Gov. Tony Evers has pledged his administration “will not touch” state funds allocated to the Unemployment Insurance program after he called for $250 million in budget cuts to deal with the COVID-19 revenue crunch.
Still, quizzed Thursday by reporters on whether the cuts would affect the departments of Workforce Development and Health Services and the UW System, the guv said all three agencies will need to “sharpen their pencils”.
Speaking on a Department of Health Service briefing this afternoon, Evers and DHS Secretary Andrea Palm pledged DHS would “take the steps we need to contribute to that target.”
Still, she noted her agency’s response to the pandemic has largely been fueled on the funding front by federal dollars from the CARES Act passed in March by Congress and said additional federal funding would be needed to prop up pandemic response in 2021.
“The dollars we have received need to be spent by the end of the year, which leaves us in need to have additional dollars at the beginning of next year to continue the response we have started here,” she said. “We’re going to need those dollars until there is a vaccine.”
DWD Secretary Caleb Frostman earlier Thursday said the cuts would be “really challenging” when asked in a Greater Madison Chamber of Commerce briefing about the implications for DWD’s modernization plan.
“We’re going to leave no stone unturned at the state or the federal level for modernization, but there will be some difficult decisions throughout state government including at DWD as to what has got to be prioritized here going forward,” he said.
Frostman added the state’s beleaguered Unemployment Insurance program was primarily federally funded, meaning the agency would be “making a large ask for our federal partners.”
Quizzed on those comments, Evers said his administration “cannot afford” to cut state funding levels for the UI program.
“They’re making good progress. We need to make sure they continue to make that good progress so that everybody that is waiting gets the resources they need in order to thrive as a state,” he said.
Still, the guv noted the agency’s scope expands far beyond the UI program and said DWD “will need to sharpen their pencils.”
Meanwhile, Finance Committee Co-Chair Rep. John Nygren is skeptical of Evers’ goal and told WisBusiness.com it’s too early to know what those cuts will look like.
“There’s no details yet, but I’m a little skeptical because when he announced he was going to do a 5 percent cut, they couldn’t even do that,” the Marinette Republican said. “It ended up being less than 2 percent and at least half of that was from UW.”
Nygren did say that he’s been supportive of the calls for budget freezes and being aggressive in managing the state’s resources “so we don’t have to get into a dire situation.”
“The good news is because we’ve been pretty frugal and pretty responsible over the last eight years, we’re in a far better situation to weather the storm than a lot of other states, but it’s still going to be difficult,” he said.
Evers also said the UW System, which in the immediate aftermath of the guv’s announcement released a statement seeking to limit cuts, would not be immune.
“We’re in the middle of conversations with the University of Wisconsin System to have them help us put our budget in the best place possible,” Evers said. “So yes, we will have expectations for them, and we’ve already communicated that to them and we’re going to have ongoing discussions around that.”
The comments come one day after System President Tommy Thompson said additional cuts in state spending for the UW System would be “an obstacle” for safely reopening schools for the fall semester. And shared governance groups argue the state’s universities “should be a funding priority.”
A UW System spokesman was not immediately available for comment.