STATE OF THE STATE (copy)

Scott Walker

In his first address to Wisconsin voters after his presidential bid, Gov. Scott Walker made a request of legislators: work swiftly to pass legislation making college more affordable.

Two months later, in lawmakers' final floor period of this session, most of the governor's proposed college affordability package was approved — absent a key proposal that served as a cornerstone for the initiative. 

That bill, authored by Rep. John Macco, R-Ledgeview, and Sen. Howard Marklein, R-Spring Green, would have eliminated the cap on the state's tax deduction for student loan interest. But with a price tag of $5.2 million, it wasn't brought to the Senate floor despite being approved by the Assembly. 

Macco dismissed the idea that the bill was an integral part of the college affordability initiative compared to any other legislation it contained and said people shouldn't lose sight of what was passed by both chambers.

Bills that will make emergency grants available to University of Wisconsin and state technical college students who need them, increase funding for need-based tech school grants, fund positions to help connect students with internships and require schools to provide financial literacy information to students were all approved and sent to Walker's desk for his signature.

Analiese Eicher, program director for the liberal group One Wisconsin Now, said she believes Republicans only intended to pass "political talking points." The group has highlighted the issue of student loan debt for several years.

Eicher was also critical of the income tax deduction bill, arguing the average savings it would have offered is less than what most student loan borrowers pay per month.

"It’s a first step," Macco said Wednesday of the bills passed this session. "I’m disappointed that we didn’t get everything done, but even then, it wouldn’t have been everything. I think there's still a lot more that we have to do to make Wisconsin first in education, and that’s really an initiative that I want to have. I'm talking about preschool, K-12, post-secondary, college — I think we’ve got an opportunity to make education first in the nation here in Wisconsin."

Macco also noted that another bill he authored, which would establish 529-A accounts in Wisconsin, could help students with disabilities save money for college.

The income tax deduction bill falls under the category of "missed opportunities" the Senate wasn't able to advance because the revenue wasn't available, said Senate Majority Leader Scott Fitzgerald, R-Juneau.

"To some extent, I think there were some members that were kind of frustrated with that, because they thought that package would look a little bit better than what the governor proposed in his State of the State," Fitzgerald said.

Lower-than-expected budget projections released in January caused lawmakers to temper their expectations for what could be passed as the session drew to a close. Walker and Republican leaders agreed any new costs should be kept under $20 million.

Fitzgerald on Tuesday described the trigger under the income tax bill as "arbitrary" and said if lawmakers are going to take an action like that, they should ensure the bill has a real impact — either by increasing the size of the deduction available or by expanding the number of people who could benefit from it. 

The bill was expected to help an estimated 31,680 student loan borrowers. The largest average benefit would be seen by those making $60,000-$70,000 per year, who would receive a deduction of nearly $350 per year.

A person making between $30,000 and $40,000 per year would see a benefit of about $142, according to the bill's authors.

Macco said he would be "delighted" to pass a bill with a larger impact, but said he thought his was a reasonable first step. 

Democrats scoffed at the Republican proposals, which they called "anemic." Most of the proposals passed on near party lines, with Sen. Kathleen Vinehout, D-Alma, breaking with her party to vote for two of them and Sen. Chris Kapenga, R-Delafield, breaking with his party to vote against the same two.

Sen. Dave Hansen, D-Green Bay, said Republicans addressed the issue of college affordability by asking, "'What is the least we can do to make it look like we care?'" and then "did even less."

Hansen, along with Rep. Cory Mason, D-Racine, has pushed for several years for the passage of a bill that would allow borrowers to refinance their student loans at lower rates.

He and other Democrats argued on the Senate floor that had Republicans adjusted their priorities, they could have afforded to do far more than what was passed.

"If you truly say you want to help college students or tech college students, then help them. The resources were there," said Sen. Jon Erpenbach, D-Middleton. "Rejigger your priorities ... In the end, yeah, you’re going to help a handful of people, but you could’ve helped so many more. But you chose not to."

Senate Minority Leader Jennifer Shilling, D-La Crosse, said Republicans were only offering "crumbs."

"We had a plan that really moved the needle ... I’m just left hungry, and frustrated, and disappointed," she said.

Macco said he's crunched the numbers on the refinancing proposal and it "simply doesn't work."

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He argued the Democrats' plan would transfer unsecured debt to the state, a scenario he said could result in a financial meltdown reminiscent of the subprime mortgage crisis of the late 2000s. 

Eicher countered that creating a program that offers lower interest rates incentivizes the system "not to fail" by ensuring borrowers can make their payments.

She said securities can be built into a program like the one Democrats did with their Higher Ed, Lower Debt bill.

"One of the things we can’t do is to chase that," Macco said. "But I think there's a lot of things we can do."

Macco would like to strengthen some of the state's two-year college programs, ensure credits from those programs can be transferred to four-year universities and work with University of Wisconsin System campuses to eliminate redundancies and strengthen areas in which each campus can specialize.

Republican lawmakers have also voiced support for some ideas mentioned by UW System President Ray Cross, including developing a three-year degree program and exploring different costs for different degrees. 

Cross thanked lawmakers on Tuesday for passing the college bills.

"Students and their families will see immediate benefit from these bills through new grants available to help UW Colleges students overcome obstacles, such as unexpected car repairs that might otherwise make it difficult to attend classes, and the provision of regular, easy-to-understand updates on loan obligations," Cross said in a statement.

Eicher countered that it was a "do-nothing legislative session for students and current student loan borrowers."

Fitzgerald on Tuesday said he thinks the next state budget would be an appropriate time to revisit proposals like the income tax deduction bill. But while he said he's hopeful the state will have more revenue, he expects the next budget will be "just as tough and just as tight" as the last one.

If the funds are available, Macco said, he hopes the Legislature can do something "even bigger." In the meantime the bills it did pass, he said, are "nothing to sneeze at."

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