WEDA: State Budget Bill Update
The Legislature’s Joint Finance Committee (JFC) yesterday finished their work on reshaping Gov. Tony Evers’ 2021-23 state budget proposal.
While the Finance Committee finished their work on time, it was a challenging budget process with numerous moving pieces, including split government, billions of dollars in federal COVID-19 relief aid, and a projected $4.4 billion state budget surplus.
The budget bill must still be approved by the full Legislature and signed into law by Evers, who could also veto the legislation in part or in whole. However, both houses of the Legislature are likely to adopt the budget approved by JFC with minimal changes.
In addition to $3.4 billion in tax cuts that would create a more favorable tax environment in Wisconsin, the budget bill approved by the JFC includes the following provisions of interest to WEDA and economic development:
- Requires the Wisconsin Economic Development Corporation (WEDC) to expend $3 million over the two-year budget cycle for talent attraction and retention initiatives. Talent attraction funding was a top WEDA budget priority.
- Provides an additional $129 million for the state’s broadband expansion grant program. This funding would be on top of $100 million in American Rescue Plan Act (ARPA) funding Gov. Evers already committed to broadband expansion. Broadband expansion funding was a top WEDA budget priority.
- Provides $1 million a year in additional funding for the Youth Apprenticeship Grant Program and increases the maximum grant award from $900 to $1,100 for each youth apprentice served by the program.
TAX CUT PACKAGE HIGHLIGHTS:
The $3.4 billion dollar tax cut package approved by the Joint Finance Committee includes the following provisions:
- Almost $2.4 billion to reduce the state’s third tax bracket from 6.27 percent to 5.3 percent.
- Over $20 million to exempt active-duty military pay from state taxes.
- Nearly $10 million to create a nonrefundable state individual income tax credit for child and dependent care expenses.
- $11.5 million to increase from 10% to 15% the refundable portion of the research and development tax credit.
- $202.4 million to support repeal of the personal property tax on business equipment.