Says salaries and benefits for Wisconsin state employee comprised 8.5 percent of the 2009-2011 state budget.
When Wisconsin Gov. Scott Walker took aim at public employees with his now-famous budget-repair bill, he used stark rhetoric to make a case for curtailing collective bargaining and making employees pay more for health care and pensions. "I don't have anything to negotiate. We are broke in this state," Walker said in February 2011, making a claim we ruled False. "We have been broke for years. People have ignored that for years, and it's about time somebody stood up and told the truth. The truth is: We don't have money to offer." A week later, state Rep. Mark Pocan -- who drew a False from us for claiming Walker’s $3.6 billion estimate of the state budget deficit was "bogus" -- took aim at the Republican governor. In a Feb. 19, 2011 blog post titled "Scott Walker’s top ten lies," Pocan tried to shred Walker’s rationale for the budget-repair bill, which would reduce the deficit but is now tied up in court. The Madison Democrat, a 13-year lawmaker, had this to say about what he labeled lie No. 9: "Walker has said that our budget problems are largely due to employee wages. Not even close, Governor. Total salaries and compensation in the last budget were 8.5 percent of the entire state budget." Pocan’s claim got national exposure when it was re-posted two days later on the liberal DailyKos.com, a leading political website. Although the claim was made weeks ago, it remains relevant. How much state employees cost taxpayers is central to the debate over their compensation and collective bargaining powers -- and we still get reader requests to check it out. So we did. Pocan’s assertion that employee wages and benefits comprise 8.5 percent of the state budget contained an asterisk, leading readers to a footnote. The footnote said the 8.5 percent figure came from the nonpartisan Legislative Fiscal Bureau, but that the figure excluded the University of Wisconsin System and the Department of Corrections, which includes the state prisons. Those are two massive state operations. So, right off the bat, Pocan’s claim is dubious. If employees in major departments are not included, it’s going to make the overall cost of wages and benefits seem smaller. Indeed, the footnote -- which did not explain why the two areas were excluded -- said that when the UW System and corrections are considered, employee compensation costs make up 17.7 percent of the state budget. We wanted to see the Legislative Fiscal Bureau report that Pocan cited as his source, but Pocan refused to provide it. The bureau also would not provide the report, saying it was confidential to the lawmaker who requested it. The Legislature Fiscal Bureau is generally regarded as the gold standard in financial matters of the state. But without seeing the bureau’s report, we don’t know what information it was asked to generate and we can’t see how it arrived at the two percentages cited by Pocan. So, we sought out other sources. Dale Knapp, research director of the nonprofit Wisconsin Taxpayers Alliance, cited the state’s 2010 Annual Fiscal Report, which shows that "general purpose revenue," or the general fund budget, was $12.8 billion. He also cited the state’s 2010 personal services and fringe benefit report, which showed that spending on salaries and benefits was $2.22 billion. That means salaries and benefits were 17.3 percent of the state budget. That’s more than double Pocan’s 8.5 percent claim (though nearly the same as the 17.7 percent figure cited in his footnote.) Since Pocan’s blog post attacked Walker, we also asked the governor’s office to weigh in. It provided a memo issued by the state budget office, which is part of Walker’s administration. The memo was issued to "interested parties" on Feb. 9, 2011, two days before Walker introduced his budget-repair bill. The memo said employee compensation costs were $2.11 billion, nearly the same as Knapp’s $2.22 billion. However, the memo compared the employee costs to the "state operations" budget, which is only $3.67 billion, to conclude that employee costs make up 60 percent of that budget. What’s going on here? The compensation numbers are being compared against two different measures of state spending. State operations covers only the UW System, corrections, the courts and other state departments -- in other words, direct services provided by state employees. The overall budget includes some $9 billion more that the state takes in and distributes to local governments, schools and individuals. We asked two other government finance experts for guidance. Milwaukee County Auditor Jerome Heer said the method used to calculate the 17 percent figure is reliable because it takes into account not only what the state spends to provide direct services but also what it sends to local governments and to individuals. City of Milwaukee Deputy Comptroller Mike Daun said there is value in the method used to calculate the 60 percent figure in that it relates only to the employee costs as a percentage of direct services. However, both agreed Pocan’s 8.5 percent figure does not reflect the share of the state budget that goes to salaries and benefits. Let’s sum up. Pocan claimed in a blog post that salaries and benefits for state employees comprise 8.5 percent of the state budget. He did not provide evidence for the figure. In a footnote, Pocan acknowledged that two huge state operations -- the university system and corrections -- were not included, and that if they were, the figure is about 17 percent. The Wisconsin Taxpayers Alliance agreed with the 17 percent, while the state budget office argued that the figure is 60 percent. Experts said the two figures are different ways to express what employees cost. But everyone agreed that Pocan’s 8.5 percent -- the main number he used, which was repeated elsewhere -- is not accurate. We rate Pocan’s statement False. (Editor's note: On April 25, 2011, the day after this item was published, Rep. Mark Pocan wrote in a blog post that we incorrectly stated in the item he refused to provide a memo that he relied on in making his claim about employee compensation. We have searched for the email on this end, including having the Journal Sentinel’s IT department check all filters for an email sent at the time in question, and have no record of receiving it. Our practice is to link to all of the source documents we use on items and would have done so with the memo Pocan requested from the fiscal bureau. The document in question simply reiterates the numbers that were cited. Thus, they do not affect the False ruling -- which Rep. Pocan has not challenged. Here is a summary of our efforts to reach Rep. Pocan for his input on this item: We emailed him April 8, 2011, asking for evidence he had to support his claim. We didn't get a reply, so we emailed him again April 12, and then emailed and called him on April 14. In the phone conversation, Pocan said he relied on a Legislative Fiscal Bureau memo in making his claim, but said that he would not send us the memo. We sent another email the same day, asking Pocan to reconsider. That is all reflected in the email Rep. Pocan said he sent to us, which is linked in his follow up post on his blog. Pocan also linked to the memo.)
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