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**** Appeals panel asks state Supreme Court to take up union bargaining law
Courtesy of the Journal
Sentinel - 4/25/2013
An appeals court asked the state Supreme Court on Thursday to quickly take up a
case over Gov. Scott Walker's controversial law on collective bargaining,
saying the high court should decide the issue without the appeals court ruling
If the seven-member Supreme Court agrees to take
the case, it would speed up final resolution over whether parts of Act 10
violate the state constitution. If the Supreme Court does not accept the case,
the Madison-based District 4 Court of Appeals will have to issue a ruling on
A Dane County Circuit Court judge in September
found parts of the law violated the state constitution's guarantee of free
association and equal protection under the law. The two sides dispute whether
the ruling affects only the unions who brought the case or virtually all
teachers and local government employees in Wisconsin.
"It is hard to imagine a dispute with greater
statewide effect or with a greater need for a final resolution by the Supreme
Court," the three appeals judges wrote in their unanimous request for
the Supreme Court to take the case.
"Although the parties do not address the
topic, news accounts suggest that several municipal employers are engaged in
legal disputes relating to this topic, and many more are left in limbo
wondering whether they are better off engaging in some type of tentative
bargaining or refusing to engage with employee representatives. We urge the
Supreme Court to accept this certification and put these legal issues to
The request comes two days after the unions who
brought the lawsuit filed a motion with Dane County Circuit Judge
Juan Colás asking him to block the Wisconsin Employment Relations Commission
from enforcing parts of Act 10 because of the judge's September ruling.
The suit was brought by Madison Teachers Inc. and
Public Employees Local 61, which represents City of Milwaukee employees.
In his ruling last year, Colás found parts of Act
10 violated the associational rights and equal protection rights of local
government employees who chose to join a union because it treated them
differently than employees who did not choose to join a union. Specifically,
those in a union are limited by how much they can seek in wage increases, while
those not in a union can seek any amount from their bosses, the judge said.
Colás also ruled Act 10 violated the home-rule
clause of the state constitution because it dictated how much Milwaukee
employees had to pay into their city pension funds.
Attorney General J.B. Van Hollen, who is trying to
overturn the lower court ruling, said in a statement he is confident Act 10 is
constitutional and called the appeals court's request a "positive
"Any remaining issues concerning Act 10 need
to be resolved as soon as possible and this action by the Court of Appeals
gives the Wisconsin Supreme Court an opportunity to resolve them in a final,
binding decision," Van Hollen's statement said.
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Here is the latest information we have
regarding ACT 10. LAW continues to monitor this issue and will update
everyone when more details are released. As always, if you have any
questions, please contact our Germantown office.
Parts of Act 10 still on hold, appeals court rules
March 12, 2013 - Courtesy of JS Online
The state Court of Appeals on Tuesday kept in place - at least for now - a lower court's ruling that found parts of Gov. Scott Walker's union law was unconstitutional.
The ruling means that for now portions of the law cannot be enforced. The law, which prompted massive protests in early 2011 at the state Capitol, all but eliminated collective bargaining for most public employees.
The court's ruling comes in the early stages of the appeal, and the three judges could reach the opposite conclusion later.
The court has not yet addressed who is subject to the lower court's decision, which has prompted disagreements between local governments and unions. Some argue the original decision applies only to workers from Dane County and Milwaukee who challenged the law, while others say the original ruling applies to all local government and school district employees.
Those who appealed the decision asked the Court of Appeals to stay the original ruling for a number of reasons, including that it had caused confusion for local officials who did not know if the law, known as Act 10, would ultimately be upheld or struck down by higher courts. The court of appeals was not persuaded by that argument.
"It appears to us that the sort of confusion the appellants
highlight is not a product of the circuit court's decision, but rather a
product of ground-breaking legislation that is now subject to constitutional
challenges," the unanimous court wrote. " . . . It appears that the
potential for litigation on this topic will not be lessened until the merits of
the constitutional issues are finally resolved by action of our supreme
Walker to public pension fund manager: "Can you spare $200
MADISON – Nearly two years after demanding public-sector
unions pick up their share of taxpayer-funded pensions, Gov. Scott Walker is
asking government workers to bet part of their retirements on a plan to
subsidize new businesses in Wisconsin.
The venture capital plan calls for moving hundreds of
millions of dollars into an embattled quasi-public economic development agency
that lost track of a $56 million loan portfolio, among other mismanagement
Documents obtained by Wisconsin
Reporter show that Reed Hall, CEO of Walker’s Wisconsin
Economic Development Corporation, recommended that the State of Wisconsin Investment
Board loan $200 million to WEDC.
Documents obtained by Wisconsin
Reporter show that Reed Hall, CEO of Walker’s Wisconsin
Economic Development Corporation, recommended that the State of Wisconsin Investment
Board loan $200 million to WEDC.
Walker serves as chairman of the WEDC board of directors.
Hall said WEDC would use SWIB’s cash to promote business
growth through taxpayer-subsidized government investments in Wisconsin
In a letter to SWIB, Hall explained that he was turning to
the pension fund because his start-up program would likely find it harder to
tap private investors “due to a lack of demonstrable track records.”
“Given that some of these funds may be managed by first-time
fund managers, the issue arises of where to turn for the outside investment,”
Hall wrote. “We recommend that SWIB consider an allocation … of $200M.”
Hall noted that $200 million “represents less than 0.3
percent of the SWIB’s total assets.” SWIB manages the $76 billion Wisconsin
Retirement System public employee pension trust fund, as well as
several smaller trusts.
SWIB politely rejected WEDC’s offer.
“The challenge for SWIB is to make sure that any new
programs it engages in, such as economic development, does not have any adverse
effect on its management of WRS assets,” the agency responded.
Any “investment opportunity” must meet SWIB’s “established due
diligence and investment requirements.”
“However, use of WRS trust fund monies to fund economic
development initiatives does not meet our fiduciary duty,” the agency added.
“We have to invest based on what’s best for trust fund,”
said Vicki Hearing, communications director at SWIB. “We make the
best investment choices based on the risk that is allowable for the trust fund.
If a fund is not about earning an investment return, then it would not meet our
fiduciary duty. Earnings will not be their primary goal.”
The brush-off might have something to do with the fact that
WEDC has already developed a reputation for inattention to detail. The Milwaukee
Journal Sentinel in October revealed the quasi-public economic
development organization lost track of a $56 million loan portfolio , among
other accountability concerns.
Another document shows WEDC has also approached private
investors for their participation, and acknowledged that politics will
determine the program’s future.
“It is also anticipated that the Program will be funded over
a term of approximately six years in annual tranches to be determined,”
WEDC’s David Volz wrote in a request for information to
venture capital fund managers in December. “There is, however, no assurance
that future Legislatures will continue authorization past the initial biannual
budget period (2013-2014.)”
“Part of what we’re doing is trying to get some inquiries in
advance of what the Legislature might do,” said WEDC spokesman Tom
Thieding. “What Tim (Cooley, director of capital development at WEDC) has
been doing is getting input from early-stage developers to fund managers to
angel investors. This could be a pretty significant investment the state makes,
and we really want to make sure we’ve done our homework and get it right out of
Despite its aversion to the WEDC proposal, SWIB has invested
pension funds locally. The organization’s “Investing in Wisconsin 2012” report
“Over the past 12 years, SWIB has allocated a total of $305
million to itsWisconsin Private Equity Portfolio. This represents 20
percent of SWIB’s total venture capital commitments. From July 2012 until June
2017, SWIB projects new Wisconsin private equity investments will range from
$25 million to $50 million.”
Hearing, the SWIB spokesperson, said $25 to $50 million is
just a guideline and that SWIB could invest more in venture capital at any
time. The investment board just hasn’t “seen the good investment
opportunities,” Hearing said.
In 2012, SWIB committed $25 million to a new venture capital
fund, Venture Investors Early Stage V fund.
SWIB’s portfolio in Wisconsin as of June 2012 shows $126
million that SWIB has committed to venture capital funds that have not been
drawn upon yet.
According to the 2012 report, SWIB has more than $16 billion
of assets in companies based in Wisconsin or companies based elsewhere that
employ more than 20 people in Wisconsin. Most of those assets are held in
Contact the reporter at firstname.lastname@example.org
Federal court of appeals upholds
Gov. Walker's union law
By Jason Stein of the Journal Sentinel
Jan. 18, 2013 12:52 p.m.
federal court of appeals has upheld Gov. Scott Walker's legislation
repealing most collective bargaining for most public employees, though a
separate case remains ongoing at the state level.
year a federal judge in Madison largely upheld the legislation but
struck down parts of the legislation dealing with prohibitions on
government employers withholding union dues from workers' payrolls as
well as a section requiring labor unions to vote to recertify yearly.
The U.S. Seventh Circuit Court of Appeals in Chicago reversed that lower court's ruling in a split decision Friday that upheld the law in its entirety.
district court invalidated Act 10's recertification and payroll
deduction provisions, but upheld the statute's limitation on collective
bargaining. We now uphold Act 10 in its entirety," the decision reads.
State Attorney General J.B. Van Hollen praised the decision in a statement.
nearly two years, those opposing Act 10 have tried every angle to have
it struck down and invalidated. Today’s decision by the Seventh Circuit
confirms what I have stated from the beginning. Act 10 is
constitutional," Van Hollen said. "While there are no guarantees, it is
my hope that this decision will pave the way for resolving any remaining
challenges in a manner that supports the legislative decisions made by
our elected officials.”
David F. Hamilton dissented in part, saying he believed part of the
collective bargaining law violated the First Amendment. Hamilton argued
the state could not bar some unions from having their dues deducted from
paychecks while it allowed public safety unions to do so.
Hamilton concurred with the rest of the decision.
Voting to uphold the law in its entirety were Judges Joel M. Flaum and William J. Bauer. Flaum wrote the opinion.
judge in Dane County last year also struck down parts of the union law
and that case is on appeal and is not affected by he federal ruling
A spokesman for Gov. Scott Walker had no immediate comment.
One attorney for the plaintiffs had no immediate comment Friday, saying she had to look at the decision.
Sen. Luther Olsen (R-Ripon) praised the ruling.
"We knew that this would happen when you get judges that look at the law, not the politics," he said.
said he was hopeful the decision would provide momentum for overturning
the Dane County decision that blocks portions of Act 10.
Wisconsin Pension System Rated Nation’s Strongest
Thursday, November 29, 2012 at 10:12 PM by Jon Peacock
A study released this week by the investment research firm Morningstar, Inc., concluded that Wisconsin has the strongest pension fund among all the states. Wisconsin led nationally by having the highest ratio of fund assets compared to liabilities. With a ratio of 99.8%, Wisconsin was one of just 7 states in 2011 to surpass the 90% level. In addition, Wisconsin had the lowest unfunded liability per capita, of $23 per state resident — far below the $160 per resident in Washington State, which was second lowest.
I apologize if this post could be considered old news, considering that Wisconsin has ranked first or second for a number of years in the fiscal health of the pension fund for public sector employees. Despite that, I think the Morningstar report is worth noting, since we often hear about fiscal practices in our state that are considerably less positive. With that in mind, I think it’s worth celebrating the fact that one of the state’s longstanding fiscal practices has made us a national leader.
Morningstar set 70% as the minimum level for a “fiscally sound” pension system. Its report found that following the recession and its reduction of pension assets, there are 21 states with funding ratios below the 70% standard. The three lowest ratios are in Illinois (43.4%), Kentucky (50.5%) and Connecticut (53.4%).
Madison judge backs deputies in
Eau Claire County dispute
By Associated Press
Oct. 27, 2012
Madison - A Madison judge has ruled Eau Claire County Sheriff deputies can negotiate their health care deductibles.
County Judge Juan Colas' ruling marks a victory for rank-and-file
police officers statewide who have complained their employers have
threatened huge unilateral deductible increases if they didn't
contribute more to their pensions.
municipalities contend language in the state budget prohibits police
and firefighters from having any say in deductible structure. But Colas
disagreed in a ruling handed down Thursday.
Eau Claire County attorney Keith Zehms didn't immediately return a message Friday.
Milwaukee County judge ruled in April that city of Milwaukee police
could negotiate deductibles. The city has appealed that ruling.
Dane County judge
maintains ruling on bargaining limits
By Patrick Marley of the Journal Sentinel
Oct. 22, 2012
Madison - A Dane County judge on Monday kept in
place his ruling striking down major limits on collective bargaining for public
Attorney General J.B. Van Hollen plans to soon ask the Court
of Appeals to stay the original order as he continues his appeal of the case, a
spokeswoman for him said Monday.
Gov. Scott Walker and Republican lawmakers sharply limited
collective bargaining for public workers with a new law last year. Unions for
school and municipal workers sued, and last month Dane County Circuit Judge
Juan Colas threw out significant portions of the law, saying they were
Van Hollen appealed the decision and asked Colas to stay his
decision until a higher court could rule on it. On Monday, Colas declined to
stay his decision, which means local governments cannot follow the portions of
the law that have been found unconstitutional.
LAW is continually monitoring the situation and consulting with our attorney's.
Click here to read.
“Update on The Fallen Heroes Survivor Income Tax Exemption” from the Wisconsin Department of Employees Trust Funds.
Department of Employee Trust Funds
September 21, 2012
WRS Contribution Rates for 2013 Set
Contribution rates for most Wisconsin Retirement System
(WRS) employees and employers will increase from 11.8% to 13.3% of payroll in
2013. In general, the total contribution rate is split equally between the
employee and employer. The Employee Trust Funds (ETF) Board approved the rate
changes yesterday, based on an annual actuarial
While many complex factors affect WRS contribution rates,
the increase is primarily due to two factors: the lingering effects of the
global economic meltdown in 2008 and recent law changes. Contribution rate
changes, whether increases or decreases, are considered normal for retirement
systems that have defined or pre-funded benefits.
Core Trust Fund investment results are distributed
(“smoothed”) over a course of five years in order to soften the impact of
year-to-year volatility of investments. The 26% Core Fund investment loss in
2008 started to affect contribution rates in 2010 and will continue to affect
the rates through 2014.
The new rates will go into effect January 1, 2013. The
contribution rates in the following table may be different for employees who
have collective bargaining agreements.
Protective with Social Security
Protective without Social Security
Van Hollen expected to seek stay Tuesday on union ruling
By Patrick Marley of the Journal Sentinel
Sept. 18, 2012 10:30 a.m.
As Attorney General J.B. Van Hollen moves to stay a ruling finding that
limits on public-sector collective bargaining are unconstitutional,
local officials and unions must sort out how to proceed knowing that the
state of the law could change again.
year, Gov. Scott Walker and Republicans in the Legislature sharply
limited collective bargaining for most public workers, but Dane County
Circuit Judge Juan Colas on Friday voided major portions of the law
because he found they were unconstitutional.
law, known as Act 10, barred most public-sector unions from negotiating
over anything but wages, and it limited any negotiated raises to the
rate of inflation unless voters approved higher raises in a referendum.
It also required teachers, local workers and state employees to pay more
for their health care and pension.
ruling, which applies to local workers but not state employees, allows
unions to negotiate over a broad array of issues, such as workplace
safety, and lifted the limits on how much they can seek in raises. It
also said requiring City of Milwaukee workers to pay more for their
pensions violates the "home rule" clause of the state constitution. His
ruling did not change the requirement that all public workers pay more
for their health care and did not change the requirement that public
workers outside of Milwaukee pay more for their pensions.
Hollen plans to seek a stay of the ruling later Tuesday. He has said he
expects Colas' ruling to ultimately be overturned by a higher court,
while attorneys for the unions are confident it will remain in place.
local officials have to decide what to do as unions begin clamoring to
start up full-fledged bargaining. For instance, Madison Teachers Inc.,
which brought the lawsuit, has said it intends to try to renew
Knapp, research director for the Wisconsin Taxpayers Alliance, said
that holding onto the higher contributions from union employees on their
health and pension benefits was the most important thing for school and
with the law struck down for the moment, school districts could still
see questions if they have used their new authority under Walker's law
to switch insurance carriers to save money or add an hour to teachers'
workday. In districts where administrators work well with union leaders,
those questions will be easier to handle than in schools where
relations are tense, Knapp said.
just worried with all the uncertainty over this," Knapp said. "You
don't know what the next day, the next week is going to bring."
Public Schools is in a different situation than many suburban districts
that have already shifted from union contracts to school board-written
employee handbooks because MPS had a four-year contract in place until
the summer of 2013 when the governor's law passed.
get the district's finances better under control, the Milwaukee School
Board pursued changes under the auspices of Act 10 that were to take
effect once the contract of their largest bargaining unit of about 5,500
educators expires on June 30, 2013. Some of those included furloughs
and rollbacks to retirement benefits.
appears those changes are void, and - absent another court ruling - the
district will have to return to the bargaining table before it could
take those steps.
the decision is likely to be appealed, (Friday's) ruling indicates the
continued and widespread concern in our state about the legality of
Walker's overreach," said Bob Peterson, president of the Milwaukee
Teachers Education Association. "We are encouraged by (the) decision,
and by the prospect of returning to Wisconsin's long-standing tradition
of solving labor disputes through collective bargaining."
Hollen said Monday the ruling consisted of "very inconsistent arguments
based up on what we believe is a misapplication of the law" that he
thinks will be blocked on appeal.
Milwaukee County officials are reviewing the decision to determine its impact on the county budget and other matters.
the short term, we are moving ahead with our budget," said Brendan
Conway, a spokesman for County Executive Chris Abele. "It would be
really difficult at this point to start over."
introduces his 2013 budget Sept. 27. This year's county budget counted
some $22 million in pension and health care savings attributable to Act
10. Walker's bargaining law also left the door open to additional
savings, should the county seek to shift further costs onto employees.
Abele has kept mum on whether he'll propose that for next year.
Abelson, executive director of District Council 48 of the American
Federation of State, County and Municipal Employees, said he was pleased
with the decision but unclear on the immediate impact.
thought all along that Walker overreached (with Act 10) and his law was
illegal," Abelson said. He said if the Dane County ruling survives
appeal, he would expect it would restore collective bargaining to the
more than 3,000 workers his local represents.
have to claw our way back on some of the wage and benefit issues that
were lost," Abelson said. The union lost its certification as a result
of Act 10, as did some other, smaller county unions. County nurses and
other health care workers still have a county contract in force.
his ruling, Colas found many of the collective bargaining limits
violated local workers' rights to freedom of speech, freedom of
association and equal protection under the law.
It is just one of several court challenges to
the law. Walker has retained the firm Michael, Best & Friedrich to
help Van Hollen defend the law, and so far taxpayers have spent about
$675,000 for its work. Its contract is capped at $850,000.
Collective bargaining battle far from over
legal battle over the collective bargaining law is about to get longer and more
County judge struck down the law last week, and now it's going to be appealed.
Wisconsin Attorney General J.B. Van Hollen will throw a big red flag. He
wants a higher court to review the law that was ruled unconstitutional, and put
everything on hold until a decision is made.
going to be confusion even if a stay is entered," said former Wisconsin
Supreme Court Justice Janine Geske. She predicts a court will put the
brakes on the recent decision until the case is appealed, but if they
don't. "Well then we have chaos," said Geske.
problem is clear, all future negotiations will be without the law but the
problem is past negotiation or the 'lack there of' was based on that law."
Court could speed up the process by taking the case right away and bypassing
the court of appeals. It would take four justices to say yes; the issues
unconstitutional primarily because there are two classes of workers: the
workers who don't have a collective bargaining agreement can fight for wages
above the cost of living increases, and the others can't," said Geske.
Attorney General J.B. Van Hollen thinks the state will ultimately
prevail. "We've got a lot people working on this case."
taxpayers have already been billed $728,000 in legal fees to defend the
law. Throw in $13.5 million in this year's recall races and it starts to
will of the people who have spoken through the legislature and the governorship
should not be upset until it's ultimately struck down, if it is," said Van
||Click the following to access story:|
September 4, 2012
Annual Certification Election Activity Halted Pending US Court of Appeals Decision
March 30, 2012, United States District Court Judge William M. Conley
issued a Decision and Order that enjoined the WERC from taking any
further action as to the initial annual certification elections created
by 2011 Wisconsin Act 10. That Decision and Order is on appeal to the
U.S. Court of Appeals for the Seventh Circuit. Pending a decision from
that Court, the WERC cannot take any action to certify the results of
the annual certification elections held in March 2012 or conduct any
additional annual certification elections.
Seventh Circuit Court of Appeals has scheduled oral argument for
September 24, 2012, regarding appeals filed as to Judge Conley’s Order.
It is not known when the Court of Appeals will issue its decision.
will keep tabs on this case and post future developments as soon as
they are available. As always, if you have any questions, please call
the Germantown office at 1-800-657-0742.
Update on WRS Study
Shown below, is a link to the WRS Study that was required
in Act 32 by Governor Walker. Pursuant to the study, the Department of
Employee Trust Funds made the following recommendation:
Given the current financial health and unique risk-sharing
features of the WRS, neither an optional DC plan nor an opt-out of employee
contributions should be implemented in Wisconsin at this time. Analysis included in this study from
actuaries, legal experts, financial experts, and information from similar
studies conducted in other states show that there are significant issues for
both study items in terms of the actual benefit provided and potential for
negative effects on administrative costs, funding, long term investment
strategy, contribution rates, and individual benefits.