Wisconsin Senate passes budget, sends to governor

MADISON, Wis (Reuters) - The Republican-controlled Wisconsin state Senate on Thursday night approved a two-year $66 billion state budget that cuts spending and hands Governor Scott Walker a significant political victory, lawmakers said.

The bill now goes to Walker for his signature. The Senate vote was 19-to-14 and along party lines, like the 60-to-38 vote in the Assembly that came 3 a.m. local time early in the day.

"I am proud of the work done by the Legislature, which passed a budget today that isn't built on accounting gimmicks, use of one time money for ongoing expenses, or tax increases," Walker said in a statement after the Senate vote.

"The budget approved by the Legislature is an honest document that balances Wisconsin's $3.6 billion budget deficit so that our children and grandchildren aren't saddled with mountains of debt in the future," he said, adding that he would sign the bill before June 30 after a final review.

The legislature had previously passed a budget repair bill for fiscal 2011 ending June 30, which included tough curbs on public union collective bargaining demanded by the newly elected Walker that prompted huge public protests from teachers and other public employees.

Those provisions were passed separately in a parliamentary move that was challenged in courts but upheld this week by the Wisconsin Supreme Court. Unions have since filed a lawsuit to try to block the curbs once again.

The Senate debated almost nine hours on the legislation, turning back eight Democratic amendments, including one to repeal the collective bargaining changes.

As the roll call began, a protester rose to raise a point of privilege.

"I want my democracy back," she yelled.

The Assembly bill included several changes, such as exempting transit workers from the new collective bargaining law, maintaining a rural broadband program, and removing a school voucher provision for Green Bay.

General fund budgets of $14.2 billion in fiscal 2012 and $14.8 billion in fiscal 2013 are projected to result in a $70 surplus at the end of the two years, according to Bob Lang, director of the Wisconsin Legislative Fiscal Bureau.

The spending plan also include $1.7 billion of debt, including $337 million for restructuring outstanding state bonds to avoid debt service payments during the upcoming two years, Lang added.

Democrats said the Republican-crafted budget cuts public school funding by $1.6 billion and university funding by $250 million, while cities and other local governments would get a nearly $77 million reduction. Medicaid, the state and federally funded health care program for the poor, would be slashed by $500 million.

Minority Leader Peter Barca, a Kenosha Democrat, said the bill was a mistake that will permanently hurt families in the state and goes against Wisconsin's values and traditions.

(Reporting by Jeff Mayers and Andrew Beckett; Editing by Karen Pierog, Peter Bohan and Greg McCune)