Progressive Thinking

Senator Smith looks back at the bipartisan achievements of 2023 and the hope for continued collaboration in the New Year. Have a happy holidays!

BRUNSWICK, WI - While this is the time of year for reflection, it’s also a time when we should look forward. Families may have celebrated weddings, births and other life changing events – these are the hallmarks of our past year. In the political sphere, headlines usually focus on events that are not so positive. Constructive bipartisan accomplishments are worth commemorating and remembering as we start the New Year.

Wisconsin has a biennial legislative session, so in the odd-numbered year, the legislature and governor go right to work on the next biennial budget. Certainly many of us would have liked a final budget that reflected priorities Governor Evers had placed in his proposal. But, like each budget presented by the governor since winning his election in 2018, the Republican-led Joint Committee on Finance rejected it and crafted their own version.

Trashing the Governor’s budget wasn’t the best way to start bipartisanship this year, however, both Democrats and Republicans got the job done for UW-Eau Claire’s Science and Health Sciences building. That’s huge for the UWEC, the Eau Claire community, the Chippewa Valley region and our state. It’s an investment we can truly tout as a positive, bipartisan accomplishment. I hope you can be as excited as I am to see how the unique partnership between Mayo Clinic and UWEC plays out for our region being a leader in rural healthcare.

For decades towns, villages and cities saw their share of state revenue declining. Revenue limits made it impossible for communities to keep up with inflation. Year after year, it became harder for local governments to meet the needs and expectations of their citizens. During the 2022 campaign, incumbents and challengers alike promised that shared revenue would be a top priority. We all know how campaign promises don’t always pan out, but this bipartisan effort to fix shared revenue became real in 2023. In fact, the shared revenue bill was finished before the budget. This bipartisan achievement will pay dividends for our local communities for years to come.

A real headline grabber was state funding to upgrade the Brewers stadium. It captured the attention and imagination of the press and public. Opinions were all over the place about why public money should go toward a professional sports stadium. The state of Wisconsin is the owner and landlord of the property, and we have the responsibility to maintain it. I’m proud of the fact that, when the bill came to the Senate, we were able to foster a bipartisan partnership to protect our state’s interests, fulfill our obligations and keep the Brewers in Wisconsin. On top of it all, we found a way to direct more resources to communities in every corner of Wisconsin and up the contribution by the Brewers to fund the final deal.

Another bipartisan effort to highlight that will pay off for rural Wisconsin was the creation of the Agricultural Road Improvement Program. This program offers a one-time $150 million investment to fix and upgrade deteriorating infrastructure to benefit agriculture. Keeping agricultural goods flowing through Wisconsin benefits everyone in our state.

Before we broke for the holidays, Republicans and Democrats teamed up again to modernize Wisconsin’s alcohol regulations. This overhaul legislation makes many changes to Wisconsin current alcohol regulations and creates a new state office to implement and oversee them. Some of the beneficial changes are allowing wineries to stay open as long as bars and local brewers can now sell out-of-state beer and own off-site locations. This bill was good for enhancing oversight while also creating new opportunities for our local wineries and craft brewers.

Democrats and Republicans may fight like cats and dogs at times, but when we work together, we can accomplish great things. Here’s to hoping 2023 was the bipartisan bedrock we can build on moving into 2024.

Senator Smith represents District 31 in the Wisconsin State Senate. The 31st Senate District includes all of Buffalo, Pepin and Trempealeau counties and portions of Pierce, Dunn, Eau Claire, Jackson and St. Croix counties.

MADISON - “What’s happening to the UW reserve money?” the woman asked. She was concerned about criticism of the University of Wisconsin. “It seems like they want to attack the UW,” she told attendees at the Mondovi Town Hall Meeting.

A recent memo from the Legislative Audit Bureau (LAB) and the Legislative Fiscal Bureau (LFB) revealed nearly a billion dollars in what appeared to be reserve funds carried over from the last budget year.

Legislative leaders reacted by calling for a freeze on UW tuition. Other lawmakers want to cancel the promised $181 million increase to the UW. University officials cautioned most of the money was obligated to student financial aid or support of high demand programs like business and engineering. They say unrestricted does not mean uncommitted.

Nothing was clear except the UW’s so-called “unrestricted net assets” took a big increase in the past few years.

LAB reported in January the sizable growth of UW unrestricted net assets – or dollars not restricted by the funding source. Auditors reported UW unrestricted assets at $860.2 million. These assets increased by $624.9 million over five years.

The discovery of a large sum of unrestricted net assets comes on the heels of sustained tuition increases. It also comes at a time when the Legislature gave the UW new freedoms in how to spend money.

In recent years, as state funding to the UW dropped, university officials asked for and were granted new authorities. Changes in the last budget made funds formerly directed for a specific purpose into a flexible block grant; to allow the UW to spend as it saw fit while honoring the needs of all campuses.

New authorities granted in the last budget allowed the UW to set its own travel policies. Beginning this summer the state gave the university system contracting authority for supplies and materials unique to the UW, and the UW Madison was to develop a new system-wide personnel system.

This decision was made after many problems and much expense with the last personnel system. Even with recognition of the system’s problems, officials failed to stop recent overpayment of the health insurance and retirement of some employees. This discovery led the Joint Committee on Audit to approve an investigation of the UW personnel system as its first audit of 2013.

The discovery of large sums in reserve fractured the trust building between the UW and the Legislature. Sharp words and threats came from leaders when details about the exact purpose for which the money was set aside were hard to find.

My legislative colleagues on both sides of the aisle called for a freeze in tuition. Some said planned UW budget increases should be scrapped.

The surprise in the Legislature over the discovery of these dollars may reflect the general obscurity of the financial matters of the state and not any attempt by the UW to conceal cash.

Across the country, as in Wisconsin, legislators turn to the Comprehensive Annual Financial Report (CAFR) to learn of the state’s fiscal health. Hoping to find cash to balance the budget, legislators identify what appear to be cash balances.

But few state reports are as opaque as the CAFR. Auditors examine finances according to governmental accounting standards. While this method may assist bonding agencies in comparing risk, it does not provide legislators with necessary detailed financial and management information. So in Michigan, California and Wisconsin lawmakers seek funds the universities say are already committed.

Exactly what money is in reserve and what money is already committed is unclear.

This is why my Audit Committee colleagues and I recently directed the Legislative Audit Bureau to review the dollars and their oversight.

It is right for us to ask questions and we know the questions to audit: are the unrestricted net assets commitments or reserves? They can’t be both. What is the appropriate level of reserves necessary for a $5.5 billion operation like UW? What oversight do system officials provide and is this oversight adequate?

My legislative colleagues should slow their rush to judgment until auditors complete their investigation. It’s always better to make decisions based on facts.