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July 26, 2002 budget repair edition

Shared Revenue Plan
McCallum Restores ERP Program 

As previously announced, Gov. Scott McCallum restored funding for the the expenditure restraint program for 2004 in his budget repair bill vetoes.  The governor also restored the utility aid payment portion of the shared revenue program, separating out $58.1 million in expenditure restraint money and an estimated $28.8 million in utility payments from the $999.7 million remaining in shared revenue in 2004 under the bill the Legislature passed earlier this month.

Traditional shared revenues could be reduced further under a program to siphon off up to $45 million a year in shared revenues for one-time consolidation-incentive payments to municipalities under a plan McCallum proposed and the conference committee adopted. Under that plan, municipalities could receive up to 75 cents for every dollar of estimated savings they expect in the year a condsolidation takes effect.

"My veto to restore expenditure restraint payments means that shared revenue will now include two savings incentives, rather than only one," McCallum said in his veto message.

Because we haven't seen the bill language yet and formulas will continue to run under the vetoes, we are unable to calculate the effect on inidividual Alliance members.

Our initial reaction is the vetoes are a mixed bag for our cities.

For the text of the governor's veto message and his budget summary, go to Dick Wheeler's website by clicking here.

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Gov. McCallum

McCallum also called for a special legislative session prior to the November elections to pass a constiututional amendment to create a state "rainy day" fund and to require a referendum whenever there is a tax increase. Under another one of the governor's proposals, legislators and the governor would not be paid if a budget isn't done on time.

Among issues that concern us, McCallum also vetoed:


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McCallum backs 10-lane Freeway Plan

Gov. Scott McCallum has decided to go against the will of local officials and support planning for an expansion of the Milwaukee area freeway system of up to 10 lanes.

"This provision is a common-sense approach to planning for our future," the governor said of the budget provision that remains intact. "Freeways support jobs, commerce and economic development."

Milwaukee Mayor John Norquist immediately criticized the plan.

"Scott McCallum's actions today show why the state has a $1 billion deficit," Norquist said. "Who's going to pay the $6.25 billion bill for this unnecessary freeway widening project?

For Larry Sandler's story in the Milwaukee Journal Sentinel, look here.

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Two more lanes?


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How the Shared Revenue Debate Shook Out

2002 2003 2004
Current Law $1,029.4 $1,039.7 $1,039.7
Governor      679.4      679.4          0.0
Joint Finance*   1,029.4      750.0       515.0
Assembly*   1,029.4

     750.0

      515.0
Senate 1,029.4 1,039.7 1,039.7
Conference Committee 1,029.4 1,039.7 999.7 **
Governor's vetoes 1029.4 1039.7 999.7 ##

(in millions of dollars)
* 2004 numbers would have increased if general fund tax collections increased.
**amount does not include $45 million set-aside for consolidation incentive payments.
## this total will increase or decrease according to changes in utility payments.
Source: Legislative Fiscal Bureau, governor's veto message


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Upcoming Events

   Aug. 8-9 Sheehy Task Force, St. Norbert College DePere
Aug. 19 Alliance session on regionalism, Fond du Lac (details to follow)
Aug. 21-23 League CEO Workshop, Rhinelander
Sept. 19-20 Alliance meeting, La Crosse
Sept. 25 McCormick Health Care Task Force 225 NW
Nov. 21-22 Alliance meeting, Appleton

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THE WISCONSIN ALLIANCE OF CITIES
14 West Mifflin Street Suite 206
Madison, Wisconsin 53703
(608) 257-5881