Evers Vetoes GOP $2 Billion Tax Cut and Child Care Tax Credit

Protester’s signs line the halls of the Wisconsin Capitol during a Sept. 20 special session for child care funding and other investments. Republicans took no action, but later rewrote Gov. Tony Evers’ proposal. Evers vetoed the revised bill Monday. Photo by Henry Redman by Wisconsin Examiner.

Gov. Tony Evers vetoed the Republican rewrite of his special session bill Monday, declaring it “wholly out of touch with what Wisconsinites, including child care providers, some of our state’s largest employers, working parents, students, and our state’s higher education institutions, are asking for and need.”

Evers’ rejection of the bill was widely expected. The Legislature’s Republican majority deleted entirely the $1 billion legislation he initially proposed — bolstering child care providers and the University of Wisconsin system along with provisions to start a paid family leave program in Wisconsin and extended funding for a series of workforce development projects.

Instead, GOP lawmakers replaced Evers’ plan with a $2 billion measure, primarily a tax cut for households with incomes ranging from $27,000 to more than $300,000 a year. It included an expanded tax credit for families with child care costs as well as an expansion of a start-up program for new child care centers.

Nevertheless, child care providers said those were inadequate in the face of their greater need for ongoing supplemental revenue that could allow them to improve employees’ pay without raising tuition. In addition, the structure of the child care tax credit expansion resulted in a larger subsidy for higher-income taxpayers than for taxpayers with lower incomes but the same child care costs.

“I am vetoing this bill in its entirely because I object to Republicans in the Wisconsin State Legislature gutting my comprehensive workforce plan to instead pass a completely unserious proposal that fails to meaningfully and sensibly address the workforce challenges that have plagued Wisconsin for a decade,” Evers wrote in his veto message.

In a statement announcing the veto, Evers charged that “Republicans have consistently dragged their feet on finding solutions to the most pressing issues facing our state even as small businesses, farmers and producers, hospitals and healthcare sectors, and schools, among others, face challenges filling available jobs, child care providers are closing their doors, and our UW campuses lay off hundreds of employees.”

In October, the Department of Administration announced that the state ended the fiscal year June 30 with a balance of more than $7 billion in the state’s budget and a record $1.8 billion in the state’s budget stabilization “rainy day” fund.

Evers’ original special session proposal marked his second attempt to win lawmakers’ support for continuing the Child Care Counts program that provided monthly payments to providers during the COVID-19 pandemic.

While the program was originally covered by federal pandemic relief funds, Evers had proposed continuing it for the next two years in the 2023-25 state budget. Republicans who hold 12 of 16 seats on the Legislature’s budget committee removed that funding, however.

In August Evers called for a special session that would take up the child care support proposal along with three other elements that had been cut from his proposed budget: added funding for the UW System, including a new UW-Madison engineering school building; money to kickstart a proposed paid family leave program that would be funded through a payroll deduction; and the expansion of programs that the administration started in 2021 with pandemic relief funds.

As Evers had proposed it, the special session bill would have put about $365 million into child care support. After a state Senate committee approved the Republican rewrite eliminating that funding, the Evers administration moved $170 million in remaining pandemic relief money to continue the child care aid at a reduced level through June 2025.

As expected, Evers vetoes GOP bill that replaced child care and other aid with tax cut was originally published by the Wisconsin Examiner.