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State treasurer: Occupational licenses taking too much money

By   /   March 2, 2017  /   News  /   No Comments

WAUKESHA, WIS. – Wisconsin’s State Treasurer Matt Adamczyk wants to give taxpayers an $8 million break in the cost of doing their jobs. That’s the amount the state collects beyond what it needs to administer occupational licenses in Wisconsin.

Over the last five fiscal years, the Wisconsin Department of Safety and Professional Services has given to the state’s general fund an average of nearly $8.5 million annually, according to figures from the Legislative Fiscal Bureau. The money is collected for the purpose of administering occupational licenses, but the state uses the excess revenue in the budget.

GIVE IT BACK: State Treasurer Matt Adamczyk says the state is collecting too much money for occupational licenses. He calls the license fees a tax.

“This is an agency that is supposed to be run on fees to pay for what they’re doing, which is regulating these professions,” Adamczyk told Wisconsin Watchdog. “But they shouldn’t be taking in more money and then putting it in the general fund, because then it’s a tax at that point.”

A study last year by the Wisconsin Institute for Law & Liberty, or WILL, showed a 34 percent increase in the last 20 years of people in Wisconsin holding occupational licenses, to 370,000 in 2016. The number of license types grew from 90 in 1996 to 166 in 2016.

The economic impact of state licenses is $1.9 billion in higher consumer costs in Wisconsin, according to the study. There are 31,634 fewer jobs in Wisconsin as a result.

“I think the Legislature can either figure out a better job of which ones can be reduced individually because they’re not as necessary,” Adamczyk said. “You could also do an across-the-board cut of, let’s say, 25 percent.”

Adamczyk gave the example of cosmetologists in Wisconsin and how much revenue their licenses generate for the state.

“There are 16,000 of them in the state. So 16,000 of these men and women are writing checks to the the DSPS every two years for $82, and it’s like, why?” Adamczyk said. “You cut it 25 percent, it would save each person $20. I’m sure these people wouldn’t mind having $20 in their pockets.”

Collin Roth of WILL said the money going into the general fund is proof that occupational license reform is necessary.

“The information that state Treasurer Adamczyk highlights reveals an uncomfortable truth about licensing fees,” Roth said. “They don’t simply serve as revenue source to run a regulatory agency but as a piggy bank for state government.”

“Whether a focus is applied to licenses, fees, or burdensome training requirements, tackling occupational licensure reform ought to be a priority for a legislature concerned with expanding opportunity,” Roth said.

Gov. Scott Walker has made occupational license reform part of his proposed welfare reform package. A “sunrise review” would analyze whether the license is the least restrictive means to address a public health or safety concern. A “sunset council” would look at existing occupational licenses to see if they’re necessary for public safety. Both would also examine the extent the license would create a barrier to new workers in that field.

SEE RELATED: Growth of occupational licensing is hurting Wisconsin’s economy

Walker has also proposed giving teachers lifetime teaching licenses in the state as an inducement to keep teachers in the profession. Despite a possible teacher shortage in the future, State Superintendent Tony Evers was described by the Milwaukee Journal Sentinel as being “wary” of the proposal.

“As we attempt to address the educator shortage in Wisconsin, we cannot lose sight of how important it is for all kids to be taught by a highly qualified educator,” Evers said. “Like many licensed professionals, a big part of keeping current includes some form of continuing education.”  

Adamczyk said he also supports lifetime teaching licenses, and could see lifetime licenses for other professions as well.

“Just give them the license,” Adamczyk said. “I’m for that for a lot of these things.”

“This is something that hits all corners of the state,” Adamczyk said. “These are regular, everyday people that pay bills, that run businesses, that are self-insured and work in a small business. It’s ultimately a lot of money that they don’t need to be paying.”

James Wigderson reports for Wisconsin Watchdog. Contact him at [email protected] and follow him on Twitter @jwigderson.

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James Wigderson is a Wisconsin-based reporter for Watchdog. He is also an online contributor to MacIver Institute and RightWisconsin, blogs at the Wigderson Library and Pub, and was formerly an award-winning local columnist for the Waukesha Freeman. James is a member of Investigative Reporters and Editors. He lives in Waukesha, WI, with his wife Doreen and their children.