Funding for Campaign Reform Survives Budget Process

July 14, 1999

Madison - The conference committee working to reconcile the Senate and Assembly versions of the 1999-2001 state budget agreed last week to include $870,000 in general tax funds to pay for any campaign finance reforms the legislature may pass this session.

Governor Tommy Thompson put $750,000 in his proposed budget for campaign finance reform, and the legislature’s budget-writing Joint Finance Committee approved the governor’s recommendation on a bipartisan 12-4 vote in April. Republicans who control the Assembly then voted to remove the funding last month, but majority Democrats in the Senate restored it in their version of the budget. The conference committee not only sided with the Senate position, it upped the amount set aside for reform.

Assembly Republicans also had added a new tax deduction for political contributions and a change undermining the income tax check-off that provides funding for public grants to candidates who agree to spending limits. Senate Democrats rejected the Assembly’s tax deduction and tax check-off revision. The conference committee agreed to dump the change in the tax check-off and eliminated the tax deduction. Moreover, the agreement calls for the $120,000 in revenue that would have been lost by providing the new tax break to be added to the $750,000 reserved in the Senate’s version of the budget for campaign finance reform.

The Assembly Republicans’ tax break would have allowed taxpayers to deduct half of political donations up to $1,000 from their taxable income. Since only taxpayers who itemize deductions could take advantage of the write-off, the three-quarters of tax filers who do not itemize would not benefit. The change in the tax check-off would have meant that taxpayers who check the box on their tax forms would see their tax liability increased by $1. Currently, the check-off designates $1 of a filer’s taxes to the Wisconsin Election Campaign Fund and does not increase the taxpayer’s liability.

Once the conference committee finishes its work on the budget, both houses have to approve the committee’s version. The package cannot be amended, limiting members of the Assembly and Senate to a final up or down vote. The budget then goes to the governor, who can use his partial veto authority to refashion it to his liking.

The Wisconsin Democracy Campaign lobbied vigorously for the inclusion of general tax funding in the budget for campaign finance reform, and opposed the changes in the income tax check-off and the tax deduction. The conference committee action represents a clear victory for reform advocates, and creates momentum for legislative action on pending reform proposals.

The Senate and Assembly committees dealing with campaign finance reform legislation are planning to hold hearings on reform legislation in late August or early September, the first step in the process of trying to reach agreement on reforms that could be debated in both houses in the fall.