Big Wisconsin Republican budget plans on taxes, K-12 education come into focus

Republicans revealed their big-ticket tax cut plan for this budget cycle, passing through the Joint Finance Committee on Thursday a $1.3 billion tax cut over the next biennium and offering incremental increases in special education and technical college funding. Read on for some bite-sized budget updates:

Middle class income and investment tax cuts approved

Currently, taxpayers pay 4.4% in taxes on income between $14,680 and $29,370 and 5.3% on income between $29,370 and $323,290. Under the new plan, which would begin in tax year 2025, the 4.4% tax bracket would expand to include income up to ​​$50,480. For married couples filing jointly, the income covered in that bracket would rise from $39,150 to $67,300. 

The proposal would reduce taxes by about $190 for a single filer and $253 for a joint married filer. 

Older retirees would also see a tax cut, as they wouldn’t have to pay taxes on up to $24,000 of retirement income that comes out of 401(k)s, IRAs and pensions. That doesn’t include retirement income that is already not taxed, such as Social Security.

The nonpartisan Legislative Fiscal Bureau estimates that those with a retirement account of $1.2 million or more would receive the maximum benefit.

Republican K-12 education plan points to property tax increases

The budget committee voted 12-4 along party lines to increase funding for special education reimbursement, though at a rate lower than recommended in Gov. Tony Evers’ budget and advocated for by parents of special education students. 

Currently, the state reimburses about 30% of the costs associated with providing students special education services to public school districts, and under the Republican proposal, this rate would increase to 35% in the first and 37.5% in the second year of the biennial budget. 

Democratic legislators, Evers and school districts across the state advocated for a 60% special education reimbursement, citing the record number of Wisconsin school districts that have gone to referendum and the state’s over $4 billion surplus.

K-12 education traditionally takes up the largest portion of the state budget; however, the proportion of funding allocated to school districts across the state has decreased from over 43% of the state’s general fund in 2002 to 36% in the last budget cycle.

Democratic and Republican legislators sparred over “right-sizing” the budget, with Republican legislators pointing to the increase in special education funding and desire for fiscal responsibility and Democrats reading testimony from students, parents and school administrators across the state expressing a need for stronger state support. 

Republican legislators also approved 90% reimbursement for high-need special education students — about 3% of special education students — and no funding increase in general school aid. 

Democrats highlighted how by not increasing general school aid, the Republican proposal would likely lead to higher property taxes across the state. If the state increases aid, property tax increases would be limited. 

Republicans pointed to Evers’ 400-year veto as the reason why property taxes will likely increase. That’s because in the previous budget, Evers used a creative veto to increase state-imposed caps on K-12 funding each year for 400 years. 

Technical colleges get modest increase

Republicans proposed an increase of more than $8 million to general aid for technical colleges over the next two years, a fraction of  Evers’ $45 million proposal.

Unlike per-pupil aid for students in the Universities of Wisconsin system, which ranks 43rd in the country, the Wisconsin Technical College System (WTCS) is currently funded at about the median rate for technical college systems. 

In an interview with the Cap Times, WTCS President Layla Merrifield said increased demand for fire and EMS training in rural areas of the state, in addition to a bounceback in enrollments since the COVID-19 pandemic and workforce shortages, necessitates the $45 million increase in state funding.

Supreme Court police force denied

Credible threats against Wisconsin judges are on the rise. There were 30 in 2022, 46 in 2023 and 29 in 2024, but 22 in just the first three months of this year.

Despite that, Republicans last week rejected the Supreme Court’s state budget proposal to create the Office of the Marshals of the Supreme Court — a law enforcement agency to serve the Supreme Court specifically. The proposal would’ve cost $2.3 million over the biennium to fund 8.4 positions.

Judges are responsible for making decisions impartially, even in the face of intimidation. Democrats on the state budget committee warned additional threats could sway rulings. 

“Given the role that they play in our judiciary and in order to be impartial, we shouldn’t want them to be in danger, or to fear for their safety, or to have any outward pressures on them that would influence the case,” Rep. Tip McGuire, D-Kenosha, said. 

Threats to federal judges have doubled since 2021. The increase has been attributed to the politicization of courts. In Wisconsin there were also contentious Supreme Court elections in 2023 and 2025.

Legislative Republicans argue it would be redundant to allocate funds to create a new police agency. 

“The Capitol Police protects the Capitol for visitors, employees, legislators, the court, whoever happens to be here,” Rep. Mark Born, R-Beaver Dam, told reporters. “I think they’ll continue to provide top-notch work here at the Capitol.”

Private health insurance market gets a boost

To address the rising costs of private insurance premiums in Wisconsin, the budget committee approved legislation to raise the cap on a reinsurance fund the state created to help insurance companies pay high-cost claims. The Wisconsin Healthcare Stability Plan — a program aimed at making insurance more affordable — would receive an additional $35 million, setting the cap at $265 million. 

In 2024, insurance claims exceeded the cap by $26 million, leading insurance agencies to raise premiums for consumers. The new cap, which is $15 million more than what Evers proposed, aims to address the rising costs of insurance. 

Due to insurance claims exceeding that $26 million cap, JFC Republicans also passed a provision to direct the Office of the Commissioner of Insurance to cover those additional claims up to $265 million for 2025. 

But Republicans decided against Evers’ proposal to automatically adjust the cap based on inflation, meaning if claims once again exceed the cap, raising it would be dependent on what happens in the next budget cycle. 

In recent years, the cost of insurance premiums have increased due to inflation raising the price of goods and services. Federal dollars cannot be used for claims exceeding the cap, putting the burden of higher premiums on consumers.

This article first appeared on Wisconsin Watch and is republished here under a Creative Commons Attribution-NoDerivatives 4.0 International License.