The Legislature's Next Project: Truth in Budgeting

It's a good thing that the Wisconsin Leggies are trying to pass an "earmark ID" bill.  Let the sun shine in!

Here's another good thing for them to do next session:  GAAP standards for Wisconsin budgets.

...Last year, the Wisconsin Legislature passed a budget that avoided most of the accounting tricks and fund transfers used by previous administrations, Democrat and Republican alike, to balance the budget as state law requires.

“(W)e balanced the $3.6 billion budget deficit with long-term, structural reforms. We thought more about the next generation than we did about the next election,” Gov. Scott Walker said in this year’s State of the State address.

Well, maybe not.

...A report from the nonpartisan Legislative Fiscal Bureau indicated that Wisconsin is projected to have a $53 million deficit at the end of fiscal 2012, which concludes June 30, and a $208 million deficit at the end of fiscal 2013, due largely to lower-than-expected tax revenue.

Even if the state’s general fund — which covers most state expenses — was statutorily balanced, the state’s Generally Accepted Accounting Principles deficit, or GAAP, measuring beyond the general fund, is running between $2.5 billion and $3 billion, said Dale Knapp, research director of WISTAX, a private government research nonprofit.

GAAP is a much more stringent way of accounting.

Knapp gave the analogy of charging an item on a credit card: Under the state’s current way of accounting, there isn’t a budgeted expense until the bill comes due.

Balancing the budget using GAAP principles may take another 6 years or so, but honest budgeting should be a priority for actual Conservatives.