Progressive Thinking

Will the truth on Walker's medicaid blunder get out of the Madison-Milwaukee echo chamber? Republican lawmakers are fooling themselves and the public if they believe Walker's talking points on health care reform, says Senator Kathleen Vinehout in her latest column on the Governor’s plan for Medicaid that was affirmed by the Joint Finance Committee.

MADISON - “We want to make things better,” one of the Finance Committee members recently told his colleagues. This Medicaid plan, he said, “Protects taxpayers, strengthens the safety net and lowers total cost to taxpayers.”

What actually happened would cost the state a hundred million more dollars than full Medicaid expansion, drop coverage for 84,000 people and leave almost half a billion of federal dollars on the table in this coming budget.

Only half of those who lost Medicaid will likely ever sign up for private insurance. When they do, their federal cost to taxpayers will be $3,000 more per person than if they had stayed on the Medicaid program.

Some lawmakers argue the safety net will be strengthened by opening up the Medicaid doors to all those who make less than $11,500 a year for a single person; that those who lose Medicaid are easily covered under the exchange and in the long run taxpayers save.

The problem: private insurance costs more to buy and more to administer. Poor people are unlikely to sign up for something they can’t afford.

Fiscal Bureau analysts caution the “take-up” rate, meaning those poor families who actually sign up for private insurance, will be much less than the near perfect number estimated in the administration’s budget.

This concern is justified. According to a Congressional Budget Office (CBO) study from last summer, an estimated one half of those losing Medicaid will never buy private insurance.

Those who do will receive federal tax credits and subsidies. Because of the increasing cost of subsidies and credits, CBO estimates federal spending would rise by roughly $3,000 per person by 2022. This is the difference between exchange subsidies of about $9,000 per person and estimated Medicaid savings of roughly $6,000.

Some analysts are quietly grateful at least the Governor decided to allow those up to 100% of the Federal Poverty Limit (FPL) - $11,500 for a single person - to receive Medicaid. Anyone below 100% of FPL is not even eligible for subsidies or tax credits. This limited lawmakers’ choices.

The majority of the state’s budget writing committee affirmed the only choice the Governor had if he wanted to continue to argue that he still opposed “ObamaCare”: cover those with incomes at or below 100% of FPL and drop (or phase out) Medicaid for parents who now receive Medicaid and make up to twice the FPL.

Simply put – if you make under $11,500 as an individual or $15,500 as a couple you will be eligible for Medicaid. If not, you’d better find out about the exchange because you can’t get on Medicaid.

Three additional factors add sting to this decision. Unlike the federal law, the Governor’s plan does not modify your income by dropping 5% to determine eligibility. Second, the plan changes the law to require that depreciation be counted as income. This is a big change for farmers who argue depreciation is not real money they can save but an adjustment on tax forms. Third, 18 year-olds are no longer covered unless they are still in high school or technical college and will graduate by age 19. Foster children are still covered until age 26.

Republican leaders appear to be following the Arkansas approach of partial Medicaid expansion. However, if Arkansas is the model, the Governor might have duped Republicans on the Finance Committee.

To move towards the Governor’s plan, the feds require the state to seek a waiver of federal law. If Arkansas’ case is prologue, Wisconsin may be required to treat those dropped from Medicaid as if they are still on Medicaid - with choice of at least two qualifying health plans and “wrap-around” Medicaid-like services if benefits are less or cost sharing is more.

Correspondence from the feds to Arkansas makes it clear the feds will evaluate each waiver on a case-by-case basis. Budget language makes it a clear this waiver must be sought and followed. This leaves a lot up the air.

Especially for elected officials who want to hit the campaign trail saying, “I said ‘no’ to ObamaCare.”

MADISON - At 3 o'clock in the morning, in the dark of the night while most of Wisconsin was fast asleep, Republicans in the Joint Finance Committee voted to expand statewide taxpayer-funded vouchers for private education in our state.  This vote occurred after weeks of closed door backroom meetings with special interest groups.

The Senate Republican plan for statewide voucher expansion is even more extreme than what Governor Walker initially proposed.

It was bad enough that Scott Walker wanted to expand vouchers schools into 9 school districts throughout the state, but now EVERY community will see voucher expansion.

This voucher scheme forces all families to pay for their neighbor’s children to attend private schools, which have been proven to under perform compared to our neighborhood public schools and are not held accountable to the taxpayers.

In addition, taxpayers whose districts are forced to accept private school vouchers will see their property taxes increase and their local school aids cut to pay for a separate under performing, unaccountable school system.

Please contribute today to show Republicans you do not support their plan to expand vouchers schools to all of Wisconsin’s school districts.

We can do better in Wisconsin. Instead of doling out millions of taxpayer dollars to private school special interests in the middle of the night, we can invest in our children's future by supporting our public schools.  The only way to ensure that happens is by taking back the majority in the Wisconsin State Senate.

As you are aware late night backroom deals are alive and well in the Wisconsin State Capitol.

With the state budget now on its way to the Assembly and Senate for approval, it is safe to say that at least Dog the Bounty Hunter will be celebrating this recent development, while the middle class and the economy will continue to suffer.

While you were sleeping last night, the Republican controlled Joint Finance Committee approved extreme motions, one of which included permitting a private bail bond system to be implemented in Milwaukee and four other counties.

Commercial bail bonds have been banned in Wisconsin since 1979 and faced near universal opposition from judges, lawyers and law enforcement. This opposition continues today on the basis that bail bonds are ineffective and a threat to public safety.

Please help us fight against this measure with your contribution of $100, $50, $25 or $10. Republicans should not be allowed to let special interests trump the safety of Wisconsin’s citizens.

Other major motions approved exclusively by Republicans on the JFC and further undermine the middle class were:

• Income tax cuts of $651 million that will primarily benefit the wealthy or top earning 1% of taxpayers—not the middle class
• An expansion of taxpayer funded, unaccountable private school vouchers across the state, which DPI estimated could cost nearly $2 billion annually
• Public school students will see an increase of only $300 per student over the next two years after suffering historic cuts of $1.6 billion in the last budget. This cut created the surplus that is now being used to bailout private school vouchers and fund tax cuts for the wealthy

You can help us stop these radical attacks on Wisconsin’s middle class by contributing $100, $50, $25 or $10. Your contribution will help ensure that we have the resources to stand up to Republicans.

This week Senator Kathleen Vinehout writes about Rep. Kooyenga’s proposed tax reform plan.  Kathleen appreciates that he wants to have a conversation about tax reform, but she does not support his proposal.  She offers to work with him on a bi-partisan proposal that is modeled after what experts tell us: Taxes should be low, broad-based, and transparent. Tax policy should not favor one type of business over another.

MADISON - Get rid of tax credits for dairy farmers? No tax breaks for meat or food processing plants? Get rid of credits for ethanol? Cut beginning farmer credits?

You’ve got to give Representative Dale Kooyenga credit. The Brookfield Republican isn’t afraid to take on the dairy state’s sacred cows.

Just as the state’s budget writing committee is wrapping up their work and Legislative leaders are about to broker a deal on public education and health, Rep. Kooyenga announces a proposal to rewrite the income tax code.

He seems to start with agriculture in mind. I bet there aren’t many cows in Brookfield.

Last summer, Representative Kooyenga and I served on a committee studying changes to the state’s income tax code. So it didn’t surprise me to see he was working on income tax reform.

But his timing in unveiling the proposal and what seem to be big changes for farmers and ag-related businesses almost ensure its demise.

That’s too bad because Wisconsin’s complex tax system needs reform.

The complexity is the product of tax loopholes, not tax rates. The State Legislature rarely meets a tax credit it doesn’t like. The result is a cumbersome tax code that hasn’t been seriously evaluated since 1999 and then the Legislature ended work without repealing a single tax credit.

There are 73 possible state adjustments after you file your federal taxes and there are dozens of credits to modify those adjustments. In the 2013 Department of Revenue report, I counted 37 credits that totaled $1.5 billion in lost revenue. My friends at the Revenue Department will remind me that the credits interact with each other and can’t always be added together: more complexity.

Messing around with state income tax is frightening for anyone who runs an operation dependent on the state. That’s because so much of what the state buys is paid for by income taxes. State income tax makes up over half of the general fund – the source of state money for health, education, local government, corrections and universities. Wisconsin is more dependent on income taxes than all but 11 other states.

While I commend the Brookfield Republican for getting this conversation started, I don’t agree with details of his proposal. For example, the proposed lowering of tax rates for high income earners - over $300,000. I don’t support his plan to allow millionaires to offset high off-farm earnings with (part-time?) farm losses. Currently no farm loss is allowed if it exceeds $600,000.

The plan favors the wealthy and doesn’t include serious reform of property tax – the part of our tax system most out of line with the national average. Start-up companies are most burdened by property tax which impacts job creation.

In the interest of advancing reform, I’d offer to be a bipartisan partner in the discussion.

First, let’s agree on a few ground rules. The goal of tax reform must be revenue neutral – meaning when all the tax breaks and loopholes are ended, every dime must go to lowering rates – but not one penny below the total dollars saved by tax changes.

I know Republicans who are too tempted to lower rates more than what we can afford. And some Democrats are very tempted to plow savings into new spending.

Second, reform must be bipartisan, regardless of the party in power. Why? Because in this hyper-negative political environment, no rookie in a swing district is going to be comfortable voting to end a tax break to (name your favorite good cause) unless they know the party against them also voted to end the same break.

Third, all taxes should be on the table. Property taxes can be regressive. Sales tax is almost always regressive. An income tax change on one group should be considered in the context of all other taxes that groups pays.

Finally, no tax break is sacred. All should be regularly evaluated even if they are not eliminated. We badly need a process to evaluate what we get for our investment.

The experts agree. Taxes should be low, broad-based, and transparent. Tax policy should not favor one type of business over another. But getting there is not for the faint-hearted. And timid does not describe my friend Dale.

So, while you’re at it, Dale, maybe get rid of the Lambeau Field tax check-off?

Oh, you just did?

Senator Kathleen Vinehout writes about the need for DNR staff to inspect the growing number of frac sand mine operations. The number of sand mine operations has grown significantly since the summer of 2012 and staff is needed at DNR to monitor them. The Joint Finance committee voted down a motion to fund the needed 10 positions.

MADISON - “We really need concerned citizens to be our eyes and ears,” wrote DNR Storm Water Specialist Ruth King in response to citizen complaints about frac sand mines. “I am only a half-time employee and cannot be everywhere at all times.”

Ms. King’s appeal was reported in an article written by Kate Prengaman of the Wisconsin Center for Investigative Journalism who closely follows the growing sand mine industry.

“Nearly a fifth of Wisconsin’s 70 active frac sand mines and processing plants were cited for environmental violations last year,” wrote Prengaman. She quoted Air Management Specialist Marty Sellers who said he sent letters of noncompliance to “80 to 90 percent” of the sites he visited.

The DNR’s limited resources means some frac sand mines are not inspected or only inspected when citizens complained about the mine.

To address the staff shortage, the state budget includes two positions as dedicated sand mine monitors. However, additional positions were recently considered by the Legislature’s Joint Finance Committee.

Monitors are needed to oversee air quality during mine construction and operation. New inspectors would monitor compliance with storm water rules, high capacity wells, wetlands and endangered resources. Inspectors review permits, blasting and fugitive dust control plans, discuss best management practices with the operator, inspect equipment and review company operation reports.

The Joint Finance Committee was informed about the sand mine industry through a paper written by the nonpartisan Legislative Fiscal Bureau (LFB) which provided detailed information on the industry that has exploded in western Wisconsin.

“Three years ago there were 5 industrial sand mines and 5 industrial sand processing plants in the state,” wrote LFB analyst Kendra Bonderud. “DNR officials recently estimated that as of April 1, 2013, there are 105 industrial sand mines and 65 industrial processing plants in the state, which is two to three times the number the Department was aware of in the summer of 2012.”

The LFB paper noted last summer the DNR reviewed staffing needs for permitting, compliance and monitoring of frac sand operations. At that time, the Department estimated 10.2 full-time positions were needed to oversee the 54 known sites. The fast growing industry now needs two to three times more inspectors.

Joint Finance Committee member Senator Jennifer Shilling offered an amendment to fund at least those 10 positions. Still, the majority of Finance Committee members voted down Shilling’s amendment.

Adequately funding sand mine monitors is important for neighbors, local government and the mine owners and workers. I receive many calls of neighbors concerned about mine operation. Local government officials are stretched thin and are often unable to monitor the mines. Most counties have few staff dedicated to the inspection of mines. Workers need necessary health and safety protections. Owners that do follow the rules are at a competitive disadvantage with those who do not.

Citizens are rightly concerned when the state relies on them to monitor mine safety. It was from citizens that I learned of one of the most serious violations. Last year Preferred Sands’ mine in Trempealeau County had a mudslide that affected a neighboring property. The WI Center for Investigative Journalism reported this mine also had “multiple violations of its air quality permit”. The violations are now being considered by the Department of Justice.

Trempealeau County is the epicenter of sand mining. With 28 mines there is no higher concentration in the state. Recently, citizens delivered to Trempealeau County Board Supervisors petitions with 821 signatures in favor of a year-long sand mine moratorium. Petitioners were upset when supervisors ignored the stack of signatures and instead failed to pass the moratorium on new county mines.

Citizens should not be charged with the monitoring of mines in their neighborhoods. If Wisconsin allows sand mining, Wisconsin must invest in staff to monitor compliance with the law.

Not all 170 mines and processing plants are up and running. But it is reasonable to expect they will be by June of 2015, the end of the upcoming state budget. The Legislature should act to phase-in the funding for all 32 needed positions before the final passage of the two-year state budget.