What To Do With $3.3 Billion

With his line item vetoes, Gov. Tony Evers may have just created a new supplemental budget process to take place this fall.

Evers did a nice job of wielding his veto pen. It may be the most masterful and bold use of the veto since Tommy Thompson was lauded with a headline in the Green Bay Press Gazette, “Tommy’s Pen Is A Sword.” Only the space between “Pen” and “Is” was rather small. People, especially Capitol wags who are people of a sort, noticed.

Evers made two especially noteworthy moves. First, he decimated the Republicans’ massive tax cut for the rich. He wiped out the benefits for the wealthy and some of the middle class while providing a modest cut at the lower income levels. Under the Republican plan people making over $1 million would have received over $30,000 while those earning between $100,000 and $125,000 would have gotten less than $700.

Not only did Evers do the right thing for fairness but he may have prompted a new budget process for the fall. He took a $3.5 billion tax cut and turned it into a $175 million cut. So, now what happens with the other $3.3 billion Evers just saved? It just sits there providing a nice cushion for the next budget unless legislators or Evers himself decides they want to find other ways of spending it. It seems possible that Republicans will turn up the heat on Evers, claiming that he’s holding onto money that should go back to taxpayers while Democrats will have new spending ideas. I wouldn’t rule out a special session on a supplemental budget.

The other big change was that Evers took a one-time $325 increase in per pupil spending in public schools and made that annual increase possible for the next 400 years. (I expect teachers unions and school boards to quickly complain about the devastation that will come in year 401.) The practical implication of this appears to be that school districts essentially have no spending limits. That’s not going to stand. It may not even survive a veto override as Republicans already have the two-thirds vote for that in the Senate and they’re only three votes short in the Assembly. They’ll claim that this will cause massive property tax increases and that may just be enough to flip enough Assembly Dems from marginal seats.

But even if it doesn’t lead to an immediate override there will be pressure to change this. That’s fine. Evers has found a way to put himself in a strong negotiating position with Vos. His message to legislative Democrats should be ‘hang with me on this and I’ll get you a better deal.’ Maybe the deal is that Republicans get more of their tax cut while Evers gets more of his school aids. Republicans provided another $1 billion for schools, but Evers had wanted $2.6 billion.

Evers also vetoed language requiring the UW to eliminate its Diversity, Equity and Inclusion programs, but he could not restore the $32 million cut that went along with that. The UW could still come back to Joint Finance to ask for their money back so long as they can show that it would be directed to workforce development programs. Nonetheless, without changes to DEI I don’t see Joint Finance restoring the money. I’ve always thought the answer to legitimate questions about DEI was a Legislative Audit Bureau study instead of an ill-targeted budget cut. That’s what I think. Nobody else thinks that.

In fact, Evers’ only stumble in this process was threatening to veto the budget over the $32 million and DEI. It doesn’t strengthen his position vis a vis Vos to threaten a veto and then not deliver. But with his action on the tax cut and school spending he’s made up for that and he’s put himself in a good negotiating position.

Nice job, Governor.