fiscal year, and legislative Democrats appear okay with it. “As far as I can tell, it appears like he’s really just making a straightforward effort put forward fiscal policies that actually address the budget shortfall that we have,” said Assembly Minority Leader Peter Barca. “This is what we should have had all along, in my judgement.”
“Democrats were, from the beginning, willing to work with Governor Walker and the Republicans to address fiscal issues to ensure we had a balanced budget,” said Senate Minority Leader Mark Miller in a statement. “I’m glad we’ve finally reached this point. But, I remain extremely disappointed that, instead of starting out with a bill to fix fiscal issues, the Governor and legislative Republicans used a fiscal repair bill as an excuse to advance a radical overreach that divided our state, stripped workers of their rights and endangered programs that provide health insurance for children and prescription drugs for seniors.”
“This legislation will allow the state to finish this year’s budget in the black without raising taxes on the middle-class,” said a statement from Walker. “The balanced budget legislation also allows us to put an additional $176.5 million into healthcare for the poor.”
Walker’s office said the legislation will also refinance the state debt, lowering the state’s interest payments, allowing the state to fulfill the necessary Medicaid commitments for low-income families; funding that the previous administration did not have in its budget. It will also allow the state to address the deficit of $22 million in the Department of Corrections.
Debt Refinancing – The bill authorizes the refinancing of principal payments in fiscal year 2010-11 on the state’s general obligation bonds. These principal repayments will be paid in future years. This provision will reduce debt service costs by $165 million in fiscal year 2010-11.
Address FY11 Medicaid deficit – Medicaid costs are expected to exceed current GPR appropriations by $176.5 million. The bill would increase the Medicaid GPR appropriation to address this shortfall, ensuring continued coverage for low-income families.
Corrections – The bill provides $22 million GPR to address shortfalls in the Department of Corrections adult institutions appropriation. These shortfalls are due to health care costs, overtime, and reductions in salary and fringe benefit budgets under Act 28.
Temporary Assistance to Needy Families (TANF) Funding for Earned Income Tax Credit (EITC) – The bill allocates $37 million of excess TANF revenues to increase TANF funding for the EITC from $6.6 million to $43.6 million in fiscal year 2010-11. By increasing TANF funding, GPR funding for the EITC is reduced by a commensurate amount.
Act 28 Required Lapses by DOA Secretary – Under Act 28, the Department of Administration Secretary is required to lapse or transfer a total of $680 million in 2009-11 from appropriations made to executive branch agencies to the general fund. The bill would reduce this amount by $79 million to ensure the lapses can be met in the next three months as this was ineffectively addressed by the previous administration.
“I don’t think there will be any problem with moving this through rather quickly,” said Barca. “We’re familiar with these provisions, many of them we recommended as part of our alternative budget repair bill.”