JFC Budget Wrap-up
On June 4 the Joint Finance Committee completed its work on the State Budget (SB 44). For a summary of the Committee’s actions, go to The Hamilton Consulting Group web site.

With JFC action on the budget bill finally over, there remains a stretch of road ahead before the package is fully approved. Although neither house is expected to make major changes to the Committee’s version of the budget, we do expect the Governor will make use of his partial veto power.

The Governor has side-stepped probing into his potential action so far; however, he has expressed concern over several parts of the Committee’s work. A June 5^th Capital Times article highlighted some of the Governor’s concerns. It was reported that the Governor believes that the  Republican package raises false hopes that substantial amounts of federal money will come through to save the State budget. Additionally, the Governor feels it is misleading for GOP members to represent their increase in state aids to schools as an overall increase in school spending, compared to Gov’s budget. In Doyle’s view, the extra state aid is offset by the cuts the Committee made to 4-year-old kindergarten funding; as a result, the Governor suggests that K-12 will actually receive less funding under the Republican package.

Further, the Governor opined that the Committee’s readjustment of the shared revenue formula for aid to municipalities unfairly retains payments to wealthier suburbs, while reducing aid to larger cities, and many smaller municipalities.

Yet Republicans stand by their package. According to JFC Co-chair Darling, the GOP plan puts the taxpayers first, by adopting the three-year property tax freeze. Additionally, she believes the Committee health care package, over the Governor’s budget, will enhance protection for Wisconsin’s “most vulnerable citizens.” JFC Co-Chair Kaufert agrees. He stated that under the JFC budget, Wisconsin will actually be spending less, and borrowing less; citizens will find relief in reduced fee increases, and, a proposed health care tax increase has been eliminated.

All parties are awaiting the draft language of the final JFC package in order to fully assess the changes to the Governor’s budget. Both houses will be briefed on the budget on June 12, with action expected to follow shortly thereafter.

Controversial Voter ID Bill Passes Senate
On June 3, AB 111 passed the Senate by a vote of 19-11. The bill provides that any person attempting to register or vote on election day, or attempting to obtain an absentee ballot, would be required to present either a valid Wisconsin driver’s license or a Wisconsin identification card issued by the Department of Transportation (DOT). If a person does not have a valid ID, he or she may be issued a “provisional” ballot but must provide a photo ID to the municipal clerk prior to 4:00 p.m. the day after the election for the vote to be counted. DOT would be required to provide the photo ID free of charge if requested for voting purposes.

Opponents have argued that this proposal increases administrative burdens of DOT, poll workers and municipal clerks and would be particularly cumbersome for elderly, disabled and minorities. Proponents point to the fact that identification is required for almost all customary business transactions and that the integrity of the important function of voting should require no less.

“Pay to Play” Bill Passes Senate
On June 4, AB-1 passed the Senate by a voice vote. The bill reenacts the portion of Act 109 (relating to campaign finance reform and other ethics violations) that adds to pay to play to current prohibitions on acts by elected officials. The bill creates a further prohibition against elected officials promising votes or public action in exchange for political contributions. (AB-1’s author Gundrum announces the Senate’s June 4^th action).

DNR Unveils Final Mercury Rule
On Thursday, May 5, DNR briefed the Clean Air Act Task Force on its final mercury rule. The rule, under development for close to three years, now goes to the Natural Resources Board for adoption at its June 24-25 meeting in Waupaca.

The final proposal continues to target mercury emissions from “major utilities” (system-wide mercury emission over 100 lbs/year). Four Wisconsin utilities trip the major utility threshold – Dairyland Power, WE Energies, Wisconsin Public Service, and Alliant Energy. The revised reduction mandates are 40 percent by 2010 and 80 percent by 2015.  DNR’s claims that modification to baseline calculations allowing credit for existing reductions means the 40/80 percent mandate equates to 20-25 and 60-65 percent in additional reductions. The original proposal called for 30/60/90 percent emission reductions over three 5-year phases.

Another significant change was the dropping of the “major stationary source” cap for industrial and small utilities emitting over 10 pounds per year. But under the final rule, these sources must still calculate annual emission using prescribed procedures. Rather than requiring emission offsets, the final rule requires Best Available Control Technology (BACT) on all new or modified sources increasing mercury emissions by 10 pounds or more.

Industrial and utility groups are still evaluating the proposals, but it is likely the final rule will see opposition at the Board and legislative review stages that must be completed before the rule becomes effective. The final rule and related documents can be found on the DNR web site at.

Committee Holds Hearing on Controversial Wage Lien Bill
The “drafting error” which changed Article 9, resulting in the “non-dischargeability” of all subordinate state and local government liens, has brought the wage lien issue back into play in the State Legislature. The change to Article 9 has been used on several occasions to recover monies due under wage liens filed by a government entity. The UCC Article 9 issue is considered by financial institutions to be a larger scale problem than allowing for a super priority status of wage liens, with some “reasonable” threshold cap. Consequently, there have been several negotiation sessions involving industry, the Governor’s office and the Department of Commerce. A “proposal” was developed which would: 1) restore the super priority status of wage liens by eliminating the financial institution exemption—prospective only; 2) establish a cap per employee for wage lien claims; and, 3) amend Article 9 to restore previous language providing that all subordinate state and local government liens be discharged in a UCC Article 9 proceeding. That proposal was introduced as Substitute Amendment 1 to AB 2.

The Senate Committee on Financial Institutions held a public hearing on AB 2 and Substitute Amendment 1 on June 4. The bill was supported by banks, credit unions and other lenders but was opposed by labor and the Department of Justice. The lenders want to resolve the Article 9 concern while the opponents want to use the opportunity to further expand on the wage claim lien coverage and status. The Senate Committee Chair, Senator Dale Schultz, is willing to allow some additional negotiation but is committed to passage in the Senate this month. The Assembly passed the original bill without the UCC fix early in the session and would have to approve the Senate version before being sent to the Governor.

Action by End of June on Economic Development Bills
Likely influencing the Senate Committee on Financial Institutions’ urgency regarding AB 2, was the Senate Republican’s June 4^th announcement that they plan to take action on AB 2 before the end of the month. The Senate also plans to act on SB-100 (relating to creation of a Small Business Regulatory Review Board, which would create more flexibility in regulatory rules affecting small businesses), and SB-180 (regarding payments to local utilities), as passage of the three bills could jump-start economic development in Wisconsin.

Energy Impact Report Bill Passes Senate
Also during Wednesday’s floor period, the Senate passed SB-113, as amended. The bill would require the Department of Administration to prepare an energy impact report on each legislative and regulatory proposal that impacts energy policies.

Bill Proposing New Joint Committee Passes Senate
On Wednesday, June 4, SB-17 was passed by the Senate. The bill creates a Joint Committee on Court Judgments and Settlements made on behalf of the state.

Controversial ‘Conscience Clause’ Bill Passes Assembly
During Thursday’s floor period, AB 67 passed by a vote of 56-35. The bill would make changes to current law regarding employment discrimination based on creed, refusal of certain health care providers and hospital employees to participate in certain procedures on moral or religious grounds, and duties of physicians regarding power of attorney for health care instruments.

WPC Recommends Reform to Strengthen Paper Industry
On Tuesday, June 3, the Wisconsin Paper Council released a report entitled The State of Wisconsin’s Paper Industry: Recommendations for Action.  The report was written as part of the Department of Commerce’s economic cluster initiative, and is aimed at strengthening the paper industry’s presence in Wisconsin. Main priorities for policy change are tax reform, environmental regulation reform, and strong energy policy.

Potawatomi Compact Amendments Approved by Governor
Responding to certain criticisms made by Republicans regarding recently renegotiated gaming compacts, the Governor and the Potawatomi Tribe have agreed to an amendment to their original compact that would:

• Delete language from the original compact providing for use of funds by the State for the benefit of the University of Wisconsin,

• Delete State’s express waiver of sovereign immunity,

• Provide alternative remedies for the Tribe should the State legislature not authorize an express waiver of the State’s sovereign immunity for enforcing the compact.

Identity Theft Bill Hearing
The Senate Committee on Judiciary, Corrections, and Privacy is scheduled to hold a hearing on AB 288 on June 10, at 10am. The bill passed the Assembly on May 29^th. The bill is aimed at persons engaged in identity theft and expands the definition of “personal identification document” to include several new types of documents under the prohibition. The bill also creates a new crime, prohibiting the unauthorized use of identification documents or information relating to a corporation, partnership, association, government, or government agency.

Hearing on Bill Deleting Gas Tax Indexing.
The Assembly Committee on Ways and Means is scheduled to hold a hearing on June 11, at 10am, on AB 242. Under the bill, current law requiring the rate of motor vehicle fuel tax to be annually adjusted would be deleted.

National Medicare Budget
On June 5, key Senate Finance leaders announced they’d made an agreement on the basics of the Medicare reform package that will head for committee action next week.

Clear Skies Hearing
At a June 5^th hearing on the Clear Skies Bill, the Chairman of the Senate Subcommittee on Environment and Public Works Clean Air, Climate Change, and Nuclear Safety, George Voinovich, R-O, announced that he does not support the addition of carbon dioxide regulation to Bush’s Clear Skies Bill. However, repeated calls to attach carbon dioxide to the bill, which would already create new controls on mercury, sulfer dioxide, and nitrogen oxide emissions, were not fully silenced. The bill will likely face further heated debate in committee and on the Senate floor before moving too far this summer.

Hatch Considers Changing Asbestos Bill to Build Support
Senate Judiciary Chairman Hatch said this week he is considering changes to asbestos litigation reform legislation in order to build support for the bill. Changes include doing away with language that would reduce compensation to victims of asbestos-related diseases based on payments from other sources. Hatch is trying to win the support of key Democrats to pass the plan for reforming the litigation system for victims of asbestos-related illnesses. Both parties, as well as insurers, defendant companies, victims' groups, unions and others say reform is badly needed to ensure that companies are not driven into bankruptcy and to ensure that the sickest victims are compensated. Other changes to the legislation include a proposal that would ban the future use of asbestos, and a plan to compensate victims in the mining town of Libby, Montana, where asbestos exposure and related diseases are widespread among miners and their families. Hatch indicated he would examine concerns that asbestos victims' compensation would be unfairlyreduced by payments from Medicare, Medicaid, insurance and other "collateral" sources.

The Senate Judiciary Committee held a hearing on the bill this past week. Excerpts of the testimony follow:

• AFL-CIO: "We intend to talk to Hatch on Friday," Damon Silvers, associate general counsel of the AFL-CIO in Washington, told Reuters. Although a meeting time had not yet been set, Silvers reported that "we very much appreciate the invitation," to speak with Hatch.

• Senator Leahy: "The stakes are too high for us to leave the field before trying our utmost to complete the task.  I urge everybody working on this - industry, labor, victims, and lawyers - everybody involved to keep on working for a consensus." (Leahy’s goal for consensus on the bill derives from his belief that acting together will provide the best chance of success in getting legislation on the President's desk).

• Senator Durbin: “We have reached a national crisis and have to do something.  I have an open mind and hope that we truly have a bipartisan and open mark up.”

• Senator Feingold: “The current bill falls short, but I am hopeful that the process will yield a consensus bill we can all support.”

• Senator Sessions; “The fundamental problem is that we're not getting enough of limited resources to victims in need.  Congress has a moral obligation to get resolution to people in true need as soon as possible. The number of bankruptcies will escalate dramatically without legislation.”

Kaiser Commission Releases Report on Health Insurance Coverage for All
Health insurance coverage for all citizens would increase the nation's health spending by between $34 billion and $69 billion, which constitutes between 3 and 6 percent of total spending, according to a study released this week by the journal Health Affairs and the Kaiser Commission on Medicaid and the Uninsured. Expanding coverage to all would increase health spending's share of the gross domestic product from 14.1 percent to between 14.5 and 14.9 percent.

Changes Proposed to Improve Access to Generic Drugs
A bipartisan group of senators have a plan to improve access to generic drugs that could save billions of dollars. Senator Judd Gregg, R-N.H., chairman of the Senate Health Committee, said his committee would vote on the legislation next week. The proposal is co-sponsored by Sen. Edward Kennedy, D-Mass., the panel's top Democrat, and Sens. Charles Schumer, D-N.Y., and John McCain, R-Ariz.

The bill is aimed at limiting some of the practices that brand-name pharmaceutical companies allegedly use to keep generic competitors off the market. It would allow only one 30-month stay, delaying Food and Drug Administration approval of a generic drug when a brand-name company sues the generic maker over patent infringement. Currently, the brand-name company can use repeated 30-month stays to keep a generic off the shelves.

The first maker of a generic product to come to market now has 180 days of exclusivity, where the brand-name maker pays its competitor not to enter the market. The Gregg-Schumer bill would forfeit exclusivity for companies that enter anticompetitive deals or fail to come to market in a timely fashion.

The bill would also allow the generic company to file a counterclaim when sued by a brand-name firm.

Energy Bill’s Hydropower Provision Retains Public Input on Environmental Protections
Senate Energy Committee Chairman Pete Domenici and Public Lands and Forests Subcommittee Chairman Larry Craig issued a statement to set the record straight on the hydropower provision in S. 14 (The Energy Policy Act of 2003) which is currently under consideration by the Senate. The hydropower relicensing provision in the bill ensures reliable and affordable electricity by seeking to eliminate unnecessary costs, delays, and uncertainty in the relicensing process.

Ethanol Amendment Passes Senate
On June 5^th, the Senate accepted the Frist-Daschle-Voinovich backed amendment to the energy bill. The amendment would increase the use of ethanol nationwide in the manufacturing of gasoline, and includes the Renewable Fuel Standard, coauthored by Voinovich.

Additional amendments to the energy bill may be coming, as environmentalists have reported that they are gathering votes for an amendment deleting liability protection provisions from the bill.

Sunday, June 8:

• US Rep. James Sensenbrenner (R), Waukesha, 4:00 p.m.

Monday, June 9:

• US Rep. Dave Obey (D), Milwaukee, 8:00 a.m.

Sunday, June 22:

• Reception for Tom Petri, Fond du Lac, 11:30 a.m.

Monday, June 30, 2003

• State Rep. Jon Richards, Trocadero, 5:00 p.m.

• Reception for Tom Petri, Manitowoc, 5:00 p.m.

• Fundraiser for Terri McCormick, Oshkosh

• Reception in Honor of Congressman Jerry Kleczka, Milwaukee, 5:00 p.m.

For Further Information

In the News

Panel OKs budget plan: Milwaukee Journal Sentinel, June 5, 2003.

A look at the GOP's freeze on property taxes, state spending: Milwaukee Journal Sentinel, June 5, 2003.

Committee backs state budget plan; Democrats riled: Wisconsin State Journal, June 5, 2003.

Sales tax exemption sought for papermakers: Green Bay Press-Gazette, June 5, 2003.

Paper companies aim at small gains: Appleton Post-Crescent, June 3, 2003.

Unions, paper firms seek reforms: Appleton Post-Crescent, June 3, 2003.

Industry seeks help: Wisconsin Rapids Daily Tribune, June 3, 2003.

Assembly bill on right of refusal passes: Milwaukee Journal Sentinel, June 5, 2003.

State health plan remains grounded: Green Bay Press-Gazette, June 4, 2003.

Drug recovery plan advanced: Eau Claire Leader-Telegram, June, 3, 2003.

GOP told: Don't raid state pay: Madison Capital Times, June 3, 2003.

Property tax freeze drawing support, criticism: Manitowoc Herald Times, June 3, 2003.

Reinstate conservation fee increase (opinion): Manitowoc Herald Times, June 3, 2003.

Republicans reallocate gambling revenues: Eau Claire Leader-Telegram, June 3, 2003.

Council proposed to improve state, tribal relations: La Crosse Tribune, June 3, 2003.

State budget deficit worsens school inequities: Oshkosh Northwestern, June 1, 2003.

Alliant faces energy demands: Milwaukee Journal Sentinel, May 31, 2003.