(The Center Square) – The Republicans who control Wisconsin’s legislature are getting praise for managing to save more than $100 million during the coronavirus and the economic slowdown that hit the state this spring and summer.
The state’s largest business group, Wisconsin Manufacturers & Commerce, applauded the State Assembly and State Senate for adding to the state’s rainy day fund.
“Wisconsin’s pro-growth legislators deserve immense credit for a decade of prudent and responsible budget decisions that have put our state on solid financial footing,” WMC’s Scott Manley said in a statement.
Republican lawmakers on the state’s budget writing panel said knowing the importance of the rainy day fund is now being shown to be just what Wisconsin needs.
“The rainy day fund is for exactly this type of situation,” Sen. Alberta Darling, R-River Hills, told The Center Square. “Just like how families put money away for future use, Republicans made investments in the rainy day fund in good times to protect taxpayers in difficult times.”
Darling said a recent report in Business Insider, said Wisconsin is among the best fiscally prepared states to handle a recession.
Darling, along with Rep. John Nygren, R-Marinette, head the Joint Committee on Finance. They essentially write the state budget.
Nygren explained that while money coming into the state has dropped this year, mainly because of the coronavirus, a good year last year helped push Wisconsin into a surplus.
“In short, tax collections were lower than estimated in January, but higher than estimated when the budget passed last June,” Nygren said.
Wisconsin’s latest Annual Fiscal Report shows the state ended the fiscal year with a $1.2 billion balance in addition to a $106 million transfer to the state’s rainy day fund. That rainy day fund is now at a record $762 million.
But that $1.2 billion balance and the rainy day fund could change, and quickly.
“It is important to note that the recently ended fiscal year is the first year of the state’s two-year budget,” Nygren said the state’s financial picture for the second year of the state budget will likely be very different. “It will likely change based on lower tax collections, expenditures changing, federal funding changes, Congressional actions, among other things. “
Both Nygren and Darling say Wisconsin will get a better picture of where Wisconsin stands financially later next month.
“We will receive our next revenue estimates in November,” Darling said. “We will have to see what they say. The governor will present a new budget in early 2021. It’s my hope he doesn’t try to raise taxes again. Republicans stopped his tax hikes last time. Tax hikes would be devastating for a recovering economy.”
Benjamin Yount reports on Illinois and Wisconsin statewide issues for The Center Square. Reposted with permission.