DOR Secretary holds roundtable, luncheon with area representatives
Wisconsin Department of Revenue Secretary Richard Chandler visited New Richmond and Glenwood City on Wednesday, Oct. 25, as part of the Governor's Northern Economic and Community Development Summit taking place Oct. 25- 26 in Trego at the Heartwood Conference Center and Retreat. This summit brings state agencies together to discuss the unique challenges and opportunities of northern Wisconsin's economy.
"The Governor encourages all cabinet agencies to make visits around the area to talk to people about what is going on in Madison and to get input from people about things you think we should know about," Chandler said.
Chandler visited with the Glenwood City High School DECA program Wednesday morning before stopping at WITC-New Richmond to visit with the school's powersports technician program.
"I was at Glenwood City High School today meeting with the kids involved in the DECA program, which includes running the school store. They got a grant from the economic development organization, which is great," Chandler said. "If you get discouraged by the things that are going on in Washington sometimes — and how things can seem disfunctional and also can get disheartening sometimes — visiting with the high school kids and seeing the great things that are going on with the kids there, it kind of restores your faith and makes you think that there are some good things in for us in the future."
Chandler ended his day with a roundtable discussion and luncheon with representatives from the New Richmond Area Chamber of Commerce, the City of New Richmond, the St. Croix County Economic Development Corporation and WITC.
"One of the themes as I talk about things is going to be that there really have been some dramatic changes in Wisconsin's tax climate and economy in the past few years. I think sometimes there is a little bit of a perception lag, where people remember back 10, 15, 20, 25 years ago when we were known as a very high tax state. That has changed dramatically," Chandler said. "Wisconsin's state and local tax burden, now, is actually below the national average and we rank 21st out of the 50 states in tax burden. We are no longer in the top 10 in the highest tax states ... and we are very competitive. And that can also be said for the economy as well."
During his roundtable at the Chamber, Chandler discussed the changes in taxes in the state of Wisconsin.
"Gov. Walker has made economic growth a priority and our economy now is the best in 18 years and we are doing very well by a wide variety of measures," Chandler said. "We haven't ranked that low since the early 1960s. The concerns that people had in the 80s and the 90s ... of Wisconsin being a state with all kinds of advantages, but held back in some ways by a high tax burden, that has changed.
"We are now competitive with the vast majority of other states in terms of tax burden. We expect we will continue to improve in the future."
According to Chandler, Wisconsin's tax burden was 0.3 percent below the national average in 2015. In 1995, Wisconsin ranked as the fourth worst state when it came to tax burden, but moved back to ninth in 2010 and made its largest jump to 21st out of 50 states in 2015. That makes Wisconsin's tax burden, according to Chandler, better than Illinois, Minnesota and Michigan, and it is now comparable with Iowa and Indiana.
"Because of the changes we've made recently, our rankings have really improved. We were recently ranked as the number 10 best state in the country for business by Chief Executive magazine, which is widely read by companies making location decisions," Chandler said. "We've got a great education system, lots of real estate, good infrastructure, hard working workforce and a good environment for start up companies."
One of the major job creation incentives that Wisconsin has imposed in recent years that has allowed its business climate to climb to new heights was the creation of manufacturing and agriculture tax credit. The tax credit is a 7.5 percent credit against income derived from manufacturing and agriculture activities that take place in the state.
"Those are our two traditionally most significant sectors of our economy and they have been the twin drivers of our economy throughout our history," Chandler said. "Wisconsin is one of the two most manufacturing intensive states in the country, along with Indiana. About one in every six workers is in manufacturing and about 20 percent of our state gross domestic product comes from manufacturing. Do we want to build on our strength in manufacturing and continue to make this a premier state for manufactures to locate in."
The state's unemployment rate is 3.4 percent below the average and has more jobs than before the recession. The state also has one of the highest labor force participation rates in the country, Chandler said.
And not only has Wisconsin become more attractive to companies and businesses, but in lowering its tax burden the state has also started to look better to people looking to relocate for work.
"If you are looking at just how much you can earn, we may rank a little bit lower than other places. But when you adjust for cost of living, we look better. And then when you adjust it for quality of life, we look even better," Chandler said. "When adjusted for cost of living, the state becomes 18th in terms of income adjusted for cost of living. It is sometimes hard to get people to think through that whole picture."
Chandler also touched on the state budget — which he stated was balanced — and the fact that the state's retirement plan is fully funded or almost fully funded.
"We were a little above 100 percent, but I think the most recent report said we were at around 99 percent. But we are one of about three or four states in the country that is around 100 percent funded," Chandler said. "That is a tremendous advantage for the state because other states, over time, will have to do something about their unfunded liabilities. We've been funding our commitments as we go along, which means we don't have a lurking tax increase in the future to address."
One of the last topics Chandler touched on during the luncheon was the fact that baby boomers across the country are retiring and less millennials are coming along into the job market.
"We have to do better with retaining people who grow up here and create job opportunities for them. I think we are at a point where there are plenty of great jobs available. But we need to do things ... and be thinking about ways we can attract more workers and more young people to Wisconsin," Chandler said. "A topic we should continue to talk about is how do we use all of those positive attributes to retain and attract more workers. We need to keep thinking about what we need to do to market the state."