Lawmakers want to limit manufacturing tax credit, increase special education funding
State Sen. Jon Erpenbach (D-West Point) and Reps. Chris Taylor (D-Madison) and Shelia Stubbs (D-Madison) circulated a proposal this week to limit the manufacturing portion of the Manufacturing and Agriculture Tax Credit and to increase special education funding.
The bill would make it so an individual claiming the credit for manufacturing income can only claim it on the first $300,000 of qualified income. The lawmakers said that change would release an estimated $295.4 million in new revenue the state should then re-invest into special education for public schools.
Right now, the lawmakers said, more than 82% of the tax credit is going to millionaires, and fewer jobs have been created while the credit has been in full effect than the three years prior to its implementation.
Meanwhile, they say, despite special education funding not being increased in over a decade, Republicans cut $500 million from Gov. Evers’s proposal for special education in favor of roughly $500 million in tax breaks for the wealthy and only provided $100 million in new money for special education — 17% of the increase Evers proposed.
What’s more, the lawmakers argued, whether or not the state increases funding for special education, taxpayers are on the hook because when the state reimburses less, local taxpayers pay the difference, forcing taxpayers to increase their own taxes to keep their school doors open.
The lawmakers say the bill would protect Wisconsinites and ensure tax dollars are utilized wisely.
“Only 14% of the manufacturing credit recipients are millionaires, but they take 82% of the total,” Erpenbach said. “In summary, 20 people in Wisconsin earning over $30 million annually are taking $50.4 million in tax credits. That is money that should be invested in our schools. Instead of bending to millionaires, this bill will help us be able to give greater relief to property taxpayers across Wisconsin.”
Taylor said the tax credit diverts hundreds of millions of tax dollars to millionaires and billionaires in the state, and they don’t have to create one job to get it.
“Meanwhile, our public schools continue to reallocate general education funds because of inadequate funding for special education,” she said. “Our schools and our state cannot be successful if we continue to prioritize tax breaks for the wealthy elite over our most vulnerable students.”
Stubbs, a former special education teacher, said she understood just how vital the legislation was.
“We must fund our schools’ special education programs to ensure that students have the resources they need to reach their fullest potential,” she said. “Investing in special education is investing in the future of our state.”
Shilling, McGuire co-author Buy American Act
In an effort to boost American businesses, state Sen. Jennifer Shilling (D-La Crosse) and Rep Tip McGuire (D-Kenosha) are introducing a Buy American Act that would require the state of Wisconsin to purchase materials made in the U.S.
“We know that quality products are made by dedicated workers right here in the United States and it’s time we ensure they aren’t being undercut by foreign corporations and workers in other countries,” Shilling said. “The Buy American Act is a no-brainer policy to boost local businesses and support quality American-made products. This legislation is part of broader Democratic efforts to stop foreign outsourcing, level the playing field, and expand economic opportunities for Wisconsin workers.”
Buy American legislation has been introduced in 31 states, with seven states signing proposals into law, including Colorado, Illinois, Maryland, New Hampshire, New York, Oregon, Pennsylvania, Texas, and West Virginia.
Democrats propose another avenue to provide student debt relief
This week, state Sen. Jon Erpenbach (D-West Point), Jennifer Shilling (D-La Crosse), and Dianne Hesselbein (D-Middleton) circulated a proposal they say will help address the burden of student loan debt in Wisconsin.
The changes made under the bill would allow the use of EdVest funds to be used to repay student loans without state tax penalties. The change on the federal level was passed with strong, bipartisan support they say shows the clear and growing need to address student loan debt.
“For too many in our state, the threat of never-ending student loan debt payments is an obstacle that prevents individuals from reaching their full potential,” Shilling said. “By making it easier to save for college and pay off debt, we can give families greater financial flexibility to work toward their goals whether it’s owning a home, buying a new car, starting a business, or raising a family.”
Erpenbach said student loan debt is hindering the economy.
“Wisconsin students on average carry $30,000 in debt, and one in five students fall behind on their student loan payments,” he said. “This is a crisis that we need to address now. I am hopeful that this small change to apply a federal change will receive bipartisan support.”
Hesselbein said the state has always been committed to making sure Wisconsinites are set up for success.
“People of all ages and in all 72 counties of this state have been burdened with substantial student loan debt,” she said. “This crisis disproportionally affects students of color, low-income students, first-generation college students, women, veterans and seniors. By allowing people to invest more into education earlier through EdVest, Wisconsinites will be able to prioritize education without fear of life-long debt.”
Bill aims to help protect farmers
Assembly Republicans are preparing to introduce legislation aimed to strengthen Wisconsin’s agriculture community and said in a press conference this week they intend to make the bill a top priority.
“I’m glad that we incorporated the perspectives of hard-working farmers and agricultural producers across the state in crafting these proposals and not Madison bureaucrats,” said Rep. Rick Gundrum (R-Slinger). “Agriculture is not just part of our heritage, it is an economic engine that pumps over $100 billion annually into our economy. Farmers face unique challenges unlike any other industry.”
Gundrum said he was excited to collaborate with his colleagues from rural parts of the state and the farming community to identify areas where they can make long-term improvements.
“I am grateful to address the challenges in the agricultural industry in a way that does not unnecessarily grow the size of government,” he said.
The bills are expected to be taken up by the full Assembly before the conclusion of the legislative session later this month.
Higher minimum wage proposed; small business opposed
A proposal that would increase the state’s minimum wage to $15 per hour is circulating in the Capitol, but it is being strongly opposed by the National Federation of Independent Business (NFIB) in Wisconsin.
“Raising the minimum wage is more about the politics of the moment than about the realities of the economy,” said Bill G. Smith, state director in Wisconsin. “A government mandate that increases the wage rate for entry level workers may score political points, but it will have a serious negative impact on the ability of our small member employers to provide meaningful job opportunities for a vital share of our workforce.”
Small business would feel the brunt of the legislation, Smith said, because when employers face government mandated increases in wages, they must increase the cost of their products or services or reduce labor costs.
In New York City, Smith said, a study by The Hospitality Alliance found 75% of the more than 300 respondents reported they will reduce employee hours as a result of the minimum wage hike to $15 per hour, while 47% said they will eliminate jobs.
“And when all is said and done,” he said, “raising the minimum wage actually puts very little disposable income in the pockets of individual workers. To the contrary, for those who are the victims of fewer hours or lost job opportunities, earned income will be lost.”
Smith urged legislators who are serious about improving the lives of working families to focus more on creating an environment where small businesses can grow and create good paying jobs rather than wage and benefit mandates by the government.