Budget Repair Bill Myth Busters

Tuesday, March 15, 2011


Budget Repair Bill Myth Busters

The month long debate on the budget repair bill has been awash with many misconceptions, half truths, and outright lies about what’s actually in the bill that was passed by the Legislature last week and signed into law by Gov. Walker on Friday to address the ongoing budget crisis.

In an effort to get accurate information out to my constituents, over the next several weeks I will be putting out a series of Frequently Asked Questions and a Fact versus Myth memo that sets the record straight on some of the more ridiculous claims made against the budget repair bill.

Fact versus Myth part 1: Collective bargaining changes are an attack on working families

While the debate on the changes to collective bargaining will rage on in our state in the coming days and months, I want to share some facts about where Wisconsin stands in relation to other states and the national government when in comes to collective bargaining for public employees.

FACT: The budget repair bill does significantly change the current structure of collective bargaining for most public employees by limiting bargaining to only the base rate of pay. The pay increases are capped at the Consumer Price Index (CPI) which typically averages 2-3% depending on the year. Local units of government can give their employees a higher pay increase but they must first seek the approval of taxpayers in their district through referendum.

FACT: With these changes Wisconsin is now in the middle of the pack as far as how states regulate collective bargaining. In fact, there are 24 states that currently have some regulation on collective bargaining and another 12 states that allow no collective bargaining in either the public or private sector.

FACT: Another important point that has flown under the radar in this debate is the fact that most federal employees are NOT allowed to collectively bargain for wages or benefits under President Obama. Yet, you don’t see the 2 million federal workers walking off their jobs and storming the White House in protest.

Fact versus Myth part 2: Union members claim the budget repair bill will cut off aid to municipalities and schools, while removing millions from the state pension fund.

Several public employees emailed me a list of provisions that they were told were a part of the full budget repair bill. Included in the fictitious list were page numbers and section citations from the bill making claims that aid to local schools and municipalities would be cut and millions would be taken out of the state pension fund to pay for other programs. To disprove these ridiculous claims I asked the non-partisan Legislative Fiscal Bureau, our budget experts, to put together a memo that addresses each of the items from the list.

Here are the questions I asked which made reference to the claims from the email followed by the Legislative Fiscal Bureau’s (LFB) response:

On pages 135-136, Section 9211 and page 58, Section 148 (or anywhere else in the bill) are there provisions that “cut off State aid to municipalities,” “cut off $900 million in state aid to public k-12 schools,” or “cause the tuition at UW to go up 26% over the next two years?”

LFB response: There is nothing in the budget adjustment bill that references these aid reductions, or increases in UW tuition.

On page 125, Section 9115, (or anywhere else in the bill) will the “state be allowed to take $28 million from the Employee Trust Fund, the state employees’ pension fund, to pay the state’s portion of the employee medical and pension contributions until 2013?”

LFB response: The $28 million is from reserve accounts established for group health insurance and pharmacy benefits for state employees and is intended to be used to reduce employer costs for providing group health insurance for state employees for the period July 1, 2011 and December 31, 2011. There is nothing in the budget adjustment bill that takes monies from the state employees’ pension fund.

On page 58, Section 62.623, this provision will allow “the state to no longer pay anything towards state employees medical and pension fund, requiring state employees to pay the entire cost of medical and pension contributions?”

LFB response: The section of the bill you cite is related to pension fund contributions for the City of Milwaukee and is not related to state employees. For state employees under the budget adjustment bill, general employees and executive and elected officials (including legislators and their staff members) would be required to make an employee contribution to the Wisconsin Retirement System equal to one-half of all required contribution rates. (For 2011, one-half of the rate would be 5.8% of salary for general employees and 6.65% of salary for executive and elected officials.)

Under the bill, state employees would pay approximately 12.6% of the cost of health insurance premiums for the remainder of 2011.

I hope this helps clear up some of the misinformation that has been spread around about the budget repair bill and its impact on public employees and on collective bargaining. Please stay tuned to future editions of the Suder update for more information on the budget repair bill.

January Jobs Report Shows Signs of Recovery

Late last week, the state Department of Workforce Development announced Wisconsin’s private sector added more than 10,000 jobs in January! It has been a priority of mine to grow our economy and create jobs ever since we started this session two months ago, and the January jobs report is a promising step in the right direction. 10,000 new jobs and a lower statewide unemployment rate is great news, but it is my hope that what we saw in January is just the beginning and that the measures we’ve enacted so far in the Assembly will make January’s growth the starting point for our recovery.

Keep in Touch!

As always I welcome your input and feedback on these issues. Please feel free to send me an email with any questions you may have on these topics or any other legislative issues that may be of concern. Your correspondence is important and appreciated, so please keep in touch!

Have a great week and thanks for reading!


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State Representative Scott Suder
State Capitol - Room 215 West - Post Office Box 8953 - Madison , Wisconsin 53708
(608) 267-0280 - Toll Free: (888) 534-0069
Email: Rep.Suder@legis.wi.gov