Gov. Evers Delivers Fourth State of the State; Calls Special Session on Surplus Spending

Gov. Tony Evers (D) delivered his fourth annual State of the State address on the evening of February 15 before a joint session of the Wisconsin Legislature. The address was delivered in the Assembly Chambers of the Wisconsin Capitol Building. It was the final address of Gov. Evers’ first term as governor; he is seeking reelection this November. The governor’s office has released the full text of his prepared remarks as well as some excerpts.

Gov. Evers began his address by tracing his career and the path he took to the governor’s office, concluding the story by saying that “Tonight, I am proud to be able to report that the state of our state is stronger and better than it was a year ago, or two years ago, or even three years ago.” The governor then reviewed some his administration’s accomplishments since the arrival of COVID-19:

  • “Through federal pandemic aid to our state, we’ve invested $1 billion into supporting our small businesses, farmers, and tourism, lodging, and entertainment industries.”
  • “[W]e were also able to keep all 375 transportation projects during the 2020 construction season on track.”
  • Directed more than $100 million to fund broadband expansion grants.
  • “[A]s a share of the federal aid our state has received, Wisconsin ranked second in the country for aid we’ve directed to economic development, and we ranked first in the country in aid we’ve allocated to businesses.”
  • “At 2.8 percent, we now have the lowest unemployment rate and the fewest number of people unemployed ever in state history,” lower than the 3.1 percent unemployment rate in January 2019, Gov. Evers’ first month in office.
  • “[W]e’ve invested nearly $60 million into 12 regionally-based programs to meet the unique needs of different communities. And, after workers lost their jobs during the pandemic, we invested $20 million into helping thousands of workers get new skills and training to find new jobs.”
  • Signed the 2021-23 state budget including a $2 billion cut to income taxes through changes to the rates, brackets, and sliding scale standard deduction.
  • Updated the individual income tax withholding tables for tax year 2022 onward, meaning that take-home pay for most Wisconsin workers will increase this year.

The core of Gov. Evers’ address concerned his plan for spending some of the state’s projected surplus revenue. As we reported here, the state is expected to end the current fiscal biennium on June 30, 2023 with a $3.8 billion surplus, nearly $2.9 billion more than the most recent projection. Most of this is attributable to large increases in expected sales, income, and corporate tax collections.

On January 27, a few days after issuing a press release acknowledging the new fiscal projections, Gov. Evers announced a proposal to direct about $1.7 billion of the projected surplus towards tax relief and education spending:

  • “Allocate $815.7 million toward a surplus refund of $150 for each Wisconsin resident.”
  • Allocate $102.5 million to “create a nonrefundable caregiver tax credit for qualified expenses incurred by a family caregiver to assist a qualified family member.”
  • Allocate $29.3 million to “increase the newly created Wisconsin nonrefundable credit match on the Child and Dependent Care Credit from 50 percent of the federal credit to 100 percent.”
  • “Invest nearly $611 million in K-12 education.”
  • “Provide $111 million for the University of Wisconsin System.”
  • “Provide $28 million for the Wisconsin Technical College System.”

The proposal has been introduced as Senate Bill 956, authored by Sen. Janet Bewley (D-Mason). A more detailed summary of the legislation can be found here. The governor issued an executive order (and related press release) the day after his address formally calling on the Legislature to meet in a special session to consider his proposal.

The Legislature is expected to quickly end the special session without action. Shortly after the Gov. Evers announced his proposal in January, Republican legislative leaders including Assembly Speaker Robin Vos (R-Rochester) and Senate Majority Leader Devin LeMahieu (R-Oostburg) indicated that they will wait until 2023 to spend any surplus funds. Sen. LeMahieu referred to the proposal as a “reelection gimmick” for the governor and Speaker Vos said he wants to use the money “to do a massive tax cut,” and to “fill in any gaps when federal funding at the governor’s disposal is used up.”

Gov. Evers rounded out his State of the State address by announcing several other initiatives:

  • Provide $20 million in federal ARPA funds to support emergency medical services (EMS), including $12 million in flexible one-time grants to EMS providers and $8 million to supplement the Funding Assistance Program (FAP) for public ambulance service providers. Also, provide $7.4 million in state funds to implement a 16 percent reimbursement rate increase under Medicaid. Press release
  • Provide $20 million in federal ARPA funds for student mental health initiatives, including $15 million to support school-based services for K-12 student and $5 million for the University of Wisconsin System. Press release
  • Provide $5 million in federal ARPA funds to expand mental health services for members of the Wisconsin National Guard. Also, create a Blue Ribbon Commission on Veteran Opportunity “to develop new, innovative initiatives to support the more than 300,000 veterans who live in Wisconsin.” The governor noted that the Guard has contributed to the state’s COVID-19 response by distributing personal protective equipment, supporting the state’s testing and vaccination efforts, and assisting in election administration. Press release

The governor concluded the address by acknowledging the privilege of living in a democratic country that respects the right to vote and the peaceful transfer of power. He called on Wisconsinites “to forget our own prejudices, to make concessions where the greater good demands, and to find common ground wherever and as often as we can.”

Gov. Evers’ previous State of the State addresses

In his address last year, Gov. Evers declared 2021 the “Year of Broadband Access” and discussed redistricting and his proposal to reform the state’s unemployment insurance system. Because of COVID-19, the governor chose to deliver the address virtually via YouTube and Facebook.

Previously, Gov. Evers focused his 2020 address on agricultural policy, redistricting, PFAS, and the so-called “dark stores” loophole. In his first address, the governor declared 2019 the “Year of Clean Drinking Water” and discussed his proposals for education spending and Medicaid expansion.

For more coverage of legislative issues in Wisconsin, see these recent articles: