Statement: Wisconsin’s Surplus Deal Didn’t Pass the Test
We applaud the legislators who put Wisconsin families over politics
Last week the Governor’s problematic surplus deal was blocked in the Senate. This deal represents more than just a partisan disagreement about schools and taxes. At its core, this disagreement demands that we ask a simple question: are we going to make decisions that help Wisconsin families for the long haul, or keep chasing short-term band-aids that sound good in a headline but don’t actually solve the problem?
There’s no doubt our schools need more funding. Parents, teachers, and students across Wisconsin are already feeling the effects of years of underfunding. Special education funding especially has fallen far behind what schools actually need.
“As a lifelong Wisconsinite and public school teacher for 30 years, it’s been incredibly disheartening to watch the decades of disinvestment in our children. We are all exhausted from repeated referendums, staff shortages, and growing classroom pressures,” shared Mary, retired teacher from Menomonee Falls.
That is real. And families are frustrated for good reason.
But this deal would not have solved the problem. Here’s why.
Once the Surplus is Gone, It’s Gone
Lawmakers tried to package together one-time rebate checks, tax cuts, and school funding increases using the state’s $2.4B surplus. The problem is that almost all of the tax cuts and spending would be ongoing and carried forward into future budgets, while the money paying for them was temporary. Once it’s gone, it’s gone. That’s how states end up with massive budget problems later.
In fact, this deal was projected to create a nearly $3 billion budget hole within the next few years — setting Wisconsin up for future cuts to schools, health care, and other services families rely on every day.
Tax Breaks for Some, But Too Many Left Out
Despite all the talk about the real struggles with affordability, much of the help in this bill would not have gone to the people struggling most. The truth is the people who could have used a one-time $300 rebate the most weren’t even gonna get a check.
About 30% of Wisconsin adults would not have received rebate checks at all, including many seniors on Social Security. Meanwhile, about half of the money would have gone to households making more than $100,000 a year.
And then there were the tax exemptions on tips and overtime pay.
At first glance, those ideas may sound helpful. But many of the biggest benefits would likely have gone to higher-income workers who already have access to large amounts of overtime pay — while leaving the state with less money to invest in schools, roads, health care, and child care later on.
Wisconsin’s wealthiest 1% already pay a lower tax rate than the bottom 20%. This would have made it worse.
A Setup for Long-Term School Funding Problems
The same thing happened with school funding. Supporters called the school funding aspects of the deal a major investment in public schools, but only half of the funding would have ever made it into classrooms at all. Instead, it would have provided minor property tax relief, not additional resources for school districts.
Plus, schools still would have been stuck dealing with the same long-term funding problems a few years from now.
Some parts of the plan also risked making things worse. Changes to school funding formulas would have deepened existing inequalities at a time when Wisconsin leads the nation in racial disparities for school outcomes. According to the Kids Count Data Center, Wisconsin’s racial disparity between Black and white youth was the highest (compared to all other states with available data) on both the percentage of high school students graduating on time, and the percentage of 8th graders testing at proficient levels on statewide math assessments.
Bold Leadership Means Getting Real on Revenue
A surplus alone will never solve the bigger problem: Wisconsin has the capacity to build a tax system that works better for everyday people—not just the wealthiest households.
Wisconsin families need lasting solutions only tax fairness can deliver: affordable child care, strong public schools, stable housing, accessible health care, and wages that actually keep up with rising costs.
An affordable, livable Wisconsin is actually possible if we focus on the root causes of how we got here: the wealthy few have not paid their fair share in taxes. When we come together, reject division, and demand a system that works for all of us, communities can have the resources they need to thrive.
Thank you to the legislators on both sides of the aisle that stuck out their neck for what’s right.
NOTE: This press release was submitted to Urban Milwaukee and was not written by an Urban Milwaukee writer. While it is believed to be reliable, Urban Milwaukee does not guarantee its accuracy or completeness.
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