On January 16, 2002, the Legislative Fiscal Bureau completed its review of the state's general fund for the remainder of the 2001-2003 biennium and announced that there is a $1.117 billion budget deficit. Governor McCallum has called the Legislature into special session beginning January 22 to address the fiscal crisis. Governor McCallum will release the details of his budget adjustment bill by the start of the session. Republicans in the Legislature, however, are already calling for severe cuts in education as an easy way to solve the budget shortfall problem. These cuts will harm the ability of local school districts to provide every kid with a great school.

Talking points on Senate/Assembly Republican anti-public education budget cuts

• Republicans in the Senate and Assembly support plans calling for a freeze in state spending and to reduce the state's overall commitment to fund two-thirds of school operating costs. These plans also prohibit school districts from raising their property tax levies to offset cuts. Local officials will be forced to cut programs that place kids in classrooms that work, like giving parents the option to put kindergartners in school all day.
• Any freeze or rollback of the state's 2/3 commitment to fund schools will jeopardize the ability of districts to maintain quality staff. There are more than 300 unsettled contracts across the state and Republican proposals to yank major revenue sources from schools have dumped more issues on negotiations already tangled up in prolonged and sometimes bitter contract talks.
• Budget-cutting measures that harm public education are unacceptable, especially since public schools have already been forced to make budget cuts for eight years under the state-imposed revenue caps and QEO law. As the Legislature prepares for a budget adjustment session, it is time for WEAC members to speak openly about accomplishments in public education and get ready to meet the challenges that lie ahead. We must renew our strong commitment to maintain high quality public schools that benefit everyone in the community. Without our direct actions to defend public education at the state and local levels now, the future success of our great schools is at stake.

The complete Legislative Fiscal Bureau budget deficit analysis can be found at: http://www.legis.state.wi.us/lfb/lfb_publications.htm.

Senate and Assembly Republican budget cutting plans

• The Senate and Assembly Republicans have offered similar plans to cut the budget deficit.
• Freeze state spending at 2001-2002 levels (Similar approaches in both plans)
• Freeze the state property tax levies of all local governments (Same in both plans)
• Require state agencies to make budget cuts equal to a 10% reduction in workers (Senate only)
• Limit the Homestead Tax Credit to homeowners 56 and older (Senate only)
• Freeze UW System tuition for two years (Senate only)
• Freeze all technical college spending (Senate only)
• Place a moratorium on tax referendums and on all long-term bonding (Senate only)
• Use money in Public Service Commission fund to pay school heating costs (Senate only)
• Delay state aid for new school computers by halting local TEACH grants (Senate only)
• Hire 50 new public defenders; stop paying private lawyers to defend the indigent (Senate only)

Additional details of Senate/Assembly Republican plans and impact on Great Schools

Senate Plan:

• Cut a total of $344 million by adjusting school district revenue payments to 2001-2002 levels for 2002-03
  • Cut $190 million by reducing state aid to school districts
  • Cut $115 million by prohibiting schools from raising their property tax levies
  • Cut $39 million by eliminating TEACH block grant and training funds in 2001-03
• Put a freeze on technical college spending at the 2001 level
  • Cut $35.4 million by reducing state general aid to technical college districts (29.9%)
• Cut $170.9 million by requiring a 10% across-the-board cut in state GPR employees
  • 10% of the total positions in each agency that are GPR financed would be eliminated
    • Cut $219,343 from Employment Relations Commission
    • Cut $10.8 million from Health and Family Services
    • Cut $1.7 million from Public Instruction
    • Cut $323,940 from WTCS

Assembly Plan:

• Cut a total of $441 million by reducing general fund appropriations to maintain 2002-2003 spending at 2001-02 levels and cap property tax levies at the amount levied in 2001
  • Provide exemptions for Birth-to-Three, Prescription Drugs for the Elderly and SAGE
  • Freeze all state bond programs with debt service paid from GPR issued after 12/31/01
• Impact of Assembly Republican freeze on certain state agencies
  • Cut $92,000 in '01-02 & $92,000 in '02-03 from Employment Relations Commission
  • Cut $6.5 million in '01-02 & $19 million in '02-03 from Health and Family Services
  • Cut $412,300 in '01-02 & $186,231,600 in '02-03 from Public Instruction
  • Cut $124,200 in '01-02 & $124,200 in '02-03 from WTCS

For More Information:
Revisit OnWEAC for additional updates, as the budget adjustment session gets under way. Contact Bob Burke with any questions relating to this memorandum. He can be reached by e-mail at burkeb@weac.org.

This paper was prepared by the WEAC Political Action, Legislative, Federal and Agency Relations (PALFAR) Campus

Posted January 17, 2002