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MADISON - Gov. Jim
Doyle and other Democrats are adamant that their state budget proposal
won't hurt middle class taxpayers. But don't tell that to cell phone
users, smokers and property owners.
Taxes and fees on all of them will go
up under the state's new two-year budget that passed out of committee
on Friday and could clear the Democratic-controlled Legislature next
month.
But Doyle and fellow Democrats say
Republican critics are grasping at straws to find tax increases that
will affect average, working class people in the budget that balances
a $6.6 billion budget hole.
Doyle refused to rely on the simple
solution — raising sales or income tax rates — to come up with the
cash quickly to balance the shortfall. Instead, he and lawmakers
cobbled together a mixture of tax and fee increases, cuts to state
agencies, schools, local governments and others, federal stimulus
money and a variety of other accounting moves to balance it.
Under the plan, cigarette taxes will go
up 75 cents a pack, cell phone users will have to pay 75 cents more
per month, income taxes will be raised on those earning over $300,000
a year and property taxes paid by homeowners will go up about 3.2
percent this year.
"I know the usual rhetoric but the
fact is the only tax increase is for somebody that is earning over
$300,000 a year and then it's only a very small marginal
increase," Doyle said Friday in Milwaukee. "Despite a huge
budget deficit there are no sales tax increases, there are not income
tax increases, we have really worked to protect middle-class taxpayers
in this budget."
Republicans argue that new taxes
imposed on big oil companies and hospitals will also be passed along
to car drivers and patients, but Doyle says they will not. The oil tax
specifically disallows the tax to be passed through, but it's likely
to be fought in court. The hospital tax generates federal matching
money to help pay Medicaid providers, reimburse hospitals and help
balance the state budget.
All 12 Democrats on the Joint Finance
Committee voted for the plan early Friday, while all four Republicans
opposed it.
Top Doyle aide Dan Schooff said the
plan stuck to the primary framework the governor laid out to address
the budget shortfall, but he would not say whether vetoes were likely.
Many parts of the budget have not yet been reviewed by the governor's
office, he said.
Even so, Schooff said he expected the
budget to pass the Legislature and be signed into law before the new
fiscal year starts on July 1.
Republicans accused Democrats of having
misplaced priorities and raising spending by more than 7 percent.
Democrats countered that increase was due to $3 billion in federal
stimulus money, but that state general fund spending was actually
going down about 3.5 percent over two years.
The massive and far-reaching plan
included far more than just budget balancing.
Democrats approved mandating insurance
coverage for children with autism, creating new driver's cards for
illegal immigrants who can't get licenses and giving legal rights to
same-sex couples.
Complicating the work this year was
another $1.6 billion added to the state's budget shortfall, which had
stood at $5 billion. The deeper hole forced Doyle to propose even
larger cuts and other changes to his original budget introduced in
February.
The budget proposes a 3.1 percent cut
in aid to schools, a 5 percent reduction in most state agency spending
and cuts in funding for local governments. Doyle also ordered 16 days
of unpaid days off for most state employees and rescinded a 2 percent
pay raise for nonunion workers. If union workers don't agree to a pay
cut, Doyle said it could lead to 400 layoffs. Another 1,000 state
workers could lose their jobs due to other cuts.
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