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Priscilla Thain, Newsletter Editor
A legislative session that was extended from March to May, ended with a dramatic vote to kill a sixth version of "Taxpayer Protection Amendment" (TPA) in the Senate. The Assembly had previously passed the proposal on a 50 to 48 vote. Assembly Joint Resolution (AJR) 77 would have put limits on the revenue (state taxes) that the state and local government are able to collect. In the original version, the formula controlling the revenue would be tied to the Consumer Price Index (CPI). In each version, the limits were changed. In the 6th version, state spending was limited, not to the CPI, but to 90 percent of the 3-year rolling average of the growth in personal income, as determined by the federal government. PROFS is part of an anti-TPA coalition "Partners 4 Wisconsin" which lobbied heavily against all versions.
Professor Reschovsky's TPA Analysis Influenced the Outcome
A UW-Madison faculty member played a key role in the debate over the TPA. Professor Andrew Reschovsky (Ag & Applied Economics and the LaFollette Institute) issued an analysis showing, among other things, how the initial version would have seriously limited state support of the UW if it had been in place from 1985 to 2005.
Reschovsky pointed out that the CPI is based on a market basket of goods and service purchased by the typical household. Governments purchase a very different basket of goods and services, he said. "They pay for the services of highly-skilled labor such as police officers, teachers, and doctors. If the costs of providing public services continue to grow faster than the inflation and population growth rates, the impact of the amendment would be to continuously reduce the level of services provided to the residents."
Regent President David Walsh spoke up vehemently in the Legislature before the vote and the Board of Regents issued a statement saying, among other things, that the TPA would harm the UW and cause it to shrink because mandated, formula driven, or entitlement programs would receive funding first. This bill followed the defeat of the Taxpayer Bill of Rights (TABOR) that would have put limits on state spending. Versions of these bills may come back another year.
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