On Monday (Oct. 14) a Department of Administration report showed Wisconsin's state budget surplus stood at $760 million – far higher than the balance that was projected in January.
Early this year the non-partisan Legislative Fiscal Bureau believed the state would end the fiscal year with a balance of $485 million.
As a result of the added surplus documented by the new report this week, the state will deposit $153.2 million into its "rainy day fund" putting the total in that fund up to nearly $279 million - its largest balance ever.
Gov. Scott Walker said the report "shows we're on the right track."
In a statement Walker said the "tough, but prudent decisions" he has made since taking office two years ago are paying off. The rainy day fund deposit is the largest in state history.
"In just over two years, we've turned a $3.6 billion budget deficit into a nearly $760 million surplus," he said.
The timing of the report couldn't be better for Walker and lawmakers who are backing his plan to provide property tax relief of $100 million.
That proposal, revealed by the governor and top lawmakers last week, was set to go before the Joint Finance Committee and the state Senate on Tuesday.
Before unveiling his tax relief plan, Walker issued an executive order calling a special session of the legislature to quickly pass the property tax relief bill and two other economic development issues.
Co-chairs of the state's budget-writing joint finance committee Sen. Alberta Darling (R-River Hills) and State Representative John Nygren (R-Marinette) said in a statement that it is their hope to move this legislation quickly during the fall legislative session.
They said that thanks to "prudent budgeting" and tax cuts, the state should be able to return $100 million to taxpayers through a significant property tax relief.
"Gov. Walker has repeatedly outlined five priorities in his tenure: develop our workforce, transform education, create jobs, reform government, and invest in our economy.
The Joint Finance Committee has been working with the same priorities," their statement added. "That's why tax relief for Wisconsin's middle class families was a top priority in the state budget passed earlier this year."
Democrats, who make up the minority in both houses of the Legislature, said they support property tax relief but questioned the speed of the governor's proposal, which came just days after Mary Burke announced she would challenge Walker in the governor's race.
It could be less than a week from the time Walker unveiled the tax relief plan to his signing it into law.
State budget experts said the state still has a roughly $545 million structural deficit and the new property tax relief plan could add to that long-term deficit.
Walker's tax relief plan would come in the form of aid to schools, but would not require local school districts to dedicate those savings to property tax relief, according to a Legislative Fiscal Bureau note that came out on Monday.
In some districts the extra funds might end up going to pay for programs that have been hard hit by a $1 billion cut in funding in the GOP budget.
The new legislation is billed as $100 million in property tax relief because it would offer $40 million more to school aid in the current year and $60 million in 2015-16, the fiscal bureau's note explains.
School districts are operating under a revenue limit formula which means that more aid from the state could mean locally levied property taxes for schools could be lower under the bill.
Walker said that in the decades before he took office property taxes were up 27 percent on median-priced homes. Those taxes have dropped for three consecutive years, he added.
Once Walker completes his first term in office in 2015, he said property taxes for those median homes will be lower than when he took office in January 2011.