Unless you’ve been on another planet for the past week, you have heard about the siege on Madison. Thousands of protesters and supporters of Senate and Assembly Bill 11 have filled the Capitol and it’s grounds. Scott Walker and the Republicans have been vilified, Democrats have fled the state and for now, the debate among the citizens has been peaceful.
But what are Walker and the Republicans trying to do? Is Walker taking advantage of a crisis, pulling a page from former White House Chief of Staff Rahm Emmanuel’s playbook? Will these bills save the state money and make it easier to do business in Wisconsin, or are they a bold power grab and attempt to bust the public employee unions?
Actually, the bills will do a little bit of both.
Walker inherited a fiscal deficit for the remainder of the 2010-11 fiscal year (which ends on June 30). Union leaders and national talkers have said it is a false budget crisis, that the state would actually have a $121 million surplus according to a report by the WI Legislative Fiscal Bureau released on Jan. 31, if not for the legislature giving away millions of dollars in tax credits and breaks to big business.
But a closer look at that report reveals the state owes has more than $258 million in unpaid bills through the end of the fiscal year, including $3.5 million to the State Public Defenders board, over $50 million in tax reciprocity payments to Minnesota and a $174 million shortfall in the Medicaid fund for medical payments to the needy. And that doesn’t even take into account the more than $200 million a judge has ordered the state to repay to the Patient Compensation Fund. A thorough analysis of this issue appeared in yesterday’s Milwaukee Journal-Sentinel Politifact® Wisconsin.
So what does Walker want? First, he wants the public employee union members throughout the state (with the exception of police and fire unions) to contribute 5.8 percent towards their pensions and 12.6 percent towards their health insurance premiums. He says this will free up $30 million in the current fiscal year and 10 times that amount in future years.
At first union members were livid about the loss of take-home pay due to the contributions, but in recent days have acquiesced and will now accept the health and pension contributions in exchange for retaining their union bargaining rights. Walker said the unions had their chance to negotiate in December when their contracts were up for vote (which failed) and they weren’t interested, so he is not interested now. He has said repeatedly and clearly that he will not negotiate on collective bargaining.
Second, Walker wants to change the law that allows for the end of union bargaining rights, something that has been in place for state employees since 1959. He will allow the unions to bargain on their base wages, but wages would be tied to the consumer price index. There would be no bargaining of overtime, premium, merit or performance pay, supplemental compensation, pay schedules, and automatic pay progressions. Work rules, overtime, vacations and all other civil service rights would remain in place for state employees, but those benefits could come off the negotiating table for municipal employees.
The bill would require any pay raise exceeding the CPI, the be agreed to by governmental resolution and a referendum of the public. In addition, each union would have to hold an annual authorizing vote of its membership and wouldn’t be able to collect dues or fees from non-union workers. Strikes by public employees, which were prohibited except for very limited reasons, would be illegal in all cases.
The bill would prohibit Limited Term Employees (usually temporary employees who work less than 1,043 hours a year) from receiving state health and pension benefits. It would allow employees to be fired if they are absent without leave from work more than three days during a declared state of emergency or if they participate in any work slow down or stoppage. It would remove collective bargaining rights from child care workers and health care workers who are paid under the Medicaid program.
Teachers, correctional workers, public works employees and private union members took to the streets to protest this, while 14 Democrat Senators have gone to Illinois rather than allow a vote that would take those bargaining rights away from workers. But Walker is adamant that collective bargaining has to go.
He has told the public that removing collective bargaining will give state and local governments and school district the flexibility to control costs in the face of deficits and falling tax revenues, plus it will avoid the layoffs of 1,500 employees this year.
Wisconsin is one of 30 states that currently allow its public employee unions to collectively bargain.
These two issues have been at the forefront of the protests this past week, but there is so much more in the bill.
The University of Wisconsin Hospitals and Clinic Board would be eliminated, its employees not allowed to collective bargain. University of Wisconsin employees would also lose bargaining rights.
Walker is proposing to refinance general obligation bond debt incurred by the state, similar to when you move credit card debt to another lower interest card. It is estimated to save the state $165 million in debt service costs, which Walker wants to use to pay one-time costs to comply with the Injured Patients and Families Compensation Fund state Supreme Court decision and the tax bill owed to Minnesota.
Because of the recession the use of Medicaid programs has increased leading to the current budget for the program being $153 million short. Walker’s repair bill would authorize the Department of Human Services to make program and payment changes that would effect nursing homes, ICFs-MR, the State Centers for the Developmentally Disabled and the Wisconsin Veterans Homes.
The changes implemented by DHS could include requiring medical assistance recipients to make cost share payments up to the federal maximum; allow providers to deny care to those who can’t share the costs; revise provider reimbursements for certain groups of recipients; mandate all recipients enroll in managed care; impose restrictions on MA accessibility to non-U.S. citizens; set standards for establishing and verifying eligibility for assistance and reduce income levels for purposes of eligibility.
All of these changes would have to comply with the maximums and minimums eligibility and care levels set by the federal law for medical assistance, something that Wisconsin has often exceeded in the past.
The bill also shifts cash from some programs to other programs experiencing shortfalls – $22 million redirected to the Department of Corrections to cover increased health care and overtime costs, $3 million moved from the Aging and Disabilities Resource Centers (which oversees the intake and assessment to the FamilyCare Program) to the Medicaid program, and shifting $37 million from the Temporary Aid to Needy Families fund to increase the Earned Income Tax Credit program.
Finally, the bill would change the practice of carrying unused general revenue funds from the Medicaid program into the next biennial budget. Instead these surplus funds would move to the state’s general fund to be used for any programming.
So while the focus on this bill has been the rights of state employees and their contributions to their benefits, there is more than that. There are proposed changes that could alter how our poorest and neediest citizens receive medical care; it will push principle payments on outstanding debts into another fiscal year and it will shift money from certain departments to cover increasing health care costs and provide relief in the form of earned income tax credits. Things that can affect every citizen of the state.
The Senate version of this bill is currently at the final adoption stage. Last Thursday, the Democrats missed their opportunity to offer amendments to the bill when they fled the state. Senate Republicans have 19-members in the 33-member senate and Majority Leader Scott Fitzgerald said he has the 17 votes to pass the bill. However, since this is a fiscal bill, there needs to be 20 Senators on the floor to vote, per Senate rules. The Senate is currently under a “Call to House,” awaiting the return of the Wisconsin 14.
The Assembly will return to the floor Tuesday at 10 a.m. They have been in recess since Friday afternoon, when the Republicans almost passed their version of the bill in a session opened before the scheduled time. Democrat Minority Leader Peter Barca gave an impassioned plea to reverse the actions of the improper session, which was granted after the Majority Leader Jeff Fitzgerald admitted he “didn’t think they (Democrats) were coming.”