Fate of state treasurer post is on April 3 ballot

Next Tuesday (April 3), Wisconsin voters will be asked to consider amending the state constitution to abolish the office of state treasurer, a position dating from Wisconsin’s territorial days.  If state voters approve the amendment, Wisconsin would join five states—Florida, Minnesota, Montana, New York and Texas—that have eliminated or merged the office of state treasurer with another office.

Because this ballot question has received relatively little attention in the media and elsewhere in the public arena, one might be tempted to ask, “Why does this vote matter to school leaders?”

One of the state treasurer’s most significant duties is to serve as one of three members of the Board of Commissioners of Public Lands (BCPL), along with the state attorney general and the secretary of state.  This is relevant to school leaders because the BCPL generates investment income for schools and school libraries (in the form of Library Aid), loans money to local governments for public purpose projects and manages about 77,000 acres of state forests in Wisconsin, mainly in the north woods. If the amendment to eliminate the state treasurer is approved on April 3, the lieutenant governor would replace the treasurer on the BCPL.

WASB takes no position on the constitutional amendment based on the fact that we do not have a resolution on the topic.  Nevertheless, because of the potential impact to the BCPL, Common School Fund and State Trust Fund Loan program, school leaders would do well to study the issue of eliminating the state treasurer position and the arguments raised by both sides carefully before going to the polls next Tuesday.

Supporters of the constitutional amendment argue that, since lawmakers and the governor have transferred most of the duties of the treasurer to other state agencies, the office of treasurer is largely obsolete and eliminating it would save money.

Opponents of the constitutional amendment argue that replacing the treasurer with the governor’s running mate might undermine traditional “checks and balances” and thus  turn the BCPL into another arm of the governor’s office, citing experience from other states where similar changes have occurred.  As a result, this change could pave the way for efforts to eliminate two major BCPL programs that have been legislative targets (e.g., 2017 Senate Bill 713) in recent years:  the Common School Fund and the State Trust Fund Loan program (see previous post).  The result, critics argue, could be less money for schools, libraries and local government financing.

WASB did oppose SB 713 based on Resolution 1.41 which supports the State Trust Fund Loan program being available to school districts for borrowing.

Background: The Common School Fund was established by the Wisconsin Constitution in 1848 with the granting by the federal government of about 1.5 million acres of land for educational purposes.  These lands were to be sold to create the principal for a permanent school fund, with the earnings to be exclusively used to support and maintain common schools (now known as K-12 public schools) and “the purchase of suitable libraries and apparatus therefor.”

Managed by the BCPL, Common School Fund monies are invested in State and Municipal Bonds and also loaned directly to Wisconsin communities and school districts as part of the BCPL State Trust Fund Loan Program.  These revolving fund loans are used for:

o   Local economic development projects
o   School repairs and improvements
o   Local infrastructure and utilities
o   Capital equipment and vehicles

The interest paid by schools and municipalities on State Trust Fund Loans comes back to these communities in the form of support for public school libraries (Library Aid), which in many cases is the largest, and in some cases, only source of dedicated funding assistance for these school libraries. (Note: General public libraries do not receive direct state aid that is funded from the Common School Fund.)