Highlights of Gov. Evers' budget, tax cuts and historic school funding
MADISON, Wis. (CBS 58) -- Gov. Tony Evers proposed cutting taxes for the middle class and took aim at the Trump administration during his state budget address.
Evers unveiled his state budget to lawmakers Tuesday evening that includes a $2 billion tax targeted towards the middle-income earners while also raising taxes on wealthiest individuals.
"My plan will provide nearly $2 billion in tax relief through efforts to lower property taxes, eliminate the sales tax on several everyday expenses, and cut income taxes for middle-class Wisconsinites," Evers said.
That's in addition to new initiatives from Evers with hundreds of millions of dollars set aside for education, replacing lead in pipes and buildings, rural road projects, and new incentives for local government.
Overall, the budget would spend nearly $119 billion, an increase of 20% from the last two-year spending plan.
However, many of the governor's proposals will be "dead on arrival" by the GOP-controlled Legislature after top Republicans indicated they will toss out Evers' budget and start building their own from scratch.
"In many ways this is kind of like the movie Back to the Future," Vos said. "Evers tried these things for the last few budgets that had lots of tax increases, lots of spending, and I have a belief my colleagues will reject them just as they did before."
New Tax Bracket, No Tax on Tips
Evers proposed a new income tax bracket for joint filers that make over $1 million, or $500,000 for single filers.
The state's top tax bracket caps at 7.65% for married couples who make over $420,000.
The governor also introduced plans to eliminate tax on cash tips, taxes on electricity and natural gas in homes.
K-12 & Higher Education
Evers also proposed significant increases in support for both K-12 and higher education. Evers' budget includes a proposed $3.15 billion investment in K-12 schools and $865 million for the UW System.
Evers' education plan includes a proposal to boost special education reimbursement from 33%, where it currently is, to 60%. That increase would cost more than $1 billion.
State Superintendent Jill Underly, who advanced Tuesday to the April 1 spring election in her bid for a second term, noted the increase in school referendums in recent years as a reason to boost state aid.
"It's unfair to put this burden on local taxpayers and for them to make this choice. They need to invest in the schools," Underly said. "Special education is a reimbursement that touches every school district in the state, and I think that's a great place to begin."
Snyder said he supported a significant increase in the special education reimbursement total, but he added there was no way Evers and Democrats would get the 60% reimbursement level they seek.
"When I talk to my superintendents, they're having to take out of their general fund to cover some of the special ed, so I really do think we need to look at those types of things," Snyder said. "60 [percent]? No, but it's like when you're selling a house; you go high, and you know what you'll take."
Evers also proposed making several essential services and items exempt from the state sales tax, including electricity and diapers. His budget would also create a new state office that would review the claims health insurance companies deny.
Evers also previously announced plans for $300 million to boost mental health services in schools.
Property Tax Freeze
Evers' budget also offers a mix of proposed ways to freeze property taxes. One proposal would offer property tax credits directly to land owners. Another would pay county and municipal governments to not increase property taxes.
Evers proposed giving local governments the equivalent of what they would have generated had they increased property taxes by 3%. The program would cost nearly $112 million in the budget's first year and $227 million in the second. Evers' property tax proposals cost a total of $1 billion.
Democratic lawmakers said they were interested in seeing more specifics about the property tax plan.
"I would love to see a little bit more detail, but that is something that I heard a lot in my old district, and I think, frankly, our state," State Sen. Dora Drake (D-Milwaukee) said. "People are concerned about the cost of living."
State Rep. Pat Snyder (R-Weston) said he was skeptical Republicans would support dedicating such a large portion of the state's surplus toward short-term property tax relief.
"A billion [dollars] is pretty high, especially when you're working with a $4.3 billion surplus. Taking a billion out of that, a lot of that is meant for one-time spending," Snyder said. "If this is something the governor wants to invest in every year, I just don't know if we can feasibly do it, so it needs to be discussed."
Lowering Health Care Costs
Evers also proposed creating a new government office geared towards helping people whose health insurance claims were denied.
He also proposed to eliminate the sales tax on over-the-counter medication, which is estimated to save $70 million over the next two years.
Capping the cost of insulin at $35 is also included in the governor's budget.
Evers Targets Trump Admin
During his budget address, Evers also criticized the Trump administration for newly imposed tariffs and the push to freeze federal grants and loans.
"The needless chaos caused by the federal government in recent weeks has already made preparing a state budget that much more difficult," Evers said.
He also called on lawmakers to "plan accordingly" regarding the uncertainty related to efforts by the White House to cut government spending.
The governor also outlined plans in response to President Donald Trump's tariffs on goods overseas. The Trump administration recently imposed 25% tariffs on Canada and Mexico.
Evers proposed creating a new agricultural specialist to help farmers navigate disruption in the markets due to tariffs.