By Nick Novak
The Legislature had a busy year in 2015, but that doesn’t mean they should head out the door early this year. There are still quite a few ideas that need to be discussed and bills that should be passed — particularly those that would be beneficial to the construction industry.
I’ve outline three items the Legislature should take up before they break for the summer campaign season.
Real vs. personal property
The first comes in the form of Assembly Bill 623 and Senate Bill 503, which were introduced by Rep. John Macco, R-De Pere, and Sen. Howard Marklein, R-Spring Green. In terms of red tape, the issue this bill aims to fix is a big one. Under current law, the sales tax is applied differently to goods and materials used to construct a building.
If a product is determined to be “real property,” the contractor pays the sales tax. If a product is determined to be “personal property,” the building owner pays the sales tax.
This may not sound terribly puzzling until it is revealed what is real property and what is personal property. Typically, anything that is a permanent part of the structure would be considered real property. Anything seen as removable would be considered personal property. Unfortunately, there are countless instances that are anything but typical.
As The Daily Reporter pointed out recently, security cameras count as real property if they monitor an entrance and personal property if they monitor inventory. Electric cables behind a wall are real property, but data cables behind that same wall are personal property. And cabinetry can change designations depending on the type of room it is installed in, even if it is the exact same cabinet.
AB 623 does not fix the problem with designating what is real or personal property — which would be welcomed — but it does expand a law that clarifies who would pay the sales tax. In 2013, Wisconsin changed its tax law so that if less than 10 percent of a building’s purchase price is personal property, and it is being sold for a single lump sum price, the contractor can pay all of the sales tax without having to do a separate sale to the owner.
This legislation would expand that law to apply to all construction projects, not just lump sum sales. With the passage of this bill, the time spent determining who pays for what could instead be spent planning another project and getting more people back to work.
Cutting costs and red tape
Another bill that will reduce red tape and save money is Senate Bill 411, introduced by Sen. Duey Stroebel, R-Saukville, and Rep. Robert Brooks, R-Saukville. This legislation essentially swaps federal money that now pays for local transportation projects with state transportation dollars.
While the construction of local roads and bridges can get costly for taxpayers, this is one more way for counties and municipalities to cut expenses in a way that would not reduce the quality of the work being done. It would simply get government out of the way and allow for more competition among contractors.
As policymakers struggle to find a long-term solution to our transportation needs, this bill would find at least one more efficiency for taxpayers and local governments alike.
Addressing Wisconsin’s skilled worker shortage
One last idea that the Legislature should consider is something that could help get more people into skilled trades. Contractors all across the state are struggling to find skilled workers for the positions they have available. Wisconsin has workers that could fill these jobs, but many may not know about the great opportunities that are available.
A widely untapped group of prospective employees are students who are at two- and four-year University of Wisconsin schools and have decided college isn’t right for them. The Legislature should direct the Department of Workforce Development to reach out to these former students and make them aware of the employment and training opportunities available in the state.
While a four-year college may not have been the right place for a student, any state-approved apprenticeship program may be the perfect fit. This will not instantly solve the worker shortage problem, but it would be a step in the right direction.
It would also fight against the unfortunate notion that, to be successful, someone must graduate from college. That simply isn’t true. There are numerous career paths one can take that prove to be financially and personally rewarding. People just need to know the options that are out there.
In the coming months, legislators will take on many issues. Included should be the ideas mentioned above. They would greatly benefit the construction industry and help get more Wisconsinites back to work.