(The Center Square) – The latest idea for how Wisconsin should spend its stimulus money involves suing Congress.
The Wisconsin Institute for Law and Liberty this week suggested in an op-ed in the Wisconsin State Journal that Wisconsin should join other states in suing to free-up states in how they can spend their billions from Washington, D.C.
“It is clear that this influx of federal dollars is not only unnecessary, but has the potential to lock the state into future obligations for decades to come if not managed properly. In response, some have proposed using this windfall to provide more relief to families through a tax rebate. This idea has merit, but important legal questions would need to be resolved first,” WILL Policy Director Kyle Koenen wrote.
Twenty-one state attorneys general wrote a letter to Treasury Secretary Janet Yellen last month questioning if they are expressly prohibited from using their share of the CARES Act money to cut taxes. The White House has said President Biden does not want the money to be used for tax cuts.
Ohio’s attorney general has filed a suit challenging the CARES Act limits.
Koenen at WILL said tax cuts or property tax rebates would be the best use of the money in Wisconsin.
“The state’s fiscal outlook is in relatively good shape with a 6.5% increase in revenue in 2020 compared to the previous year, placing the state as one of the best in the nation for revenue growth,” Koenen wrote in his piece. “Despite this, the state is still slated to receive over $5 billion under this package, with approximately $3.2 billion for the state and $2 billion to local governments.”
Koenen acknowledges that Congress can place limits on how states spend federal dollars. But he wrote Congress cannot coerce or compel states to spend money as leaders in Washington wish.
Koenen added it’s “highly unlikely” Attorney General Josh Kaul will join the states in their lawsuit. So he says it’s up to Republicans in the State Capitol to act.
“If the Legislature does not want to be hamstrung in their ability to lower taxes into the future, they should take action and join the efforts to overturn this unconstitutional provision. It is a fight worth having,” Koenen wrote.