- I'm Frederica Freyberg.
Tonight on "Here & Now," a first look
at the new Republican transportation funding plan.
Then Capitol Insight.
The U.S. House version of the new American Health Care Act
and later, the potential impact of homeless bills
that passed the State Assembly this week.
It's "Here & Now" for May 5th.
- Funding for "Here & Now" is provided in part
by Friends of Wisconsin Public Television.
- A first look tonight at an Assembly Republican
plan to fund Wisconsin roads.
The majority-lead Joint Finance Committee rejected Governor
Scott Walker's budget plans
for transportation to fashion its own.
Tonight Joint Finance Committee member Republican Representative
Dale Kooyenga walks us through
his multi-pronged funding proposal.
He joins us by phone.
Thank you for doing so.
- Thank you for having me. Appreciate it.
- Take us through what your transportation package does?
- Well I think Wisconsin has some improvements to be made
in both our transportation and income tax codes.
It's one of the few problems that we've not made
significant progress on in the last couple years.
And so what we're proposing is Wisconsin is actually of the
50 states has the most generous law in place for gas stations
called the minimum mark-up law.
We're only one of two states that actually specifically say
this is what your gross margin has to be on the sale of gas
and that adds up to 9.2% approximately.
What we're saying is, in a pragmatic fashion,
is let's lower that mark-up from 9.2% to 3%.
This will save hundreds of millions of dollars
for people at the pump.
And I have gas station owners actually who have gas stations
in Wisconsin and Michigan who testify that would be
a penny for penny reduction in the price of gas.
And then what we do is we apply the sales tax to gas.
Sales tax applies to most things you purchase but for some reason
it does not apply to gas.
While we're lowering the price pressure at the pump by doing
some business reforms, what we're doing is applying the
sales tax and then what we do is we have enough money left over
to actually do two things.
What we're going to do is lower Wisconsin's gas tax and we're
going to lower the amount of bonding we do for our roads.
The amount of bonding for roads is reaching unhealthy levels
which will put significant pressure on the transportation
fund going forward.
And the Assembly Republican position is that we'd rather
have money spent for concrete and labor to improve our roads
than paying in interest to bond holders.
While we're doing that we're doing a lot of different reforms
to make sure the state runs more efficiently.
And also doing income tax reforms which are going to lower
income tax to a single rate in Wisconsin of 3.95%.
Everybody will see a reduction.
But what we're doing is we're paying for that by one,
simplifying the code and by two, taking a portion, a portion
that's less than inflation in future growth and using that to
make sure that government does not grow at a rate faster than
inflation and putting that towards relief for Wisconsin
taxpayers.
- So on that flat tax that is part of this whole
transportation plan, how is that related to road funding?
- What we're looking at is the tax mix in Wisconsin.
And what's happening right now is the transportation fund is
being supported by the general fund.
This is the opposite of what used to happen.
The transportation fund was being used to fund the general
fund and now the general fund is being used to fund the
transportation fund.
And what that does is puts significant pressure going
forward on our schools.
It puts significant pressure going forward on more debt and
other cost.
On our income tax code.
And so when we actually propose is a transportation solution,
what that does in the general fund is it frees up money.
And with that freed-up money what we're doing is income tax
cuts.
We believe Wisconsin is a high-tax state.
When we're looking at the right revenue mix between
transportation fund and our general fund needs, that's the
tax reform that comes in to take a comprehensive look
at all the money going into the state
and where that money should be directed.
- Tell me if I'm right on this when all is said and done with
package, transportation and flat tax,
you'd increase revenue by about $300 million over two years.
How far does this go to fill that billion-dollar shortfall
and find that long term, sustainable source for funding
of Wisconsin highways?
- Yeah, I think you have to look at it over the long term
and it's $300 million in this biannual.
And then you have to look going forward.
And so if you're looking at the one-time cost of infrastructure,
you're looking about billions of dollars over the next decade.
And we have the billions come in and you're also looking at
actual revenue now that you can leverage.
You're still going to have to use some bonding.
I think you're looking at a position where you say, hey,
we're reaching a reasonable point where we could actually
pay to make sure we have 21st century infrastructure.
- We'll be watching this as it goes forward.
Thanks very much.
- Thank you.
- The transportation budget plan faces opposition from
Democrats at the state capitol.
A Democratic member of the Joint Finance Committee joins us now
from Oshkosh.
Representative Gordon Hintz.
Thank you for being here.
- Happy to be here.
- What is your reaction to Representative Kooyenga's plan
for transportation funding?
- For the past six years the challenge on transportation
funding has been pretty clear.
Revenue has not kept up with inflation and project demand out
there and the legislature needs to address this.
There's been studies.
There's been recommendations.
It's all pretty much known.
What was a pretty clear-cut simple challenge has been met
with incredibly complex plan that increases the gas tax
effectively 23% but it's the part that goes well beyond that.
It seems like the biggest objective of this is to reduce
the income taxes of some of the wealthiest earners in Wisconsin
along with a lot of other things that have nothing to do
addressing transportation.
- How will that be met on the Joint Finance Committee when
it's this really giant package that as you say includes not
just uppers and downers on sales tax on gas and the gas tax but
then this whole idea of introducing a flat tax?
How will that be met?
- Well, I can tell you it's been met by the Democrats on the
committee as a non-starter.
We've been looking for an opportunity to try to work with
Republicans on this.
Two years ago in the budget we proposed at least re-instating
indexing to make sure the problem wouldn't get any worse
and that funding would keep up with inflation.
But this goes so far beyond the any of the recommendations to
address transportation.
And this idea you can significantly reduce the taxes
again, a 50% tax cut for the wealthiest earners in Wisconsin
as some sort of offset for a 23% sales tax increase--er, gas tax
increase doesn't make any sense.
And it just shows you that budget after budget the biggest
priority, bigger than K-12 education, bigger than the UW
System has been these expansive tax cuts for the wealthy and
this is just another example of that.
- Specific to his transportation financing plans
though, are there some parts of that Democrats could support?
- Well, I think if you were to just look at the transportation
proposal and separate the other things I think there are some
elements worth looking at.
I think they give local government some options with a
sales tax a lot of the counties have been asking for as their
roads have increasingly declined.
As state revenue support for those communities
hasn't been there.
But it's hard to get around the fact that their plan, their
transportation plan, was called "The Road to A Flat Tax." In
other words, it seems to be more important for them to erode
future money for public schools and UW System than it is to fund
our transportation shortfalls.
It should be broken up and separated.
And we can evaluate those things but it's a 23% increase in the
gas tax and that's a lot of.
It's a lot of the people who have the oldest, least fuel
efficient cars are some of the lowest income earners in the
state so the sales tax is regressive and unpredictable.
But it is a starting point.
- What do you make of -- so you talk about the increase in the
sales tax on gasoline but he counters that with eliminating 4
to 5 cents in the gas tax.
Would you like it better if the sales tax went up as well as the
gas tax?
- Well, I mean again, the net in the analysis by the Fiscal
Bureau said it would ultimately lead to a 7.2 cent gas tax
increase for $2.40 a gallon.
That's all the public is going to talk about.
We can talk about upper, lower, moving things around
but at the end of the day that's what we're talking about.
I think the real thing that stood out to me
was even with this increase in revenue
there's no new money for any of the road projects.
And a lot of that is because they attempt to restore all the
misguided policies from the last few years trying to reduce the
amount of record borrowing they've done to try to replenish
the money they've money from the general fund to pay for roads.
There's certainly cleaner, easier ways to do it.
And the problem with the sales tax is when gas is more
expensive you're going to pay more with the sales tax.
Whereas if you just increased the gas tax, it would stay
standard on a per gallon basis.
- Representative Gordon Hintz, thanks very much.
- Thank you.
- From Wisconsin to Washington, the House of Representatives
narrowly passed its version of so-called American Health Care
Act late this week.
At a White House gathering after the vote, House Speaker Paul
Ryan claimed that ObamaCare is no longer viable.
- And that is why we have to repeal this law and put in place
a real vibrant marketplace with competition and lower premiums
for families.
That's what the American Health Care Act is all about.
- Under the bill passed in the House, subsidies for people to
help pay for plans are based on age instead of income.
Expanded Medicaid would go away.
Penalties for not having insurance are eliminated and
states would be able to decide how to cover people with
pre-existing conditions and which essential health benefits
to offer.
Tax increases on high-income earners that help pay for the
Affordable Care Act are eliminated.
Here's what Wisconsin U.S.
Senator Tammy Baldwin says about the bill, quote, President Trump
promised insurance or everybody but the House Republicans broke
that promise today by putting millions of people at risk of
losing health care coverage and forcing millions to pay more for
less care.
- High political drama played out over the Republicans' House
vote this week.
In tonight's Capitol Insight, we turn to Republican Bill McCoshen
who is managing partner with Capitol Consultants and Democrat
and executive director of One Wisconsin Now Scot Ross.
Thanks to both of you for being here.
- Thanks for having us.
- I saw this quote from a Kentucky congressman this week
saying the American Health Care Act is like a kidney stone.
The House doesn't care what happens to it as long as they
can pass it.
How real is that?
- I think there's some truth to that.
I mean it's obviously been a pretty high mountain to climb
for Speaker Paul Ryan and the Republican conference.
They tried in late March and failed to get this over the goal
line.
And it was critical to this forward but I think it's
important for your viewers to understand it's just step one.
It's going to go to the United States Senate.
They'll make modifications to the bill.
And then it's likely to go to conference.
So there's a long way to go before it actually hits the
president's desk.
- Does this put politics over really important policy?
- I think absolutely.
When have you a bill that passes basically by two votes on
something that's one-sixth of the American economy where
24 million people are going to lose their health care.
We're going to lose protections for pre-existing conditions.
What are going to be those essential services that are cut?
I mean some of those essential benefits are things like
maternity care, childhood immunization and even substance
abuse programs.
So there's a real challenge out there.
And it was a terrible vote.
And I think it's a vote that's put things like Glenn Grothman's
district in play for 2018.
- I'd say this.
There was a lot of risk for Republicans.
There was risk of doing something and there was risk of
doing nothing.
Truthfully as a Republican strategist, I'd say there was a
far greater risk of doing nothing for the Republican
house.
If this is their number one promise they've had since 2010.
It is the one thing that's galvanized social conservatives
and economic conservatives for the last seven years.
And if they did not deliver on this, Republicans would have
been wiped out in 2018.
- And yet is it really construed at this moment as a
big, big win for Paul Ryan the way this went down?
- I don't think you can call it a big win for Paul Ryan because
he looked so feckless for a month or so
when they first tried this and then he had to pull it back.
I think the challenge that Ryan has is there's so much bad
that's going to come out of the bill.
If they got this bill through the Senate and they're not going
to-- essentially he would be at risk of losing his speakership
because there are so many people who are going to lose their care.
You may not remember who gave you your health care but you're
sure as heck going to blame who took it away from you.
- What about that?
He says that Glenn Grothman's district is in play because of
this.
Is that real?
- Not a chance.
He hasn't had serious opposition in that seat.
I mean the way that---I just don't think any of our Wisconsin
congressman are going to be at risk as a result of this vote
because they're going to get one more kick at the cat.
Some like Congressman Mike Gallagher have said he had some
concerns about this bill.
He's hopeful the senate will make modifications and I think
probably folks like Duffy, Sean Duffy and Glenn Grothman feel
the same way.
- Wait, Mike Gallagher said something about this piece of
legislation because for six weeks he didn't say a word
despite when the media would contact him.
And then finally he put something out
after the bill last night.
I think that's a huge, huge indication as to how challenging
that vote he took as a freshman member of Congress is going to
be in the upcoming 2018 election cycle.
- Voters that follow this on both sides are very savvy.
This, to use a baseball analogy, this was a double by the House
of Representative to get the ball--to score a run, they gotta
get the bill through the Senate and also through conference and
ultimately to the president's desk.
- You're saying voters are savvy on the issues?
- I think they are. I think they understand.
Clearly Republican voters have been motivated by this issue
for six straight years, three election cycles.
Now potentially, Democratic voters
will be motivated by this.
And we don't know how that's going to play itself out yet.
- Do you feel like voters who might be recipients of some of
the current coverage understand what some of this means?
- I think they will if they lose their coverage or if for
instance they lose their pre-existing conditions or for
instance, the estimate by one esteemed economist says if you
had cancer and then you try and get insurance your premiums are
going to be $140,000 a year.
That is an obscenity.
And that is not coverage.
If you cannot afford coverage, you've lost your coverage.
And I'll agree with Bill.
You can defend action.
You cannot defend inaction but this piece of legislation is
going to trickle down into state races.
Governor Walker came out Friday and said he would be willing to
get a waiver to eliminate pre-existing conditions
protections here in the state of Wisconsin.
You've had Brad Schimel and John Nygren talking about opioid
coverage for the last year and a half.
And those things could be gone as a result of this.
- What about that point?
- This bill attempted to do three things: to lower premiums,
to lower deductibles and to provide states more flexibility.
The jury's out on the first two quite frankly
but it certainly would provide state's more flexibility
on what type of coverage.
The good news for Wisconsinites is we have some of the best
health care here in the country and we have the lowest uninsured
population in the country.
- Yeah, but we also --just remember this, here in the state
of Wisconsin we have people who have been denied access to care
because of the actions Governor Walker has taken related to
not taking the Medicaid money and things like that.
You just have to think when push comes to shove if seniors are
paying five times more for their coverage as a result of this,
that is going to a huge impact especially in a 2018 election
where it's an older population.
- It may well be tough.
Let me get both of you to respond to the transportation
plan that came out of the state legislature this week, Bill?
- Pretty creative.
Representative Dale Kooyenga from the Milwaukee area got the
support of his leadership and his caucus, the Republican
Assembly Caucus to do what we would call a big, bold plan.
It includes--they call it "The Road to the Flat Tax." It
includes a long-term comprehensive transportation
plan, which by the way would have the first increase in
revenues for transportation in the past decade.
But it also has some pretty significant tax reduction.
We'll see.
It's step one.
It's a good starting point but it's got a long way to go.
- "The Road to the Flax Tax" is going to roll right over the
middle class.
We're talking about double taxing your gasoline so that
they can cut the top 1% income tax rate in half.
So the richest man and woman in Wisconsin, John Menard and Diane
Hendricks are going to have their tax rates cut in half
essentially, the tax rate.
And you're going to pay twice on your gasoline to pay for that.
- We'll leave it there.
Scot Ross, Bill McCoshen.
Thank you.
- Thanks for having us.
- Now a look ahead to potential impact of bills having to do
with the homeless population that passed this week in the
Assembly.
It's estimated there are nearly 30,000 homeless people in
Wisconsin and not just in the urban areas.
According to the Wisconsin Coalition Against Homelessness,
the state lags way behind neighboring states in its
response to the problem.
But this week the State Assembly passed four bills to fight
homelessness.
Among them creating a pilot program to get chronically
homeless people on the waiting list for federal housing
vouchers.
Freeing up more money for transitional housing and making
$75,000 available for one city for a pilot program to help the
homeless get jobs.
Homeless advocates say it's the first time in 25 years there
will be an initiative to provide more resources and policy
enhancements.
Also among the bills passed, one calling for the creation of an
interagency council on homelessness with the
secretaries of eight state agencies meeting to discuss
services.
Lieutenant Governor Rebecca Kleefisch will chair the
council.
She joined us earlier to discuss her role.
Lieutenant Governor, thanks for joining us.
- Thank you for having me.
- Why is this issue getting the attention of Republican
lawmakers and the administration now?
- I think one of the reasons it is a key piece of our workforce
solution is because you have a lot of folks on the sidelines of
the traditional Wisconsin economy who can be animated to
get into the economy if only given the connections they need
and I would argue they deserve as their right.
Our Constitution says and our Declaration of Independence
guarantees we have the right to pursue happiness
here in the United States of America.
You have a lot of folks who may be housing insecure who have not
been exercising their right to happiness.
And I believe this package of bills and the impetus, the
budget from our executive branch allows those things to happen.
Those connections to be made and folks who are right now on the
sidelines of Wisconsin's economic recovery to get into
our talent pipeline.
- How do you see the interagency council moving
forward to help prevent and reduce the homeless population
in the first place?
- Well, I've been working on this issue for about the last
year and a half.
You know as a former journalist I like to see both sides of a
story and interview everyone involved before making
a decision on best steps forward.
So I have traveled the state and can assure you this is not a
problem, an issue for just one area or just one demographic.
Homelessness and housing insecurity in fact affects all
corners, all facets in Wisconsin.
I spent a lot of time not only with the advocates and
those not-for-profit and social workers working with this
population but also with the population asking them the
questions that I think I need the answers to in order to
provide the best solutions and resources so we can get them
connected to opportunity.
I imagine the interagency council will continue that work.
The work determining how those on the front lines of this
challenge can best use resources and which are the most necessary
and the most immediately needed.
But also as we see challenges change how we can be more
responsive and more nimble in assuring we can get our homeless
and house-insecure population attached to a safe place to
sleep at night so they can get engaged in our workforce.
- According to the Wisconsin Coalition Against Homelessness,
Wisconsin's annual funding for homeless programs is $3.25
million compared to Minnesota's nearly $45 million.
What is the commitment to put more money into programs?
- Well, after traveling this state for the last year and a
half talking to the groups with whom I've talked and the folks
with whom I've met, I can tell you honestly this is less about
funding and more about our expectations of the use of the
funds we've allocated.
I'm not arguing we don't need more funding.
What I am arguing is we need to have high expectations and we
also need to re imagine how we do this funding as it is spent in
communities.
I've seen really good models, Frederica.
I've also seen models that are not accomplishing what I would
consider to be success.
It's one thing to say somebody got a safe place to sleep for a
night and they're not on our rolls.
They're not counted anymore because they've just moved
to another program.
That to me isn't success.
What I see as success is a long-term solution where someone
is well, mentally healthy, is well, free of addiction but also
connected to the services and also perhaps even the private
sector economy where they can succeed independently long-term.
- One type of program we've reported on is something called
"Housing First" where homeless people get permanent housing
first and then supportive services to go with it.
Is this the kind of program you would support?
- "Housing First" works specifically and best I think in
cases of what we call dual-diagnosis, which means
mental illness coupled with addiction.
Because oftentimes in cases like that you need intense
wrap-around services, almost life coach style, in order to
get someone well enough to have a dependable income to begin to
live independently in the first place.
- We need to leave it there as you're suggesting varied reasons
for homelessness, varied approaches.
We'll be watching as this goes forward.
Lieutenant Governor Rebecca Kleefisch.
Thanks very much.
- Let's keep talking about this, thank you.
- Now for an update from the UW System.
UW Madison Chancellor Rebecca Blank spoke this week about her
hopes for funding increases in the state budget.
The system lost $250 million dollars in state funding over
the last two years.
And Blank said funding has been cut in five of the last six
biannual budgets or ten of the last twelve years.
- That means we and the UW system's goals haven't been able
to invest in the way we need and that's really problematic
because our competitors are investing.
So Mark and I, the chancellors of the UW schools are really
making the argument in this budget year that it's time to
reinvest in Wisconsin.
- Governor Walker has proposed an increase in funding for the
UW System most of which will be tied to performance but Blank
said in her speech she's worried that could disappear if May
revenue projections are low.
Tonight is our last Friday with our student news intern
of two years, Nina Kravinsky.
She's graduating from UW Madison, congratulations,
and off to new opportunities.
Good luck and thanks to Nina.
Now our tradition is to ask to you sign off on tonight's
episode so go ahead.
- Next week an update on the growing opioid problem
with our partners WisContext.org.
I'm Nina Kravinsky for "Here & Now."
Have a great weekend.
- Funding for "Here & Now" is provided in part
by Friends of Wisconsin Public Television.