The Wisconsin biennial budget deficit is expected to drop further into the red than first expected, Gov. Jim Doyle announced Tuesday.
Now expecting a $5 billion shortfall over the next two and a half years — up from the $3 billion estimation made Oct. 15 — Doyle said the national economical recession and a decline in state tax revenues are to blame.
“The announcement is based on the effects of the national economy, on the state’s fiscal situation,” Doyle spokesperson Lee Sensenbrenner said. “Gov. Doyle is making this announcement because three weeks ago, he warned the state — due to the national economy — is facing a gap of over $3 billion. Now it’s clear that that figure is $5 billion or more.”
Doyle said he was committed to not raise sales or income taxes to make up the shortfall, but Sensenbrenner said Doyle is “not putting anything off the table, and there’s going to have to be cuts everywhere.”
Sensenbrenner said the University of Wisconsin System will likely see cuts as a result of the deficit, but added safeguarding of education is one of Doyle’s top priorities.
“We’ve gone through very tough times, and we’ve protected our priorities,” Sensenbrenner said. “We don’t want to get through this recession in a way that leaves us further behind when we’re out of it.”
State Rep. Terese Berceau, D-Madison, said legislators must be sensitive not only to rising tuition costs when deciding what budget items to cut, but also students’ ability to get good loan rates “when getting an education from the University of Wisconsin is one of the best things a person can do to get a good job right now.”
“There are no questions this is going to be a challenging budget, and the Democrats will be more support for the university than the Republicans have been,” Berceau said.
If raising tuition is inevitable, Berceau said student access to low interest loans and grants should also increase.
State Rep. Scott Suder, R-Abbotsford, said he believed the deficit would affect all state agencies, including the UW System, but believed the state universities will be treated fairly.
“I would recommend that the UW executives and regents not overreach and demand huge increases because with a $3 to 5 billion deficit, we just do not have the money,” Suder said. “They must realize there’s going to be some pain involved in this budget process, and every agency will be included in that pain.”
Suder said he was skeptical that Doyle would not completely take a sales tax increase off the table and said he believed in creating more jobs to make sure the government is helping — not stifling — small businesses.
Todd Berry, president of the Wisconsin Taxpayers Alliance, said he questioned the timing and motives behind Tuesday’s budget announcement, especially because Democrats recently took control of the state Assembly.
“If they’re going to have to do something politically painful … they will want to do it quickly and with one big move because then the pain will be administered,” Berry said. “They’ll have two years before the next election to either make people forget it, undo it or in some way compensate for it.”
