With personal property tax cut and paper mill vetoes, Evers tells lawmakers to try again

On the same day that he signed the state’s 2021-2023 budget, Gov. Tony Evers vetoed a separate bill Thursday that was tied to the state spending plan.

Evers rejected the state Legislature’s bid to end what is left of the personal property tax, a business tax that has already been whittled away by a series of exemptions. The governor said he could support the bill’s overall objective. But in his veto message he scorned the “unusual and haphazard process by which the Legislature pursued the repeal of the personal property tax.”

The result, he stated, produced “potential unintended consequences” that would affect Wisconsin’s utility and railroad taxes, potentially costing the state “tens of millions” in general fund tax revenue from those other sources.

He also criticized the state budget writers in the Legislature for their handling of $202 million that was set aside to compensate municipalities for the money lost with the personal property tax repeal. The Republican majority on the Legislature’s Joint Finance Committee put the funds in the budget’s supplemental appropriation, rather than designating it directly in the budget.

Evers in his veto message criticized that as “an unusual arrangement that is at odds with prior exemptions of personal property and such compensating aid.”

The governor left open the possibility that the repeal of the tax could still be enacted, noting that the compensation funds remain in the budget, and urging the Legislature to pass a revised bill that “comprehensively addresses the unintended impacts” of the legislation and addresses directly the need for local government aid to offset the repeal.

In a separate veto, Evers rejected a bill that would have directed $65 million from the state’s allotment under the American Rescue Plan Act (ARPA) to help finance a new cooperative venture to acquire paper mills in Wisconsin Rapids and Park Falls.

Evers said he supported the concept but that it should be funded through the state’s general fund, and that he was concerned that the federal government would reject applying ARPA funds to the project.

Alluding to his use of the partial veto to build the state’s unappropriated general fund to $1 billion, Evers wrote, “Following my action on the state budget, there is ample state funding for this and other priorities of the state.”