Highlights of the Budget adopted by the Conference Committee and passed by the full Legislature are outlined below.

Health Care
Approved:

• Governor’s BadgerCare Plus proposal;

• Modified version of MA coverage for childless adults to allow DHFS to request a federal waiver and expend certain funds if approved;

• HMO rate increases of 3.4 to 5 percent in various MA programs;

• $200 million transfer from Patients Compensation Fund to the MA trust fund (transfer expected to be litigated);

• $1 increase in cigarette taxe and an increase in other tobacco products taxes;

• $40 million MA program savings related to implementing a pharmacy benefit manager (PBM) for fee-for-service pharmacy benefits;

• New item to reduce MA benefits funding by $61 million in FY 2009 to reflect savings that DHFS is expected to achieve in FY 2009;

• One of four insurance mandates relating to CPT code changes and explanation of coverage restrictions;

Rejected:

• Senate Universal Health Care provision  referred to as the Healthy Wisconsin Plan;

• All provisions relating to the assessment on hospital’s gross revenues tax;

• Assembly provision for HSA tax exclusions and deductions;

• Assembly provision to revise the time limits for paying MA, BaderCare and Senior Care claims;

• Three out of four insurance mandate provisions including coverage for autism, increased coverage for mental health in AODA, and extended coverage for full time students on medical leave;

Taxes

Approved:

• Income tax deduction for health insurance premiums

• Senate version of the income tax exclusion for retirement income for up to $5,000 per person for taxpayers 65 or older with adjusted gross income of $15,000 or less;

• Assembly provisions relating to expansion of angel investment and early stage seed investment tax credits;

• Assembly proposed electronic medical records tax credit;

• Ethanol and biodiesel pump tax credit of up to $5000 per year, equal to 25 percent of the cost of installing  an E85 ethanol or 20 percent biodiesel fuel pump;

• Biodiesel fuel production credit equal to 10 cents per gallon for biodiesel fuel with a maximum credit of $1 million, tax credit in place for 2009 and 2010 tax years only;

• Increase in cigarette tax of $1 per pack; increase tax on other tobacco products from 25 percent of the manufacturer’s price to 50 percent of the manufacturer’s price; converted the tax on moist snuff from the current price-based tax to a weight-based tax at the rate of $1.31 per ounce;

• Two percent levy limit for counties and municipalities that would apply to taxes levied in 2007 and 2008.

Rejected:

• Hospital gross receipts tax;

• Oil supplier gross receipts tax;

• Assembly provision to federalize treatment of HSAs;

• Senate provision to implement combined reporting;

• Assembly provision to provide a workplace wellness tax credit;

• The streamlined sales and use tax provision;

Transportation

Approved:

• Registration fee increases for passenger vehicles ($55 to $75 and light trucks (various increases based on weight classification);

• Increase in heavy truck registration fees by 30 percent;

• Increase of drivers’ license fee by $10 to pay for federal security verification mandate;

• Increase vehicle title fee from $28.40 to $53

• Additional $14 million transfer from the Petroleum Inspection Fund to the Transportation Fund;

Rejected:

• Gross receipts tax on oil suppliers;

• Senate provision authorizing the Southeastern Wisconsin Regional Transit Authority to construct a KRM commuter rail link using an increase in the vehicle rental tax and bonding;

• Governor’s proposal to transfer $164 million in GPR expenses to the Transportation Fund;

Energy

Approved:

• $30 million in renewable energy grants over the biennium

• $2.6 million for bio fuel production tax credits and $750,000 for bio fuel pump infrastructure

• Authorizes $85 million in bonding per year for the Stewardship program, which enables the state to purchase land and distribute grants to conservation groups and local governments to buy land to protect wilderness.

Education

Approved:

• Wisconsin Covenant Scholars Program

• Increase general and categorical school aids by $214 million over the biennium (0.9 percent in FY 08; 2.3 percent in FY 09), plus an additional $77 million in general school aids funding for FY 09;

• Increase in the school levy tax credit distribution of $79 million for 2008 property tax year, and by $75 million for the 2009 property tax year;

• Increase in special education aids of $54 million representing an increase of 5.24 percent in FY 08 and 5.35 percent in FY 09;

• Increased SAGE funding by $13.4 million annually;

• $25 million for payments for the Milwaukee Parental Choice Program

• $12.6 million to fund Milwaukee and Racine charter school programs

• $29 million for UW System initiatives

• $10 million to support retention of high-demand faculty

Rejected:

• Repeal of QEO

Economic Development

Approved:

• $750,000 for Forward Wisconsin to enhance the entire state’s marketing efforts.

• Inclusion of $15 million in the Wisconsin Development Fund for grants and loans for renewable energy.

• Increasing angel and venture capital credits by $2.5 million each annually.

• A $350,000 GPR annual increase for manufacturing extension center grants to $1.2 million annually.

• Increased funding for Wisconsin’s Youth Apprenticeship Training program.

• Increased funding for the Workforce Advancement Training grant program.

• Tipping fees increases to a total of $2.10 combined for the environmental and recycling funds. (This is a reduction from the Governor’s proposal and an even further reduction from the Senate action.)

Rejected:

• Assembly provision of Class B Liquor License exception of “full service” restaurant from the number of liquor licenses that can be issued by a municipality.

• Assembly provision that would allow any municipality that closes a TID during the effective period of the proposed levy limits to add the closed TID’s increment value as of July 1, 2005 to its new construction value.

• Assembly provision that overturns the Thomas “risk contribution” decision and restores the requirement to prove actual causation in mass torts cases.

• Combined Reporting.

• Oil Company Gross receipts Tax.

• Real Estate Transfer Fee Increases

Miscellaneous

Approved:

• Providing a total of $131 million in compensation reserves for state employees in FY 08 and $328 million in FY 09;

• Lapse or transfer of $200 million biennially to the General Fund from the appropriations of Executive Branch state agencies;

• Requiring a General Fund statutory balance of $65 million for FY 08-11;

Wisconsin has a budget: Milwaukee Journal Sentinel, Oct. 24, 2007. Long-overdue fiscal plan has higher fees, taxes, and free booze.

State budget approved: Wisconsin State Journal, Oct. 24, 2007. Governor expects to sign the bill within the "coming days. "

Legislature passes budget: Oshkosh Northwestern, Oct. 24, 2007. Hintz, Owens, Roessler vote no.

Reaction mixed on budget's cigarette tax increase: Green Bay Press-Gazette, Oct. 24. 2007. 'If you need to tax someone, it might as well be the smokers'.

Budget has shortfall of $892 million: Wisconsin State Journal, Oct. 23, 2007. The brokers seeking to solve the state's budget problems have found one major point of agreement — push many of them into the next budget.

Budget full of surprises: Milwaukee Journal Sentinel, Oct. 23, 2007. Fees, pork projects abound in lengthy state plan, due for a vote today.

State budget plan hikes property taxes: Appleton Post-Crescent, Oct. 23, 2007. $98 increase expected over two years on median-value homes.

From standoff to a deal: Milwaukee Journal Sentinel, Oct. 21, 2007. Week's events pushed Doyle, Legislature to a compromise on state budget.

A short-term budget (opinion): Appleton Post-Crescent, Oct. 21, 2007. Compromise deal will leave state with holes.

They've struck a budget deal: Wisconsin State Journal, Oct. 20, 2007. After reams of proposals and 111 days of delays, the stalled state budget shot forward toward a final resolution Friday.

Wisconsin budget deal hikes taxes: Appleton Post-Crescent, Oct. 20, 2007. Cigarettes will go up $1 per pack in plan that's 16 weeks late.

State leaders reach deal to end budget impasse: Green Bay Press-Gazette, Oct. 20, 2007. Hospital, oil tax rejected; UWGB money OK'd.

Budget deal sounds OK (opinion): Wisconsin State Journal, Oct. 20, 2007. Friday's budget compromise needs to be the start of better things to come.

Racine-area legislators discuss pros, cons of state budget: Racine Journal Times, October 20, 2007. Eastern Racine County’s state legislators say they are relatively pleased with the compromises in the state budget

The unspoken budget debate (opinion): Racine Journal Times, October 19, 2007. It’s high time that we have this, yet it’s not surprising that it took so long.

Finally, a budget deal (opinion): Milwaukee Journal Sentinel, Oct. 19, 2007. But lawmakers must not ignore critical needs that may have been lost in the last-minute dickering to reach a compromise.

For more Wisconsin News, go to Hamilton Consulting News Clips.

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