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Court shuts lid on cookie jar
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Recent Legislators at Work
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July 28, 2010 | 07:29 AM
Recently, the Wisconsin Supreme Court ruled an action by the Doyle Administration to raid $200 million from the Injured Patients and Families Compensation Fund to help balance the state budget was unconstitutional and a taking of private property without just compensation. Under the ruling, the state will be ordered to repay the money, plus lost earnings and interest. The Governor orchestrated this raid In the 2007-09 state budget, which was eventually approved by the Legislature. However, each of my Senate Republican colleagues and I voted against the budget and the raid, warning of this outcome.
The Patients Compensation Fund was established in 1975 to minimize the impact of lawsuit-related insurance costs. Physicians, hospitals, and other health care professionals pay into the fund in order to keep the cost of malpractice insurance in check, as well as assist in the payment of medical malpractice claims. A study by the nonpartisan Legislative Audit Bureau found the multimillion dollar raid could create a deficit in the account and result in significant increases in medical liability insurance premiums, adding to the cost of medical care. According to the Wisconsin Medical Society, which initiated the legal challenge, fees charged to doctors increased 9.9 percent last year.
While this is one example of a raid of a segregated fund, it is only one of many such accounts that have been pilfered in recent budgets and used for unrelated state expenditures. Perhaps the most egregious to date is the $1.3 billion taken from the Transportation Fund and shifted to the General Fund. That raid has resulted in higher vehicle registration and license fees for Wisconsin motorists, and of course, a huge deficit in funding transportation projects.
The Recycling Fund has also been raided in the last four budgets and used for programs which have no correlation to recycling. The money collected from solid waste disposal fees supports recycling grants across the state. However, more than $112 million of those dollars have been stolen, and in order to replenish the fund, the governor simply increased the tipping fee — or garbage tax — on Wisconsin businesses. The result is less money for local communities to pay for their recycling programs, and more burdens for local property taxpayers.
Some communities, including Waukesha County, have taken steps to voice their concerns over such raids and will offer an advisory referendum on the November ballot urging the Legislature to ban transportation fund transfers for general government spending through the adoption and ratification of a constitutional amendment. Those local units of government recognize the continued negative impacts on their streets and roads by such actions and are frustrated that the once thought to be protected account has become nothing more than a slush fund for big government spending. The kicker is that all of the taxes and fees collected to pay for transportation costs continue to rise in order to cover both the current spending commitments they were meant for, as well as the new expenses outside of the transportation budget.
I applaud the decision by the court to finally close the lid on one cookie jar, and hopefully it will send a message that all others are off limits. The state finances remain in peril and the next governor and Legislature will begin their respective terms in office with yet another multibillion dollar deficit. The court's decision affirms that no more games or gimmicks may be used to balance the state budget. We can no longer take money that is not ours, nor spend money we do not have.
Kedzie can be reached in Madison at P.O. Box 7882, Madison, WI 53707-7882, or by calling toll-free (800) 578-1457. He may be reached in the district at (262) 742-2025 or on-line at www.senatorkedzie.com.
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