In advance of Tuesday’s special session on agriculture that Gov. Tony Evers called for in January, Republican lawmakers on Monday offered five bills and threw out six of the eight measures Evers proposed.
Of the two remaining measures, they subjected one to sweeping modification.
Where Evers, in his Special Session AB-6, proposed two new positions at the Department of Agriculture, Trade and Consumer Protection (DATCP) and $1 million immediately for the department to work with the dairy industry to boost dairy exports, Assembly GOP leaders are calling for spending five times as much — but not until the next budget cycle.
A substitute amendment that the Republicans introduced on Monday would rewrite the Evers bill entirely to require the agriculture department to team up with the Wisconsin Economic Development Commission (WEDC) in the export-promotion effort, and to promote not just the dairy industry but meat and crop exports as well. The GOP version would spend $5 million, but not until the 2021-2023 budget.
The GOP version also changes the goals and timeline. Evers’ bill set a deadline of 2024 to boost the state’s milk exports to 20% of the U.S. milk supply. The Republican substitute moved the deadline back to 2026, but also calls on DATCP and WEDC to increase meat and crop exports in the same time period and to fund all three objectives equally.
Pushing back deadlines was not the action Republicans originally said they intended. At a news conference last week announcing the bills, Speaker Robin Vos (R-Rochester) stressed the point that Evers bills were fine, but did not take action immediately, labeling “primarily long-term” and saying agriculture” just felt it was not really anything that would be a substantial benefit in the short term to farmers. And Wisconsin farmers need help now.”
The only other Evers bill to make it onto the Assembly agenda is Special Session AB-7. That measure adds $600,000 to an existing program of promotional grants DATCP makes to dairy processing plants, and would require the department to favor small plants for the program.
A GOP amendment would cap eligibility for the program to processors of less than 50 million pounds of processed products a year. With that ceiling, it would include all but about a dozen dairy processing plants in the state, DATCP officials estimate.
Approaches show contrast
But where Evers’ other bills focused on adding positions and funding to the agriculture department for services and guidance to farmers, the Republicans offered two tax-cutting bills, two bills assigning homework to the University of Wisconsin, and one already in the legislature but that they have now tacked onto the special session package.
Wisconsin is losing two dairy farms a day and lost a total of 800 last year, said state Rep. Travis Tranel (R-Cuba City). “Our farmers are feeling pain and they need help right now,” Tranel said.
Evers’ original proposals carried a total price tag of about $8.5 million, although Legislative Fiscal Bureau estimates have not yet been produced.
Fiscal estimates for all but one of the GOP bills were not expected until Tuesday morning, when the Assembly Agriculture Committee will be up almost as early as the chickens for an 8:30 AM public hearing. But besides the $5 million in future spending, it includes a provision that could cut state tax revenue by $9 million.
“We know that our plan is going to be much bigger and bolder than the governor’s suggestions to us, but we’re still waiting for those final dollars, which we’re hoping that we’ll have with the public hearings this week,” state Rep. Tyler August (R-Lake Geneva) told reporters.
Introducing the Republicans alternatives, August said that the caucus “built on some of his proposals, but some of his proposals do take us in the wrong direction, with simply just adding a bunch of government employees.”
Focus on taxes
The two tax-cut bills in the Republican package are a special tax credit for farm buildings and an expansion of a tax offset for self-employed people who buy their own health insurance. AB-873 creates a tax credit, worth up to $7,500, for about two-thirds of the tax levied on farm buildings and other improvements. To qualify, farmers must have at least $35,000 in annual gross income from farming.
The credit is refundable: recipients who qualify for a larger credit than their tax bill would be paid the difference
“The reality is, for most farmers in the state of Wisconsin, their number one issue is cash flow and this would probably be the most direct benefit that they would see out of the package,” said Tranel, who operates a family dairy farm.
The tax credit would end in three years, “hoping by then the ag economy will have turned around,” Tranel said. A fiscal estimate was not available Monday.
AB-875 would effectively raise the limit on how much self-employed people can cut their income tax bill to offset what they pay for medical insurance.
The current limit is the taxpayer’s net earnings from a taxable business. The bill would expand it to include wages, salary, tips, unearned income and net earnings from the business.
State Rep. Amy Loudenbeck (R-Clinton) said that, for people such as farmers who combine self-employment with another job, their self-employment income may be less than the annual cost of their medical insurance. Allowing them to include all other earnings in calculating the limit would allow them to take the full cost of the insurance off their taxes.
“It’s a way we can make health insurance affordable,” Loudenbeck said.
A fiscal estimate wasn’t available Monday, but Loudenbeck said early calculations had put the cost at about $9 million.
Calling on the UW
Neither of the two Assembly Republican bills that assign the UW a role in relieving the farm crisis include funding.
AB-874 requires UW regents to direct a study of the UW System, due in nine months, evaluating funding, staffing, and curriculum for UW agricultural programs; proposed remedies for the financial, technical, and other problems Wisconsin farmers experience; and what other states are doing to support their farming industries.
AB-876, also with a nine-month deadline, requires the UW-Madison to research the development of an agriculture-specific science and technology program, in coordination with agriculture programs at other UW System schools.
The fifth Republican bill, AB-627, was introduced in November, then pulled into the GOP’s farm package this week. It would add $1 million annually in funding for the University of Wisconsin-Madison agriculture school to provide extension services in applied agricultural research. According to a fiscal estimate for the bill it would add about six people.
Evers’ own UW-Extension bill was among those put out to pasture.
Special Session AB-4 calls for creating 20 extension positions, at a cost of $500,000 in the current fiscal year and another $2 million in the 2020-21 fiscal year, to offer farmers research and technical assistance. A fiscal estimate has not yet been provided.
Not on the agenda
Also sidelined were five other Evers bills:
- Special Session AB-1, which would create 3.5 DATCP positions to provide outreach and marketing for the department’s farm center program, which aids distressed farmers, and to help farmers diversify and do succession planning, along with grants for farmers to hire consultants to review their business plans. The bill calls for spending a little more than $400,000 in its first year.
- Special Session AB-3, which calls for spending about $1.2 million a year to add four positions in DATCP, along with grants, for education, technical assistance, and marketing help for farmers to produce “value-added” products, with a focus on organic farming and on grazing. It would include a “farm-to-fork” program to connect farmers with non-school-based cafeterias, similar to the “farm-to-school” program already in operation, and a resource conservation program to help farmers maintain or boost their yields through practices to promote environmental quality.
- Special Session AB-5, which calls for spending $200,000 each this year and next to modify the current farm-to-school program, directing it to give preference for program grants to school districts with a high percentage of students eligible for free or reduced-price lunches.
- Special Session AB-8 would create a $500,000-a-year small farm diversity program at DATCP to award grants of up to $50,000 to existing producers that are expanding production or adding new products or to new start-up agricultural operations. Qualifying farms would have to have an annual cash gross income of at least $35,000 but less than about $525,000.