Playing the Taxpayers for Fools

Hidden hikes in ‘no-tax-increase’ budget overwhelm meager savings touted in plan; donor welfare bills, budget could add $118 to ‘graft tax’

Posted: May 25, 2005
Updated: May 27, 2005

Madison - Democratic Governor Jim Doyle’s proposed state budget and a handful of GOP legislative proposals could cost taxpayers at least $118 each a year because policymakers refuse to curtail special interest perks benefiting big campaign contributors to help close a $1.6 billion budget deficit, according to a Wisconsin Democracy Campaign report.

The report, “Graft Tax 2005: Playing Peter to Pay Paul” identifies $458 million in increases in hunting, driving, court and other fees, highway construction costs and a continuing spate of new breaks for business that subtly pick the taxpayers’ pocketbooks of any savings they would get from heavily touted proposals by Doyle and Republicans who control the Legislature to cut property taxes $3 to $10.

Doyle’s budget, which is being reviewed and altered by the legislative Joint Finance Committee before passage this summer by the Legislature, would cost taxpayers at least $101 each by increasing fees, pork barrel projects and other giveaways by nearly $393 million.

Doyle refused to consider using even a fraction of the $5 billion in tax exemptions, credits and other breaks enjoyed by wealthy campaign contributors and identified in a series of WDC “Graft Tax” reports and updates in 2003 in order to lighten the cost to ordinary citizens. The special interests that enjoy those breaks have contributed $7.42 million to Doyle from 1995 through 2004, including $6.19 million, or 83 percent, since 2002 when he ran for governor.

The report also highlights 10 proposals mostly sponsored by GOP legislators that special interests favor. Five of the measures would cost taxpayers an estimated $33 million this year. The cost of the other five proposals is unknown, but fiscal analysts warned that one of them “would cost at least several million dollars during the initial years of implementation….”

The measures include a third tax credit for corporate research and development that would cost $10 million a year, a $4.7 million a year property tax exemption for restaurant machinery and equipment sponsored by former and current restaurateurs and an $11.2 million a year tax break for businesses on apprentices’ wages.

Special interests with a stake in the mostly Republican legislative proposals have given current legislators $18.22 million in campaign contributions since 1993, including $12.65 million, or 69 percent, to Republicans.

The report also highlights six bills and two budget proposals opposed by special interests because it would cost them money. The budget includes a $140 million increase on state assessments on nursing homes and health maintenance organizations in order to attract more federal Medicaid funding. The bills opposed by special interests include ones to repeal the annual automatic gas tax increase which is one of the highest in the nation, require more minimum insurance coverage for mental illness and drug addiction treatment and prevent insurers from canceling homeowner policies due to claims filed for weather damage.

Graft Tax 2005 Report Graft Tax Scorecard 2005 (pdf file)