Stateline
Midwest
Vo l. 2 0 , No. 6 • J u n e 2 0 1 1
T he M i d w estern O f f ice o f T he C o u ncil o f S tate G overnments
INSIDE
CSG Midwest Issue Briefs 2
• New economic development measures get OK
• A look at recent Great Lakes bills in the states
• Proposals make hunting a constitutional right
• New incentives to restructure long-term care
Around the Region 4
Getting the most out of spending on roads, and
revamping nation’s flood insurance program
Question of the Month 5
How are state-supported passenger rail routes
funded?
Feature Story 5
A look at the rules that impact minorityparty rights and powers in state legislatures
Profile 8
Wisconsin Speaker Jeff Fitzgerald and
Senate Majority Leader Scott Fitzgerald
FirstPerson 9
Kansas Gov. Sam Brownback on his
state’s new Rural Opportunity Zones
CSG News & Events 10
• CSG Midwest secures grant to continue work
on behalf of Great Lakes Legislative Caucus
• CSG’s ‘The Book of the States’
now available online
Capitol Clips 12
• Illinois adopts sweeping reform of its K-12
education system
• New Kansas program seeks to increase
state’s number of engineering graduates
• Ohio ‘pill mill’ law designed to address
problem of prescription drug abuse
• Nebraska reaches compromise to alter how
public-sector labor disputes are resolved
Stateline Midwest is published 12 times a year
by the Midwestern Office of
The Council of State Governments.
Annual subscription rate: $60.
To order, call 630.925.1922.
CSG Midwestern Office Staff
Michael H. McCabe, Director
Tim Anderson, Publications Manager
Cindy Calo Andrews, Assistant Director
Ilene K. Grossman, Assistant Director
Lisa R. Janairo, Senior Policy Analyst
Laura Kliewer, Senior Policy Analyst
Gail Meyer, Office Manager
Laura A. Tomaka, Senior Program Manager
Kathryn Tormey, Policy Analyst/Assistant Editor
Kathy Treland, Administrative Coordinator and Meeting Planner
Trade partners: States
help budding exporters
Rise in exports key to region’s long-term prosperity
by Ilene Grossman ([email protected])
W
hen officials at the Wisconsin
manufacturing company SpeeDee Packaging Machinery began
seeking ways to expand the business,
it became clear that one of their best
options was to export.
The 30-year-old firm — which makes
automated machines used to measure and
dispense dry foods such as coffee and
cereal — primarily sells its equipment
to large businesses (many of them are
Fortune 500 companies) and, as a result,
has a limited U.S. customer market.
“We needed to find other customers,
so it was important for us to look globally,” says Timm Johnson, vice president
for sales and manufacturing at Spee-Dee,
which employs 45 people and is based
in the southeast Wisconsin town of
Sturtevant.
But just as is the case for many other
small- and medium-sized firms, exporting was not an easy step for Spee-Dee.
How would the staff at a small company find the time — and gain the
expertise — to understand different
global markets, overcome language barriers, find buyers and develop an overseas
presence?
The decision to move ahead with
an export plan was not taken lightly,
Johnson says, and he credits the assistance provided by the state with helping
the company through the process.
Spee-Dee is an early success story:
In less than a year, exports have helped
increase the company’s sales figures by
$300,000.
And as states in the Midwest look to
rebound from the Great Recession, these
stories of exporting success will be one
barometer of the health of the region’s
economy.
“Ninety-five percent of the world’s
customers live outside of the United
States,” notes Laura Baughman, an economist with Trade Partnership Worldwide, a
Common export services
provided by states*
1) Export counseling for firms
2) Trade missions (may include travel support)
3) Training programs and seminars
4) Market research
5) Overseas trade offices or representatives
6) Trade shows (may include travel support)
7) Training on export readiness
8) Strategy development for entering new markets
9) Searches for sales agents/distributors
* Ranked in order, based on number of survey
respondents who said service was provided to businesses
Source: State International Development Organizations (2010 survey)
trade and economics research firm.
She adds that the U.S. does not have
the world’s fastest-growing economy, so
growing and emerging markets are good
targets for American companies.
Room for growth: Exports lag
compared to other countries
In the Midwest, with its rich tradition
as a global leader in the manufacturing
and agricultural sectors, states have long
relied on their export economies.
Today, exports account for a significant portion of total state gross domestic
product in all 11 Midwestern states
— from 11.8 percent in Michigan to 4.5
percent in South Dakota, according to
2008 data compiled by Baughman for
the Business Roundtable, an association
of CEOs at leading U.S. companies. (See
table on page 6 for percentages for all 11
Midwestern states.)
Yet these figures are much smaller
than those of many key U.S. trading partners and competitors, note the authors
of a fall 2010 report by the Brookings
Institution.
For example, exports account for 35.8
percent of GDP in China and 35.1 percent
in Canada.
Though exporting is still vitally
important to the Midwest, the region
has lost some of its dominance in recent
years.
“The region can no longer take it for
granted that it will be an export powerhouse,” says Jennifer Bradley, a co-author
Please turn to page 6
Employees use SpeeDee Packaging
Machinery equipment
at a frozen-food plant.
Spee-Dee recently
began exporting its
products, thanks in
part to the help of
the state’s Bureau of
Export Development.
Increasing export
activity is seen by
many economists and
policymakers as critical
to long-term economic
growth for the Midwest.
CSG Midwest Issue Briefs
Issue Briefs cover topics of interest to the various groups and policy committees
associated with the Midwestern Office of The Council of State Governments. Located
in suburban Chicago, CSG Midwest provides staffing services for the Midwestern
Legislative Conference, Great Lakes Legislative Caucus, Midwest Interstate Passenger Rail
Commission and Midwestern Radioactive Materials Transportation Committee. More
information is available at www.csgmidwest.org.
Economic Development
North Dakota, Michigan seek
to boost economy with new
investments in research
L
awmakers across the Midwest are seeking
ways to support and expand existing and new
economic development programs. In North
Dakota and Michigan, bills recently signed into law
will ensure those states’ commitment to technology-based economic growth will continue.
North Dakota’s biennial budget includes $12
million to maintain the state’s Centers of Research
Excellence. Through the centers, the state’s highereducation campuses partner with the private sector
to commercialize projects in several targeted areas:
renewable fuels development, energy workforce
training and technology, aerospace, electronics,
advanced manufacturing, and other technical
research-and-development areas.
The approved appropriation is lower than
the $20 million requested by Republican Gov.
Jack Dalrymple to expand the program. (He
wanted to restructure the existing centers and
provide additional funding for three new centers
that would have focused on commercialization,
entrepreneurship and workforce.) However, the
$12 million will allow the state to continue its
investment in infrastructure and research capacity
at the existing 18 centers.
The North Dakota budget also includes funding
for technology-based entrepreneurship grants and
establishes a program to provide matching grants
for startup technology businesses.
The new $1 million Small Business Technology
Investment Program will provide grants of up
to $50,000; it requires a two-to-one match from
a North Dakota angel investment fund. Other
provisions in the budget to support economic
development include $2 million in workforce
enhancement grants and $4 million for entrepreneurial centers at the state’s non-research
four-year colleges.
In an attempt to encourage investment in hightech businesses and support the state’s agricultural
industry, Michigan Gov. Rick Snyder signed a bill that
will expand the state’s 21st Century Jobs Fund.
The measure (SB 144) will allow a wider range
of industries involved in research and advanced
technology to compete for funds. Currently,
tech companies engaged in activities such as life
sciences and alternative energy are eligible for
funding.
Under the new bill, more
te ch-base d f irms (those
involved with information
technology and agricultural
processing, for example) also
will be eligible for funding.
“We need to open our
door to all innovators, not
just those from a few select
Sen. Mike Green
industries,” says Republican
Sen. Mike Green, sponsor of the bill. “This legislation does exactly that.”
“[It] will encourage economic growth in
Michigan agriculture and the information technology sector,” Green adds.
“It also greatly expands the focus of the 21st
Century Jobs Fund, sending a message to all
innovators and entrepreneurs here in Michigan
and across the nation that we’re ready to do
business.”
Brief written by Laura Tomaka, CSG Midwest staff liaison for the Midwestern Legislative Conference Economic Development Committee. She can be reached at [email protected].
Great Lakes
Future of offshore wind energy,
water withdrawals among issues
being tackled in state capitols
host of policy recommendations: for example, how to
determine the proper siting of offshore wind projects
on Lake Michigan and how to compensate the state
for the use of lake bottomlands.
everal Great Lakes-related measures have
In Michigan, where some of these initial studies
been introduced in state capitols across the
have been done, legislation has been introduced to
region during the first half of
ban the installation of wind turbines in
2011, from bills on how to handle
State legislative
the lakes. The sponsors of HB 4499 have
future offshore wind energy projects to
districts within
cited several concerns about offshore
new legislative proposals on how states Great Lakes basin
wind energy, including its potential
should manage their water resources.
# of
impact on the environment and local
State
Below is a brief synopsis of these
districts
property values.
bills, some of which either already
• Indiana’s new Great Lakes
Illinois
26
have been enacted into law or apcouncil
— With passage of SB 157,
50
peared headed toward legislative pas- Indiana
the Indiana General Assembly has
sage as of late May.
Michigan
148
directed the state’s Environmental
• Future of offshore wind en- Minnesota
14
Quality Service Council to examine
ergy — Will wind turbines be dotting
issues related to the supply and quality
New York
54
the Great Lakes shoreline in the years
of Great Lakes water.
64
ahead? The policy choices that state Ohio
• Tougher invasive species
10
legislators make today will go a long Pennsylvania
rules — Minnesota lawmakers want
way toward answering that question.
Wisconsin
89
to strengthen how the state regulates
In Illinois, lawmakers want to Total
and manages invasive species, which
455
create a Lake Michigan Offshore Wind
have been discovered in more than
Energy Advisory Council to guide their
1,000 Minnesota lakes and rivers.
decisions. Under HB 1558, which had passed both
HF 1162 (passed by the House in May as part of a
larger bill on the environment) authorizes the state
houses as of late May, the council would develop a
S
Department of Natural Resources to conduct morethorough watercraft inspections, increases penalties
for violations, and requires training and permitting
for lake service providers.
• Managing Great Lakes water — Legislation
that would determine how and when states
regulate water withdrawals has been introduced in
New York and Ohio. The New York bill, AB 5318,
was passed by the state Assembly in early May.
Under the measure, anyone with the capacity to
withdraw more than 100,000 gallons per day would
be subject to state permitting requirements. (There
would be some limited exceptions to this rule,
including for agricultural users.) Inter-basin transfers of more than 1 million gallons per day would
have to be registered with the state Department of
Environmental Conservation.
Ohio’s bill, SB 170, would set higher thresholds. It
would require a withdrawal permit for facilities that
withdraw 5 million gallons or more of water from
Lake Erie; 2 million gallons a day from groundwater
and rivers and streams; and 300,000 gallons from
certain designated rivers and streams.
All Great Lakes states are in the process of
adjusting to and complying with the new rules
and requirements set out in the Great Lakes-St.
Lawrence River Basin Water Resources Compact.
Brief written by Tim Anderson. He can be reached at [email protected]. CSG Midwest staffs the Great Lakes Legislative Caucus, a nonpartisan group of state and provincial lawmakers. For more
information on the caucus, and to access its state and federal legislative trackers, go to www.greatlakeslegislators.org.
STATELINE MIDWEST JUNE 2011
Agriculture & Natural Resources
Indiana seeks constitutional
protections for hunting, adds
‘right to produce’ to proposal
M
innesota, North Dakota and Wisconsin
are the three Midwestern states in which
hunting is a constitutional right.
Indiana might eventually become the fourth
now that legislation has been passed that begins
the multi-year process of putting the issue before
voters as a proposed constitutional amendment.
And SJR 9 actually goes a
step further than those other
amendments: It seeks to ensure the right not only to hunt
and fish, but also to “engage in
the agricultural or commercial
production of meat, fish, poultry, or dairy products.”
The sponsor of SJR 9,
Indiana Sen. Brent Steele,
Sen. Brent Steele
says a previous effort to add
the amendment to the Indiana Constitution failed.
He is hopeful that the outcome will be different this
time around, in part because of the addition of the
language on agriculture.
The measure, he says, brings together two constituencies — hunters and farmers — that see themselves
as under attack by animal-rights activists.
“I looked at the Humane Society of the United
States website and saw how they wanted to end
all animal-based protein. They were against both
modern agriculture and hunting,” Steele says.
“I decided that adding farming would put the
wind beneath the wings of the bill” in terms of
helping it pass. The Senate approved the legislation
44-5, and the House passed it 75-12.
In 2005, a version of Indiana’s right-to-hunt
constitutional amendment (without the language on
animal agriculture) was passed by both legislative
chambers. However, before being placed on the
ballot, any proposed amendment approved in one
session must also be passed by the legislature chosen
after the next general election. The right-to-hunt
measure failed to pass the Indiana House in 2007.
Nebraska legislators are also advancing a bill
(LRCA 40) this session to establish in the state
constitution “the right to hunt, to fish, and to harvest
wildlife and to state that public hunting and fishing
shall be a preferred means of managing wildlife.”
These recent actions in the Midwest are
the continuation of a national trend. Last year,
residents in four states outside the region voted
on whether to extend constitutional protections
to include the right to hunt and fish; the measures
passed overwhelmingly in Tennessee, South
Carolina and Arkansas. The proposal was voted
down in Arizona.
Thirteen states now have these constitutional
guarantees in place. Two others have language
that constitutionally guarantees only the right to
fish, while some states have included trapping in
the language.
These proposals are designed “to head off
possible attacks by animal rights/anti-hunting
groups,” according to the United States Sportsmen’s
Alliance.
Opponents of these state measures have said
they trivialize constitutions by establishing protections for hobbies such as hunting, and that they
also could allow criminals to claim a constitutional
“right” to hunt — and, as a result, the right to buy
Hunting as a constitutional right in
Midwestern states
Right to hunt granted by state constitution
a gun.
According to the U.S. Fish and Wildlife Service,
12.5 million Americans hunted and 30 million
fished in 2006, the last date such numbers are
available.
In addition to the constitutional amendments
being proposed in Indiana and Nebraska, another
Midwestern state took action on a hotly debated
hunting issue.
Iowa’s SF 464 was signed into law in March.
It gives the state Natural Resources Commission
the authority to add mourning doves to the list of
game birds that can be hunted legally. With Iowa’s
actions, Michigan is now the only state in the
Midwest state without a dove hunting season.
Opponents of dove hunts argue that the bird
has little value as game and is simply shot for target
practice. In 2006, Michigan voters defeated a ballot
referendum calling for a dove-hunting season.
Brief written by Carolyn Orr, CSG Midwest staff liaison to the Midwestern Legislative Conference Agriculture and Natural Resources Committee. Carolyn can be reached at
[email protected].
Health & Human Services
New federal incentives encourage
states to shift long-term care
spending away from institutions
T
he federal government has launched a new
initiative designed to change how states
deliver services in one of the most costly areas
of Medicaid: long-term care.
Under the State Balancing Incentive Payment
Program, which was included in the federal Affordable
Care Act of 2010, states will have the chance to receive
enhanced Medicaid matching funds in exchange for
increasing their commitment to home and community-based care.
The goal of this new federal incentive is in line
with a common recommendation made by health care
experts: Reduce spending on long-term services by
allowing patients to receive care at home or in their
local communities instead of in institutions.
Evidence from several states shows that providing
services in home and community-based settings
can be less expensive than institutional care. In
addition, consumers report increased satisfaction
when they can receive services at home or closer to
Annual spending on home and
community-based services under
Medicaid waivers
$72
million
$86
million
$202
million
$429
million
$1.4
billion
$354
million
$958
million
$454
million
$1.4
$869
$462 billion
million
million
Source: Kaiser Family Foundation (2007 data)
their families.
Medicaid finances about 40 percent of the nation’s
spending on long-term services.
By law, states are required to cover the costs of
services in institutions, but states can choose to offer
home and community-based options, usually through
a federal Medicaid waiver.
Now, with the new incentive program in place,
states that spend less than 50 percent of long-term-care
dollars on home and community-based services are
eligible for an enhanced Medicaid match. According
to the Kaiser Family Foundation, 45 states — and all
Midwestern states — are eligible.
Up to $3 billion in federal matching funds
is available between fiscal years 2012 and 2015.
States that spent less than 25 percent of their
long-term-care dollars on non-institutional care
in 2009 will need to reach 25 percent by 2015.
They will receive a 5 percentage-point increase in
their matching percentages. States that currently
spend less than 50 percent of their long-term care
budgets on these services will have to reach 50
percent — and will receive a 2 percentage-point
increase in the federal match.
In addition to meeting these spending goals,
participating states must also make administrative
changes to increase the use of home and community-based services in Medicaid. For example,
states must put in place a “no wrong door” system
in which consumers can get information about all
long-term services through a single entity.
Brief written by Kate Tormey, CSG Midwest staff liaison to the Midwestern Legislative Conference Health and Human Services Committee. She can be reached at [email protected].
STATELINE MIDWEST June 2011
Around The Region
Study: Put performancebased transportation
funding on fast track
T
ransportation is one of the “big four” when
it comes to spending in state government.
Along with K-12 education, Medicaid and
higher education, roads and other infrastructure
needs take up a majority of state expenditures
every year. (The big four account for 61 percent of
total state spending, National Association of State
Budget Officers data show, with transportation
making up 7.8 percent of the total.)
All of these big-ticket items are vulnerable to budget cuts under current state fiscal
conditions, but that may be especially true of
transportation — at least if public opinion polls
are any indication.
For example, in a 2010 poll done by the Pew
Center on the States, only one in five Illinois
residents said they would be willing to pay higher
taxes in order to maintain current transportation
funding levels. In contrast, a majority of Illinoisans
said they would accept higher taxes to avoid cuts in
K-12 education and health and human services.
A more recent Pew study, released in May,
points to these recent poll results as one reason
that states should embark on a new path when
it comes to transportation policy and financing
— one that is guided by clearly defined goals
and relies on performance measures and data.
Some states are already on this path, with
Minnesota being one of the 13 that Pew says is
“leading the way” because of how it evaluates
transportation investments.
Minnesota has performance measures for 10
areas identified in its current transportation policy
plan: for example, addressing the needs of the
state’s aging population, and reducing congestion
by targeting areas where a disproportionate share
of travel takes place.
The Pew study lists six transportation goals
for states to use: 1) safety, 2) jobs and commerce,
3) mobility, 4) access, 5) environmental stewardship and 6) infrastructure preservation.
States have fairly robust systems for tracking,
evaluating and making use of safety-related data
(fatalities and injuries), Pew researchers say. But
states are less likely to have other performance
measures in place, such as tying transportation
spending to economic and environmental outcomes or to the ability of people to reach jobs.
T h e f u l l Pe w st u d y i s ava i l a b l e at
www.pewcenteronthestates.org.
Where states stand: Evaluation of
policies that measure efficacy of
transportation investments
In year marked by historic floods,
Congress may reform insurance
program swimming in debt
A
s residents in parts of the Midwest experienced record flooding this spring, discussions began on Capitol Hill about the future
of the National Flood Insurance Program.
Created in 1968, the NFIP was enacted due to
the higher disaster-relief costs being incurred by
taxpayers and the difficulty of getting flood risks
underwritten in the private insurance market.
Forty-three years later, the program itself is now
under water, upwards of $17 billion in debt.
Originally funded in part by appropriations, the
NFIP was financially self-sustaining (through the
premiums and fees paid into it) from 1986 to 2005. Its
financial condition changed dramatically, though, in
the latter part of the last decade due to the devastation
wrought by four different Atlantic hurricanes.
Along with the current debt problem, another
factor has spurred interest in restructuring the NFIP
— the possibility of more frequent natural disasters
in the future. According to a 2008 National Science
and Technology Council report, floods in areas such
as the Midwest that typically occurred every 20 years
are now projected to happen every four to six years
due to changes in climate.
The program has already been through three major reforms, including changes in 1994 (following the
Midwest floods of 1993) that led to stricter purchase
provisions based on the flood risks of communities
and homes.
Despite this change, however, concerns remain that
purchases of flood insurance in flood-prone areas are
too low. Without this insurance, the property owner
must repair damages
out of personal funds or
secure taxpayer-funded
relief payments.
A 2006 report by
the RAND Corporation
estimated that only 49
percent of property
owners in special floodNews from Washington, D.C. hazard areas had NFIP
policies; the market
penetration rate is even less in the Midwest (an
estimated 22 percent).
Several factors contribute to the low participation rate, despite the requirement that flood
insurance be purchased, according to a March
study done by the Congressional Research Service.
Those factors include decisions by the property
owner not to maintain coverage over the life of the
home loan and instances in which the homeowner
either does not have a mortgage or has it through
an unregulated lender.
Long list of potential reforms
Leading the way
Mixed results
Trailing behind
Source: Pew Center on the States
STATELINE MIDWEST JUNE 2011
Earlier this year, a congressional subcommittee
approved a bill (HR 1309) to reauthorize the NFIP
through September 2016.
The chair of that subcommittee, Republican
U.S. Rep. Judy Biggert of Illinois, says the measure
includes important reforms that will “restore the
financial integrity of NFIP.” Those reforms include
better mapping of flood areas; applying actuarially
The cost of “repetitive loss
properties” in National Flood
Insurance Program*
Total
payments
# of
claims
# of
properties
Illinois
$143 million
11,541
3,813
Indiana
$60 million
3,742
1,384
Iowa
$60 million
2,592
1,007
Kansas
$29 million
1,229
434
Michigan
$18 million
1,634
636
Minnesota
$25 million
1,539
622
Nebraska
$11 million
905
366
North Dakota
$16 million
641
273
Ohio
$97 million
5,501
1,990
South Dakota
$3 million
232
106
Wisconsin
$24 million
1,439
621
State
* A repetitive loss property is one that has experienced flood losses on
multiple occasions. These properties account for a disproportionate share of
costs in the National Flood Insurance Program. Most of these properties, too,
are currently subject to insurance premium discounts.
Source: Congressional Research Service (“National Flood Insurance Program:
Background, Challenges, and Financial Status”)
sound pricing to determine premium rates (many
property owners receive below-market rates through
the NFIP); and directing the Federal Emergency
Management Agency to better manage risk.
Under the legislation, FEMA’s role in the program
would change; for example, the agency would be
given the authority to demolish and rebuild flooddamaged properties if it were deemed a cost-effective
flood-mitigation strategy. In addition, the bill seeks
to incorporate the private insurance and reinsurance
markets more into the NFIP.
Some members of Congress also want to ensure
that FEMA’s map modernization program does not
place an undue burden on people with residences or
businesses in floodplains. FEMA is in the process of
reviewing what areas are considered floodplains, and
property owners in newly mapped flood zones might
have to purchase flood insurance.
Meanwhile, the recent experiences of some states
in the Midwest might help shape some of the eventual
reforms. For example, two effective flood-mitigation
strategies have been to acquire at-risk property and
to elevate property in high-risk floodplains. After the
2008 floods in Iowa, the state analyzed its disastermitigation projects since 1990 and discovered that
those efforts prevented possible damages to 834
properties in 2008, thus avoiding $50 million in
flood-related damages.
Another possible NFIP reform is to increase state
involvement. For example, the CRS study says an
interstate compact among the states of North Dakota,
South Dakota and Minnesota might help address
flooding problems in the Red River Valley by helping
officials better maintain dams and levees and make
crucial land purchases.
This article was written by Nell Etheredge, a legislative policy
analyst in the Washington, D.C., office of The Council of State
Governments. Nell can be reached at [email protected].
Q u esti o n of th e M onth
One of the many services provided by the Midwestern Office of The Council of State Governments is
its Information Help Line, a research service intended to help lawmakers, legislative staff and state
officials from across the region. The CSG Midwest staff is always available to respond to members’
inquiries or research needs regarding various public policy issues. The Question of the Month section
highlights an inquiry received by this office. To request assistance through CSG Midwest’s Information
Help Line, call 630.925.1922 or use the online form available at www.csgmidwest.org.
Question: How are state-supported passenger rail routes funded?
Today’s system of state-supported passenger rail
is based on the federal legislation passed in 1970
that created Amtrak. That measure allowed states
to request additional passenger rail service if they
agreed to pay a portion of the costs.
Currently, 15 states subsidize one or more Amtrak
corridor routes, including Illinois, Michigan, Missouri and Wisconsin in the Midwest. (Missouri is
included here because it is part of the Midwest
Interstate Passenger Rail Compact.)
There are 27 Amtrak routes that travel less than 750
miles from start to end. Sixteen of these are entirely
state-supported, while five have some state support.
States pay for these shorter-distance routes through a
variety of means. During the first three years of new service, startup costs for these operations can be funded
through the federal Congestion Mitigation Air Quality
(CMAQ) program. After that time has elapsed, many
states (including Illinois, Missouri and Wisconsin) have
paid for service via general fund allocations.
However, there are instances in which states use
Revenue sources for state-subsidized
passenger rail in the Midwest
# of
daily
trains
Routes
Revenue source
Illinois
28*
Chicago-Carbondale;
Chicago-St. Louis;
Chicago-Milwaukee;
and Chicago-Quincy
General fund
Michigan
4
Grand RapidsChicago and Port
Huron-Chicago
Transportation
fund
Missouri
4
Kansas City-St. Louis
General fund
Wisconsin
14*
State
Milwaukee-Chicago* General revenue
*Route cost shared with adjacent state.
Sources: Midwestern Interstate Passenger Rail Commission and Amtrak
transportation trust funds, either dedicated or nondedicated revenue. (Dedicated revenue means that
the funds, by law, must go to the rail routes.)
In Michigan, state-supported passenger rail service
receives a non-dedicated allocation of revenue from
the transportation fund.
In Iowa, which is looking to establish new passenger
rail service between Chicago, the Quad Cities and Iowa
City (the line would also eventually link to Omaha, Neb.),
the state has developed a multi-tiered business plan to
fund operations for the first 10 years of service. Its plan
calls for using a combination of CMAQ funds and contributions from municipalities that will benefit from the
service. The plan would not use money from the state
general fund or transportation-specific funds.
States outside the Midwest rely on a variety of revenue sources to fund intercity passenger rail. For
instance, California’s Public Transportation Account is
funded with a portion of state taxes on diesel fuel and
gasoline. Pennsylvania has a public transportation
trust fund whose revenue sources include the state
lottery, a portion of the state’s sales tax, and annual
payments from the state’s Turnpike Commission. And
passenger rail service in Oregon is funded primarily
from a dedicated source — personalized or “vanity”
license plate fees.
There has never been a strict definition determining
which Amtrak routes states should pay for and how
much they should pay. But Section 209 of the Passenger
Rail Investment and Improvement Act (passed in 2008)
requires Amtrak and the states to establish a system for
allocating operational and capital costs for routes under
750 miles. State and Amtrak officials have been working on a funding model to meet this new requirement.
The final agreement is expected to be built around the
principles of a fair, equitable and transparent allocation
of operating and capital charges to states that are supporting Amtrak routes under 750 miles.
The minority rules: Measuring the power of
majority party, rights of minority in legislatures
by Tim Anderson ([email protected])
T
he balance between the powers of the majority
party and procedural rights of the minority in
legislatures is an institutional issue not often
discussed beyond the walls of state capitols.
But this year was an exception, the result of the
closely watched “walkouts” this year by two minorityparty caucuses in the Midwest. In Wisconsin, Senate
Democrats left the state in mid-February to prevent
a vote on a controversial bill limiting the bargaining
rights of public employees. Indiana House Democrats
used a similar tactic, protesting contentious measures
involving unions and public schools by leaving the
state. A month-long standoff ensued.
Though not unprecedented, this minority-party
maneuver is seldom employed, in part because state
constitutions make it unusable. In most states, only
a simple majority of members in a legislative body
is required for a quorum and to conduct legislative
business. That is true of every Midwestern state except
Indiana and Wisconsin (see map).
State constitutions, though, don’t determine many
of the procedural rights of minority parties. That is
instead left to the legislatures.
“There is a quite a bit of differences among the
states, more than many might realize,” says Nancy
Martorano, a professor of political science at Dayton
University. “Those variations come both from the
formal rules of the legislature and informal norms.”
In a 2004 paper, Martorano developed an eightpoint index to measure the procedural powers granted
to minority parties in state legislatures.
Several of these measures focus on the power of
the minority within legislative committees. Do these
committees have ranking minority members? What
is the majority-to-minority ratio of membership on
these committees? Does the minority have the right
to request committee meetings and to file committee
reports on the floor of the legislature? Can a bill be
discharged from a committee by a minority vote or
the request of a single member, thus allowing an
open debate by the full legislature? (In North Dakota,
legislative rules allow all bills to reach the floor.)
And then there are the rights afforded to, or not
afforded to, minority parties on the floor of the legislature. For example, some states require a super-majority
vote to suspend normal legislative rules or procedures
— a rule that protects the minority party.
Another factor, Martorano says, is the extent to
which legislatures allow floor amendments on a bill.
Some permit amendments at multiple stages of the
process, thus giving the minority party ample opportunity to have its voice heard. In contrast, Oregon
allows no floor amendments. Many legislatures have
established some kind of middle ground, limiting
amendments to the second or third reading of a bill.
Martorano says she knows of only one state
with a rule close to the U.S. Senate’s “filibuster rule,”
which allows a minority of members (39 of the 100)
to effectively stall and block legislation. That state is
Texas, where a two-thirds vote is required for any bill
Rules on quorums in state legislatures
Two-thirds of members required for quorum
Majority of members required for quorum;
three-fifths required for actions on fiscal bills
Majority of members required for quorum
to be considered on the Senate floor.
Meanwhile, in Indiana and Wisconsin, there has
been legislative movement to prevent future minority-party walkouts from occurring. As part of the
budget bill signed into law in Indiana, a civil penalty
of up to $1,000 per day can now be imposed on a
lawmaker who “commits the act of legislative bolting.”
In Wisconsin, Democratic Sen. Tim Cullen has called
for a constitutional amendment to eliminate the rule
requiring that three-fifths of members be present for
fiscal bills to be passed.
STATELINE MIDWEST June 2011
Cover STORy
CONTINUED FROM page 1
States can’t break down trade barriers, but can help firms overcome obstacles to exporting
of the report and co-director of Brookings’ Great
Lakes Economic Initiative.
“Other places [other regions and offshore locations] have come up to speed in manufacturing,
and metropolitan areas [in the Midwest] have not
done a good job of replacing what has left with
new, more innovative, high value-added products,”
she adds.
In the 2010 study, Bradley and her co-authors
argue that the prosperity of the Great Lakes region
will depend on a shift toward a more exportoriented economy and away from a consumptionbased economy.
Niche for states is helping small and
medium-sized firms sell goods overseas
W
hen it comes to export assistance,
Baughman says, large firms mostly need
help from the federal government in
breaking down trade barriers.
States are best suited to help small and
mid-sized firms, which often require the type of
personalized assistance that the Wisconsin Bureau
of Export Development gave to Spee-Dee.
Unlike larger companies, smaller firms often
don’t have the staff needed to develop and execute
an export strategy, which, to be successful, must
address how to overcome language barriers,
regulatory hurdles, and various banking and legal
issues.
States’ no- or low-cost assistance to these
smaller operations generally cover four broad
areas.
• Education — Counseling firms about the
value of exporting;
• Training — Helping firms get ready to
export;
• Market development — Assisting firms with
market research and development and helping
locate sales agents and distributors; and
• Market access — Aiding firms in entering
markets and selling their products through trade
missions, participation in trade shows and other
targeted assistance.
Recent federal data indicate there is signifi-
Profiles of Midwest’s export economies: Leading markets and products
State
Leading export products
Leading export markets
Illinois
1) Machinery, 28% 2) Chemicals, 13% 3) Transportation
equipment, 11% 4) Computers/Electronics, 10%
5) Electrical equipment, 5%
1) Canada, 28% 2) Mexico, 8% 3) China, 5%
4) Australia, 5% 5) Japan, 4%
Indiana
1) Transportation equipment, 26% 2) Chemicals, 20%
3) Machinery, 16% 4) Computers/Electronics, 7%
5) Primary metal manufacturing, 7%
1) Canada, 40% 2) Mexico, 8% 3) United Kingdom, 7%
4) France, 5% 5) Germany, 5%
1) Machinery, 29% 2) Processed foods, 18% 3) Crop production,
10% 4) Chemicals, 9% 5) Transportation equipment, 7%
1) Canada, 32% 2) Mexico, 16% 3) Japan, 7%
4) Germany, 5% 5) Russia, 3%
1) Transportation equipment, 39% 2) Crop production, 12%
3) Processed foods, 12% 4) Machinery, 9%
5) Computers/Electronics, 8%
1) Canada, 21% 2) Mexico, 11%
3) Japan, 7% 4) Germany, 5%
5) United Kingdom, 5%
Michigan
1) Transportation equipment, 47% 2) Machinery, 9%
3) Chemicals, 9% 4) Oil and gas, 7%
5) Primary metal manufacturing, 5%
1) Canada, 53% 2) Mexico, 14% 3) Germany, 3%
4) Japan, 3% 5) China, 3%
Minnesota
1) Computers/electronics, 21% 2) Machinery, 15%
3) Transportation equipment, 11% 4) Medical equipment and
miscellaneous manufacturing, 10% 5) Processed foods, 7%
1) Canada, 29% 2) China, 5% 3) Japan, 5%
4) Ireland, 5% 5) Mexico, 4%
Nebraska
1) Processed foods, 27% 2) Machinery, 19%
3) Crop production, 15% 4) Transportation equipment, 9%
5) Chemicals, 7%
1) Canada, 28% 2) Mexico, 21% 3) Japan, 7%
4) China, 4% 5) Korea, 3%
North Dakota
1) Machinery, 43% 2) Crop production, 22%
3) Transportation equipment, 8% 4) Processed foods, 8%
5) Oil and gas, 8%
1) Canada, 52% 2) Mexico, 7% 3) Russia, 5%
4) Belgium, 3% 5) Germany, 3%
1) Transportation equipment, 35% 2) Machinery, 13%
3) Chemicals, 11% 4) Computers/Electronics, 7%
5) Fabricated Metals, 6%
1) Canada, 44% 2) Mexico, 8% 3) Brazil, 4%
4) China, 4% 5) Japan, 3%
South Dakota
1) Computers/Electronics, 31% 2) Processed foods, 21%
3) Machinery, 16% 4) Beverages and tobacco products, 7%
5) Transportation equipment, 6%
1) Canada, 35%, 2) Mexico, 18%, 3) Thailand, 12%
4) Hong Kong, 10% 5) Germany, 4%
Wisconsin
1) Machinery, 30%, 2) Computers/Electronics, 15%
3) Transportation equipment, 13% 4) Processed foods, 6%
5) Electrical equipment, 5%
1) Canada, 32% 2) Mexico, 9% 3) China, 6%
4) Germany, 4% 5) Japan, 4%
Iowa
Kansas
Ohio
Source: Trade Partnership Worldwide (for Business Roundtable)
cant room for export growth among small- and
medium-sized enterprises (SMEs): Of the nation’s
approximately 6 million firms with 500 or fewer
employees, only about 270,000 export. Over a
10-year time frame, SMEs accounted for approximately 30 percent of total U.S. export activity.
In Wisconsin, assistance to these firms is provided in several ways, says Mary Regel, director of
the Wisconsin Bureau of Export Development.
The bureau first serves as a facilitator, reach-
ing out to companies that have not sold goods in
foreign markets and encouraging them to explore
the possibility. The bureau partners with 25 organizations around the state — including community
colleges, chambers of commerce, local economic
development corporations and university business
schools — to conduct outreach and offer seminars
to prospective exporters.
The next step is to provide technical assistance:
for example, information on financing, customs
‘Export-rich’ Midwest still relies heavily on ability of its companies to sell goods and services overseas
Nurturing growth in innovation, research and development, and technology firms is one
overarching strategy for states to take. Another is to encourage more businesses to export.
In the 1930s, exports accounted for just 3 percent of the nation’s GDP.
Eighty years later, the goods and services sold to other countries made up 12 percent of
GDP, note Bruce Katz and Emilia Istrate in a recent report for
Export Nation, a research project of the Brookings Institution’s
Approximate % of state’s GDP that is
Metropolitan Policy Program.
based on export activity (2008)
And over that time period, no region came to rely on the
power of exports as an economic engine more than the
Midwest.
Today, for example, exports support 398,000 jobs in Chicago
and 20,000 jobs in Des Moines, according to Export Nation.
Chicago and Detroit rank in the top 10 metropolitan areas in
the nation for highest dollar volume of exports (and greatest
reliance on exports as well). Minneapolis and Indianapolis
are in the top 20.
“The Midwest has been a particularly export-rich region,”
says Jennifer Bradley, co-director of the Great Lakes Economic
Initiative at the Metropolitan Policy Program, noting the
region’s strength as both an agricultural producer and a
manufacturing hub.
7.3%
8.6%
6.5%
11.8%
8.9%
8.5%
STATELINE MIDWEST JUNE 2011
10.4%
9.7%
10.2%
But the region’s status as an export powerhouse has been questioned in recent years, and retaining or regaining it will be critical to the overall economic recovery of states, Bradley says.
But not only do 95 percent of the world’s consumers live
outside of the U.S., Bradley says, the middle class in Asian and
Latin American countries is growing rapidly. And these areas
have been much quicker to come out of the global recession
than have Europe and U.S. regions such as the Midwest.
8.9%
4.5%
Currently, only 1 percent of all firms in the United States
export; most are content to sell domestically, viewing this
country as having a big enough pool of customers.
Source: Business Roundtable
Laura Baughman, an economist with Trade Partnership
Worldwide, notes, too, that U.S. exports are much more than
the goods made by manufacturers or commodities produced
by farmers.
Services are important as well. According to the Brookings
Institution, U.S. exports of commercial services, including
business and technical services, exceeded $500 billion in
2008.
In a recent report for the Business Roundtable, Baughman and
her colleague estimated that more than 38 million U.S. jobs — 6.3 million in the Midwest
— were dependent on trade in 2008.
FEATURE STORY
regulations, legal requirements and regulaattention, Bradley says, helping existing firms
International presence: Countries
tory compliance. Bureau staff also works with
export and expand is an investment that pays off
where Midwestern states have trade
the company to explore the best global markets
for states.
offices or consultants (as of 2009)*
Kathy Hill, team leader in the Iowa Department of
for the firm’s products. Spee-Dee used the state
# of Midwestern states with trade offices/
Country
Economic Development’s International Trade Office,
of Wisconsin’s low-cost, fee-based service to do
consultants
says companies that export tend to be more innovaresearch about potential customers.
7 (Illinois, Indiana, Iowa, Kansas, Minnesota,
tive, and often spend more on research and develop- China
Another common approach used by states is
Ohio and Wisconsin)
ment. These are characteristics seen as vital not only
to help companies connect with local overseas
6 (Illinois, Indiana, Iowa, Kansas, Nebraska and
for individual firms, but for overall state economies Japan
sales agents and distributors. In Wisconsin, this
Ohio)
to be able to compete in the global economy.
work is done with the assistance of the state’s four
Mexico
5 (Illinois, Iowa, Kansas, Ohio and Wisconsin)
Regel says exporting companies bring many
trade offices, located in Canada, China, Brazil and
1 (Iowa)
benefits to Wisconsin’s economy. For example, they Germany
Mexico. (Some of these overseas offices are shared
grow faster than non-exporters and pay higher Canada
3 (Illinois, Ohio and Wisconsin)
with other states.)
wages to employees — between 10 and 14 percent United Kingdom
Wisconsin also helps companies develop an
2 (Indiana and Kansas)
more, according to state of Wisconsin data.
overseas presence through participation in foreign
Israel
2 (Illinois and Ohio)
According to Bradley, Hill’s and Regel’s findings
trade shows. The state offers $5,000 grants to
1 (Indiana)
and observations about exporters in their states Taiwan
companies to participate in these events; the grant
hold true across Brazil
2 (Ohio and Wisconsin)
covers the direct
the
country:
These
Chile
1 (Ohio)
costs of participatcompanies
tend
ing in a show, such
Belgium
2 (Illinois and Ohio)
to innovate more
as registration fees,
2 (Illinois and Ohio)
and p ay hig her South Africa
but cannot be used
India
2 (Illinois and Ohio)
salaries.
for travel costs.
Fe d e ra l d at a Australia
1 (Indiana)
Simi larly,
show that jobs at
Hong Kong
1 (North Dakota)
Iowa provides up
exporting compaJennifer
Bradley,
co-director,
Great
Lakes
Economic
to $3,000 for a
1 (Illinois)
nies pay 15 per- Poland
Initiative at the Brookings Institution
company to travel
1 (North Dakota)
cent more than the Kazakhstan
overseas to meet
average U.S. salary. (In 2008, exports accounted Ukraine
1 (North Dakota)
with potential customers. Companies can receive
for nearly 7 percent of total U.S. employment and * In some cases, international trade offices are shared among multiple states.
these grants up to two times in a year, and the
Source: State International Development Organizations
one in three manufacturing jobs.)
money can be used for participation in trade shows
Regel adds that as Wisconsin struggled through
or trade missions.
the national recession, exporting companies
was contracting.
Now, as states in the Midwest position themhelped maintain the state’s manufacturing base.
Companies that export lead way on
selves
for positive future growth, they will rely at
Companies that exported were more likely to
innovation, pay higher wages
least in part on having a thriving export economy.
be able to hold on their employees, Regel says,
In turn, small- and medium-sized firms will
because of their ability to trade in markets whose
ost states in the Midwest provide some
continue to rely on states for assistance.
economies were growing while the U.S. economy
level of export assistance to small and
medium-sized companies.
Exactly what type of assistance proves to be
New federal export initiative includes more grant money for state programs
most beneficial varies from firm to firm.
During his State of the Union address in 2010, President dations. They include expanding government loan programs
For Spee-Dee, Johnson says, the state of
Barack Obama announced his plans for the National Export for exporters and negotiating international agreements
Wisconsin’s ExporTech program is what gave
Initiative, the goal of which is to double U.S. exports by that remove trade barriers in other countries.
the company the final push to begin selling its
2015.
products overseas. Companies pay $1,000 to enroll
Another priority is to provide additional assistance to small
Meeting this objective would result in an additional 2 and mid-sized enterprises (companies with 500 or fewer
in the program, which runs for three months,
million jobs, administration officials estimate.
employees).
includes experts on everything from shipping to
banking, and results in a customized export plan
Traditionally, export assistance at the federal level has For these firms, export assistance has often come from
for every participating firm.
been fragmented. According to Joe Hurd, chair of the states, and the federal government is looking to expand
In the case of Spee-Dee, the plan called for the
Trade Promotion Coordinating Council, 18 different federal on these state-level initiatives.
agencies have a role in various
company to enter three new markets (Canada,
Under the three-year State
aspects of export promotion.
Mexico and the United Kingdom), as well as to
“At a time when jobs are in Trade and Export Promotion
build on relationships it already had with interThe executive order creating short supply, building exports (STEP) pilot program, up to
national companies in order to get its products in
the new federal initiative es$90 million in federal grants
is an imperative.”
overseas plants.
tablished an Export Promotion
will be provided to states.
Cabinet, made up of a number President Barack Obama, in a 2010 speech
The company’s exporting plan has quickly
State initiatives likely to be
of cabinet-level officials and
announcing his new Export Council
expanded to include India, where Spee-Dee’s mafunded through STEP include
agency directors.
chines are well adapted to dispensing raw rice.
training workshops; support for
A l ong t he way, t he Bu re au of E x p or t
In addition to trying to better coordinate export-develop- overseas travel to develop foreign markets; and help in creating
Development helped Spee-Dee locate overseas
ment efforts at the federal level, the newly formed marketing products, campaigns and trade show exhibits.
cabinet has developed 70 recommendations (published
distributors and sales agents and assisted the firm
in September 2010) for how to increase U.S. exports. This federal assistance comes at a time when states are
in understanding the different safety standards
(Another document outlining a national export strategy struggling to maintain their export-assistance activities.
in overseas markets. And when Johnson made
was expected to be issued in June.)
According to a recent survey done by the State International
a recent sales trip to Mexico, he was able to use
One recommendation of the 2010 report focused on Development Organizations, an association of state trade
Wisconsin’s trade office.
providing more coordinated export advocacy overseas. agencies, more than two-thirds of the states cut funding
States offer most of their export services at
For example, senior-level executive officials in relevant last year to their international programs. The average
reduced costs, and sometimes at no costs.
agencies are now reporting their travel schedules. If a U.S. reduction was 10 percent.
As result, there is a fiscal commitment to
company is being considered for a government contract
exporting — a commitment that, as in all areas
Collectively, though, states have historically devoted more
in another country, all department officials going to that
staff resources to trade promotion than has the federal
of state government, is being tested due to today’s
country, for nearly any purpose, will be asked to mention
government, SIDO says. In 2008, states spent a combined
difficult budget conditions.
this in their meetings.
$103 million on small-business export promotion and on
Though the recruitment of companies from
In all, eight priority areas are targeted in the 70 recommen- attracting foreign plants and investment.
other states or countries often gets more public
“The region can no
longer take it for granted
that it will be an export
powerhouse.”
M
STATELINE MIDWEST June 2011
STATELINE PROFILE
Wisconsin Speaker Jeff Fitzgerald and
Senate Majority Leader Scott Fitzgerald
For lawmaker brothers, public service is a family affair
by Kate Tormey ([email protected])
O
n a regular basis, Wisconsin Senate Majority
Leader Scott Fitzgerald needs to seek the
assistance or counsel of the leader of the
state’s other legislative chamber, the Assembly.
And when he picks up the phone to call the
speaker, the voice on the other end of the line is a
familiar one: that of his younger brother, Jeff.
Both Republicans — and with more than 30
years of legislative experience between them — the
brothers currently lead their respective legislative
chambers, where party control changed hands
after the fall elections.
Their close relationship was particularly helpful
earlier this year, when Wisconsin was in the national
spotlight as lawmakers debated a controversial bill
to change state employee labor policies.
“I look back and think about some of the
decisions we were making in February and
March, and I realize that if you had leaders that
didn’t communicate, [it would have been] painful
sometimes,” Sen. Fitzgerald says.
“Because Jeff and I have that personal relationship, we were able to communicate and work
through things that would have otherwise been
very difficult.”
A tradition of leadership
The Fitzgeralds’ passion for public service was
fostered by their father, who served for 14 years as
sheriff in northeast Wisconsin’s Dodge County. As
young men, the brothers helped their father with
his campaign, writing press releases and arranging
appearances at local events.
And the brothers’ parents were deeply involved
in their local community through service organizations and their church — a civic-minded way of
life that left a lasting impression on their sons.
“My father, being in law enforcement, really
was about helping people, and that was a mantra
that our parents instilled in us from an early
age,” Speaker Fitzgerald says. “Public service is
something to be valued, and you probably don’t get
any greater reward than helping a constituent.”
Sen. Fitzgerald was the first to follow in his
father’s path of public service. He was elected to
the Senate in 1994 and has held the legislative
seat ever since.
It wasn’t long before his younger brother was
drawn to politics as well. Speaker Fitzgerald served
on the Beaver Dam City Council for three years
before being elected to the Assembly in 2000.
Leadership is not new to either of them. They
have each served as minority and majority leader
in the past, including during the 2009-2010 legislative session, when they were minority leaders at
the same time.
The Fitzgeralds have their own styles and
legislative agendas, but this year, they have shared
at least one policy goal: reducing voter fraud.
Late last month, policymakers approved
legislation that requires voters to show identifica-
STATELINE MIDWEST JUNE 2011
tion at the polls. Voters without identification on
election day can cast provisional ballots and later
prove their identity to validate their vote. Both
Speaker Fitzgerald and Senator Fitzgerald strongly
supported the legislation, which had failed to pass
in previous years due to concerns about voter
disenfranchisement.
“It’s really about restoring some voter integrity
in the election system here in Wisconsin,” Sen.
Fitzgerald says. “We’ve had some problems with
fraud, such as felons voting and people double
voting.
“It’s about trying to get back to where we have
a fair election where voters don’t feel that their
vote was cancelled out by someone who committed
fraud.”
Last month, CSG Midwest interviewed the
Fitzgeralds about their legislative careers, policy
goals and leadership philosophies. Here are some
excerpts from the interview.
Q:
When you took over as leaders of the
Wisconsin legislature this year, what was your
first priority when you were sworn in?
Speaker Fitzgerald: We came in the first month of
session … and we had 10 special-session bills that
were really focused on job creation in the state,
including some regulatory reforms. We are trying
to make it better for people to either relocate a new
business here or for businesses in Wisconsin to
expand. It was a very fast pace … and we passed
nine bills in January and we’ve already seen some
great results. Since January, we have seen over
30,000 new jobs in Wisconsin. In a magazine
ranking, we have jumped 17 spots on the list of
best places to do business — the biggest jump of
any state on the list. That’s what our main priority
is: getting people back to work.
Senator Fitzgerald: I don’t think that there was much
else that the members of my caucus ... were focused
on besides the economy and job creation.
The governor came out with a pretty major
reform, which was to eliminate the Department
of Commerce and replace it with the Wisconsin
Economic Development Corporation, which is a
quasi-governmental, private-sector [group]. Many
of the members of my caucus were relieved to see
that we were headed in that direction, because they
knew we needed some major reform.
Q:
Your state was the focus of national attention
earlier this year as lawmakers debated a controversial employee labor bill. What was it like to be under
that level of scrutiny?
Speaker Fitzgerald: We didn’t realize the national attention we were going to gain on that issue. We thought it
would be controversial; whenever you are dealing with
reforms in government, it’s going to be very difficult.
With the thousands of protesters and the people from
all over the country who contacted us, there was a
With more than 30 years of legislative experience
between them, brothers Speaker Jeff Fitzgerald
(left) and Senate Majority Leader Scott Fitzgerald
(right) hold the top leadership positions in
their respective legislative chambers.
huge silent majority that was with us as well.
On the Friday we went in to session to debate
the bill, I had the Capitol police come to me and
tell me that they could no longer guarantee the
safety of me and my members on the floor, so I
had to send them home for the weekend. I had
the votes, and as speaker, you never want to send
your members home when you have the votes. But
they went back to their districts and when we came
back on Monday, we were more unified as a caucus
because they had heard from that silent majority
that they represent. ... All of the controversy that
surrounded the bill has brought us closer and made
us a stronger caucus, which has helped with the
other bills that we’ve had in session.
Senator Fitzgerald: Every day was uncharted territory, and not only making decisions about where
we were as far as legislative priorities and policy,
but on a lot of security decisions and logistical
decisions.
Q:
What has it been like to lead during this difficult
time in state government?
Speaker Fitzgerald: It’s been a very interesting first
five months. I knew going into this that it was
going to be a tough session, and when I was sworn
in as speaker, I said in my speech that I thought
this would be the most difficult session in which
anyone could ever serve. But I also think it could
be the most rewarding. In state government right
now, we’re up against it. And there are only two
ways out: you either cut government spending or
you can raise taxes. When you cut government
spending, you make some tough decisions.
Senator Fitzgerald: It’s been incredible. We never expected that Wisconsin would end up being the tip
of the spear on the changes in the budget repair bill
and would become part of the debate nationwide.
We are very fortunate to have strong caucuses and
leaders that were able to pull together. ... And it’s
still a changing environment. In the Senate, there
is clearly a divide that exists between the parties
that I have never experienced before, so that’s
made it even more challenging.
FIRST PERSON
A for u m for legislators and constit u tional officers
Kansas acts to counter dramatic
population drain in rural counties
‘Opportunity Zones’ incentives seek to attract new residents
by Kansas Gov. Sam Brownback ([email protected])
O
n Jan. 29, 2011, Kansas celebrated its
150th year of statehood. As the governor
of Kansas, I was proud and humbled to
mark the occasion and to reflect on our state’s
rich history.
The first generation of Kansans pledged their
lives and destinies to forge a Kansas of freedom
amidst the blood and fire of war. Against immeasurable odds, they succeeded and God blessed
our state with generations of men and women who
had the courage to build a Kansas of humanity
and hope.
Freedom is central to the Kansas experience,
as is opportunity. Free land drew pioneers to settle
the state at the end of the Civil War with passage
of the Homestead Act.
If you and your family had enough courage
to come and claim 160 acres, then it was yours.
Some families succeeded, some failed, and
meanwhile, a state was born through the creation
of opportunities.
For each of the various groups of people
who move into these counties, services,
businesses and infrastructure will
have to meet their needs, spurring further
economic development.
counties by providing economic incentives to
attract people into those declining areas.
SB 198, which I signed into law on March
31, designates 50 Kansas counties as Rural
Opportunity Zones, or “ROZs.” It provides two
basic incentives: 1) an exemption from the state income tax for five years for individuals who relocate
to those counties from out of state and 2) a statematching program for counties to repay student
loans of up to $15,000 for qualifying students who
move into the ROZ counties.
I was pleased by the broad bipartisan support
Great Recession hit state hard
that SB 198 received from legislators from across
Kansas families again face enormous challenges.
the state.
More than 100,000 Kansans are out of work, and
The Kansas Department of Revenue will
our state budget was more than $500 million in the
administer the tax credit portion of the ROZ prohole. The Great Recession exacted a tremendous
gram, and the Kansas Department of Commerce
toll from our state, and Kansans are still feeling
will oversee the student loan repayment portion.
the effects.
Kansans from small towns and rural counties
National and global forces over which we will
appreciate that there are more tools at their
have little control will certainly come to bear on
disposal to attract people, money and jobs into
Kansas during the next decade. But without goals
their communities. And like the Homestead Act
and a focus, we
that helped settle
will simply wave
our state, ROZs
Kansas counties designated as Rural
in the wind, waitoffer opportunity
ing for a change of
Opportunity Zones
instead of handweather. We canpicking winners
not stand idly by
and losers.
as global events
For example:
overtake us.
• Kansans
During the
who have built a
campaign, Lt.
career in another
Gov. Jeff Colyer
state can come
and I pledged
back to Marion
that growing our
County to spend
state’s economy
their retirement
Source: Kansas governor’s office
would be our
years in the natuadministration’s
ral beauty of the
top priority.
Flint Hills of Kansas without having to pay taxes
Attracting capital and investment to the state
on their income for five years.
is key to growing our way out of the recession,
• Coloradans, Nebraskans and Oklahomans
especially in those parts of our state that are
who have lost their jobs in their home state can
experiencing a loss in population. The 2010 U.S.
cross the state line into Morton, Stanton, Rawlins
Census found that nearly half of the state’s 105
or any of the 17 ROZ counties along Kansas’ border
to take advantage of the job creation that ROZs
counties underwent double-digit percentage
will bring.
population declines in the last 10 years.
• College graduates who want to move home
To fight the loss of population, my administration proposed the creation of Rural Opportunity
to counties such as Stafford County in western
Zones, targeted toward growing rural Kansas
Kansas find it difficult to do so because of lower-
paying jobs and the lack of opportunities for the
county’s young people.
With its five-year student loan repayment
program, the ROZ legislation makes it more
affordable. When qualified teachers, lawyers,
veterinarians, doctors and farmers coming out of
college move to a ROZ county that partners with
the state, they will receive help paying off their
student loans.
Incentives will have ripple effect
I
t is innovative and aggressive incentives
such as ROZs that will help attract business,
entrepreneurs, professionals and families to
move to Kansas. For each of these groups of people
who move into these “opportunity zone” counties,
services, businesses and infrastructure will have
to meet their needs, spurring further economic
development.
This new economic development tool won’t take
effect until January 2012, but my administration
already has heard from businesses and families
from coast to coast who want to know more about
how they can improve their quality of life and help
to grow Kansas.
Just like the original Homestead Act encouraged
the settlers that were the forefathers of Kansas, I
believe our Rural Opportunity Zones will reverse
the population decline these 50 Kansas counties
have experienced for too long, and will help create
and sustain thriving communities.
Kansas Gov. Sam Brownback was elected governor in 2010
after serving 15 years in the U.S. Senate.
Submissions welcome
This page is designed to be a forum for legislators and
constitutional officers. We accept submissions on a
wide range of public policy issues and state initiatives.
The opinions expressed on this page do not reflect
those of The Council of State Governments or the
Midwestern Legislative Conference. Responses to any
FirstPerson article are welcome, as are pieces written
on other topics. For more information, contact Tim
Anderson at 630.925.1922 or [email protected].
STATELINE MIDWEST June 2011
CSG Midwest News & EVENTS
MLC Annual Meeting offers legislators chance
to work on policy issues in nonpartisan forum
S
tate policymakers are encouraged to register for this year’s Midwestern Legislative
Conference Annual Meeting, the premier
event for state lawmakers to gather and share ideas
on issues of importance to this region. The meeting
will be held July 17-20 in Indianapolis.
Registration materials are available at
www.csgmidwest.org.
The conference provides a unique opportunity
for legislators to learn from policy experts and work
with one another in a welcoming, nonpartisan
environment. It will also offer attendees and guests
a chance to see all that Indiana and its capital city
have to offer.
Daytime activities for spouses and other adult
guests include walking tours of historic Indianapolis
and a visit to the Indianapolis Museum of Art. In
addition, trips to the Indianapolis Zoo, the NCAA
Hall of Champions and the Children’s Museum of
Indianapolis have been planned for children. Evening
events — for both MLC meeting attendees and their
guests — include an opening night reception at Lucas
Oil Stadium (home of the Indianapolis Colts and host
of the 2012 Super Bowl) and Family Night at the
Indianapolis Motor Speedway.
The business agenda will offer sessions in a variety
of policy areas, as well as opportunities for professional development. Below are some of the sessions
and topics that will be featured.
Sunday, July 17
MLC Agriculture & Natural
Resources Committee Meeting
•
•
•
•
Ethanol and commodity prices
Economic gardening in rural communities
States and animal-rights activism
Environmental regulations
MLC Economic Development
Committee Meeting
•
•
Regional collaboration on economic
development policy
Economic gardening
A
Monday, July 18
Keynote Address
“America at a Crossroads: Today’s Critical
Policymaking Challenges
and Opportunities” (Ron
Br o w n s te i n , p o l i t i c a l
director, Atlantic Media
Company)
Expert Panel
“America at a Crossroads:
Pe rsp e c t ive s f rom t h e Ron Brownstein
Midwest”
Public Policy Roundtables
•
•
•
State Strategies for Improving Elections
Collective Bargaining and Employee Labor
Law
Transportation Funding Alternatives
Tuesday, July 19
Plenary Session
“The States’ Role in Transforming K-12
Education”
Plenary Session
“R e g i on a l D e mo g raph i c C h ange s and
Implications for the States” (Dante Chinni,
director of the Patchwork Nation project)
Electric transmission in the Midwest
The future of nuclear energy
Alternative and renewable energy
MLC Health & Human Services
Committee Meeting
•
•
•
Medicaid reform/cost containment
Long-term care
Rural health issues
MLC Midwest-Canada Relations
Committee Meeting
•
•
•
•
Perimeter security and the economy
Reducing barriers to exporting
Cross-border supply chains
Cross-border regulatory cooperation
s of late May, a series of proposed
reforms to Ohio’s criminal justice
system had passed the House with nearunanimous bipartisan support and had the
backing of Republican Gov. John Kasich.
HB 86 is based on recommendations made
by The Council of State Governments’ Justice
Center and its Justice Reinvestment project,
which issued a report in February with ideas
on how the state could reduce corrections
spending and use the savings to invest in
strategies that can reduce crime.
The Ohio measure is projected to save
the state up to $100 million over four years.
Among other reforms, the legislation would
divert nonviolent offenders to community
programs in lieu of sending them to prison.
It would also offer inmates time off of their
sentences (up to a 25 percent reduction)
for participating in treatment or other
programs.
CSG’s Justice Reinvestment project
CSG’s Justice Reinvestment project provides assistance to state policymakers in evaluating and
strengthening their criminal justice systems.
To get started, policymakers establish an
interbranch, bicameral and bipartisan team of
elected and appointed officials to work with
the Justice Center’s nationally recognized
policy experts. These experts then consult
with a broad range of stakeholders, such as
prosecutors and public defenders; judges;
corrections and law enforcement officials;
service providers and community leaders;
victims and their advocates; and people who
have been incarcerated.
Luncheon Presentation
“The Beltway and Beyond”
(Mara Liasson, NPR national
politics correspondent)
MLC Energy Committee Meeting
•
•
•
Ohio justice
reforms based
on CSG report
Professional
Development Workshop
“Fro m C a mp a i g n i n g t o
Governing: The Art of Public
Decision Making” (Phillip
Boyle, president, Leading and Governing
Associates)
Mara Liasson
Wednesday, July 20
Closing Session
“An Economic Long View: What Can We
Learn from the Past?” (John Steele Gordon,
business/financial historian)
Together, these policymakers, experts and
stakeholders work to
• a n a l y z e d at a a n d d e ve l op p o l i c y
options,
• adopt new policies and put reinvestment
strategies into place, and
• measure performance.
Along with its work in Ohio, the Justice
Reinvestment project has completed work in
13 other states, including Indiana, Kansas,
Michigan and Wisconsin.
The CSG Justice Center receives support
from the U.S. Bureau of Justice Assistance and
private grant makers such as the Public Safety
Performance Project of The Pew Center on
the States. For more information on the CSG
initiative, visit www.justicereinvestment.org.
The Council of State Governments was founded in 1933 as a national, nonpartisan organization to assist and advance state government. The headquarters office, in Lexington, Ky., is responsible for a
variety of national programs and services, including research, reference publications, innovations transfer, suggested state legislation and interstate consulting services. The Midwestern Office supports
several groups of state officials, including the Midwestern Legislative Conference, an association of all legislators in 11 states: Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Nebraska, North
Dakota, Ohio, South Dakota and Wisconsin. The Canadian provinces of Alberta, Manitoba, Ontario and Saskatchewan are MLC affiliate members.
10
STATELINE MIDWEST JUNE 2011
2011 edition of renowned reference tool
“The Book of the States” available online
T
he 2011 edition of The Council of State
Governments’ signature reference tool, “The
Book of the States,” is now available online in
its entirety and free of charge.
“The Book of the States” is CSG’s longest-standing
publication. Launched in 1935, it has been the state
government reference tool of choice for more than
three-quarters of a century, providing information,
analysis and comparative data on all 56 U.S. states
and territories.
State government leaders and their staffs
— across all branches and agencies — have
come to rely on “The Book of the
States” as the most comprehensive
and accurate resource on state
government.
The publication is also used
across the country by the media,
academic researchers, various
other publications, attorneys,
libraries, graduate students and
private citizens.
The compendium not only focuses on historical data, but also
highlights current trends in various
state public policy areas. Considered
the encyclopedia of state government, and featuring approximately 100,000 pieces
of unique data, it includes 200 in-depth tables,
charts and figures.
The book also has more than 30 articles from
state leaders, innovative thinkers, noted scholars
and CSG policy staff that analyze and report on
the evolving world of state government and state
policy.
Articles found in this year’s edition discuss
topics such as state reforms of public retirement
systems, the solvency of unemployment insurance trust funds, and effective prisoner re-entry
strategies.
In addition, “The Book of the States” contains
data and information from other professional
organizations, including the National Association
of State Budget Officers, the National Association
of Secretaries of State, the National Association
of Attorneys General and the
National Governors Association.
The book also contains information from several federal agencies, including the U.S.
Census Bureau, the Bureau of
Justice Statistics, the Bureau of
Labor Statistics and the Federal
Highway Administration.
In all, information is colle c te d f rom more t han 500
sources in state government, the
federal government, nonprofit
organizations and private citizens
through survey responses and
data verification.
Contents of “The Book of the States” can be
accessed at www.csg.org/bookofthestates.
Print editions will be available in July and can
be purchased at www.csgstore.org.
New grant secured for Great Lakes Legislative
Caucus; group to meet July 15-16 in Indianapolis
Upcoming Midwestern Legislative
Conference and Council of State
Governments Events
Great Lakes Legislative Caucus
Meeting
July 15-16, 2011
Indianapolis, Indiana
Contact: Tim Anderson ([email protected])
630.925.1922
www.greatlakeslegislators.org
66th Annual Meeting of the
Midwestern Legislative
Conference
July 17-20, 2011
Indianapolis, Indiana
Contact: Gail Meyer ([email protected])
630.925.1922
www.csgmidwest.org
17th Annual
Bowhay Institute for Legislative
Leadership Development
August 12-16, 2011
Madison, Wisconsin
Contact: Laura Tomaka ([email protected])
630.925.1922
www.csgmidwest.org
Henry Toll Fellows Leadership
Conference
A
two-year grant from the Joyce Foundation
will allow CSG Midwest to continue its
staff support of the Great Lakes Legislative
Caucus.
The goal of the caucus is to provide a forum
for state and provincial lawmakers to exchange
ideas and information on key Great Lakes issues,
as well as to strengthen the role of legislatures in
protecting and restoring the lakes.
The nonpartisan group is open to all legislators
who represent districts within the basin or who
have an interest in Great
Lakes issues.
It will next meet on
July 15-16 in Indianapolis
in conjunction with the
Midwestern Legislative
Conference Annual
Meeting. A travel and
lodging stipend is availMinnesota Sen. Ann Rest able (on a limited basis)
for legislators who attend
and participate in the caucus event.
For more information, please contact Tim
Anderson ([email protected]) or Mike McCabe
([email protected]) at 630.925.1922.
The caucus meets at least once a year.
C alendar
September 9-14, 2011
Lexington, Kentucky
Contact: Krista Rinehart ([email protected])
859.244.8249
CSG National Conference and
North American Summit
Other member ser vices include a website
(www.greatlakeslegislators.org), an electronic
newsletter, and a bill tracker that monitors state
and federal Great Lakes legislation.
With the new grant, the caucus plans to travel
to state capitols over the next two years to raise
awareness among state legislators about key Great
Lakes issues.
In the past, the caucus has weighed in on various
Great Lakes issues (including a resolution pushing for
stronger measures to keep Asian carp out of the lakes)
and held workshops on the Great Lakes-St. Lawrence
River Basin Water Resources Compact when the
measure was being debated in state legislatures. The
compact became law in 2008.
Minnesota Sen. Ann Rest currently serves as
chair of the caucus, which was started by legislators in 2003.
October 19-23, 2011
Bellevue, Washington
Contact: Kelly Arnold ([email protected])
800.800.1910
www.csg.org/events
67th Annual Meeting of the
Midwestern Legislative
Conference
July 15-18, 2012
Cleveland, Ohio
Contact: Gail Meyer ([email protected])
630.925.1922
www.csgmidwest.org
STATELINE MIDWEST June 2011
11
CAPITOL CLIPS
Kansas invests in plan Major school reform
to boost number of
gets near-unanimous
engineering graduates approval in Illinois
Nebraska finds common
ground on how to
handle labor disputes
Ohio takes on problem
of prescription-drug
abuse with new law
One of the first sentences in a recently enacted
Kansas law explains the rationale for the state’s
new, targeted investment in higher education:
“Engineering intensive industries represent approximately one-third of the statewide payroll
and tax base.”
Amid all of the partisan rancor this year over the
future of public employee labor law, one state in
the Midwest managed to enact a major reform
of its system without a single “no” vote.
Last month, Ohio lawmakers approved
legislation aimed at cracking down on “pill
mills” that illegally provide prescription
medications to patients.
That state is Nebraska. And while LB 397 passed
by an overwhelming margin in the Unicameral
Legislature (48-0-1), and was signed into law the
next day, it took countless hours of negotiations
to finally reach consensus, the Omaha WorldHerald reports. The compromise legislation
maintains public employees’ rights to collectively
bargain, keeps intact the state’s unique process
for resolving labor disputes, and is expected to
help local governments control costs.
Under Ohio’s HB 93, pain-management
clinics — and the physicians who work in them
— will be more heavily regulated under special
licenses from the state Board of Pharmacy. The
state Medical Board will establish rules for
physicians who operate these facilities and
standards for doctors who provide care.
Kansas wants more engineering graduates, and
the increased economic activity that it believes
will come with them.
To that end, SB 127 and SB 154 were passed by
the Legislature and signed into law in May. The
first measure sets aside $10.5 million annually
over the next 10 years. That money will be split
evenly among three public universities, which
will work with the Board of Regents and Kansas
Department of Commerce to increase the number of engineering graduates. The state’s goal is
to have 1,365 graduates by 2021, a 56 percent increase over current figures, according to the Lawrence Journal-World. SB 154 will allow the University of Kansas School of Engineering to issue
$65 million in bonds for an expansion project.
SB 7 passed the Illinois House and Senate with
near-unanimous approval. It is the result of collaborative negotiations among teachers unions,
school-management groups, education reform
advocates and legislators.
According to the Chicago Tribune, the bill requires
a 75 percent vote of members before the Chicago
Teachers Union can strike. SB 7 also authorizes
Chicago Public Schools to increase the number
of hours in a school day and the number of days
in the school year. In addition, the bill instructs
districts across the state to base teacher-layoff
decisions on performance and job qualifications,
not just seniority.
Rules on tenure will change as well. To be
granted tenure, teachers must receive consistently positive evaluations over their four-year
probationary period. Accelerated tenure will be
offered to high-performing teachers, while the
process for removing poorly performing tenured
teachers will be streamlined. SB 7 also requires
school board members to undergo training in
areas such as financial oversight, accountability,
and education and labor law.
CHANGE SERVICE REQUESTED
www.csgmidwest.org
E-mail: [email protected]
Fax: 630.925.1930
Phone: 630.925.1922
Lombard, IL 60148-5095
701 E. 22nd Street, Suite 110
Midwestern Office
June 2011
The Council of State Governments
PERMIT NO. 210
Stateline
Midwest
FREEPORT, IL
U.S. POSTAGE PAID
NON-PROFIT ORG.
Between 1986 and 2006, Kansas was one of 30
states where the number of students earning a
bachelor’s degree in engineering declined, according to a 2008 American Association of Engineering Societies study. Iowa, Minnesota and
Nebraska were the only three Midwestern states
not to experience a drop over this time period.
Longer school days, new rules for when teachers can strike, and changes in the granting of
teacher tenure are among the major provisions
in Illinois legislation that has been hailed as a
milestone in K-12 education policy.
In Nebraska, a five-member, governor-appointed
“labor court,” the Commission on Industrial
Relations, serves as the arbiter of public-sector
labor disputes. Reforms to the commission’s
decision-making process were pushed this year by
cash-strapped municipalities.
Under LB 397, the commission will now consider
not only the wages of employees, but pension
benefits as well. The commission, which makes
its rulings by looking at compensation levels
in comparable local governments, will also be
given a range for where to set compensation
levels — between 98 percent and 102 percent
of the midpoint. During a recession, the range
falls to between 95 percent and 102 percent.
The bill also limits the amount of controlled
substances that physicians can personally
provide to their patients, and these
prescriptions will be tracked in the state’s
existing drug database. In addition, a program
will be created to collect unused medication.
Ohio legislators took on the issue this year due
to continuing concerns about prescription-drug
addiction and related deaths in the state and
across the nation. According to the White House
Office of National Drug Control Policy, rates of
deaths due to drug overdose have doubled since
the early 1990s. Prescription painkillers were
implicated in nearly 40 percent of these deaths.
Policymakers in 43 states have set up or are
in the process of creating prescription-drug
monitoring programs, which track patients
and prescribers to identify troubling patterns.