Decision 2010

102010capitol

The mood of the electorate in Wisconsin mirrors that of the rest of America as voters make final choices for the November election. What’s the on the business agenda of local candidates for state legislature? We provide the answers.

Forward by Bob Warde

IN THE ROUGH AND TUMBLE WORLD OF POLITICS, the election cycle that will end next month seems much rougher than many, though they’ve been getting more so in recent years. As Wisconsinites go to the polls in a few short weeks, one of the sure questions on their minds will be what the candidates’ views and goals are for the business climate in the state, regulation, taxes and getting a handle on the large deficits state government has been running – and are growing, with the latest estimate for the next two-year budget cycle topping an amazing $3 billion.

As we have every two years since October 2002, New North B2B asked area candidates for Wisconsin Assembly to answer six questions about those topics to provide our readers with a greater understanding of their views, as well as whether a given candidate is worthy of your vote. This time around we didn’t include state senate candidates, as the only local state senate race up this November is for the 19th Senate District, where long-time incumbent Sen. Mike Ellis (R-Neenah) is running unopposed.

One candidate for assembly, Mert Summers of De Pere, who is running as a Democrat for the 5th Assembly District, declined to participate in the survey.

Michelle Litjens, a newcomer who won the Republican primary on Sept. 14 is now unopposed for the 56th Assembly District seat, and incumbents Rep. Al Ott (R—Forest Junction) in the 3rd Assembly District; Rep. Richard Spanbauer (R-Oshkosh) in the 53rd Assembly District; and Rep. Dean Kaufert (R-Neenah) in the 55th Assembly District were not included because they are unopposed.

Click on the links below to read the unedited responses from candidates from the four contested assembly races in the B2B readership area.

5TH ASSEMBLY (Includes Kaukauna, portions of Little Chute, rural northeast Outagamie County and rural areas of western Brown County)

  1. Economic development professionals have long identified regulatory burdens as one of the challenges to attracting and retaining businesses in Wisconsin. In just the past few years, several thousand paper and other manufacturing jobs have left northeast Wisconsin for other states and other countries. What can the legislature do to make Wisconsin a more attractive place to do business, create jobs, and generate tax revenue for local government?

STEINEKE: The legislature can have a dramatic impact on the state’s business climate, either for the good or bad. In Wisconsin, our State government must realize that in order to retain or attract compaines that bring with them high paying jobs, we must make the tax and regulatory climate at least as attractive as other states.
I have proposed that we phase out the corporate income tax over the course of four years in order to reduce overhead and make our businesses more competitive. I also propose that we eliminate tax incentives and credits that allow the state legislators to pick businesses they favor to receive these tax breaks while other businesses remain at a competitive disadvantage.

Regarding the regulatory problems we have in the state, I recommend that we institute a 3 year waiting period on implementing new regulations. In other words, if a new regulation is approved it would not be able to be enforced until the three year period is up. This would allow businesses, municipalities, and anyone else affected by the regulation an opportunity to plan for the costs of compliance; it would give everyone a cooling off period in order to determine if the regulation makes sense according to a cost/benefit analysis; it would allow the state legislature additional time to review the regulation and hear all sides on the issue before the regulation is implemented.

  1. More than ever before, local government officials are facing the dilemma of cutting jobs and services while still remaining under revenue caps. In recent years, state legislators have proposed various local government spending and taxing measures intended to hold down property taxes, including both the so-called Taxpayers Bill of Rights and the Taxpayer Protection Amendment. Should state government continue to limit school, municipal and county property taxes? Are the current limits the appropriate method to do so?

STEINEKE: Not only do I feel it is appropriate, but I also feel the limits need to apply to state spending as well.

  1. During the past two years, a handful of legislators have written bills to allow a state tax credit for contributions to health savings accounts, similar to the exemption currently given to such accounts in regard to federal taxes. On each occasion, the bill failed to pass out of committee. As a legislator, why would you support or oppose such a tax credit?

STEINEKE: I worked on this issue as a member of the Wisconsin Realtors Association’s Public Policy Committee. I am in full support of tax deductibility for HSA’s

  1. In the upcoming biennium, Wisconsin’s new governor and legislature will inherit a multi-billion-dollar structural imbalance, requiring tough decisions about cutting costs and raising revenues. What specific programs would you cut and or taxes would you raise to balance the budget? Would you support an overall reduction in spending to balance the state budget? If not, how would you address rising debt?

STEINEKE: We absolutely cannot afford to raise taxes in the face of a weak economy. We need to redefine the role of State government and limit the areas in which we spend taxpayer dollars. Here are my proposals for spending to protect as well as areas to cut spending: 
Elimination of pensions for elected officials, beginning with those elected for the first time in 2010 – Eventual cost savings of $789,000/year 
2% across the board cuts in all departments with the exception of those affiliated with education, transportation, public safety, Veterans Affairs, and aid to the developmentally disabled. Includes the elimination of the Arts Board, the Housing Cost Reduction Initiative, the Homebuyer and Rehabilitation Program, the closure of Ethan Allen Juvenile Detention Center, and the elimination of the office of Secretary of State – Estimated savings of $455 million
The above number also includes $180 million in savings from state employees paying their share of pensions·
Eliminate the 5% state income tax credits for rehabilitation of historic buildings used for income producing purposes, including residential rental

  1. Wisconsin has relatively good roads compared with other states. Wisconsin spent $627 per capita on highways in 2008, 12th highest nationally. Transportation is funded through segregated gas taxes and registration fees that, in recent years, state officials have taken to balance the budget. How do you propose to support transportation funding moving forward – by increasing taxes and fees, additional borrowing, placing an end to using transportation dollars for other purposes, or less road construction.

STEINEKE: I do not support additional taxes or fees. I do support a constitutional amendment to protect segregated funds. If we weren’t constantly raiding the transportation funds, we wouldn’t see regular maintenance on our roads and bridges being delayed.

  1. In the run-up to the latest biennial state budget, more than $1 billion in new taxes and increases of existing taxes on business were proposed by legislators. Many, including combined reporting, hospital assessment, streamlined sale and use tax agreement and others made it to become law. Would you consider voting to repeal or reduce any of the business taxes? Which ones and why?

STEINEKE: I would absolutely favor repealing the tax increases passed in the last budget. Politicians are too afraid to make hard decisions on program and spending cuts so they take the easy way out and increase fees and taxes. We need more people in government that are less concerned about reelection than they are about doing the right thing. This next budget is going to be a wake up call and we’ll need to make some unpopular decisions with some in order to get our state’s fiscal health back on the right track.

52ND ASSEMBLY DISTRICT (Includes Fond du Lac and North Fond du Lac)

  1. Economic development professionals have long identified regulatory burdens as one of the challenges to attracting and retaining businesses in Wisconsin. In just the past few years, several thousand paper and other manufacturing jobs have left northeast Wisconsin for other states and other countries. What can the legislature do to make Wisconsin a more attractive place to do business, create jobs, and generate tax revenue for local government?

CZISNY: Studies continue to show that the most important ingredient in creating a community attractive to business is having safe communities that offer access to quality education at all levels; support for research and development; ample resources; and reliable, quality public services. It is these types of communities that achieve the most success in attracting and retaining new businesses. Our state, with its respected system of collegiate education, its strong public schools, and its safe and vibrant communities, offer businesses far more that the average state does.
Wisconsin needs to market our communities’ considerable strengths, it needs to tie tax incentives for incoming businesses with promises to stay in our state’s communities, and it needs to separate effective regulation from meaningless bureaucratic red tape.  These would be my priorities in the legislature for long-term economic development in our state.

THIESFELDT: My campaign has touted three simple main points: 1) Cut Taxes 2) Reduce Spending  3) Control Red Tape.  Too large a percentage of the cost of products produced in Wisconsin goes toward mandated administrative costs.  While some paperwork is necessary, the amount that is required by the state and the federal government is a disincentive to starting a business or expanding a business.  It places Wisconsin at a competitive disadvantage to states with a more business-friendly climate.  I want to see Wisconsin in the top 10 rankings of states for pro-business climate; unfortunately the recent past has been the opposite.  Reducing the red tape allows businesses to make the cost of their products more competitive in the marketplace.  This will in turn lead to higher sales and profits.  The businesses can use the increased profits to invest within their business through expansion and hiring.

  1. More than ever before, local government officials are facing the dilemma of cutting jobs and services while still remaining under revenue caps. In recent years, state legislators have proposed various local government spending and taxing measures intended to hold down property taxes, including both the so-called Taxpayers Bill of Rights and the Taxpayer Protection Amendment. Should state government continue to limit school, municipal and county property taxes? Are the current limits the appropriate method to do so?

CZISNY: One of the reasons I entered this race is because I am tired of elected officials ducking their responsibility to make the tough decisions necessary for effective governance.  It is disingenuous for state legislators, unwilling to make the difficult decisions necessary to balance our state budget, to place revenue caps and spending limits on local governments.  Local officials, arguably, are most directly responsible to their constituents; they are most directly responsible for providing necessary services such as police protection, fire prevention, and K-12 education.  Arguably, therefore, they are the officials least likely to misspend or abuse taxpayers’ money.  As noted above, it is well-documented that businesses, as would any rational person, seek to locate in vibrant, healthy communities.  Dictating spending limits for essential public services from Madison makes little sense.  Legislators have to make the tough choices necessary to get our state back on track; they should not duck behind gimmicks like TABOR and the so-called Taxpayer Protection Amendment, tying the hands of future generations as well as those of local governments.

THIESFELDT:  Levy limits have kept costs down in local municipalities.  I serve on a city council and the limits have consistently forced us to examine closely all aspects of the city budget in order to prioritize and maximize the value of the services returned to the taxpayers.  The levy limits should be maintained in some form but should have some flexibility for communities to preserve some local control and for those that have special circumstances that prevent meeting the levy limit.

  1. During the past two years, a handful of legislators have written bills to allow a state tax credit for contributions to health savings accounts, similar to the exemption currently given to such accounts in regard to federal taxes. On each occasion, the bill failed to pass out of committee. As a legislator, why would you support or oppose such a tax credit?

CZISNY: In an ideal world, it would be appropriate to provide tax savings for those who have to commit funds to health care costs and insurance. However, it budget times like these, it would be necessary to evaluate whether or not such deductions would reduce health care costs otherwise assumed by the state.  It would be irresponsible to commit to specific budget items (and make no mistake, a tax credit or deduction is a budget item) at a time when all sources of revenue and expenditures should be on the table for review.  I would not support health care savings accounts being a tax *deduction*, giving a disproportionate share of relief to those in higher tax brackets, which I believe is the case under the federal tax code.  I would only consider health savings accounts being awarded a tax * credit.*

THIESFELDT:  I would support the inclusion of a tax credit for the contributions to health savings accounts (HSA).  The trend in health insurance is toward lower cost high deductible plans.  Such plans make it easier for employers to offer coverage to their employees, and it also allows self-employed individuals to afford to purchase their own coverage.  In both cases, policy owners would be encouraged to make contributions to their own HSA due to the tax credit associated with them.  A recent study by the HSA Coalition found that 1/3 of HSA purchasers were previously uninsured.

  1. In the upcoming biennium, Wisconsin’s new governor and legislature will inherit a $1.2 billion structural imbalance, requiring tough decisions about cutting costs and raising revenues. What specific programs would you cut and or taxes would you raise to balance the budget? Would you support an overall reduction in spending to balance the state budget? If not, how would you address rising debt?

CZISNY:  I believe that all revenue sources and expenditures of taxpayer dollars should be subject to review.  I do not favor a meat-cleaver approach to expenditures; part of legislating is setting priorities and making tough decisions.  We have to determine which cuts will have the most detrimental effect on the people of Wisconsin, including the long-term impacts of such cuts.  Specifying particular programs to be cut or taxes to be assessed would be premature.  Having said that, however, I do favor a new approach to  corrections in our state.  Minnesota, as state with almost identical population, demographics and *crime rates* as Wisconsin, has only one-third as many people in prison as our state does, and ends up spending less than half as much on corrections as Wisconsin does, even though it has more people on supervision than we do.  We need to reserve our prisons for those who present a public danger, and stop incarcerating people (or, in particular, incarcerating them for terms much longer than necessary to protect the public) to show how tough politicians can be.

THIESFELDT: I will not vote for any tax increases.  Wisconsin is already one of the heaviest taxed states in the nation.  As a state, Wisconsin spends too much.  Difficult decisions will need to be made across the board and I anticipate working with future governor Scott Walker to enact these changes.  All avenues will be explored to find waste and eliminate unnecessary wasteful programs.  Government was never intended to possess the reach that it currently has, and state legislature needs to have the courage to say, ”no”.

  1. Wisconsin has relatively good roads compared with other states. Wisconsin spent $627 per capita on highways in 2008, 12th highest nationally. Transportation is funded through segregated gas taxes and registration fees that, in recent years, state officials have taken to balance the budget. How do you propose to support transportation funding moving forward – by increasing taxes and fees, additional borrowing, placing an end to using transportation dollars for other purposes, or less road construction.

CZISNY: As indicated above, safe, vibrant communities are key to economic development, and a sound infrastructure is a requisite for such communities.  A balanced system of transportation, including necessary and well-maintained roads, rail services, and use of green technologies should be combined with a like commitment to clean water, functioning sewers and other public services necessarily provided by government.  Financing mechanisms for all of these should be on the table when setting the next biennial budget.

THIESFELDT: My community has felt the impact of Jim Doyle’s practice of using dedicated funds for ongoing budgetary items in the case of the improperly funded Hwy. 151 Bypass.  This practice must be discontinued.  The Transportation Fund is funded directly by transportation-related dollars.  Using these dedicated funds for other unrelated budget items is a form of taxation without representation.  In addition, the current system supplying the Transportation Fund is sufficient to maintain and build state transportation infrastructure.  The state cannot afford to start spending additional dollars on unpopular light rail programs that will only serve a small portion of the state and have been proven to require a heavy government subsidy.

  1. In the run-up to the latest biennial state budget, more than $1 billion in new taxes and increases of existing taxes on business were proposed by legislators. Many, including combined reporting, hospital assessment, streamlined sale and use tax agreement and others made it to become law. Would you consider voting to repeal or reduce any of the business taxes? Which ones and why?

CZISNY: I would review each of the items individually, then balance the pluses and minuses of each with our budget needs and constraints.  If the evidence shows that the particular tax has a net negative effect on our state’s finances, I would be inclined to reduce or repeal it.  We have to be mindful, however, as noted in question #4, that we have a large structural deficit in our state budget now.  We need to pay for what we want and we need to close the structural deficit.  Let me make clear that I will not support an effort to repeal the new 7.75% tax bracket put in place by the legislature on net incomes over $225,000 (individual) or $300,000 (couple filing jointly) per year.  It is clear that this tax is reducing the structural deficit and it places a minimal burden on those who are most capable of helping us reduce that deficit.  And let’s be honest about what this increase meant.  For a family *clearing *$310,000 a year, after all business expenses, all personal exemptions, all tax deductions, they have a tax increase of $100.  A hundred bucks to help pay for our schools, our roads, our parks.  It seems hard to believe that anyone would have a problem with that.  The tax that I am most opposed to is new taxes on our children.  It is our responsibility to make the hard choices necessary to get our fiscal house in order.

THIESFELDT: Wisconsin needs to simplify its tax code to encourage business development and entrepreneurs.  All of the new taxes need to be reexamined.  Scrutiny must also be placed on all other taxes to try to implement a better way to fund necessary government operations. Combined reporting should be repealed.  It has cost many jobs by decimating profits of major employers such as Harley-Davidson that paid an additional $22.5 million in 2009 due to this new tax.  The current prevailing wage laws should be repealed as well.  I have seen the cost increases placed on municipalities due to the manipulation of costs by the new law.  The increased costs lead directly to higher tax levies borne by the taxpayers.

54TH ASSEMBLY DISTRICT (Includes most of Oshkosh)

  1. Economic development professionals have long identified regulatory burdens as one of the challenges to attracting and retaining businesses in Wisconsin. In just the past few years, several thousand paper and other manufacturing jobs have left northeast Wisconsin for other states and other countries. What can the legislature do to make Wisconsin a more attractive place to do business, create jobs, and generate tax revenue for local government?

HINTZ: There are many reasons why businesses decide to locate and expand in Wisconsin and to leave, reasons that often have nothing to do with government.  Government and business must recognize the impact of globalization and increasingly focus our initiatives on more advanced technology. The Legislature over several sessions has reduced the corporate income tax rate, established targeted business tax credit programs, provided training and retraining grants to businesses, built new roads, and supported venture capital initiatives.  It has sought to maintain an educated and skilled supply of workers for our businesses. We need to do a better job of matching demand and supply in specialized jobs.  I strongly support the continuation of these initiatives.

I believe targeted initiatives for investment and training, especially to support venture start-ups, are a better use of tax dollars for economic development than general programs.  I support Commerce Department programs that actively encourage regional economic initiatives and the efforts to give the department more flexibility.

We need to integrate traditional aspects of Wisconsin’s economy into efforts to stay one step ahead of global commerce. This means helping family farms find new markets for their artisan dairy products and working with manufacturers to stay competitive with foreign rivals in addition to becoming a worldwide hub for biotechnology.

With regard to regulation, I believe that periodic reviews of existing regulations should be conducted and regulations streamlined whenever possible without sacrificing protections of our natural resources, a significant quality of life asset. Finally, major road projects should be evaluated not only in terms of safety, but economic impact as well.

KRAUSE: We can start by rolling back the Combined Reporting law that greatly increased taxes on companies doing business outside of Wisconsin.  Is it any coincidence that Mercury Marine, the Oshkosh Corporation and Harley Davidson threatened to move operations and jobs out of the state right after the law was passed–and that lawmakers had to “come to the rescue” with tax credits to make them stay?

The State can also help by streamlining the permitting process for construction and expansion of new business facilities.  It amazes me that environmental studies needed to build the new “high speed” train between Milwaukee and Madison could be fast-tracked for stimulus dollars–but private employers have to wait months and years to get the go-ahead to expand their workforces.

Finally, we can do away with the arbitrary renewable energy production goals Governor Doyle set for the state, which are driving up electricity costs.  Yes, we need to find alternative energy sources–but why force higher prices on major manufacturers (and residential customers) just because 25% by 2025 sounds “cute”.  Of course, if Cap and Trade is put in place by Congress–we’ll be looking back on the electricity rates we are paying now with the kind of nostalgia my grandparents felt for 5-cent gas.

  1. More than ever before, local government officials are facing the dilemma of cutting jobs and services while still remaining under revenue caps. In recent years, state legislators have proposed various local government spending and taxing measures intended to hold down property taxes, including both the so-called Taxpayers Bill of Rights and the Taxpayer Protection Amendment. Should state government continue to limit school, municipal and county property taxes? Are the current limits the appropriate method to do so?

HINTZ: There are no easy answers. First, it is important to recognize that state funding programs for municipalities, schools, and counties are not the same and any funding changes need to take the differences into account.  Municipalities gave up taxing authority on such items as machinery and equipment and the state pledged to make it up with shared revenue.  As increases in shared revenue have not kept up with costs, municipalities have been forced to rely more heavily on the property tax.  The school funding formula penalizes districts with special needs and those that spent less in earlier times.  Counties receive substantial federal funding that is passed through the state government.  Many counties are having to confront both levy and mil rate limits on property taxes which puts them in an untenable position.

For state funding I would support tying municipal shared revenue to a portion of the sales tax collected by region, thus linking municipal revenue growth with the commercial success of a region.  We also need to continue efforts to get health care costs under control in the short and long-term and to encourage regional service sharing to bring about greater productivity.  We need to provide an alternative funding source to the property tax, perhaps by allowing local governments to substitute revenue from a one percent sales tax for revenue raised by the property tax. In general, I believe that restrictions placed on local governments by the state do not recognize local conditions and the perspectives of local residents.

KRAUSE: The growth of all government should be directly tied to the citizens’ ability to pay for it.  I prefer seeing property taxes connected to the growth (or decline) of real property values in a community.  While the burst in the housing bubble may have been bad news for those who went in over their heads to buy–it does bring home values more in line with what they probably should have been all along.

Let’s not forget, the current limits allow communities and school districts to exceed the revenue caps through referendum–meaning if people want to pay more, they still have the right to impose those extra taxes on themselves.  As we have found in a majority of recent school referenda–taxpayers have clearly said they feel they are paying enough for those services.

  1. During the past two years, a handful of legislators have written bills to allow a state tax credit for contributions to health savings accounts, similar to the exemption currently given to such accounts in regard to federal taxes. On each occasion, the bill failed to pass out of committee. As a legislator, why would you support or oppose such a tax credit?

HINTZ: I consider health savings accounts to be one of several approaches to providing health insurance.  For some people it is a very appropriate health insurance option. But currently there is not a viable reporting method to distinguish which HSAs are being used for medical expenses and which HSAs are being used as tax shelters. Once we have an accurate means of making this distinction, I will be happy to revisit a potential state tax exemption.  The reason the legislature failed to pass the exemption was the estimated loss in state tax revenue during a global recession which would have been fiscally irresponsible.

KRAUSE: As someone who participates in a high-deductible, health savings account policy through my private employer, I strongly support a state tax credit for HSA.  When we talk about real ways to lower the cost of health coverage in the US, more emphasis needs to be placed on taking responsibilty for saving money to pay medical bills.  Unfortunately, the State believes those of us who are being responsible should be “punished” for doing so by paying taxes on our HSA constributions.  Where is the incentive in that?  Meanwhile, those who pay the higher deductible in order to have more members of the group pay for their medical expenses get all of their premiums deducted from their taxable income.

  1. In the upcoming biennium, Wisconsin’s new governor and legislature will inherit a multi-billion-dollar structural imbalance, requiring tough decisions about cutting costs and raising revenues. What specific programs would you cut and or taxes would you raise to balance the budget? Would you support an overall reduction in spending to balance the state budget? If not, how would you address rising debt?

HINTZ: As recently as October 2008, the projected GPR budget shortfall for 2009-2011 was roughly $1.8 billion. This would have been Wisconsin’s lowest “structural deficit” in several years. However, the decline of the economy worldwide led to a steep decrease of $5 billion in the amount of state revenue collected, leading to a $6.8 billion deficit.

The 2009-2011 Budget included $3.2 billion in spending cuts – the largest and deepest in Wisconsin history.  It is crucial that we find ways to maintain funding to local government in order to prevent massive tax increases. Nearly two-thirds of our State’s general purpose revenue is transferred as unrestricted aid to our counties, cities, villages, towns and school districts.

We need to prioritize programs, aggressively investigate and reduce fraud, and encourage productivity improvements.  We need to work to reduce our state’s estimated 23,000 inmate population by offering nonviolent offenders an opportunity for earned early release. We currently spend $1.2 billion annually on our prison system, up 71% from 1999. A recent study found that one in 39 Wisconsin adults is imprisoned and it is estimated that if we do not make changes we will need to spend $2.5 billion by 2019.

For the longer term, I believe there must be systematic and probably structural changes to increase productivity.  There may need to be more school district and municipal consolidation.  The state revenue system needs to be reviewed with greater reliance on the sales tax and less on the property tax. Business creation and expansion should be encouraged by the tax code.

KRAUSE: I believe reducing spending is the only way we are going to get out of our current budget mess.  No one has ever dug themselves out of a hole by cointuning to shovel.  My wife and I are debt-free except for our house–and to get there we had to make some sacrifices and some tough choices.  There is no reason the Legislature and the Governor can’t do the same thing in the next budget.

Some specific areas to cut include: cutting Legislative pay and eliminating health insurance benefits and pensions (most members have full time jobs away from Madison already), negotiating with labor unions to increase the State employee contributions for health insurance and pensions, delay some State building projects and land acquisition, streamline administration in all departments, eliminate ineffective subsidy programs, reduce Wisconsin Works fraud, review the effects of Truth in Sentencing and mandatory minimum sentences to ease prison overcrowding, return Badgercare to it’s original, stated goal of insuring children only, lower the cost of inmate health care and transportation and do a better job of collecting on delinquent taxes and fines.

  1. Wisconsin has relatively good roads compared with other states. Wisconsin spent $627 per capita on highways in 2008, 12th highest nationally. Transportation is funded through segregated gas taxes and registration fees that, in recent years, state officials have taken to balance the budget. How do you propose to support transportation funding moving forward – by increasing taxes and fees, additional borrowing, placing an end to using transportation dollars for other purposes, or less road construction.

HINTZ: We need to continue to devote state resources to ensuring a quality transportation network throughout the state. A good transportation system is very good for business and is one of the main factors in determining the locations of business.  Investment in infrastructure also is an enormous economic multiplier that provides construction jobs, moves goods from manufacturers to consumers, and allows employees to get to work.

First, Wisconsin can take advantage of federal recovery funds that have been designated for highways, roads and public transportation. Wisconsin is traditionally a federal tax dollar “donor state,” which means we collectively get less money back from Washington, DC than we send. In 2004 the federal government returned only $0.82 back to Wisconsin for every tax dollar we sent. Getting federal recovery funding back is a good way to see infrastructure dollars return to Wisconsin.

Second, although I generally do not support the creation of budget “silos”, the transportation fund is well established and understood and is a relatively stable source of revenue. I do support it for the sole purpose of paying for transportation infrastructure. Although it should be noted that bonding for a long-term asset is an established principle of finance, the idea of the governor and legislature using trust fund money for other purposes creates uncertainty and is not a good idea.

Finally, the amount of money necessary to maintain the state network will depend on the work necessary to be done and on prevailing costs.  If necessary, I would consider additional excise dedicated to transportation.

KRAUSE: I vehemently oppose using Transportation Fund dollars for other purposes in the budget–costing us $400-million dollars in lost funds during the Doyle Adminsistration.  This is just another broken promise to Wisconsin residents–that some of the highest gas taxes in the country will be used to maintain and expand our transporation system.  As I said many times on the air at the radio station–“Apparently, every driver deserves a great school.”

Wisconsin missed out on an opportunity to get caught up on many overdue bridge and highway repairs by not using federal stimulus funds for that purpose.  I’m not a fan of using so much debt to fund projects like that–but at least we would have had “concrete” results for the money our children and grandchildren will be paying back–instead of seeing most of it used to fix previous budget holes.  And yes, we can save ourselves even more money in the future by derailing the not-so-high-speed train–which will take even more money away from local streets and highways for subsidizing its operation.

  1. In the run-up to the latest biennial state budget, more than $1 billion in new taxes and increases of existing taxes on business were proposed by legislators. Many, including combined reporting, hospital assessment, streamlined sale and use tax agreement and others made it to become law. Would you consider voting to repeal or reduce any of the business taxes? Which ones and why?

HINTZ: According to the Council on State Taxation, Wisconsin’s business tax ranking is now 30th in the nation, its lowest ranking since 1961 and well below the national average. State government has worked to make Wisconsin an attractive place to create and expand businesses.

The hospital assessment tax was actively supported by the Wisconsin Hospital Association because it made many health care centers eligible for increased federal funding that frequently more than offset the new state assessments.

Combined reporting treats parent companies and their subsidiaries as a single corporation for state income tax purposes, preventing multi-state companies from moving profits out of Wisconsin and onto the books of subsidiaries/parents in states with little or no income tax. Twenty-two other states, including the neighboring states Minnesota, Illinois, and Michigan, already have combined reporting. Republican Governor Tommy Thompson backed combined reporting in the 1990’s and many of the largest corporations in Wisconsin already deal with combined reporting in other states, including Kohler, 3M Company, Kraft, Georgia Pacific, Oshkosh, New Page, Kimberly Clark, and Curwood.

I am open to changing our tax system to incentivize and maximize economic development in Wisconsin as long as we adequately fund important core services such as public safety, education, and a safety net for those in need. You can’t call for a repeal unless you decide how to pay for it.  I am proud we were able to balance the last budget without increasing the sales tax, the payroll tax and, the income taxes for 99% of Wisconsin citizens.

KRAUSE: I would vote to repeal the combined reporting tax for reasons mentioned above.  There is no sense in putting Wisconsin at a competitive disadvantage when so many states do not have it.  I would also repeal the hospital assessment–since that was just an accounting “trick” meant to increase compensation rates from Medicare.  All this law does is switch the pocket from which taxpayer money is taken.  Medicare is already a pretty big deduction on my paycheck and the assessment only makes sure that it gets bigger.

57TH ASSEMBLY DISTRICT (Includes most of Appleton and portions of Little Chute)

  1. Economic development professionals have long identified regulatory burdens as one of the challenges to attracting and retaining businesses in Wisconsin . In just the past few years, several thousand paper and other manufacturing jobs have left northeast Wisconsin for other states and other countries. What can the legislature do to make Wisconsin a more attractive place to do business, create jobs, and generate tax revenue for local government?

BERNARD SCHABER: The state legislature can continue to create targeted and performance based tax incentives, continue to develop programs that include Economic Development Corporations with matching state and private grants to encourage new businesses, continue to invest in incentives for Angel and Venture funding for lower dollar amounts of investment to encourage local private support for medium to small businesses. The state can continue to support the Office of Business Regulatory Reform or the Business Ombudsman position in the Department of Commerce to assist businesses. Regulations should be effective and efficient, protecting the public from potential harm while not burdening or delaying safe and productive businesses.

HANSON: The legislature needs to create an economic environment by reforming (a) State government spending budgets, (b) State tax policies and (c) education requirements.
The delay of making tough decisions is quickly coming to an end. Appleton needs to have a legislator willing to reform government and make spending decisions on what the taxpayers “can afford” rather than what State government “thinks” it needs. State government has to aim to only raise the revenue it needs, and it should be done through a simple and predictable manner that provides certainty for employers, working families and retirees. In my own business, I have to budget and carefully watch where and on what I spend my money. We need to have that same mentality in government. It’s not other people’s money. It’s our money. How we spend “our” money at that level should not be any different than how we spend money in our businesses or in our homes. Families don’t operate their budgets with an open checkbook, I don’t in my business and neither should our State government. Finally, the State needs to reduce mandates on schools, improve failing schools through proven strategies and ensure secondary and continuing education opportunities that are tailored to the needs of both employers and workers. Every mandate or regulation costs someone, somewhere more money.

  1. More than ever before, local government officials are facing the dilemma of cutting jobs and services while still remaining under revenue caps. In recent years, state legislators have proposed various local government spending and taxing measures intended to hold down property taxes, including both the so-called Taxpayers Bill of Rights and the Taxpayer Protection Amendment. Should state government continue to limit school, municipal and county property taxes? Are the current limits the appropriate method to do so?

BERNARD SCHABER: The caps and levies were put in place to limit excessive growth in the tax burden, they have been effective in controlling excessive tax growth but have also added a burden to the local communities because the levies did not allow for increased costs and for added programs. State and local governments, State Agencies, Departments and Programs, and the communities need to work together to develop an appropriate and fair revenue system that allows for core services to be delivered in an efficient and effective fashion while controlling tax increases.

HANSON: Continuing to raise taxes is never going to get to the core issues of spending in this State! We cannot continue to spend money we do not have. Continually going back to the same “well” to raise more money (taxes) is at some point going to make the well run dry. Many businesses and individuals have run dry. I believe there are probably many areas where efficiencies can be developed. As a business owner, I continually have to look at ways to run leaner and more efficiently with less. The current property tax limitations need to be examined to measure outcomes and unintended consequences. Appleton residents and businesses alike need certainty in their budgets in order to focus on making our community a better place to work, live and raise families.

  1. During the past two years, a handful of legislators have written bills to allow a state tax credit for contributions to health savings accounts, similar to the exemption currently given to such accounts in regard to federal taxes. On each occasion, the bill failed to pass out of committee. As a legislator, why would you support or oppose such a tax credit?

BERNARD SCHABER: I am supportive of a tax credit for HSA for middle class citizens, similar to a bill that was introduced this session by Representative Dexter.

HANSON: As a Healthcare expert, I know that HSA’s are an important component of reducing the cost of healthcare because it allows individuals and small businesses to obtain basic and affordable coverage without some of the up front bells and whistles (copays, etc), which helps keep insurance premiums down. The federal government took a bold step forward by making HSA’s tax deductible. It is disappointing that the current legislature has repeatedly refused to understand that making insurance more affordable to more people helps reduce the burden on State funded insurance programs.

  1. In the upcoming biennium, Wisconsin ’s new governor and legislature will inherit a multi-billion-dollar structural imbalance, requiring tough decisions about cutting costs and raising revenues. What specific programs would you cut and or taxes would you raise to balance the budget? Would you support an overall reduction in spending to balance the state budget? If not, how would you address rising debt?

BERNARD SCHABER: In the last biennial budget there were cuts made in all state agencies, and there was a closing of the tax loophole for corporations who were reporting their profits out of Wisconsin to avoid paying taxes. State legislators, their staffs and other state employees took 8 furlough days in each year. State legislators froze their pay and cut their office budget. I will be actively involved in the budget process, studying specific budget requests and asking for significant cuts where possible. I am not able to list cuts for specific programs at this time. I believe the State should continue to eliminate duplication and waste and the State should consider reforming our current tax system.

HANSON: Because of the legislative “leaders” delay in making major spending cuts last year, the current structural deficit will be even more exacerbated in the 2011 budget debate. It’s time for real leadership that is willing to look at all State programs to make better spending decisions. This includes looking at Wisconsin ’s five biggest problems, the five smallest problems and “everything” in between. I know from running my own business that not all spending is equal. Some spending is an investment. However, other spending decisions are bottomless pits that will never achieve desired outcomes. The key here is to make spending decisions that will produce a return on investment and outcomes based on performance.

  1. Wisconsin has relatively good roads compared with other states. Wisconsin spent $627 per capita on highways in 2008, 12th highest nationally. Transportation is funded through segregated gas taxes and registration fees that, in recent years, state officials have taken to balance the budget. How do you propose to support transportation funding moving forward – by increasing taxes and fees, additional borrowing, placing an end to using transportation dollars for other purposes, or less road construction.

BERNARD SCHABER: Having a strong Department of Transportation with an integrated transportation system using roads, public transportation, and improved freight and commuter train lines is essential to the future of our State. Indexing of the gas tax was removed several years ago and transportation funds were used for other transportation related needs beyond road building projects. Consideration should be given to re-instating the indexing of the gas tax. I am supportive of a Regional Transit Authority that would allow local municipalities to decide on a sales tax increase to support their public transportation programs.

HANSON: It’s time to end the practice of raiding segregated funds like the Transportation Fund, otherwise why have segregated funds anyway? Wisconsin residents and businesses need good roads and bridges, as well as the predictability of regular maintenance and repairs.

  1. In the run-up to the latest biennial state budget, more than $1 billion in new taxes and increases of existing taxes on business were proposed by legislators. Many, including combined reporting, hospital assessment, streamlined sale and use tax agreement and others made it to become law. Would you consider voting to repeal or reduce any of the business taxes? Which ones and why?

BERNARD SCHABER: I would not support removal of combined reporting. Surrounding states also have combined reporting and in my discussion with a number of businesses they did not indicate that combined reporting was a concern for them. 

I do support the streamlined sale and use tax because that sets up a level playing field for local suppliers of goods as related to internet and online sales. Several small business owners who have significant competition from online sales have told me they support the streamlined sales and use tax. 
The Wisconsin Hospital Association and the local health care organizations have all indicated to me that they support the Hospital Assessment as it allows them to have improved access to Federal Dollars that they did not have access to in the past.

HANSON: The Democrat-controlled legislature in the last session raised taxes on everything from cloth diapers (people trying to “Go Green”) to nursing home patients. The State needs to take a close look at the negative effects of the tax on hospital patients, the tax on international employers, tax on computer software, tax on computer downloads (ie. Greeting cards, mp3’s, etc), capital gains tax and the tax on garbage. I love the Fox Cities region and this State, and I am going to do everything in my power to keep this area a viable and thriving community!