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Dec. 12, 2008

The watershed 2008 elections came to a close with much anticipation and a certain degree of apprehension. Hamilton’s Andy Engel has written a comprehensive analysis on what all of this may mean for Wisconsin.

Andy recently joined the Hamilton Consulting Group after ten years on the political side of our business. Most recently, he served as Chief of Staff to Senate Majority Leader Judy Robson. In addition to his political successes with the Senate Democrats, Andy has extensive policy experience developing and advancing major pieces of legislation, as well as working on multiple budget bills. On the upcoming challenges, Andy notes:

For the first time in over 20 years, Democrats hold the Governor’s Office and majority control in both houses of the Legislature. The implications of these watershed 2008 elections in Wisconsin are numerous; some obvious, with others nuanced yet still vital. This paper takes a look back at the 2008 elections, the upcoming budget and legislative session as well as a look forward to the 2010 elections.

Read the complete analysis.

Wisconsin Developments

Wisconsin Elections 2008 - Analysis of a Wave
The Wisconsin budget debate will start in earnest with the introduction of Governor Doyle’s budget in February 2009. The powerful Joint Finance Committee is charged with developing the initial, and most important, legislative version following the Governor’s budget submission next February. With their 12-4 committee majority, it will be a decidedly Democratic budget.

Even before the budget bill is introduced, the Governor and legislative leaders are likely to advance a “stimulus package” that will include new revenue measures to help address the $5 billion budget hole in a timelier manner, and may introduce a “budget repair” bill to address a shortfall expected by the close of this fiscal year, June 30, 2009.

The Legislature is expected to revisit many tax and fee initiatives passed in the Senate last session that ultimately failed to be included in the final budget deal. At the top of that list are the oil company gross receipts tax, the hospital assessment, and combined reporting. Even if all three are enacted, the budget gap is hardly closed, and further revenue increases, budget cuts, federal assistance and borrowing will be required. The bottom line – there will be higher and expanded taxes and fees; the only question is on whom and how much. 

On the policy front, the Senate Democrats return with the same 18-15 majority and leadership team while the Assembly Democrats have gained control for the first time since the 1993 Session. The Senate Democrats are likely to pursue many of the same policy priorities with the possible exception of Healthy Wisconsin. Much of the key policy debates will likely turn on the direction of the new Assembly Democratic majority and leadership team.

Some of the most significant policy changes as result of the power shift in the Assembly could be in the area of energy and the environment. Overall, the issue of climate change will be front and center. In addition to narrower bills on such issues as California car standards, we expect more sweeping initiatives to implement the recommendations of Governor Doyle’s Task Force on Global Warming or the developing Midwestern Greenhouse Gas Accord.

In addition to the environmental groups, labor, plaintiff lawyers, pro-choice advocates, and champions of campaign finance reform are newly emboldened. So we expect legislation that advances their agendas, such as bills to unwind civil justice reforms enacted in past sessions. Health care reform, even if not in the form so sweeping as Healthy Wisconsin, will also be a top priority for many. Please take the time to read Andy’s piece for a detailed analysis of these issues.

While uncertainty and risks abound, the Governor and Legislature will have one overall objective that is aligned with business interests - saving and creating jobs by getting the economy back on track. Balancing our deepening economic crisis, a worsening budget shortfall, and new legislative policy priorities will be a challenge. Businesses and their representatives in Madison have a critical role to play in meeting that challenge.

Please contact Andy or any other member of Hamilton Consulting Group’s lobbying team if you have any questions on these or other issues facing Wisconsin during the upcoming legislative session.

Read the complete analysis.

Court of Appeals Upholds Jury Verdict Against City of Milwaukee
On Nov. 25, 2008 the Wisconsin District 1 Court of Appeals affirmed the jury’s verdict (June 22, 2007) that determined that NL Industries was not negligent and would not have to reimburse the City of Milwaukee for the City’s lead cleanup effort. The City appealed and the Appellate Court ruled 2-1 that: “…the evidence was sufficient to support the jury’s finding that NL Industries did not intentionally cause the public nuisance found by the jury.” 

In its appeal, Milwaukee argued that the evidence was not sufficient to support the jury’s finding in favor of NL Industries. In rejecting the City’s arguments, the Court noted that while the jury found a public nuisance, there is a distinction between a nuisance and liability for a nuisance. The Court clearly stated that in order to establish liability for the public nuisance, Milwaukee was required to establish a causal connection between the nuisance and the underlying tortious acts - and it did not do so to the satisfaction of the jury. 

The City also argued that a partial new trial should be granted, citing a number of procedural issues including alleged erroneous rulings on jury instructions and admissibility of certain evidence. That argument was likewise rejected.

See Hamilton's Lead Paint Update.

Wisconsin News

Doyle to tell Congress about economic challenges: Eau Claire Leader-Telegram, Dec. 9, 2008. Scheduled to testify before the House Appropriations Committee this week about the need for a congressional bailout plan for states.

Hixson tabbed to chair committee overseeing university system: Janesville Gazette, Dec. 9, 2008. Hixson, who is on unpaid leave from his associate professor position at UW-Whitewater, replaces Rep. Steve Nass, R-Whitewater, a frequent critic of the University of Wisconsin System.

Legislators stick with per diems, despite double-funded days: Milwaukee Journal Sentinel, Dec. 8, 2008. Satisfied with the per diem system, which paid an average of $9,000 to each lawmaker last year.

Doyle would let tax cuts stand: Milwaukee Journal Sentinel, Dec. 5, 2008.  But in light of deficit, he might try to revive estate tax.

Doyle needs to get serious about shortfall (opinion): Madison Capital Times, Dec. 5, 2008. Wisconsin's first priority in addressing the budget shortfall should be to put tax policy on the table.

Biskupic stepping down as U.S. attorney: Milwaukee Journal Sentinel, Dec. 4, 2008. He tackled police, political corruption in his six years.

State budget deficit will require cuts and tax hikes: La Crosse Tribune, Dec. 4, 2008. It’s tough to increase taxes during a recession. But the size of the deficit will require significant budget cuts as well as strategic tax increases.

Wisconsin cuts Social Security tax: La Crosse Tribune, Dec. 3, 2008. Lawmakers from both parties agreed in the 2005 budget to phase out taxes on Social Security income, and Gov. Jim Doyle used his partial veto power to speed up the relief, eliminating them altogether in tax year 2008.

Even With A Bailout, State Will Need To Cut: Wisconsin State Journal, Dec. 3, 2008. Wisconsin will face very deep and painful budget cuts, said Doyle, who, along with other governors, met with President-elect Barack Obama in Philadelphia.

'Issue Ads' To Get New Scrutiny: Wisconsin State Journal, Dec. 1, 2008. Campaign Finance Reform To Move Up On Legislature's Agenda.