Wisconsin passes a $100 million tax cut in just four days

October 18, 2013

Gov. Scott Walker (R-Wis.) speaks during an August rally for South Carolina Gov. Nikki Haley (R-S.C.). (Credit: Richard Shiro/AP)

That was fast. Just four days after its introduction, a bill to cut $100 million in Wisconsin property taxes is on its way to becoming law.

The bill, introduced on Monday by Republican Gov. Scott Walker and the top Republicans in the state houses, passed its final hurdle on Thursday. Gov. Walker plans to quickly sign it.

“I thank Majority Leader Scott Fitzgerald and Speaker Robin Vos for their swift action to pass our $100 million property tax cut,” Walker said in a Thursday statement. “I will quickly sign this legislation, so it will be reflected on tax bills in December.”

In widely circulated campaign ads last year, Walker touted the elimination of the state’s $3.6 billion deficit, as did Speaker Vos during Thursday’s afternoon session.

“In bad fiscal times, our citizens make sacrifices because we need to keep government running,” he said Thursday. “Now that better times have returned because of our stewardship of the economy it’s time to return the surplus that we have generated.”

But others criticized the move, arguing that the same legislators who celebrated erasing the deficit simply replaced it with a smaller one. Along with other bills, the tax cut will grow the state’s budget shortfall to $725 million from $545 million over the 2015 to 2017 budgetary period, according to state legislative analysts.

Walker’s detractors also criticize the package for turning a one-time, higher-than-expected revenue haul into a lasting tax cut. Owners of median-value Wisconsin homes will save $680 over four years compared to the previous four-year period, the administration says.

The $725 million deficit going forward is not “insurmountable,” Jon Peacock, the director of the policy think tank the Wisconsin Budget Project wrote this week in a critical post about the cut. But it would be better spent on offsetting bonds the state has issued in recent years or increasing the state’s minimum budget balance, he said.

But Vos addressed that criticism on the floor on Thursday, arguing that lawmakers have also simultaneously strengthened the state’s rainy day fund.

During Tuesday’s Senate session, Democratic Sen. Tim Cullen criticized the package as a political move, arguing that the money could better serve other purposes.

“What we’re doing is trying to help a governor get elected,” Cullen said. “One hundred million dollars of property tax relief — nice headline.”

Like it or not, though, Wisconsin did something that feels increasingly rare at the federal level: it’s “getting things done,” as Vos put it Thursday, the day that marked the end of the 16-day federal government shutdown.

“While Washington is mired in dysfunction and debt, overspending and over-promising, Wisconsin is going in a different direction,” he said.

The Senate passed the bill 28 to 5 on Tuesday, while the Assembly passed it 82 to 12 on Thursday.

Niraj Chokshi reports for GovBeat, The Post's state and local policy blog.
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