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Madison – Today Governor Walker’s office released a detailed breakdown of the current fiscal crisis facing the State of Wisconsin.

The new budget breakdown released today was prepared by the State Budget Office and is based on the recently released revenue estimates, an analysis done by non-partisan fiscal experts (Legislative Fiscal Bureau), appropriation shortfalls in the current fiscal year, and state agency budget requests.

The State of Wisconsin is facing a $136.7 million deficit for fiscal year 2010-2011 (FY11).  Specifically, the FY 11 deficit is caused by:

FY 2010-11 General Fund Balance $67.4 Million

Lapses from accounts with balance deficits as identified by Legislative Audit Bureau’s report of January 20, 2011 ($45.3 Million)

Reduction in Estimated Tax Collections                                   

($12.9 Million)

Increase in Department Revenues                                          

$20.7 Million

Reduction in Expenditures due to reduction in debt service               

$69.6 Million

Higher than expected Appropriation Lapses                                

$21.9 Million

FY 2010-11 Adjusted General Fund Balance                                 

$121.4 Million

Tax Reciprocity Bill owed to the State of Minnesota

($58.7 Million)                               

(Daily Interest associated with reciprocity bill is $4,584.)

Deficit in Medical Assistance Programs to fulfill spending requirements under current law ($153.2 Million)

Deficit in Medical Assistance admin services ($16 Million)

Deficit in Income Maintenance Activities ($5 Million)

Deficit in State Public Defenders Office ($3.5 Million)

Deficit in Department of Corrections ($21.7 Million)

Fiscal Year 2010-11 Deficit ($136.7 Million)

Also looming is a required $200 million payment owed to the Injured Patients and Families Compensation Fund.

In addition to the FY10-11 shortfall the next budget is currently facing a $3.6 billion deficit when working from agency budget requests.  This deficit is caused by:

  • $2.9 billion in agency expenditure requests which are projected to exceed revenue—nearly two-thirds going to Medicaid
  • $500 million in federal Medicaid money which the state will most likely not receive
  • $800 million of DOA ordered lapses that were built into the DOA request, which artificially lower the deficit

Along with this new budget analysis Governor Walker’s spokesman, Cullen Werwie, released the following statement:

Bill collectors are waiting at the door of the State Capitol. 

Without taking action to reduce the deficit in the current fiscal year, thousands of Wisconsin children and families could lose their health care coverage through BadgerCare, and there would need to be even more aggressive spending cuts in the future.

Repairing the current budget will send a clear message to employers that the state is serious about getting its fiscal house in order, which is key to growing jobs, reviving our economy, and making sure the world’s job creators know Wisconsin is open for business.                                                                                                      

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