Steven Walters
The State of Politics

Walker’s Budget Borrows Big

$1.3 bonding for transportation means 23% of taxes for roads will pay interest on bonds by 2016.

By - Feb 9th, 2015 09:43 am
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Gov. Walker plans to borrow $1.3 billion to continue major highway, bridge and other transportation programs statewide.

Gov. Walker plans to borrow $1.3 billion to continue major highway, bridge and other transportation programs statewide.

“During the present downturn, Wisconsin’s proud tradition of responsible budgeting gave way to … excessive borrowing for operations.” Republican Gov. Scott Walker said that in his first State of the State speech Feb. 1, 2011.

In his March 1 budget message that year, Walker doubled down on his February comment: “Wisconsin is broke, and it’s time to start paying our bills today—so our kids are not stuck with even bigger bills tomorrow.”

Flash forward to today. In some Capitol office or in the basement work area of the governor’s executive residence in Maple Bluff, there is a whiteboard with a list of ideas of how to permanently pay for Wisconsin’s transportation future. Each of a dozen ideas has a line drawn through it. The only thing not crossed off—lucky No. 13 on that whiteboard—is “bonding.” That’s another term for “borrowing.”

Walker’s controversial decision to ask legislators to borrow $1.3 billion by mid-2017 to continue major highway, bridge and other transportation programs statewide allowed his aides to make these claims: “The Governor’s budget provides a total of $6.5 billion to build and maintain Wisconsin’s transportation infrastructure… There are no new taxes, fees, or increases in the transportation budget.”

Walker’s Democratic critics say he ignored two years worth of fund-raising suggestions — including $751 million worth of specific ideas from his transportation secretary that would avoid putting future transportation costs on the taxpayers’ credit card — because he’s running for President. But the Democrats can denounce Walker’s decision without having to lead on the issue. Everyone in the Capitol is still waiting for a list of what specific transportation tax and fee increases Democrats are promising to support.

The governor defends his request to borrow $1.3-billion more for transportation, and another $220 million for a new downtown Milwaukee Bucks arena, by saying his overall budget would borrow less than any budget in the last 10 years. It’s also important to note that Walker’s $1.3-billion bonding request includes every important statewide project – all of which are championed by local legislators, chambers of commerce and other civic groups – and increases aids to local governments.

The official budget summary puts it this way:  “This includes timely investments to rebuild the Zoo Interchange, as well as the Hoan and Stillwater bridges. The governor also recommends enumeration of the I94 East/West project [west of Miller Park] to allow DOT to initiate substantive work on the project. The budget also includes $836.1 million over the biennium to keep major highway projects on schedule, such as the widening of I39/90,” between Madison and the Illinois border.

What isn’t in that budget summary: The current two-year budget borrows $991 million for transportation programs, so the new proposal would borrow $1.3 billion more. It would require, by the 2016-17 budget, 22.8 percent of all state transportation taxes to go to paying off bonds, instead of for highway and bridge construction and maintenance.

The budget sends this hardball message to Republican legislative leaders and transportation special-interest groups: “If you don’t like my plan to borrow $1.3 billion, you raise taxes and fees – or you pick the major highway projects that will be delayed. And then you – and not me – get the blame for doing anything but borrowing $1.3 billion.”

Two of those GOP leaders – Assembly Speaker Robin Vos and Joint Finance Committee Cochairman Rep. John Nygren – bristled at Walker’s bonding total. “I got elected to solve problems, not push them off,” Nygren said.

What were some of those pay-as-you-go options Walker rejected?

*Raising gas and diesel fuel taxes, which haven’t been hiked since 2006.

*Raising the $75 annual registration fee, flat since 2008.

*Basing the annual registration fee on vehicle age and cost.

*Enacting a registration fee surcharge for electric and hybrid vehicles.

*Enacting a sales tax surtax on new vehicles.

*Diverting sales taxes on vehicles, repairs and parts to the transportation fund.

*Ending the sales tax exemption on vehicle trade-ins.

*Tolling, although it would require changing federal law.

*Giving regional transit authorities new taxing powers.

*Having vehicle owners self-report miles driven, so those who drive the most pay more.

When he preens as a presidential candidate, Walker claims a record of “big” and “bold” changes. When it comes to transportation funding, there’s a third B—“borrowing.”

Steven Walters is a senior producer for the non-profit public affairs channel WisconsinEye. Contact him at stevenscwalters@gmail.com

9 thoughts on “The State of Politics: Walker’s Budget Borrows Big”

  1. tomw says:

    This is “Pentagon” budgeting brought to the state level. Ever wonder why even when politicians decry the federal deficit the Pentagon is never challenged to make significant cuts for example when they have military bases that are so empty they can be used to house children and parents of immigrants being held by Homeland Security without displacing any troops or equipment? EVERY congressional district has defense dollars being spent within their boundaries. The Governor has simply transferred that to transportation spending. As you so well point out, how do you complain about a budget item that rebuilds highways and bridges in YOUR district even if it means borrowing? As much as I find Walker and his ilk so wrong, this is one of the shrewdest ploys he’s offered. The can is kicked. And hello Iowa and New Hampshire, Mr. No new taxes but new highways is here to shake your hands and seek your votes!!

  2. Casey says:

    Ahhhh fiscal conservatism at its best. Since that group alway like to compare govmnt budgeting to home budgeting would this be like needing a car but also various other needs so instead of buying an old Tercel with cash you decide to get a Bentley on credit?

  3. David Ciepluch says:

    Walker did the same thing at the County level and the pension problem. Issue a lot of bonds and kick the problem off to the next guy. He is a one trick pony, kick the can down the road and hope the mess does not happen on his watch. Let the next guy try and clean up the mess he makes and also take the blame. Freezing tuition payments while slashing the UW budget is another example of inflicting great pain, but the real impact and fallout will be after he leaves office or is booted out to a high paying lobby job.

    If we want infrastructure and quality of life in our communities, we have to pay for it.

  4. Chris Byhre says:

    Walker’s budget borrows 2 billion dollars less then Doyle’s last budget. How upset were all you libs when Doyle was raiding transportation funds and the State Medical Malpractice fund (illegally as it turns out) yet still borrowed billions? Talk about kicking a can down the road, Obama will have run up more debt than all US Presidents combined. Where is your concern over that? Your selective concern is hypocritical.

  5. PMD says:

    That works both ways doesn’t it Chris? Where is all the conservative outrage over Walker’s borrowing, something they constantly rail on Democrats for?

  6. Wisconsin Conservative Digest says:

    If someone would bother to check statistics, you will find that Walker and consistently reduced borrowing compared to the 8 years under Doyle and under prior governors. Most of the people on this site just display there immature petty hatreds and some odd talking points. Do little research or offer any solutions. PMD worst trash.

  7. Chris Byhre says:

    PMD, there are many Conservatives, myself included, who are not happy with all of the borrowing. I think Walker should have paid down some debt last year rather then approve the relatively meager tax breaks many of us received. However, this site and most of the people on it don’t seem to concern themselves with a fair or balanced approach to issues. It’s one hit piece after another and so once in a while I feel the need to comment.

  8. PMD says:

    Fair enough Chris. Selective partisan outrage and very short memories seem to plague political discussions no doubt, and really we’re all probably guilty of them from time to time.

    Worst trash? What is that supposed to mean? Chris is conservative and he’s not happy with Walker’s borrowing. Is he also “worst trash?”

  9. Michael says:

    Chris –

    In his last budget proposal, Doyle proposed LESS borrowing then what Walker is now. However the Republican controlled legislature added extra borrowing, mostly to fund the construction of UW system buildings.

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