Required general fund statutory balance
Current statutes contain a rule of proceeding governing legislative action on certain bills. Generally, the rule provides that no bill directly or indirectly affecting general purpose revenues may be adopted if the bill would cause the estimated general fund balance on June 30 of any fiscal year to be less than a certain amount of the total GPR appropriations for that fiscal year. Beginning in fiscal year 2017-18, that amount has been equal to the prior fiscal year’s required statutory balance plus $5,000,000, but not to exceed 2 percent of total GPR appropriations for the fiscal year.
The bill provides that for fiscal year 2023-24 and each fiscal year thereafter, the amount is $600,000,000.
Refunding certain general obligation debt
The bill increases from $9,510,000,000 to $11,235,000,000 the amount of state public debt that may be contracted to refund any unpaid indebtedness used to finance tax-supported or self-amortizing facilities. The unpaid indebtedness includes unpaid premium and interest amounts. Under current law, the Building Commission may not incur public debt for refunding purposes unless the true interest costs to the state can be reduced.
National and community service board appropriation
Current law appropriates moneys received from the federal Corporation for National and Community Service to administer the national and community service program. The bill changes this continuing appropriation from one that is limited to the amounts in the schedule to one that is composed of all moneys received.
State employment
Additional biweekly payroll appropriations
Under current law, there are supplemental appropriations from general purpose revenue, program revenue, and segregated revenue to pay for salary and fringe benefits for permanent state employees, including permanent project employees, on the state’s biweekly payroll system in any fiscal year in which a 27th pay period occurs. The bill clarifies that the supplemental appropriations for salary and fringe benefits include permanent UW System employees, including permanent project employees, on the UW System biweekly payroll system.
Removal of salary caps for WHEDA employees
Current law allows WHEDA to employ an executive director and limits the compensation of the executive director and employees of WHEDA to the maximum of the salary range established for positions assigned to executive salary group six. The bill removes this limit on compensation of the executive director and staff of WHEDA.
Removal of salary caps for WHEFA employees
Current law allows WHEFA to employ an executive director and limits the compensation of the executive director to the maximum of the salary range established for positions assigned to executive salary group six. Current law also limits the compensation of each other employee of WHEFA to the maximum of the salary range established for positions assigned to executive salary group three. The bill removes these limits on compensation of the executive director and staff of WHEFA.
Paid family and medical leave
The bill requires the administrator of the Division of Personnel Management in DOA to develop a program for paid family and medical leave of 12 weeks annually for most state employees. The bill requires the administrator to submit the plan for approval as a change to the state compensation plan to the Joint Committee on Employment Relations. If JCOER approves the plan, the plan becomes effective immediately.
Paid sick leave for limited term employees
Under current law, permanent and project state employees receive the following paid leave: vacation, personal holidays, sick leave, and legal holidays. The bill requires the state to provide paid sick leave to limited term employees of the state at the same rate as to permanent and project state employees.
Vacation hours for state employees
The bill provides additional annual leave hours to state employees during their third, fourth, and fifth years of service.
Under current law, state employees who are in nonexempt status under the federal Fair Labor Standards Act earn annual leave at the rate of 104 hours per year of continuous service during the first five years of service and, on an employee’s fifth anniversary of continuous service, the rate increases to 144 hours of annual leave per year of continuous service. Under the bill, beginning on the employee’s second anniversary, a state employee in nonexempt status begins earning vacation hours at the rate of 120 hours per year of service.
Under current law, state employees who are in exempt status under the federal Fair Labor Standards Act earn annual vacation at the rate of 120 hours per year of continuous service during the first five years of service and, on the fifth anniversary of continuous service, the rate increases to 160 hours of annual leave per year of continuous service. Under the bill, beginning on the employee’s second anniversary, a state employee in exempt status begins earning vacation hours at the rate of 136 hours per year of service.
Pay progression caps; deputy and assistant district attorneys, assistant state public defenders, and assistant attorneys general
Under current law, there are pay progression plans for deputy and assistant district attorneys, assistant state public defenders, and assistant attorneys general. These pay progression plans consist of 17 hourly salary steps, with each step equal to one-seventeenth of the difference between the lowest hourly salary and the highest hourly salary for the salary range, and are based entirely on merit. However, current law caps the annual salary adjustment that a deputy or assistant district attorney, assistant state public defender, or assistant attorney general may receive under the respective pay progression plans to no more than 10 percent of the individual’s base pay.
Under the bill, the 10 percent cap on annual salary adjustments for deputy and assistant district attorneys, assistant state public defenders, and assistant attorneys general does not apply during the 2023-24 and 2024-25 fiscal years.
Juneteenth state holiday
The bill designates June 19, the day on which Juneteenth is celebrated, as a state holiday on which state offices are closed. Under current law, the offices of the agencies of state government are generally closed on Saturdays, Sundays, and a total of nine state holidays. The bill also requires the administrator of the Division of Personnel Management in DOA to include June 19 as a paid holiday for UW System employees in the proposal it submits to JCOER for compensation plan changes for the 2023-25 biennium.
Veterans Day state holiday
The bill designates November 11, the day on which Veterans Day is traditionally celebrated, as a state holiday on which state offices are closed. Under current law, the offices of the agencies of state government are generally closed on Saturdays, Sundays, and a total of nine state holidays. Additionally, under current law, state employees receive annually a total of 4.5 paid personal holidays, one of which is provided specifically in recognition of Veterans Day. Under the bill, state employees continue to receive 4.5 paid personal holidays. However, the bill removes the specification that one of the paid personal holidays is provided in recognition of Veterans Day.
In total, the bill increases the number of regular paid holidays state employees receive annually from nine days to 11 days.
Legislature
Legislative intervention in certain court proceedings
Current law provides that the legislature may intervene as a matter of right in an action in state or federal court when a party to the action does any of the following:
1. Challenges the constitutionality of a statute.
2. Challenges a statute as violating or being preempted by federal law.
3. Otherwise challenges the construction or validity of a statute.
Current law further provides that the legislature must be served with a copy of the proceedings in all such actions, regardless of whether the legislature intervenes in the action.
The bill repeals all of those provisions.
Retention of legal counsel by the legislature
Current law allows representatives to the assembly and senators, as well as legislative employees, to receive legal representation from DOJ in most legal proceedings. However, current law also provides all of the following:
1. With respect to the assembly, that the speaker of the assembly may authorize a representative to the assembly or assembly employee who requires legal representation to obtain outside legal counsel if the acts or allegations underlying the action are arguably within the scope of the representative’s or employee’s legislative duties, and the speaker may obtain outside legal counsel in any action in which the assembly is a party or in which the interests of the assembly are affected, as determined by the speaker.
2. With respect to the senate, that the senate majority leader may authorize a senator or senate employee who requires legal representation to obtain outside legal counsel if the acts or allegations underlying the action are arguably within the scope of the senator’s or employee’s legislative duties, and the majority leader may obtain outside legal counsel in any action in which the senate is a party or in which the interests of the senate are affected, as determined by the majority leader.
3. That the cochairpersons of the Joint Committee on Legislative Organization (JCLO) may authorize a legislative service agency employee who requires legal representation to obtain outside legal counsel if the acts or allegations underlying the action are arguably within the scope of the employee’s legislative duties, and the cochairpersons may obtain outside legal counsel in any action in which the legislature is a party or in which the interests of the legislature are affected, as determined by the cochairpersons.
The bill eliminates these provisions. Under the bill, representatives to the assembly and senators, as well as legislative employees, may continue to receive legal representation from DOJ in most legal proceedings.
Advice and consent of the senate
Under current law, any individual nominated by the governor or another state officer or agency subject to the advice and consent of the senate, whose confirmation for the office or position is rejected by the senate, may not do any of the following during the legislative session biennium in which his or her nomination is rejected:
1. Hold the office or position for which he or she was rejected.
2. Be nominated again for that office or position.
3. Perform any duties of that office or position.
The bill eliminates those restrictions.
Legislative Human Resources Office
The bill creates a Legislative Human Resources Office (LHRO), a nonpartisan legislative service agency, headed by a director. JCLO appoints the director and the director reports to JCLO. The director is assigned to executive salary group six, and the director and all LHRO staff hold positions in the unclassified service of the state civil service system. LHRO must perform all of the following duties:
1. Provide human resources services to the legislative branch, as directed by JCLO.
2. Establish a formal complaint process to review and investigate allegations of harassment, discrimination, retaliation, violence, or bullying by legislators, legislative employees, and legislative service agency employees. The office shall investigate all such allegations, unless the director designates another person or entity to review and investigate any specific allegation.
In addition, under the bill, the LHRO director must perform the following duties:
1. Direct the operations of LHRO staff.
2. Employ, train, and supervise the personnel assigned to the director.
3. Supervise all expenditures of LHRO.
4. Manage reviews and investigations of the formal complaint process. Upon completion of an investigation, report the findings to the appropriate legislative leader or employee supervisor.
5. On a periodic basis, recommend to JCLO improvements to human resources services and programs.
Records and correspondence of legislators
Under current law, the Public Records Board prescribes policies and standards for the retention and disposition of public records made or received by a state officer or agency. However, for purposes of public records retention, the definition of “public records” does not include the records and correspondence of any legislator. The bill eliminates the exception for a legislator’s records and correspondence.
Passive review by JCF; objections to be public
Current law requires that JCF review certain proposed actions before an agency may execute the action. The review required often takes the form of a passive review. In other words, the agency must submit the proposed action to JCF and, if the cochairpersons of JCF do not notify the agency within a certain period, often 14 days, that a member of JCF has objected to the action, the agency may execute the proposed action. If, however, a member objects, the agency is limited to the action as approved or modified by JCF. The bill specifies that the name of any JCF member who objects to the proposed action, as well as the reason the member objects, must be recorded and made publicly available.
Review of legislation relating to crimes
Under current law, there is a Joint Review Committee on Criminal Penalties. Under current law, if a bill is introduced that creates a crime or revises a penalty for an existing crime, the committee may be requested to prepare a report on the bill. The request must come from the chair of the standing committee to which the bill is referred or, if not referred to a standing committee, from the speaker of the assembly for an assembly bill or the presiding officer of the senate for a senate bill. Upon such a request, the joint review committee must prepare a report concerning the costs incurred or saved if the bill were enacted, the consistency of the penalties proposed with current law penalties, and whether the acts prohibited under the bill are already prohibited under current law.
The bill requires that any introduced bill that creates a crime or revises a penalty for an existing crime must be referred to the Joint Review Committee on Criminal Penalties for such a report and prohibits the legislature from taking further action on the bill until the report is prepared.
Capitol security
Under current law, DOA is required to submit any proposed changes to security at the capitol, including the posting of a firearm restriction, to JCLO for approval under passive review. The bill eliminates that requirement.
Administrative law
Deference to agency interpretations of law
Under current law, courts are prohibited from giving deference to agency interpretations of law and agencies are prohibited from seeking such deference from a court. The bill repeals these prohibitions.
Suspension of administrative rules
Under current law, administrative rules that are in effect may be temporarily suspended by the Joint Committee for Review of Administrative Rules (JCRAR). If JCRAR suspends a rule, JCRAR must introduce bills in each house of the legislature to make the suspension permanent. If neither bill to support the suspension is ultimately enacted, the rule remains in effect. However, current law specifies that JCRAR may suspend a rule multiple times. The bill repeals the provision allowing JCRAR to suspend a rule multiple times.
Agency rule-making authority
Current law provides that a settlement agreement, consent decree, or court order does not confer rule-making authority and cannot be used by an agency as authority to promulgate administrative rules. Additionally, no agency may agree to promulgate a rule as a term in any settlement agreement, consent decree, or stipulated order of a court unless the agency has explicit statutory authority to promulgate the rule at the time the settlement agreement, consent decree, or stipulated order of a court is executed. The bill repeals these limitations on agency rule-making authority.
Advisory committees for rule making
Current law requires that, whenever an agency appoints a committee to advise the agency on rule making, the agency must submit a list of the members of the committee to JCRAR. The bill repeals this requirement.
TAXATION
Income taxation
Family and individual reinvestment credit
The bill creates a new family and individual reinvestment income tax credit for taxable years beginning in 2023. The credit is nonrefundable and may be claimed only up to the amount of the taxpayer’s income tax liability. Under the bill, for a single individual or an individual who files as a head of household whose adjusted gross income (AGI) is less than $100,000, for a married couple filing jointly whose combined AGI is less than $150,000, or for a married individual filing separately whose AGI is less than $75,000, the credit is equal to 10 percent of the claimant’s net tax liability or, for a single individual, head of household, or married couple filing jointly, $100, and for a married individual filing separately, $50, whichever is greater. Net tax liability is a claimant’s income tax liability after the application of most nonrefundable income tax credits. Under the bill, the credit phases out to zero as a single individual or head of household filer’s AGI increases from $100,000 to $120,000. A similar phaseout occurs for a married joint filer whose combined AGI increases from $150,000 to $175,000 and a married separate filer whose AGI increases from $75,000 to $87,500. Also, under the bill, no new claims for the working families tax credit may be filed for a taxable year that begins after December 31, 2022.
Manufacturing and agriculture credit limitation
Currently, a person may claim a tax credit on the basis of the person’s income from manufacturing or agriculture. A taxpayer may claim a credit equal to 7.5 percent of the income derived from either the sale of tangible personal property manufactured in whole or in part on property in this state that is assessed as manufacturing property or from the sale of tangible personal property produced, grown, or extracted in whole or in part from property in this state assessed as agricultural property. If the amount of the credit exceeds the taxpayer’s income tax liability, the taxpayer does not receive a refund, but may apply the balance to the taxpayer’s tax liability in subsequent taxable years.
The bill limits to $300,000 the amount of income from manufacturing that a person may use as the basis for claiming the credit. The bill does not affect the amount of income from agriculture that may be used as a basis for claiming the credit.
Expanding the child and dependent care tax credit
Under current law, an individual who is eligible to claim the federal child and dependent care tax credit may claim a state income tax credit equal to 50 percent of the amount the individual may claim as a federal income tax credit. The bill allows an individual to claim a state income tax credit equal to the full amount claimed for the federal child and dependent care tax credit.
Earned income tax credit
