June 10, 2009

Speaker Mike Sheridan said there would only be "tweaks" not major changes.

The two-year spending plan passed the Democratic-controlled Joint Finance Committee last month. The full Assembly planned to take up the budget on Thursday, followed by the Senate next week.

The first series of proposed changes voted on publicly by Assembly Democratic members in their caucus were largely technical. More votes were expected into the night.

The Senate, also controlled by Democrats, is expected to make additional changes. That will force Democrats from both houses to hammer out a deal they all can agree on before sending the budget to Gov. Jim Doyle.

Some proposals most heavily under attack include a new tax on large oil companies with a prohibition against passing the costs to customers at the pump; changing lawsuit liability laws to make it easier for damages to be collected when several people are at fault; and increasing minimum car insurance requirements, a move expected to raise rates for drivers.

But those issues are just a handful of dozens that Republicans and others have attacked for weeks in the plan designed to balance a projected $6.6 billion budget shortfall, the largest in state history.

"If there's tweaks that need to be made, we're going to go ahead and make those," Sheridan said in an interview. "But I don't see any big changes from what was proposed."

Democrats hold a slim 52-46 majority in the Assembly. It takes 50 votes to pass the budget, making every vote critical. The one independent lawmaker, Jeff Wood of Bloomer, has been meeting in caucus with Democrats.

Democrats control the Senate 18-15.

Also on Tuesday, the state's largest lobbying group, Wisconsin Manufacturers and Commerce, delivered a petition with more than 2,100 signatures to Sheridan objecting to more than a dozen parts of the budget.

In particular, WMC singled out the proposals to raise income taxes on households earning more than $300,000 a year, increase capital gains taxes and change the liability law.

"The budget under consideration will hamper job creation in our state and prolong the recession," said James Haney, president of WMC.

Cellular phone carrier Cellcom, which provides service in both Wisconsin and Michigan, attacked a 75-cent phone fee increase that's part of the budget. Money raised would go to local governments for police and fire protection.

"This is an unfair fee that places an additional burden on phone users during difficult economic times," said Patrick Riordan, president and chief executive officer of Nsight, the parent company of Cellcom.

He also opposed a part of the budget that gives local governments $20 million that was raised from a previous cell phone fee and originally was intended to be returned to those who paid it.

Sheridan defended the budget, saying 99 percent of families will see no tax increase. There is no general sales or income tax increase, but taxes and fees would increase $2.1 billion under the budget, according to the nonpartisan Legislative Fiscal Bureau.

The $62.2 billion, two-year budget increases overall spending by 6.3 percent. However, that is due largely to $3.7 billion in federal stimulus money used to fund schools, Medicaid and other state operations. State tax-dollar spending actually decreases 3.2 percent over the two years.

Even with all the fixes in this year's budget, the state will face a $2.2 billion hole by mid-2013, the Fiscal Bureau said. A projected shortfall four years away is not unusual, but this one is the largest since 2005.

The Fiscal Bureau also released details on how a 3.5 percent cut would be split among local governments under the formula that distributes aid to counties, cities, towns and villages. In general, the more property-rich parts of the state will get a higher cut, up to 15 percent, while poorer areas will get less. The total cut was about $30 million.

Associated Press