Is Minnesota to blame for the events in Madison? Yesterday, progressive sites and the New York Times began pushing the meme that the Wisconsin budget crisis was being ginned up, but the Milwaukee Journal Sentinel took a look at that claim and far from being staged, the facts show a number of factors leading up to this crisis, including a link to Minnesota:
Opponents are pointing to a Jan. 31 memo by the Legislature’s nonpartisan budget shop that says that the state will finish this fiscal year with $121.4 million in its main account.
But there’s more to the memo. The budget surplus will only happen if the state keeps its spending in line with what has been budgeted.
But the memo lays out about $258 million in spending by the state that is projected to go over budget. That’s in several areas, including health care spending for the poor, prisons and a payment due to Minnesota in December after the canceling of an income tax agreement between the two states.
Bob Collins points out that MPR reported on this tax agreement last month, and that Wisconsin owes Minnesota $58 million:
For 40 years, Minnesota and Wisconsin allowed for reciprocity so people who live in one state but work in another didn’t have to file tax returns in each state. Gov. Pawlenty ended the agreement in 2009 because he wanted Wisconsin to speed up payments to Minnesota. He was banking on the funds to help balance the state’s budget. His decision to end the reciprocity agreement meant Minnesota was set to gain as much as $131 million from Wisconsin in the current budget cycle.
I’m not surprised progressives would level such a distortion against their political opponents, but to see a news source of supposed high repute such as the NYT promote it is disturbing. However, it is likewise comforting to know other news sources like MPR and the Milwaukee Journal Sentinel are more keen to verify their content.
Update: It’s also important to note that Wisconsin works on a biennial budget, so a fiscal year surplus means little without the context of the additional year comprising the biennial cycle.