Wisconsin lawmakers aim to use general tax dollars, rather than money generated from its nursing homes, to fund its veterans programs, a departure from Scott Walker era funding plans.
Wisconsin's two-year budget, which the Legislature plans to send to Gov. Tony Evers' desk at the end of the month, includes a provision that would use $29.6 million in general tax dollars from 2019-2021 to infuse the Veterans Trust Fund, an account housed within the Wisconsin Department of Veterans Affairs to pay for veterans benefits. The Veterans Trust Fund was originally sustained largely through a mortgage, personal and home improvement loan program for veterans but has faced significant structural deficits since the state closed the program in 2011.
The state's veterans nursing homes have been its primary source of funding, much of which was spent on agency salaries. From 2003-04 through 2018-19 the state transferred $91 million from its veterans nursing homes, primary from the Wisconsin Veterans Home at King, the state's largest home, to fund other veterans programs and salaries, according to the state's Legislative Fiscal Bureau. The state owns three homes in King, Union Grove and Chippewa Falls that care for hundreds of elderly and sick veterans. Though owned by the state, Chippewa Falls is run by a private contractor.
If Evers signs off on the changes, the state will transfer $13.8 million in 2019-20 and $15.8 million in 2020-21 in tax revenue to the Veteran's Trust Fund, effectively making tax dollars the "primary source of ongoing revenue for veterans programs," according to a Legislative Fiscal Bureau budget paper issued earlier this month.
Some lawmakers and veterans groups have criticized the practice of reallocating nursing home revenue to fund administrative salaries and other programs for years, arguing that a different funding stream was needed. Changes to the funding model now come as the nursing homes have decreased its numbers of residents and are not generating money like they used to.
The Wisconsin Veterans Home at King had an excess of $50 million in reserves it generated from filling the home to capacity. As the number of residents there has decreased, those reserves have also declined and are expected to be $14.4 million at the end of this fiscal year, according to the Department of Veterans Affairs.
There were 690 residents at King at the start of the 2016-17 fiscal year, according to the LFB. At the end of May there were 542. With fewer beds filled, expenses at King are now expected to exceed revenues.
The decision to decrease the number of residents was an intentional one and has been an ongoing process, said Carla Vigue, spokeswoman for the Department of Veterans Affairs. There is declining demand for long-term care because more people are opting for in-home care as long as possible, she said, leading to shorter and fewer stays at 24-hour skilled nursing facilities like King.
The home has also struggled with staff turnover, recruiting and retention for more than a decade. There are nursing staff shortages nationwide, but King's is compounded because of its location, in rural Waupaca County, she said.
"Secretary Kolar is interested in finding the best way to balance how we manage current operations while also planning for future requirements at our Wisconsin Veterans Homes, as well as improving our overall financial situation," Vigue said.
The agency hired a new administrator for the state's veterans nursing homes who has been tasked with "developing a strategic plan that reflects a shrinking veteran population, current trends in long-term care, and financial realities," Vigue said in an email.
There will be changes at King when that plan is complete, she said.