The proposed cuts in Gov. Scott McCallum’s budget deficit plan have the potential to affect power plant construction and upkeep throughout the state because of cuts to shared revenue.

Under the current system, shared revenue provides financial assistance to local governments with power plants. Power plants pay taxes based on their revenues and the money is distributed among more than 1,000 communities.

Shared revenue is the only source of income communities receive for housing power plants in their area. Eliminating this incentive may affect cities’ willingnesses to host power plants.

Rep. Dan Schoof, D- Beloit, said he feels strongly that the proposal is not in the best interests of the state.

“I think that it is a sudden and amazing lack of leadership by the governor,” Schoof said. “We have to make sure that we have adequate [energy sources] for our economy. It will delay the [placement] of power plants.”

McCallum’s budget deficit proposal would eliminate $350 million of state aid each year for the next two years. Shared revenue would be completely phased out by 2004.

McCallum’s proposal is designed to help diminish some of the state’s $1.1 billion debt. He has received support from many groups for attempting to diminish the budget deficit. However, supporters of shared revenue fear the proposal will do greater damage than good.

Rep. Steve Kestell, R-Elkhart Lake, said he feels the proposal will be adjusted.

“That is one area of the budget that needs work,” he said. “It does not make any sense to create a disincentive. Most people realize that we need to [work on it].”

Kestell, who represents an area hosting a power plant, said he feels some sort of middle ground exists.

“I am certain that a compromise will be found,” he said. “We are still in the early stages of the budgetary process.”