Wisconsin Lawyer
Vol. 81, No. 3, March 2008

Inside the Bar

State Budget Woes and the Practice of Law

by George C. Brown,
State Bar executive director

Over the past few weeks we've been reminded again that nothing is ever as clear-cut or final as we might wish. In this column last December, I enthusiastically reported that the state's 2007-09 budget bill included a $1 million appropriation that made Wisconsin the 45th state to provide state funding for civil legal services for the poor.

At that time, the state's economic and fiscal prospects were sound. But by last month the picture had changed dramatically. The national economy slowed markedly as the full scope of the nation's housing and credit problems became clear. In its regular review of tax collections and economic assumptions underlying the state budget, the nonpartisan Legislative Fiscal Bureau concluded that national economic trends will translate into general tax collections falling nearly $600 million short of the amount projected when the budget was finalized last fall. Other revenue and expenditure reestimates move the potential biennial shortfall to $655 million. By law, the state budget must be balanced by June 30, 2009, the last day of the biennium.

At about the same time this information was released, Gov. Doyle ordered state agencies to cut their projected expenditures and took other budgetary steps to reduce the deficit by more than $200 million. We believe those cuts include reducing the State Public Defender private bar reimbursement budget line. This inadequate reimbursement is a hit that our defense counsel members have been taking on for years and it effectively leaves those private practice lawyers who take public defender cases unpaid for several months. This budget hit is on top of the already abysmally low rate of $40 per hour the state now pays them.

But the bad news doesn't necessarily end there.

The Fiscal Bureau also cited other potential budget hazards. If the state loses several high profile court cases, an additional $500 million will be added to the deficit and drive the projected shortfall to more than $1 billion. This situation is exacerbated by the fact that Wisconsin budgeted a razor-thin reserve of less than 1 percent of total spending (far short of the 6.7 percent nationwide average). If Wisconsin had instead amassed reserves close to the nationwide average, it would have nearly $1 billion available to meet cyclical budget shortfalls, according to the Wisconsin Taxpayers Alliance.

What does this budget situation mean for lawyers and the courts? As of this writing, no solutions have been offered formally, but some legislative leaders have responded by insisting that the state enact no new legislation that would require spending money. This means that efforts to increase private bar rates and to raise indigency standards for public defender cases probably are stalled for the balance of this legislative session. It also means that efforts to change the law regarding the treatment of 17-year-olds charged with crimes are unlikely to gain any traction until at least next year.

Amid all this fiscal uncertainty there is one bit of positive news. Our State Bar government relations coordinators are confident that the five circuit courts scheduled to open in August 2008 will do so.

As difficult as the fiscal problems outlined above are, the situation could get worse - especially if fears of a national economic recession come true. We will continue to closely monitor fiscal developments here in Madison and keep you informed about how the state's response to the budget shortfall could affect the judiciary and other members of the State Bar. We also will continue to remind policy-makers that providing access to justice for all Wisconsin residents must remain a top state government budget priority.

Wisconsin Lawyer