Hamilton Political Tidbits - Oct. 28, 2010

Introduction

With less than a week until the 2010 general elections, candidates and independent groups are filling the airwaves with political advertisements aimed at swaying undecided voters.

In this edition, Hamilton Consulting Group provides an update of the most closely watched races which will likely help decide who will control the legislative and executive branches in Madison. Also, please watch for Hamilton Consulting Group's special Election Day edition on November 3rd with results of all Wisconsin state and federal races.

Three cases recently accepted by the Wisconsin Supreme Court  will have an impact on businesses. Andy Cook provides summaries below. In addition, Amy Boyer reports on the newly formed Bioenergy Council, which is tasked with creating new state standards for renewable energy. Finally, see Hamilton Consulting Regulatory Watch for more on the article regarding federal regulations aimed at increasing ethanol content of gasoline to 15 percent in newer vehicles. 

Political Tidbits will provide continuous updates on election news and other government news. Also, please visit Hamilton Consulting Group's Blog for timely updates. And remember to vote on Tuesday!

 

Final Preview of 2010 General Elections

By Hamilton Consulting Group Staff

Governor

Scott Walker led the primary from box to wire, eventually ousting his Republican primary competitor Mark Neumann with 60 percent of the vote. He now faces Democrat Tom Barrett. According to the polls, Walker has led Tom Barrett in head-to-head data since the race began. Various polls have Walker's lead anywhere from three to nine points.
UPDATE: Polling in this race remains consistent from the prior report. Statewide polls still give Walker a healthy lead, as high as 10 points. Democratic based pollsters insist this race is closer and have Walker with a lead as little as 2 points. There has not been a single poll in recent times that shows Barrett tied or leading Walker.

Attorney General

Sitting Attorney General J.B. Van Hollen is facing challenger Scott Hassett. This race has stayed well below the radar and most insiders predict an easy victory for the incumbent.
UPDATE: The Attorney General's race has registered on the radar as both candidates took to the airwaves. While most believe Hassett would still be considered a tremendous long shot to beat Van Hollen, some Democratic insiders believe the race is tighter than perceived.

State Senate

Republicans need a net gain of two seats to take back the majority they lost in 2006. There are four freshman Democrats that are bearing the brunt of that effort. The chessboard has shifted many times over the last few months, but control of the Senate still will likely come down to whether or not the Democrats can protect three of the four freshmen members.
UPDATE: 29th District: Senate Majority Leader Russ Decker vs. Republican Pam Galloway.
Since our last update, over half a million dollars have been put on television against Decker, and it is almost all negative. This race used to be hanging under the radar, but it is now a toss-up with the other four senate seats. This puts five senate seats into the toss-up category.
UPDATE: 25th District: Senator Jauch vs. Republican Dane Deutsch.
We are not ready to throw this race in the toss-up category yet, but independent groups have taken to the airwaves to try to unseat Jauch in a northern district that some view as winnable in the current environment.

State Assembly

There are many different dynamics in play that will have an impact on who controls the State Assembly at the end of the day. Republicans need to pick up four seats to hit the magic number of 50 for control.
The overall electoral environment means a lot more Democratic seats are in play than normally would be. The following provides a lay of the land as we currently see it. Our determination of whether or not the seat leans one way or the other, or is a toss-up, takes into account what both sides are saying about their chances, combined with available polling we've seen on the races. At this point in time they are not predictions of the outcome.
UPDATE: We have moved around slightly some of the races below and removed one name off of the completely safe list for Democrats. The biggest change was moving all but one of those on the "lean Republican" line to "strongly leaning Republican."
The Assembly Democrats maintain the majority if:
The likeliest scenario would be for them to split the seats in the open Hubler and open Nelson, win the open Davis, and win 7 of the 8 incumbent protects that we consider in-play. They also need to not have any surprises from the incumbent Dems on the other lines below.
The Assembly Republicans take the majority if:
Their likeliest scenario is to sweep the open Hubler and open Nelson seats and knock off at least 1 incumbent. Both scenarios assume the open Wood seat goes Republican and the open Hilgenberg seat goes Democrat.
Chaos takes the majority if:
The parties split the open seats referenced earlier (at this point it seems unlikely Dems will win both the 5th and the 75th) and only one Assembly Democratic incumbent loses. This would likely put the Assembly at 49-49-1.

Current Position: 51 Democrats, 46 Republicans, 2 Independents
Open Seats: 20 - 8 Democrat, 11 Republican, 1 Independent
Safe Democratic Seats: 31
Strongly Leaning Democratic Seats: 6
Terry Van Akkeren, Andy Jorgenson, Cory Mason, Gordon Hintz, Benedict open, Tony Staskunas
Leaning Democratic Seats: 3
Jeff Smith, Mark Radcliffe, Marlin Schneider
Toss-up Democratic Seats: 11
Hubler open, Hilgenberg open, Nelson open, Ted Zigmunt, Ann Hraychuck, Fred Clark, Kim Hixson, Penny Bernard Schaber, Kristen Dexter, Jim Soletski, Phil Garthwaite
Safe Republican Seats: 36
Strongly Leaning Republican Seats: 9
Mark Honadel, Rhodes open, Montgomery open, Jerry Petrowski, Keith Ripp, Mary Williams, Lee Nerrison, Gary Bies, Open Friske seat
Leaning Republican Seats: 1
Jeff Wood open
Toss-up Republican Seats: 1
Open Davis seat
Leaning Independent Seat: 1
Ziegelbauer
New Assembly Members (won primaries - no major party opponents)

• Democrat Jocasta Zamarripa replaces Pedro Colon
• Democrat Elizabeth Coggs replaces Polly Williams
• Republican Dale Kooyenga replaces Leah Vukmir
• Republican Chris Kapenga replaces Scott Newcomer
• Republican Michelle Litjens replaces Roger Roth

Likely new Assembly members (won primaries in very partisan districts - with opponents)

• Republican Tyler August replaces Tom Lothian (pending potential appeal of recount results)
• Republican Jeremy Thiesfeldt replaces John Townsend
• Republican Paul Farrow replaces Rich Zipperer
• Republican Mike Kuglitsch replaces Mark Gundrum
• Democrat Brett Hulsey replaces Spencer Black
• Democrat Janet Bewley replaces Gary Sherman

Strongly leaning incumbent party holds in open seats:

• Democrat Roger Anclam versus Republican Amy Loudenbeck to replace Democrat Chuck Benedict
• Republican Chad Weininger versus Democrat Sam Dunlop to replace Republican Phil Montgomery
• Republican Dean Knudson versus Matt Borup to replace Republican Kitty Rhodes

The six open seats in play:

• 5th District: Democrat Mert Summers versus Republican Jim Steineke to replace Democrat Tom Nelson - Parts of Green Bay and areas to the west and south, Kaukana, Oneida County (lean Republican)
• 35th District: Republican Tom Tiffany versus Democrat Jay Schmelling to replace Republican Don Friske - Northcentral Wisconsin, including Tomahawk, Merrill, Antigo (strong lean Republican)
• 51st District: Democrat John Simonsen versus Republican Howard Marklein to replace Democrat Steve Hilgenberg - Southwest WI, includes Sauk, Iowa, and Lafayette Counties (toss-up)
• 67th District: Republican Tom Larson versus Democrat C.W. King to replace Independent Jeff Wood - Chippewa Falls and surrounding area to the north (lean Republican)
• 75th District: Democrat Steve Perala versus Republican Roger Rivard to replace Democrat Mary Hubler - Northwest Wisconsin, including Rice Lake and Spooner (lean Republican)
• 80th District: Democrat Janis Ringhand versus Dan Henke to replace Republican Brett Davis - Southwest of Madison including Evansville, Monroe and New Glarus (lean Democrat)

The eight top protects for Assembly Democrats:

• 1st District: Ted Zigmunt versus Andre Jacque - Southeast of Green Bay, including Two Rivers
• 28th District: Ann Hraychuck versus Erik Severson - Northwest Wisconsin, including Polk and Burnett Counties
• 42nd District: Fred Clark versus Jack Cummings - Includes Dells, Baraboo, Portage
• 43rd District: Kim Hixson versus Evan Wynn - Southwest Wisconsin, including Edgerton, Milton and Whitewater
• 49th District: Phil Garthwaite versus Travis Tranel - Southwest Wisconsin, including Platteville, Grant County
• 57th District: Penny Bernard Schaber versus Chris Hanson - City of Appleton
• 68th District: Kristen Dexter versus Kathy Bernier - Northern Eau Claire, Fall Creek
• 88th Distric:t Jim Soletski versus John Klenke - Green Bay
   

High Court Accepts New Cases that Have Impact on Businesses

By Andrew Cook

The Wisconsin Supreme Court this month announced that it accepted 18 new cases for the 2010-11 term. Below is a discussion of three of the cases that most directly affect Wisconsin businesses.

deBoer Transportation, Inc. v. Swenson, et al.

The issue in this case is whether an employer failed to show "reasonable cause" by not rehiring an employee recovering from an injury who refused to participate in the company's mandatory overnight reorientation.

The employee, Charles Swenson (Swenson), injured his knee at work. After several months away from work, Swenson was cleared to return to his job. His employer, deBoer Transportation, instituted a "reorientation" program for drivers that have been off work more than 60 days. One of the requirements was an overnight "check-ride" which required the driver to spend a number of nights on the road traveling.

Swenson took care of his terminally ill father and therefore requested that deBoer pay the cost of caring for his father during the overnight check-ride. Because deBoer refused to pay for the care of Swenson's father or to make alternative check-ride arrangements, Swenson decided not to participate in the check-ride. As a result, Swenson was not rehired.

Swenson filed a complaint with the Labor and Industry Review Commission (LIRC), which concluded that deBoer failed to show "reasonable cause" for its refusal to rehire Swenson, as required by Wis. Stat. § 102.35(3). The circuit court upheld LIRC's decision.

The Court of Appeals reversed LIRC. According to the Court of Appeals, the "reasonable cause standard in Wis. Stat. § 102.35(3) does not contemplate requiring employers to either deviate from a facially reasonable and uniformly applied policy, or explain why it would be burdensome to do so, when a returning employee requests the deviation to accommodate a non-work and non-injury personal need."

The Court of Appeals further opined that "it is not reasonable to suppose that the legislature intended to impose on employers the burden of judging which non-work, non-injury-related requests need to be accommodated if reasonably possible." The Court went on to pose a number of hypothetical scenarios where employers would be faced with employees making certain requests, such as making accommodations to meet an employee's desire not to miss woodworking or dance classes.

Oral argument for this case is scheduled for 9:45 a.m. on Thursday, January 6, 2011.

Kilian v. Mercedes-Benz USA, LLC

This case involves Wisconsin's Lemon Law and whether the lessee had the right to recoup damages.

The vehicle (a Mercedes-Benz) in this case was leased by Mercedes-Benz Financial (Financial) to Steven Kilian (lessee). In accordance with an agreement with Mercedes-Benz under Wisconsin's Lemon Law, Kilian returned the vehicle to the dealer and received a refund check from Mercedes-Benz.

After Kilian returned the vehicle, he began receiving phone calls from Financial (the lessor) indicating that he was in default on the lease payments. Financial also reported this information to credit bureaus. When Kilian was unable to resolve the dispute, he filed a lawsuit under Wisconsin's Lemon Law.

Kilian sued Mercedes-Benz arguing that the manufacturer violated the Lemon Law by not automatically refunding Financial the current value of the lease within 30 days of the demand for refund. Kilian also sued Financial for damages for reporting the information to the credit bureaus. Both the trial court and Court of Appeals ruled in favor of Mercedes-Benz and Financial.

As for the claim against Mercedes-Benz, the court ruled that under Wisconsin's Lemon Law, the manufacturer only has an obligation to pay off the lease when the lessor offers to transfer the title (Wis. Stat. § 218.0171(2)(b)3.a.). In this case, Mercedes-Benz did not receive an offer from Financial to transfer the title until after the lawsuit was filed. Therefore, the court ruled that Mercedes-Benz did not violate Wisconsin's Lemon Law.

The Court of Appeals also upheld the lower court's dismissal of damages against Financial. The Court of Appeals ruled that Kilian failed to prove that he suffered a pecuniary loss by Financial sending the information to the credit bureaus.

Oral argument is set for 9:45 on Wednesday, January 5.

Rasmussen, et al. v. General Motors Corp. et al.

This case will determine whether Wisconsin has personal jurisdiction over foreign corporations based on an agency theory.

Although the case caption cites General Motors, the specific issue in this case is whether Wisconsin has personal jurisdiction over Nissan Japan.

The lawsuit involved a class action case against numerous auto manufacturers for alleged anti-trust violations. Specifically, the plaintiffs alleged that Nissan Japan and its wholly owned subsidiary, Nissan North America, conspired to keep new car prices at significantly higher prices than prices in Canada for same vehicles. The plaintiffs alleged that the defendants arranged for U.S. dealers to not honor warranties on cars imported from Canada to prevent lower prices cars from being imported to the U.S.

The case was dismissed for lack of personal jurisdiction by the trial court, which was upheld by the Court of Appeals. The issue before the Wisconsin Supreme Court is whether Wisconsin's personal jurisdiction statute (Wis. Stat. § 801.05) allows for general or specific jurisdiction over a foreign parent corporation based on an agency theory.

The case is noteworthy because a line of cases in the U.S. District Court for the Eastern District of Wisconsin appear to support finding general jurisdiction based on an agency relationship. However, the Court of Appeals cited to a case from the U.S. District Court for the Western District of Wisconsin that holds the opposite. See Insolia v. Philip Morris Inc., 31 F. Supp. 2d 660 (W.D. Wis. 1998). The Court's decision will determine which line of cases hold and could set significant precedent for foreign corporations.

Oral argument is set for 9:45 on Wednesday, January 5 (after the Kilian case above).

Bioenergy Council Members Appointed

By Amy Boyer

The Department of Agriculture, Trade and Consumer Protection Secretary, Randy Romanski, this month appointed members to the newly formed Bioenergy Advisory Council.

The Bioenergy Advisory Council was created to advance homegrown, sustainable energy sources.  According to Secretary Romanski, "The Council will help establish standards to sustainably grow and harvest crops to meet the state's renewable energy needs while strengthening our agricultural economy."

The Council will be co-chaired by David Donovan of Xcel Energy and Jamie Derr, farmer and member of Landmark Services Cooperative Board of Directors.  This 16-member Council will advise agencies and other stakeholders on best practices for sustainable production of biomass feedstocks.

EPA Grants E15 Waiver for Newer Vehicles

The Environmental Protection Agency this week waived a limitation on selling fuel that is more than 10 percent ethanol for cars and light trucks made in 2007 and newer. Under the EPA's waiver decision, fuel and fuel additive manufacturers are allowed to introduce into commerce gasoline that contains up to 15 percent ethanol (also known as E15).

The EPA denied a portion of the waiver for introduction of E15 for use in model year 2000 and older light-duty motor vehicles, as well as all heavy-duty gasoline engines and vehicles, highway and off-highway motorcycles, and nonroad engines, vehicles, and equipment. The EPA will decide at a later date whether E15 will be allowed for model year 2001 to 2006 vehicles.

For more information about the E15 waiver, visit Hamilton Consulting Regulatory Watch.

Notes from the Hill

By Elizabeth Fassbender

Democrats on the Defensive

With more than 100 Democratic House seats at risk, the Democratic Congressional Campaign Committee recently purchased $21.6 million worth of air time in 66 districts as a final effort to curtail the GOP's momentum in the last week of the campaign. The majority of those 66 districts were once considered safe Democratic seats and only three of those seats are currently held by Republicans.

Though many races could still go either way, this latest effort indicates it may be too late for Democrats to change the broader Election Day outcome. It is now nearly certain that Republicans will take over the House with gains in the 40s or 50s. Additionally, Republicans will likely make big gains in the Senate, though they don't appear to have the numbers for a Senate takeover.

Providing much of the GOP momentum are independents, who now make up almost 40 percent of the electorate and are generally siding with Republicans in the final week. GOP pollster Glen Bolger recently explained his take on the action, stating that "When you look at '06, '08 and '09, including Scott Brown, independents have tended to break in one direction because they think the country is on the wrong track."

The Kentucky Senate race is just one of several examples where this appears to be the case. Until recently, Republican nominee Rand Paul and Democrat nominee Jack Conway had kept the race within single digits. However, independents have started moving en masse to support the Republican nominee, and in a new Public Policy Polling survey released Tuesday, Paul now leads the Democratic nominee Conway 53-40 overall.

Ultimately, much of the Republicans' hopes for major gains remain tied to the "enthusiasm gap" that they believe will deliver far more conservatives to the polls. Democrats insist that the enthusiasm gap between parties won't matter greatly, "because if people vote, they vote."

To that effect, Democratic Senatorial Campaign Chairman Bob Menendez wrote in a campaign memo distributed earlier this week that "Republicans have turned themselves into meteorologists forecasting dark storm clouds, tidal waves, and tsunamis. But like the weather, politics can be difficult to predict."

Ms. Fassbender is employed at Strategic Marketing Innovations (SMI, Inc.), a government relations firm in Washington, DC specializing in federal policy and appropriations for the defense and energy industries.

Related News

Tribune endorsement: Walker is best pick for governor (opinion): La Crosse Tribune, Oct. 27, 2010. Giving Mayor Barrett the authority to fix Milwaukee Public Schools while giving Gov. Walker the opportunity to cut the cost of government in Wisconsin would be an important combination for our state’s future.

$7M spent on election ads in Green Bay TV market: Green Bay Press-Gazette, Oct. 27, 2010. Democratic Senate candidate Russ Feingold spends the most.

Don’t burn money at new plant (opinion): Wisconsin State Journal, Oct. 27, 2010. It’s more than $250 million to provide enough power to heat and cool some 300 local buildings.

Wisconsin law banning mercury in some devices to start: Janesville Gazette, Oct. 27, 2010. Prohibits the sale of a number of products that contain mercury, including thermometers, manometers, thermostats, barometers, hydrometers, toys, jewelry and over-the-counter drugs.

Milwaukee area fills up with food industries: Milwaukee Journal Sentinel, Oct. 27, 2010. Report finds large, successful food cluster locally.For governor, Scott Walker (opinion): Beloit Daily News, Oct. 26, 2010. Fiscal conservatism badly needed in Madison.

Scott Walker is better choice for Wisconsin governor (opinion): Green Bay Press-Gazette, Oct. 26, 2010. It's time for a change in Madison, and one candidate for Wisconsin governor is better suited to rein in spending and restore a needed fiscal conservatism in the Badger state.

A look at the 'turnout gap' in Wisconsin: Milwaukee Journal Sentinel, Oct. 26, 2010. How much do turnout rates vary from county to county? A lot.

Unfinished business (opinion): Milwaukee Journal Sentinel, Oct. 26, 2010. For MPS to do its core job of educating students, its finances need to be in order. The contract agreement gives the district financial flexibility. Teachers should approve it.

Gov. Doyle breaks ground on Biomass project: WQOW News, Oct. 25, 2010. The project follows Governor Doyle's 2008 announcement that Wisconsin would stop burning coal at state-owned heating plants on Madison's Isthmus.

Jobs, budget deficit top issues in 7th District race: Milwaukee Journal Sentinel, Oct. 24, 2010. Duffy, Lassa differ on solutions to problems.

Final chapter in Kenosha's automotive history ends quietly: Milwaukee Journal Sentinel, Oct. 24, 2010. The significance of the Chrysler Kenosha engine plant's closing, albeit a quiet ending, will not be lost on historians.

Property Trax: WRA keeping a closer eye on home sales around the state with new monthly reports, affordability measure: Wisconsin State Journal, Oct. 21, 2010. In September, the inaugural WRA report showed, sales of existing homes were down 30.9 percent statewide from September 2009