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Analysis: State faces $505M deficit going into 2017

MADISON, Wis. (AP) – Changes that Republican lawmakers made to Gov. Scott Walker’s executive budget likely would result in a half-billion dollar deficit going into the next two-year spending plan, according to a new analysis.

The nonpartisan Legislative Fiscal Bureau released a review of the 2013-2015 budget that the Legislature’s finance committee passed last week, the Wisconsin State Journal reported.

The analysis found that the state will have a $670 million surplus as of July 1, but that the new budget would create a $505 million shortfall going into the 2015-2017 biennium, assuming state tax revenues and expenditures don’t change. Such a shortfall is commonly referred to as the state’s structural deficit.

Republicans on the finance committee made a host of changes to Walker’s spending package. They nearly doubled an income tax cut, reduced borrowing for building by $250 million, froze University of Wisconsin System tuition, increased money for public schools and transportation, expanded private school vouchers and created a private school tuition tax deduction.

Property taxes on an average $154,800 home would increase $58 over the next two years, compared with $19 in Walker’s original budget, the fiscal bureau’s report said. That’s because the budget would loosen the cap on public school revenue limits by $150 over the next two years.

Assembly Speaker Robin Vos, R-Burlington, expects the full chamber will take up the budget next Tuesday and vote on the package by Wednesday. The Senate could take up it up as early as June 20, a spokeswoman for Senate Majority Leader Scott Fitzgerald, R-Juneau, said.

Vos said Tuesday he hopes neither house will make any changes to the budget before sending it to Walker for his signature. But Republican Sens. Dale Schultz and Rob Cowles both told The Associated Press on Wednesday they believe the structural deficit is too large.

Schultz said he is working on changes to lower the deficit, but he declined to elaborate or say whether he would vote against the budget if the deficit remains unchanged. Cowles left the interview before he could be asked about whether he would vote for the budget if the deficit remains the same. He didn’t immediately respond to a follow-up request for comment left at his Capitol office.

Republicans hold an 18-15 edge in the Senate, and would need either Schultz’s or Cowles’ vote to pass the budget.

Information from: Wisconsin State Journal,

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