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With record referendum spending possible in 2018, regulatory fight brewing

With a prominent Wisconsin lawmaker irked that a record could be set for approvals of school projects this year, a lobbying group has emerged to block legislation that could upend the state’s school-referendum system.

Former Wisconsin Assembly Speaker John Gard has registered as a lobbyist for an organization called the Wisconsin Construction Group, which advocates for “school construction and school referendums.” Gard filed a disclosure form with the Wisconsin Ethics Commission on Thursday — one day after a Wisconsin Policy Forum report found that state voters will have the opportunity in November to approve a record $2 billion worth of school referendum spending this year.

The prospect that a record could be set has irked Wisconsin Sen. Duey Stroebel, R-Saukville, who has promised to again pursue legislation that would curtail the use of school referendums. Stroebel has also criticized construction companies for offering so-called pre-referendum services to help school districts win voters’ approval for spending proposals.

In an interview Tuesday, Gard pushed back against Stroebel’s previous statements about pre-referendum services. He said school districts rarely if ever have construction professionals on staff and often need outside help from general contractors, architects and other firms to gain an accurate understanding of what a once-in-a-generation building project is likely to entail.

“Unlike the state and other levels of local government, these districts do not have engineers on staff. It’s not something that they do,” Gard said. “We believe that the school referendum situation is very unique, and we want to make sure people understand the full array of things that have to be considered by a district. If you’re a small- to medium-sized district, and you haven’t had a building project in 30 to 40 years, your people are focused on educating students.”

Gard’s other clients in the construction industry have included Neenah-based Miron Construction, the International Union of Operating Engineers Local 139 and Green Bay-Based Foth & Van Dyke. He is also listed as the registered agent for the new Wisconsin Construction Group, which filed incorporation papers with the Wisconsin Department of Financial Institutions on Sept. 24.

This brewing debate surrounding school referendum spending comes on the heels of a Wisconsin Policy Forum report last week showing that referendums tend to be approved more often in economic boom times and are being passed at increasingly higher rates in Wisconsin.

In 2016, for instance, 79 percent of all the proposals that were put before voters were given the go-ahead. The amount approved, $1.7 billion, remains the record.

Now, if the 61 referendums on Wisconsin ballots pass this November, schools would set a new record — embarking on $1.4 billion worth of spending in a single election. That would come on top of the $648.1 million worth of spending voters approved in the spring.

The increasing use of school referendums follows on a shift in public opinion. A Marquette University Law School Poll in August found that 61 percent of the respondents to that survey favored increasing school spending, and 31 percent favored reducing taxes instead. That was a change from 2013, when 49 percent of the respondents to a similar poll said they’d prefer lower taxes and 46 percent said they’d like to see more school spending.

The state’s caps on schools’ and local governments’ ability to raise tax revenue, which were passed in the mid-’90s, are a big part of the reason why school districts have come to rely more and more on referendums.

Gard said school referendums help ensure control over school budgets remains with local officials and residents. Existing rules, he said, “appropriately” limit how often school districts can put questions directly to voters.

“I think anybody who disrespects the outcome of the electorate is not paying attention,” Gard said. “I would say, it’s not like at the end of the day people don’t put a high value on education. They appreciate being asked through referendum, and if a local district can make the case, they are voting yes.”

In a statement released on Tuesday, Stroebel deemed Wisconsin’s current system for school projects uncompetitive. He noted that school districts, unlike most other forms of government, are not required to bid out their projects, even those whose cost runs into millions of dollars.

A proposal Stroebel sponsored in the most recent legislative session, Senate Bill 236, would have required school districts to bid out such projects. The bill passed the Wisconsin Senate but failed in the Assembly. Stroebel blamed lobbyists “who don’t want transparency.”

“I am not surprised Mr. Gard is involved as he has been one of the go to lobbyists for anyone opposing reform in the construction industry in recent years at the expense of the taxpayer,” Stroebel said. “There is nothing inherently wrong with a school district seeking technical expertise from a company, but the way construction companies advertise their services shows the real world unspoken understanding.  ‘You give me the contract. I’ll help pass your referendum’.  The question should be, will you deliver the best building at the best price?”

Editor’s note: This story has been corrected to state that $1.7 billion worth of referendum spending was approved in 2016, not $1.35 billion. We regret the error.

About Nate Beck, nbeck@dailyreporter.com

Nate Beck is The Daily Reporter's construction staff writer. He can be reached at (414) 225-1814 (office) or 414-388-5635 (mobile).

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