As Dems Claim “Fiscal Doom!” Budget Numbers Say Otherwise
Make no mistake about it, the recently passed Wisconsin state budget will be a campaign issue during next year’s gubernatorial election. The only question that remains is which narrative will prevail; the one of “Doom and Gloom” being pushed by state Democrats, or will the numbers speak for themselves?
If you believe the words of the state Democratic Party, you’d think Wisconsin was a wasteland. To them, the state is a land of fiscal mismanagement, underfunded priorities, and all around bad things. They say as much in their response to Wednesday’s unofficial announcement video by Governor Scott Walker saying there’s ‘More to be done.” Confirming long-standing speculation and rumors that he’ll be seeking a third term.
“If Scott Walker released an honest video on his track record in Wisconsin, it would show his refusal to expand health care to all Wisconsinites, his rejecting federal money to improve broadband in rural Wisconsin, his wounding cuts to our public schools and his singular pursuit of serving the ultra-wealthy around the country over the majority of middle-class Wisconsin residents. Proof is in his tax giveaways to the rich, his extravagant credit-card state borrowing and his complete failure on his very own job-creation promises that were the centerpiece of his first campaign.”
As for the state’s fiscal status, the numbers appear to be speaking for themselves. On Monday, new tax revenue figures were released by the Wisconsin Department of Revenue. According to the agency, the state ended fiscal year 2017 with a $579 million dollar surplus – a figure which was $126 million above initial estimates.
Wisconsin’s budget finished the fiscal year that ended June 30 with a $579 million surplus, $126 million more than expected and the fourth-largest surplus of the past two decades.
The amount was higher than expected mostly because agencies spent about $116 million less than they were authorized to spend.
Tax collections and departmental revenues came in almost level — $4.9 million more than projections that were made when the 2015-17 budget was approved two years ago, an indication that economic growth has held steady since then.
The surplus was the second-highest since Gov. Scott Walker was elected, with the highest coming in 2013 at $760 million.
Beyond the surplus news, the state also received other good financial news as well as its bond rating was increased.
In a release from the governor’s office, they announced that the Kroll Bond Rating Agency (KBRA) upgraded Wisconsin’s long-term bond rating from AA to AA+.
Governor Scott Walker today announced Kroll Bond Rating Agency (KBRA) upgraded Wisconsin’s long-term rating to AA+ from AA. KBRA cited sound budgeting, holding the line on taxes, greater investments in education and transportation, and economic growth in issuing the upgrade to the state’s general obligation bonds.
“We are focused on being good stewards of taxpayer dollars, and this upgrade is yet another confirmation that our reforms are working for Wisconsin,” Governor Walker said. “We proved you can budget responsibly and make strong investments in priorities like education and infrastructure, while holding the line on taxes. We are working and winning for Wisconsin.”
In its own statement, KBRA stated they were actually upgrading two bonds Wisconsin issues; the state’s general obligation (GO) bonds as well as its “Master Lease Certificates of Participation (COPs). The upgraded ratings could allow Wisconsin to offer a future issuance of debt at a lower interest rate; lessen the burden on taxpayers for such an undertaking.
This marks the second upgraded rating for Wisconsin’s GO bonds in 2017. In August, Moody’s upgraded them from Aa2 to Aa1. One step below the coveted AAA rating, making them a great choice for those who invest in municipal bonds.
But these weren’t the only upgrades Wisconsin had towards its bond rating. Late on Thursday afternoon, Walker’s office announced bond upgrade. This time from Fitch Ratings.
Governor Scott Walker announced today that Fitch Ratings upgraded Wisconsin’s bond rating to “AA+” from “AA.” The announcement comes on the heels of yesterday’s news that Kroll Bond Rating Agency also upgraded the state’s bond rating to “AA+.”
“This is now the second agency in as many days to upgrade Wisconsin’s outlook, and it shows our reforms are working for Wisconsin,” Governor Walker said. “We proved you can budget responsibly and make strong investments in priorities like education and infrastructure while holding the line on taxes.”
Like the statement from KBRA, Fitch commented on how the state has stopped its reliance on one-time fixes and how the reforms passed early in Walker’s tenure helped stabilize the state’s finances.
“The state’s fiscal performance was historically challenged by structural imbalances and a reliance on one-time resources to cover budgetary needs. The fiscal 2011-2013 budget marked a turning point, with extensive structural budget actions and the resolution of several lingering fiscal challenges.”
So going forward, Wisconsin voters will have to choose between the rhetoric or the numbers when it comes to the state’s actual fiscal picture. So far, the numbers aren’t lying.
(Post updated on October 20 to reflect the additional news regarding the upgrade from Fitch Ratings.)