>> I was very hopeful that this thing would be done
by the first of July.
That deadline has come and gone.
So now it's a matter of simply, "Let's get the Finance Committee
back in there and get this thing done."
>> This week new developments in the budget impasse between
Senate and Assembly Republicans.
In our first look the main stumbling block has been
transportation funding.
The Senate Republican plan would borrow $712 million
to fund roads.
Assembly Republicans have said, "Find a way to pay for it
without borrowing." The new Senate budget proposal would
also eliminate the prevailing wage and the personal property
tax while allowing more families to qualify for the statewide
private school voucher program.
But now Governor Walker says he would be willing to forgo his
income tax cuts in order to send that funding to roads.
Late this week Assembly Republicans said they'll accept
the governor's offer to redirect more than $200 million
originally earmarked for income tax cuts,
money that would offset the bonding they don't like.
But is it a deal? Not quite yet.
So this week we take a closer look
at the latest budget proposals.
It's all fluid because it appears Republicans are also
eyeing a deal that is flexible as they attempt to land Foxconn.
That's the Taiwanese cell phone manufacturer that could bring
10,000 new jobs to southeast Wisconsin.
In exchange Foxconn would be looking for subsidies,
tax breaks and other government incentives.
We were able to talk with Scott Fitzgerald Thursday about that
and how it's tied to the budget stalemate
now entering its fourth week.
But we started by asking about borrowing for roads.
Senator Fitzgerald, thanks very much for joining us.
>> Good to be with you.
>> Why do Senate Republicans think you can break this budget
impasse by calling for even more bonding for highways
than the governor did?
>> Because it brings some projects online that otherwise
are not going to be completed under the governor's budget.
It's pretty much that simple.
Some of those projects are important
to some of those members.
They're regional.
And I think probably your viewers would agree,
if you have been in southeastern Wisconsin, and you see,
you know, the third phase of the zoo needs to be completed.
Certainly you need to complete between the Marquette
interchange and the construction that's going on right now
related to the zoo.
You want to bridge that gap, and that is the east-west.
And then the north-south is I-94 from the state line,
and there's a lot of clamoring to make sure,
for a lot of different reasons, probably including economic
development that gets completed as well.
>> Two years ago though you thought that bonding was a bad
idea and rejected it?
What has changed?
>> GPR.
We have a lot more general purpose revenue.
We've been fortunate in that the economy has been growing and
expanding in Wisconsin.
And that was the first thing I noticed is that, "Hey, listen,
we've got some general purpose revenue that might be able to
help us through this transportation budget." That
just simply didn't exist last time.
$8 million in this budget buys you $350 million in bonding
which keeps those projects on course.
So it's pretty straightforward.
>> Assembly Speaker Vos and his Republican caucus had wanted new
sources of revenue to pay for roads like increasing the gas
tax as you know or vehicle fees.
Why are those sources strictly a no go?
>> For two reasons.
First and foremost Governor Walker just flat out said,
"I'm not going to go along with the gas tax increase and a
vehicle registration increase," which always puts a damper on
whether or not the caucus wants to go there.
Because you're not going to override the governor
on something in that area.
And certainly with DOT, there's still a lot of concerns as to
whether or not that agency is operating efficiently.
So there's kind of two different prongs to that.
It's let's get DOT back in a good form.
And we've got a lot of reforms that are going to be included in
this budget as well as probably a separate piece of legislation
related to an audit that might do that as well.
>> As to efficiencies at DOT, that has been an agency
obviously that has been headed by a secretary that has been
appointed by a Republican governor for all of these years.
Why now are you looking at that?
>> I think there's a lot of interaction
with the federal government when it comes to transportation.
I think what we're starting to see is a lot of the
megaprojects, and there are six of them in southeastern
Wisconsin.
The draw that those projects are having off the segregated
transportation fund is so massive that it's leaving very
little revenue for other out-state projects.
And I think if there was any fault that could have been cast
on DOT probably over the last four to six years,
it's been that they have breathed life into some of these
projects that should have been simply eliminated.
And this came to light as a result of the audit.
I think before that we just kept plugging along and hoping that
we had enough revenue to get this done through some of the
other things we've done.
>> What do you think a company considering moving to the state
of Wisconsin with its 10,000 jobs thinks about a state with
problems funding important infrastructure like highways,
and not only that but fighting amongst yourselves over it?
>> The first part, I would say, this is not just a Wisconsin
problem.
This is a national problem.
Our infrastructure is crumbling.
And it's in every state for the same reason.
All of these projects were built, 40, 50 years ago.
And the bill's coming due.
And that's why we find ourselves in the same position that many
other Midwestern states as well as the east coast has a huge
problem with infrastructure cost.
The second part is I think we're arguing and we're disagreeing on
the right things.
The discussion right now is about tax cuts.
And the discussion right now is about putting in place probably,
you know, some guardrails when it comes to other areas of the
budget to make sure that we're doing the right thing fiscally.
I like that.
I think that's part of it.
>> Your Senate plan eliminates the state personal property tax.
Is the governor now okay with your plan eliminating his income
tax cuts?
>> That's one of the moving parts.
I mean income tax, personal property tax,
do you want to do something related to
the alternative minimum tax?
There's a lot of smaller items as well that I think, you know,
that's what we're negotiating on.
That's what we're trying to figure out right now as kind of
we sit here in mid-July.
>> Are there other negotiating points that we can look ahead to
in the coming week or so?
>> Yeah, I mean we do have this project, Foxconn,
that is out there.
We don't have a lot of details.
And I'm talking about the legislature.
But there is negotiations going on.
And as a result of that, that could have an impact not only on
this budget but probably the agenda that continues late
summer, early fall.
>> How so?
>> It's a big deal.
It sounds like it could have a huge impact on southeastern
Wisconsin and really the entire state.
So I think it's going to dominate a lot of the discussion
moving forward for the legislature.
>> Are you suggesting we're close to getting it or that we have a shot?
>> I don't know.
I say that -- I'm hopeful that things can come together and
this ultimately turns out to be the deal that many of us hope it
is, but I don't have enough information right now.
>> How much would we offer them?
>> I don't know.
I don't know exactly the level of detail that would let me even
describe that at this point.
>> Let me leave it there. Thanks very much.
>> Thank you.
>> The Joint Finance Committee is expected to reconvene on the
budget in the next two weeks.