CA$H AND CARRY

How Not-So-Concealed Cash Carries the Day at the State Capitol

November 3, 2003

Hand proffering moneyINTRODUCTION

Civics lessons teach that state laws, policies and programs are borne from innovative ideas or public needs that are advanced through a legislative proposal by elected representatives. But these days in the world of Wisconsin politics very few bills evolve from innovative ideas or a general public need.

Concealed weapons.

Flag desecration.

Defining marriage.

Regrettably the Legislature has spent much of the last four months working on divisive social and ideological proposals that the general public does not care about or does not want, rather than more serious problems that gouge the pocketbooks of Wisconsin citizens, such as soaring health care costs, prison spending, unemployment, school spending and campaign finance reform.

More than 900 legislative bills have been introduced so far in the 2003-04 legislative session but lawmakers opted to spend hundreds of hours at taxpayer expense working on a few esoteric issues because they choose to do the bidding of powerful special interests who supply policymakers with large campaign contributions.

This report, "Cash and Carry," highlights some of the measures that the Legislature has recently approved or may consider between November 4 and November 13 – the last floor session until mid January – and send to Democratic Governor James Doyle.

Despite the diverse nature of the bills, the report reveals a common thread that runs through all of them. The bills benefit a narrow special interest and many of the authors, sponsors and supporters are among the top recipients of campaign contributions from the special interests affected by the proposals.

BillboardBILLBOARD REPAIR

Assembly Bill 496 – This plan allows owners of old billboards to make extensive repairs every 12 months rather than once over the life of the sign, thus making it more difficult for the state to force owners to remove old roadway billboards.

Currently, about 4,500 billboards are located on land where the state no longer allows them because they were permitted to remain when a billboard regulation law was changed in 1972. However, as a means to phase out old billboards the owners were told that the signs would have to come down when the cost to repair them exceeded 50 percent of the costs to replace them.

Billboard opponents say the signs degrade the scenery and this proposal could keep them up indefinitely. Supporters of this proposal say billboards are an important advertising tool for business.

In addition to aesthetics, the proposal would cost the state $487,500 to enforce as well as a possible loss of $57 million in federal highway funds, according to a state fiscal estimate.

The billboard repair bill received a hearing in September 2003 and awaits action by the Assembly.

The industry contributed $19,760 to current legislators and an additional $4,120 to three legislative campaign committees controlled by legislative leaders since 1993. One third of the individual contributions – $6,630 – went to the bill’s author and three of its sponsors, including Republican Representatives Lorraine Seratti and Stephen Freese and Democratic Senators Mark Meyer and Roger Breske. The Republican Assembly Campaign Committee, the legislative campaign committee controlled by Assembly Republicans, received nine contributions totaling $2,350 from billboard company owners on June 30, 2003 just two months before the bill was introduced. Previously, the committee had only received $300 in contributions in 1997 and 1998 from billboard interests.

Shopping cartSHOPPING CART THEFT

Assembly Bill 570 – The proposal dramatically enhances the penalties for someone convicted of stealing a shopping cart or stroller. Under current law, a person faces a fine of up to $50, however, the bill would upgrade the crime to a Class A misdemeanor punishable by penalties of up to $10,000 and up to nine months in prison.

Unlike most bills that take months or even years to pass the measure has received speedy attention by the Legislature. It was introduced October 9, received a public hearing two weeks later and is ready for floor action in the Assembly in November. If passed by both houses and sent to the governor in November it could become law in a little more than a month after introduction.

The measure, sponsored mostly by majority Republicans in both houses, has the backing of the business community which has contributed nearly $1.1 million to present members of the Legislature, including $29,768 to the bill’s author, Republican Representative Curtis Gielow, and lead Senate sponsor, Republican Senator Dave Zien. The bill’s 22 additional sponsors have received $154,084 in campaign contributions from the business community.

Bound newspapersNEWSPRINT RECYCLING

Assembly Bill 187 – The proposal lowers the required amount of recycled content in newsprint from 40 percent to 33 percent. Backers of the measure contend the 40 percent content standard puts Wisconsin printers at a competitive disadvantage when they cannot find newsprint with a 40 percent recycled content and have to pay more.

Opponents of the bill said it relaxes the standard too much and weakens Wisconsin’s model recycling program. The measure was approved by the Assembly and Senate and sent to the governor.

Printers and publishers have contributed $141,325 to legislators since 1993 including 31 percent or $43,933 to 23 of the bill’s sponsors. Three of the Senate Republican sponsors are the top recipients in the Legislature of contributions from the printing and publishing industry including Senators Robert Welch at $8,330, Sheila Harsdorf at $8,310 and Cathy Stepp at $5,800. Other key recipients of industry campaign cash were members of legislative committees who recommended the Legislature pass the bill. Five members of the Assembly Natural Resources Committee who favored the bill have received $4,073 from printers while the lone vote against the bill has received no industry contributions. Three members of the Senate Environment and Natural Resources Committee who voted for it have received $11,964. The committee member who voted against it has received $100 in 10 years from the industry.

Gas pumpGAS THEFT

Assembly Bill 232 – This bill enhancing penalties for people caught and convicted of stealing gasoline or diesel fuel from gasoline stations was approved by the Assembly in September and awaits action in the Senate.

This product-specific proposal gives gasoline retailers special treatment by making the penalties for stealing their product more severe than stealing other products of similar value. It imposes fines of up to $200 and driver’s license suspensions.

Retail gasoline dealers and businesses that support the proposal have contributed $1.21 million to legislators since 1993. Business interests are one of the most influential special interests at the State Capitol, giving generously to both Republicans and Democrats who support their agenda. The Assembly Republicans have received $479,640 from the business community and gas retailers since 1993. The bill’s author, Republican Representative Becky Weber who was just elected in 2002, has already accepted a hefty $6,161 from business interests. The Senate Republican caucus has received $398,359 from business and retail gas interests. Republican Senator Scott Fitzgerald, the bill’s main Senate sponsor, has accepted $11,224 from these interests.

Hammer and triangleCONTRACTOR PAYMENTS

Assembly Bill 417 – The proposal introduced in June and awaiting a public hearing would reduce the amount of money state and local governments and school districts can withhold from contractors until a project is half finished. Currently governments and other public entities can withhold 10 percent of their payment to a contractor until at least 50 percent of the project is finished. The bill, sponsored by Republican Representative Daniel Vrakas, would reduce the withholding to 5 percent of the total payment.

Vrakas and the industry claim the bill is needed to ease cash flow burdens that some contractors experience when they are working on multiple projects. The construction industry has contributed nearly $1.3 million to current legislators including 18 percent of it, or $226,856, to the bill’s 17 sponsors.

Vrakas has received $13,320 from the industry since 1993, his second largest group of special interest contributors behind bankers.

Factory with emissionsMERCURY POLLUTION

Mercury Emissions Limits – Committees in the Republican-controlled Senate and Assembly rejected a proposed Department of Natural Resources rule in August that would have required the state’s four electric utilities to cut mercury emissions 80 percent by 2015. The committees’ actions sent back the proposed rules to the DNR for revisions after business and utility interests told committee members that the 80 percent reduction goal is too strict, the plan will increase utility bills, cost the state jobs and a "Wisconsin-only" rule will do little because mercury pollution travels across state lines.

The Assembly Natural Resources Committee voted 9-2 against the proposed rules. The nine opposing members received between $2,443 and $13,108 in campaign contributions from utility and manufacturing interests since 1993 while the two members in favor of the rule received only $650 combined from those special interests during the same period.

The Senate Environmental and Natural Resources Committee voted 3-2 against the rules. The three opposition votes came from lawmakers who received a total of $118,125 in campaign contributions from manufacturing and utility interests while the two members in favor of the rule received a total $9,175 since 1993 from those interests.

Overall, Republican members of the Legislature have received 3.5 times more campaign contributions than legislative Democrats – $1,345,948 versus $386,502 – from manufacturing and utility interests.

Waiter’s arm with platterRESTAURANT BREAK

Senate Bill 216 – The proposal would provide a property tax exemption for restaurant machinery and equipment worth $4.6 million a year to the industry. The plan has Democratic and Republican sponsors, many of whom are high up on the restaurant industry’s list of campaign contribution recipients since 1993.

The sponsors include Democratic Representative Dan Schooff, a member of the Legislature’s budget-writing Joint Finance Committee, who has accepted $2,125; Republican Representatives Scott Jensen who has received $11,530; Judy Krawczyk who has accepted $7,223; and Karl Van Roy, a former restaurateur and past president of the Wisconsin Restaurant Association, who has accepted $6,788.

The restaurant industry has contributed $420,211 to legislators since 1993 including $111,047 to the bill’s sponsors. Eateries, like other narrow special interests, use their resources to target legislative leaders and key committees both of which determine the fate of bills that help or hurt them. In addition to the bill’s sponsors, the restaurant owners and the Wisconsin Restaurant Association PAC have contributed $41,482 to Assembly Speaker John Gard and the Republican Assembly Campaign Committee which he controls. They have also contributed $21,950 to Republican Senate Majority Leader Mary Panzer and the Committee to Elect a Republican Senate, the legislative campaign committee which she controls.

School building with flagSCHOOL CHOICE

Assembly Bills 259, 260 and 472 – Assembly Republicans rolled out a batch of proposals to expand Milwaukee’s school choice program after nearly identical school choice plans inserted in the Republican-controlled Legislature’s version of the proposed 2003-05 state budget were vetoed by Doyle in July 2003.

The Milwaukee Parental School Choice Program started in 1990 and uses tax dollars to help Milwaukee children from low-income families attend private schools. It enrolls about 12,950 students in 107 schools.

The measures to expand the program are backed by large individual contributors, several of whom contribute through a conduit called the Fund for Choices in Education. Many of these contributors are wealthy, out-of-state captains of business, including Wal-Mart owners John and Christy Walton, Amway founders Dick and Betsy DeVos and former Circuit City chief Richard Sharp and his wife, Sherry, who have contributed generously to Wisconsin candidates who support the school choice program.

Between July 1, 2002 and June 30, 2003, the conduit contributed $103,350 on campaign to legislative candidates who won their races. Most of the conduit’s legislative support was for Republican candidates.

The school choice proposals were inserted in the proposed state budget within months after the conduit had funneled $20,450 to key GOP leaders, including $8,000 to Assembly Speaker John Gard, $6,200 to his Republican Assembly Campaign Committee, $3,350 to Republican Senator Alberta Darling who is co-chair of the budget-writing Joint Finance Committee, $1,400 to Assembly Majority Leader Steve Foti, $1,000 to Senate Majority Leader Mary Panzer and $500 to Representative Dean Kaufert who is co-chair of the Finance Committee.

Shortly after the budget proposals were vetoed they were introduced as separate legislation, passed and sent to the governor.

AB259 lifts the 15,000-pupil limit on the number of students who can be in the program and allows pupils to remain in the program if their family’s income exceeds the $32,532 limit for a family of four. AB472 raises the family poverty level income limit to make it easier for more children to qualify for the program and AB260 allows private schools in Milwaukee County to participate in the program currently open to only private schools in the city.

The conduit sent $51,150 to winning Assembly candidates, all of whom were Republicans. The Assembly votes on all three bills were nearly party line votes with most Republicans voting for the measures and most Democrats voting against them, except for AB472 where several Milwaukee-area Democrats voted in favor of the measure, probably because it was the only proposal among the three authored by a fellow Democratic Milwaukee-area representative.

The conduit funneled $52,200 to winning Senate candidates, mostly Republicans. Two Democrats – Senators Gary George and Robert Jauch – accepted a total of $300 in contributions but Democratic Senator Jeffrey Plale of Milwaukee took $10,000 in campaign contributions from choice supporters between July 2002 and June 2003.

Months later Plale joined the 18-member GOP majority in the Senate to vote in favor of AB259 and AB472.

Factory or other corporate buildingBUSINESS REGULATIONS

Assembly Bills 486, 228, 267 and Senate Bills 246, 100 – Legislative Republicans introduced five bills that change the way the state regulates new and existing businesses. Collectively, the measures are strongly supported by a spate of powerful special interests including business, manufacturers, distributors, realtors, utilities, telephone companies, the agriculture industry, insurance, transportation, construction, transportation and the leisure and tourism industry.

The special interests that support these bills have contributed substantial amounts since 1993 particularly to Republicans who now control both houses of the Legislature for the first time in five years and determine which bills pass and which ones die. Their contributions collectively comprise such a large portion of the total amount of large individual and PAC contributions that these special interests have become career benefactors for many Republicans and Democrats. Members of the majority Senate and Assembly Republican caucuses have accepted a total of $13.71 million in large individual and PAC contributions since 1993. Of that amount, $7.55 million, or 55 percent, came from special interests backing these bills.

AB228, which was passed by both houses and sent to the governor, would allow businesses to self-audit their compliance with environmental laws. If their in-house audit shows they are breaking the law, they can reveal the results to state regulators and agree to voluntarily eliminate the problem in return for reduced penalties. The bill’s author, Republican Representative Phil Montgomery, has accepted $44,773 since he was elected in 1998 from the energy, construction, business, agriculture, manufacturing and real estate interests that back this bill. The proposal’s main Senate sponsor, Republican Senator Neal Kedzie, has accepted $56,140 since he was elected in 1996 from these interests. These contributions are slightly more than one third of the total large individual and PAC contributions Kedzie and Montgomery have received since they were elected.

AB486, which was passed by the Assembly, and SB246, which was passed by the Senate, would require state agencies to meet self-imposed deadlines for issuing business permits. If an agency fails to rule on a permit request by the deadline, the applicant would automatically be granted a permit. Backers say the bills speed up a process that is lengthy and drives businesses to other states to locate or expand. Opponents say permit deadlines could hurt the environment by forcing agencies to hastily review applications that may require a longer review. The telecommunications, agriculture, business and manufacturing interests who back these bills contributed $81,995 to Republican Senator Cathy Stepp, the Senate author, during her hard-fought 2002 election campaign and $30,473 to Montgomery, the Assembly author, since 1998.

SB100, which was passed by the Senate, and AB267, which was passed by the Assembly, would create a small business review board that would review business regulations and inform state agencies as to whether they are too strict and suggest modifications. The measures also would exempt small businesses from state penalties if they voluntarily disclose violations, cooperate with any investigations and try to comply with the law in the future. The bill is backed by construction, business, manufacturing, tourism, agriculture, insurance and transportation interests whose contributions comprised 48 percent, or $109,430, of Republican Senator Ronald Brown’s total large individual and PAC contributions during his 2002 election campaign. The bills’ other author, Republican Representative Terri McCormick, accepted $23,171, or 45 percent, of her total large individual and PAC contributions from these interests since she was elected in 2000.

Hand with bag of cashCORPORATE TAX BREAKS

Assembly Bills 507 and 508 – In addition to the new single sales factor law that provides a $45 million a year cut in business taxes, these two measures introduced in September would cost the state an additional $26.4 million every two years beginning in 2005. The measures give big business sales tax and use tax exemptions on the electricity and fuel they use, extend from 15 to 20 years the deadline manufacturers have for using $155 million in tax credits they have accumulated in a current program designed to give them breaks on fuel and electricity sales taxes, provide refunds for the tax credits they receive and redeem tax credits in years they do not make a profit.

The proposals were recommended on a party-line vote by the Joint Finance Committee for passage by the Legislature and are likely to be taken up in November.

Efforts to pass these breaks were led by big business, manufacturers, insurers and transportation who have contributed $4.9 million in large individual and political action committee contributions to legislators since 1993. The Assembly GOP caucus, which developed the bills, has received the most campaign contributions of the four caucuses from these special interests – $2.1 million. The bill’s main sponsors, Republican Representative Steve Wieckert, who has received $25,932 from these interests – nearly a quarter of his total large individual and PAC contributions since his election in 1996 – and Republican Senator Robert Welch, who has received $112,886 from these interests, which is a little more than a quarter of all of his total large individual and PAC contributions since 1993.

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