A representative of Gov. Scott Walker’s office visiting Shawano last week downplayed a Legislative Fiscal Bureau budget projection of a $1.8 billion structural deficit, but local officials are still worried the state might use that projection to hamstring shared revenue.
“The governor came in complaining about this huge structural deficit, in that he was going to tackle it,” Shawano City Administrator Brian Knapp said.
Knapp said the structural deficit was used as an excuse to cut the level of revenue shared with local governments four years ago, and he was concerned the same reasoning would be used again.
“We’ve been hit with that hammer for many years,” Knapp said.
Cindy Polzin, the governor’s senior director of legislative and local affairs, said the fiscal bureau’s budget projection is skewed because it doesn’t include projections of growth.
“If there was no economic growth in the state of Wisconsin, that would be the deficit,” she said. “There always is economic growth.”
Polzin did not have any projections for growth available but said it would “easily wipe out the deficit.”
She called media reports about the structural deficit “political campaign fodder” in an election year. Walker is running for re-election against Democrat Mary Burke in the November election.
The Legislative Fiscal Bureau does not typically include revenue growth in its structural deficit projections, and did not include it four years ago in projecting the structural deficit that Walker campaigned against.
Polzin made her comments Friday during a meeting with city and county officials at City Hall. The meeting was attended by several city officials and staff and several county department heads.
The deficit question aside, local officials still had questions about what to expect in terms of shared revenue.
Polzin said those discussions won’t take place until work on the budget starts in October.
“That’s one of the things we’ll be talking about,” she said. “We haven’t started yet. It’s a big puzzle piece that depends on how everything is going to fit together.”
Knapp said local governments are increasingly reliant on shared revenue, particularly given local levy limits imposed by the state.
Polzin said local governments have the power to exceed the levy limits if they get voter approval.
“If you wanted to, you could run a referendum to go over that levy limit,” she said.
Polzin’s stop in Shawano was the latest in a tour of Wisconsin counties to solicit comments ahead of the state budgeting process.