2020 WI 69

SUPREME COURT OF WISCONSIN

CASE NO.: 2019AP2054-OA

COMPLETE TITLE: Wisconsin Small Business United, Inc., Amy 

Dailey, Larry Gierach, Doug Hustedt, Sandi 

Vandervest and Tom Vandervest,

 Petitioners,

 v.

Joel Brennan, in his official capacity as 

Secretary of the Department of Administration, 

Peter Barca, in his official capacity as 

Secretary of the Department of Revenue and 

Carolyn Standford Taylor, in her official 

capacity as Acting Wisconsin Superintendent of 

Public Instruction,

 Respondents.

ORIGINAL ACTION

OPINION FILED: July 10, 2020 

SUBMITTED ON BRIEFS: 

ORAL ARGUMENT: April 20, 2020 

SOURCE OF APPEAL:

COURT: 

COUNTY: 

JUDGE: 

JUSTICES:

HAGEDORN, J., delivered the majority opinion of the Court, in 

which ROGGENSACK, C.J., ANN WALSH BRADLEY, ZIEGLER, and DALLET, 

JJ., joined. REBECCA GRASSL BRADLEY, J., filed a dissenting 

opinion, in which KELLY, J., joined.

NOT PARTICIPATING:

 

ATTORNEYS:

For the petitioners, there were briefs filed by Mike B. 

Wittenwyler, Kendall W. Harrison, Zachary P. Bemis, and Godfrey 

& Kahn, S.C., Madison. There was an oral argument by Kendall W. 

Harrison.
2

For the respondents there was a brief filed by Colin Roth, 

assistant attorney general, and Hannah S. Jurss, assistant 

attorney general; with whom on the brief was Joshua L. Kaul, 

attorney general. There was an oral argument by Colin Roth. 
2020 WI 69

NOTICE

This opinion is subject to further 

editing and modification. The final 

version will appear in the bound 

volume of the official reports. 

No. 2019AP2054-OA

STATE OF WISCONSIN : IN SUPREME COURT

Wisconsin Small Businesses United, Inc., Amy 

Dailey, Larry Gierach, Doug Hustedt, Sandi 

Vandervest and Tom Vandervest, 

 Petitioners,

v.

Joel Brennan, in his official capacity as 

Secretary of the Department of Administration, 

Peter Barca, in his official capacity as 

Secretary of the Department of Revenue and 

Carolyn Standford Taylor, in her official 

capacity as Acting Wisconsin Superintendent of 

Public Instruction, 

 Respondents,

FILED

JUL 10, 2020

Sheila T. Reiff

Clerk of Supreme Court

HAGEDORN, J., delivered the majority opinion of the Court, in 

which ROGGENSACK, C.J., ANN WALSH BRADLEY, ZIEGLER, and DALLET, 

JJ., joined. REBECCA GRASSL BRADLEY, J., filed a dissenting 

opinion, in which KELLY, J., joined.

ORIGINAL ACTION for declaratory judgment. Relief denied.

¶1 BRIAN HAGEDORN, J. This is an original action 

challenging whether two partial vetoes in the 2017-19 biennial 

budget exceeded the governor's constitutional authority. While 
No. 2019AP2054-OA

2

the respondents defend the vetoes on their merits, they also 

contend this challenge is too late and should be barred by the 

equitable doctrine of laches. We agree that laches should be 

applied here. The respondents have proved the three elements of 

a laches claim——unreasonable delay, lack of knowledge a claim 

would be brought, and prejudice. And given the reliance 

interests at stake and the need for stability and certainty in 

the enactment of state budget bills, we exercise our discretion 

to apply laches based on the facts of this case. Accordingly, 

we dismiss the original action.

I. BACKGROUND

¶2 Wisconsin's practice of funding the state's operations 

and programs through biennial budget bills is nearly a century 

old.1 As points of reference, the state's fiscal year begins on 

July 1 and ends on the following June 30, and a new biennium 

commences every odd-numbered year. Wis. Stat. § 20.002(1) 

(2017-18).2

¶3 Each new biennial budget is a complex collaboration 

and negotiation between the executive and legislative branches.3 

 

1 See ch. 97, Laws of 1929; see also Richard A. Champagne, 

Legislative Reference Bureau, Wisconsin Executive Budget Bills, 

1931-2019, at 1 (2020) (describing the biennial budget bill as 

"easily the most significant piece of legislation that is 

enacted during the entire legislative session").

2 All subsequent references to the Wisconsin Statutes are to 

the 2017-18 version unless otherwise indicated.

3 See Champagne, supra, at 1-6 (outlining the biennial 

budget process and its core principles).
No. 2019AP2054-OA

3

Relying on fiscal estimates and projections from the various 

branches and agencies making up state government, the governor 

creates a budget bill and submits it to the legislature. See

Wis. Stat. §§ 16.45, 16.46, 16.47. Once received, the bill is 

referred to the Joint Committee on Finance, which reviews, 

amends, and ultimately votes to recommend the revised bill for 

legislative passage. See § 16.47(1m); Wis. Stat. § 13.093 to 

§ 13.102. Like any other bill, the biennial budget is then 

debated and may be amended by the two houses of the legislature. 

After passage by both houses, the bill is presented to the 

governor. Wis. Const. art. V, § 10(1)(a).

¶4 At this point, Article V, Section 10 of the Wisconsin 

Constitution gives the governor three options: sign the whole 

bill into law, veto the whole bill, or sign the bill into law 

while vetoing parts of it. Upon presentment, a bill becomes law 

if it receives the governor's approval and signature (or if he 

does not sign or veto it within six days (Sundays excepted)). 

Id. art. V, § 10(1)(b), § 10(3). When vetoed in whole, a bill 

returns to the legislature and may still become law if approved 

by two-thirds of both houses. Id. art. V, § 10(2)(a). A third 

option is unique to appropriation bills, including biennial 

budget bills. Namely, the governor may approve such bills in 

whole or in part. Id. art. V, § 10(1)(b).

¶5 This power to partially veto appropriations bills was 

added as an amendment to the constitution in 1930, but the 

people of Wisconsin have since modified it twice. The governor 

may not exercise his partial veto authority to create a new word 
No. 2019AP2054-OA

4

by rejecting individual letters in words, nor may he create a 

new sentence by combining parts of two or more sentences. Id.

art V, § 10(1)(c). After any partial veto, the governor must 

return the rejected part with objections in writing to the 

legislature for its reconsideration. Id. art. V, § 10(2)(b). 

The legislature can override the veto if two-thirds of both 

houses agree to approve the rejected part. Id. Absent that, 

the enacted law remains; only parts approved by the governor 

become law. Id. art. V, § 10(1)(b).

¶6 Governor Scott Walker penned the partial vetoes at the 

heart of this dispute within Wisconsin's 2017-19 biennial 

budget. The governor signed that budget, with partial vetoes, 

and it went into effect as 2017 Wis. Act 59 on September 23, 

2017. Two of Governor Walker's vetoes struck individual digits 

from dates written in numeral form. The petitioners 

(collectively WSBU)4 contend that these digit vetoes violated the 

constitutional prohibition against creating new words by 

striking individual letters in words. Wis. Const. art. V, 

§ 10(1)(c).

 

4 The petition for original action was filed by Wisconsin 

Small Businesses United, Inc., Amy Dailey, Larry Gierach, Doug 

Hustedt, and Sandi and Tom Vandervest.

The named respondents were Secretary of the Department of 

Administration Joel Brennan, Secretary of the Wisconsin 

Department of Revenue Peter Barca, and Acting Wisconsin 

Superintendent of Public Instruction Carolyn Standford Taylor, 

each in his or her official capacity and all represented by the 

attorney general.
No. 2019AP2054-OA

5

¶7 The first disputed provision of Act 59 is § 1641m. 

When presented to the governor, § 1641m imposed a one-year 

moratorium on an existing law that enabled school districts to 

increase their revenue limits by adopting a resolution based on 

energy efficiency efforts. 2017 A.B. 64, § 1641m. See 

generally Wis. Stat. § 121.91(4)(o). To accomplish this, the 

text sent to the governor's desk proposed the revenue-limit 

adjustment be effective "only to a resolution adopted after 

December 31, 2018." Exercising a partial veto, the governor 

struck the "1, 2" from "December 31, 2018" (December 31, 2018), 

thereby changing the date to "December 3018." In effect, the 

proposed one-year moratorium was transformed into a one-thousand 

and one-year moratorium. 2017 Wis. Act 59, § 1641m (codified at 

§ 121.91(4)(o)4.).

¶8 When the governor received the second disputed 

provision of Act 59, § 2265, it would have imposed a year-long 

delay for the implementation of 2013 Wis. Act 229. As signed 

into law in 2013, Act 229 authorized third-party lenders that 

provide credit by way of retailer-lender credit cards to take 

tax deductions for bad debts. 2017 A.B. 64, § 2265. See 

generally 2013 Wis. Act 229. Act 229 was originally scheduled 

to go into effect on July 1, 2015, but the 2015-17 budget moved 

the effective date to July 1, 2017. 2015 Wis. Act 55, § 4750. 

In its 2017-19 budget bill, the legislature twice used the date 

"July 1, 2017 2018" to authorize another new effective date for 

Act 229. 2017 A.B. 64, § 2265. In other words, the law on the 

books when the bill arrived at the governor's desk had an 
No. 2019AP2054-OA

6

effective date of July 1, 2017, and the legislature sought to 

delete "2017" and add the year "2018." In exercising his veto 

pen, the governor rejected the legislature's effort to strike 

"20" and "7" and accepted the legislature's insertion of "8," 

creating a veto that looked like this: July 1, 2017 2018. In 

effect, each use of July 1, 2018 was changed to July 1, 2078, 

and a one-year implementation delay was turned into a sixty-oneyear delay. 2017 Wis. Act 59, § 2265.

¶9 The 2017-19 biennial budget, as modified by these and 

other partial vetoes, became law on September 23, 2017. No 

vetoes were overridden by the legislature, and the biennium came 

and went. In 2019, another biennial budget was proposed, 

negotiated, passed, and signed into law. The 2019-21 biennial 

budget went into effect as 2019 Wis. Act 9 on July 4, 2019. It 

wasn't until October 28, 2019, nearly four months after the old 

biennium had passed and the new biennial budget had been in 

effect, that WSBU filed this petition for original action. 

Having already granted a separate petition reviewing the 

governor's partial veto powers,5 we granted WSBU's petition as 

well and heard arguments in both cases on the same day.

II. DISCUSSION

¶10 While the respondents defend the constitutionality of 

the challenged vetoes, they also urge us not to reach the merits 

 

5 Bartlett v. Evers, No. 2019AP1376-OA, slip op. (Wis. S. 

Ct. July 10, 2020) (amended petition for original action granted 

on October 16, 2019).
No. 2019AP2054-OA

7

and instead bar WSBU's action pursuant to the doctrine of 

laches. Before this term, this court has addressed the 

governor's constitutional authority to veto parts of 

appropriations bills in eight decisions; none involved 

consideration of a laches defense. All but one of these cases 

were filed within a few months of the vetoes going into effect.6 

 

6 See State ex rel. Wis. Tel. Co. v. Henry, 218 Wis. 302, 

260 N.W 486 (1935) (vetoes of emergency relief budget bill, ch. 

15, Laws of 1935, published on March 27, 1935, challenge filed 

on April 2, 1935); State ex rel. Finnegan v. Dammann, 220 

Wis. 143, 264 N.W 622 (1936) (vetoes of provisions regulating 

motor carriers, ch. 546, Laws of 1935, published on October 4, 

1935, challenge decided by court on January 7, 1936); State ex 

rel. Martin v. Zimmerman, 233 Wis. 442, 289 N.W 662 (1940) 

(vetoes of public welfare appropriations bill, ch. 533, Laws of 

1939, published on November 18, 1939, challenge filed on 

December 2, 1939); State ex rel. Sundby v. Adamany, 71 

Wis. 2d 118, 237 N.W.2d 910 (1976) (vetoes of 1975-77 biennial 

budget bill, ch. 39, Laws of 1975, published on July 30, 1975, 

oral argument held on December 2, 1975); State ex rel. Kleczka 

v. Conta, 82 Wis. 2d 679, 264 N.W.2d 539 (1978) (vetoes of 

provisions regarding public financing of election campaigns, ch. 

107, Laws of 1977, published on October 20, 1977, challenge 

filed on December 2, 1977); State ex rel. Wis. Senate v. 

Thompson, 144 Wis. 2d 429, 424 N.W.2d 385 (1988) (vetoes of 

1987-89 biennial budget bill, 1987 Wis. Act 27, published on 

July 31, 1987, oral argument held on October 20, 1987); Citizens 

Util. Bd. v. Klauser (CUB), 194 Wis. 2d 484, 534 N.W.2d 608 

(1995) (veto of 1993-95 biennial budget bill, 1993 Wis. Act 16, 

published on August 11, 1993, challenge filed on June 13, 1994); 

Risser v. Klauser, 207 Wis. 2d 176, 558 N.W.2d 108 (1997) 

(vetoes of transportation budget bill, 1995 Wis. Act 113, 

published on December 20, 1995, challenge filed on January 4, 

1996).
No. 2019AP2054-OA

8

And the lone outlier was filed within a year, well before a new 

budget bill was even proposed.7

A. Laches Generally

¶11 Laches is an affirmative, equitable defense designed 

to bar relief when a claimant's failure to promptly bring a 

claim causes prejudice to the party having to defend against 

that claim. Sawyer v. Midelfort, 227 Wis. 2d 124, 159, 595 

N.W.2d 423 (1999). While formulated differently across cases 

and jurisdictions, the laches doctrine is broadly understood to 

ask whether a party delayed without good reason in raising a 

claim, and whether that delay prejudiced the party seeking to 

defend against that claim. See State ex rel. Wren v. 

Richardson, 2019 WI 110, ¶14, 389 Wis. 2d 516, 936 N.W.2d 587 

(explaining that laches "is founded on the notion that equity 

aids the vigilant, and not those who sleep on their rights to 

the detriment of the opposing party" (quoted source omitted)).

¶12 In Wisconsin, application of laches is premised on 

proof of three elements: (1) a party unreasonably delays in 

bringing a claim; (2) a second party lacks knowledge that the 

 

7 The partial veto challenge in CUB was filed ten months 

after the vetoed biennial budget bill went into effect. See 194 

Wis. 2d at 487-89. While initiated later than the other veto 

cases, this original action was still filed more than eight 

months before a new biennial budget was proposed by the governor 

and more than thirteen months before a new biennial budget bill 

was published. See S. Journal, 92d. Reg. Sess., at 73-79 

(governor's 1995-97 biennial budget message delivered to the 

legislature on February 14, 1995); 1995 Wis. Act 27 (published 

on July 28, 1995).
No. 2019AP2054-OA

9

first party would raise that claim; and (3) the second party is 

prejudiced by the delay. Id., ¶15. The party seeking 

application of laches bears the burden of proving each element. 

Id. Whether that burden is carried is a question of law. 

Id., ¶16. Even if all three elements are satisfied, application 

of laches is left to the sound discretion of the court asked to 

apply this equitable bar. Id., ¶15.

B. Laches Applied Here

¶13 The parties dispute all three elements, and contend 

that we should exercise our discretion in their favor. We 

consider each of these matters in turn.

1. Unreasonable Delay

¶14 The first element requires the respondents to prove 

WSBU unreasonably delayed in bringing the suit. What 

constitutes a reasonable time will vary and depends on the facts 

of a particular case. Foote v. Harrison, 137 Wis. 588, 590, 119 

N.W. 291 (1909) (quoting Rogers v. Van Nortwick, 87 Wis. 414, 

429, 58 N.W. 762 (1894)); see also Wren, 389 Wis. 2d 516, ¶18 

("Whether a delay is reasonable is case specific; we look at the 

totality of circumstances." (citation omitted)).

¶15 There can be no dispute that WSBU's claim became 

actionable on September 23, 2017, the day 2017 Wis. Act 59 went 

into effect. At that point, the underlying facts of the 

original action were set. This is true even though the 

legislature could have subsequently overridden the disputed 
No. 2019AP2054-OA

10

vetoes. It is the governor's procedural use of the vetoes, not 

the substance of the underlying laws, that is at the heart of 

WSBU's challenge. Notwithstanding, WSBU did not file its 

original action until October 28, 2019, well after the 

applicable biennium had closed and nearly four months after the 

new biennial budget had gone into effect.

¶16 WSBU does not contest these basic facts. Instead, it 

observes that other types of actions are governed by statutes of 

limitation longer than the time period at issue here, and argues 

the effect of these partial vetoes will be with us for years 

(decades in one instance, and a millennium in the other). This 

is true, but does not demonstrate that its delay was reasonable. 

Laches is an equitable doctrine, and therefore can and regularly 

does apply even before a statute of limitation has expired. See

Wren, 389 Wis. 2d 516, ¶13 n.8 (explaining Wisconsin 

jurisprudence has long recognized laches as an equitable defense 

that operates "independently of any statute of limitations" 

(quoting Sheldon v. Rockwell, 9 Wis. 158 (*166), 162 (*181) 

(1859))); Zizzo v. Lakeside Steel & Mfg. Co., 2008 WI App 69, 

¶7, 312 Wis. 2d 463, 752 N.W.2d 889 ("Laches is distinct from a 

statute of limitations and may be found where the statute of 

limitations has not yet run."). Moreover, it would be quite 

normal for partial vetoes to have a dramatic effect. Many a 

legislative proposal has been irrevocably altered by a 

governor's partial veto pen.

¶17 Where a litigant challenges the process by which a 

bill becomes a lawindeed whether it should even be treated as a 
No. 2019AP2054-OA

11

law at alla reasonably prompt lawsuit is and should be the 

norm. See, e.g., State ex rel. Ozanne v. Fitzgerald, 2011 

WI 43, ¶¶29, 36, 334 Wis. 2d 70, 798 N.W.2d 436 (Prosser, J., 

concurring) (bill signed by the governor on March 11, 2011, 

constitutional challenge to the bill's procedural enactment 

filed on March 16, 2011). This is far different than a 

challenge to the substantive validity of a law, where such 

lawsuits may not even ripen until enforcement begins. See

Schaeffer v. Anne Arundel Cty., 656 A.2d 751, 753-55 (Md. 1995) 

(distinguishing substantive objections to statutes from belated 

challenges to their procedural enactment for purposes of 

laches); Stilp v. Hafer, 718 A.2d 290, 293-94 (Pa. 1998) 

(finding lack of due diligence in pursuing procedural challenge 

given relevant legislative record and constitutional provisions 

publicly available at the time of the law's enactment).8 Here, 

as we discuss more fully below, money has been spent, revenues 

have come in, and the books have already been closed on the 

operation of the 2017-19 biennial budget. Cf. Schulz v. State, 

615 N.E.2d 953, 957 (N.Y. 1993) (finding an 11-month delay 

unreasonable in constitutional challenge brought against the 

 

8 WSBU's reliance on a case rejecting a laches defense 

against a constitutional challenge to the substance of a law is 

misplaced given it is attacking the process by which Act 59, 

§§ 1641m and 2265 were enacted, not the substance of those 

provisions. Cf. Cathcart v. Meyer, 88 P.3d 1050, 1058-59 (Wyo. 

2004) (rejecting laches defense against a challenge to a termlimit initiative based on the constitutionality of its 

substance, explaining there was no showing of particularized 

prejudice and contrasting with a case based on a procedural 

constitutional attack, not a substantive one).
No. 2019AP2054-OA

12

procedural enactment of public financing laws). Waiting years 

after a budget bill has gone into effect to challenge whether it 

was constitutionally enacted in the first place is too long. 

See id. ("[F]iscal year 1990-1991 has come and gone and its 

financial books in this respect have been closed. Equitable 

considerations of time, in the laches sense, may justifiably 

keep them closed . . . ."). Giving a stamp of approval to 

delayed litigation raising procedural challenges like the proper 

exercise of a partial veto would invite lawsuits over budgets of 

yesteryear and disrupt the status quo. There must be a limit to 

when a lawsuit like this may be filed. We conclude the 

challenge here, brought well after the previous biennium had 

passed, and after a new budget based on current law and future 

projections had taken effect, constitutes unreasonable delay.9

2. Lack of Knowledge

¶18 We also determine the respondents lacked knowledge of 

WSBU's forthcoming claim. The respondents assert they remained 

unaware of any potential claim until this original action was 

filed, an assertion WSBU does not deny or further dispute. WSBU 

still contends, however, that the respondents "certainly could 

have anticipated that someone might challenge vetoes with such 

prolonged consequences." That's possible, but only in the sense 

 

9 The respondents argue for a firm cutoff at the end of the 

biennium for these kinds of challenges. However, laches is 

always case-specific, and we need not establish such a rule to 

conclude that the delay under these circumstances was too long.
No. 2019AP2054-OA

13

that every partial veto could one day become a litigated matter. 

Based on the undisputed record before us, the respondents here 

had no advance knowledge or warning of this particular claim. 

That is sufficient to satisfy this element of a laches defense.10

3. Prejudice

¶19 The final element of laches requires proof of 

prejudice resulting from the claimant's unreasonable delay. 

"What amounts to prejudice . . . depends upon the facts and 

circumstances of each case, but it is generally held to be 

anything that places the party in a less favorable position." 

Wren, 389 Wis. 2d 516, ¶32.

¶20 The respondents argue that, given their roles in the 

state budget-making process, WSBU's delay places them in a less 

favorable position with regard to the planning and management of 

state receipts and expenditures. The respondents' claim is 

specifically grounded in a prejudicial change to their position 

regarding the 2019-21 budget (i.e., the state's current budget). 

Collectively, this describes a form of prejudice that we have 

called economic prejudice. See id., ¶33 & n.26 (distinguishing 

economic and evidentiary prejudice); 27A Am. Jur. 2d Equity

 

10 See Schafer v. Wegner, 78 Wis. 2d 127, 133, 254 

N.W.2d 193 (1977) (concluding party asserting laches defense 

lacked knowledge of claim given that claim had not been raised 

in a reasonable time); cf. Watkins v. Milwaukee Cty. Civil Serv. 

Comm'n, 88 Wis. 2d 411, 422-23, 276 N.W.2d 775 (1979) (noting 

the petitioner informed the respondent at the time of his 

resignation that litigation would be commenced if a 

corresponding hearing was not held).
No. 2019AP2054-OA

14

§ 144 (discussing types of prejudice including economic 

prejudice caused by a change in a responding party's position).

¶21 Broadly speaking, every new budget bill is created 

with an understanding that earlier budgets, including any 

provisions bearing marks of former vetoes, will serve as a 

foundation. At the direction of the governor, the respondents 

and other executive branch officers hold this understanding when 

they create department budgets and ready all of the other fiscal 

information that must be included in a biennial budget report.11 

The governor then carries the same understanding when creating 

his proposed budget and when signing the legislature's proposed 

budget into law. See Champagne, supra, at 1 (describing the 

state budget bill as Wisconsin's most significant piece of 

legislation in part because "it contains most of the governor's 

public policy agenda for the entire legislative session").

¶22 Turning to the making of the 2019-21 budget, if the 

challenged vetoes from the outgoing budget are removed from the 

picture, as WSBU now pleads, there would have been cascading 

 

11 The respondents, while acting in their official 

capacities, each direct and supervise a department within the 

executive branch structure. See Wis. Stat. § 15.10 (department 

of administration); Wis. Stat. § 15.37 (department of public 

instruction); Wis. Stat. § 15.43 (department of revenue). In 

these roles, they all have various duties related to the state 

budget-making process. See, e.g., Wis. Stat. § 15.04(1)(b) 

(requiring from each department a biennial compilation of a 

comprehensive program budget); Wis. Stat. §§ 16.43 and 16.46 

(requiring the secretary of administration to prepare the 

biennial state budget report); Wis. Stat. § 16.46(8) (requiring 

the department of revenue to report on estimated state revenues 

for inclusion in the budget report).
No. 2019AP2054-OA

15

effects on the state's global policy calculus and budget 

outlook, as well as options available to policymakers. For 

instance, eliminating the moratorium on the school district 

revenue-limit adjustment in Act 59, § 1641m could have led to 

property tax increases in school districts across the state. 

Even a change like this adjusts how the state's policy puzzle 

fits together. With potentially higher property taxes, the 

respondents could have chosen to offer various offsetting 

property tax relief measures. Maybe different revenue limits 

would have been proposed. Maybe school district spending 

priorities would have been altered by the incentive in a way 

that would have changed their funding requests during the new 

biennium. Likewise, according to the respondents' calculations, 

putting 2013 Wis. Act 229 into effect by undoing the partial 

veto in Act 59, § 2265 could have caused an annual decline of 

more than $10 million in sales-and-use tax revenue. This is a 

significant adjustment to the state balance sheet. To 

compensate, policymakers could have enacted a tax increase to 

make up for lost revenue. Or maybe they would have chosen to 

spend $10 million less per year on some other state program or 

priority.

¶23 WSBU responds that the financial footprint of these 

budgetary programs was a "microscopic fraction" of the total

appropriations for the 2019-21 biennium. We disagree that $20 

million is mere change in the state's coffers. While this 

amount of specific tax revenue seems small in comparison to the 

state's total revenues over the course of a biennium, it is 
No. 2019AP2054-OA

16

still a significant sum. The state's budget reserve provides a 

clear example of why this is so. The reserve, which is premised 

on projections of revenues and expenditures, acts as a budget 

stabilization mechanism in times of fiscal uncertainty.12 In 

fact, state law imposes a mandatory reserve floor. Wis. Stat. 

§ 20.003(4). For the 2019-21 budget, the state was required to 

maintain a reserve of at least $80 million and $85 million in 

the two fiscal years. See § 20.003(4)(L). Two years of $10 

million in tax revenue is almost a quarter of the reserve 

required for the entire biennium.

¶24 Even so, the point of this discussion is not the 

specific amount of revenue loss or a definitive statement 

regarding what would have happened. The point is that 

unreasonable delay cost the respondents the opportunity to 

account for those changes in the development and passage of the 

2019-21 biennial budget. The alternatives are not "pure 

speculation" as WSBU alleges. These examples show that the 

2019-21 budget paid for and relied upon decisions the partial 

vetoes solidified into law more than two years earlier.

¶25 In short, the provisions of a biennial budget are 

hardly something that can be examined in isolation. Budget 

bills are complex and dynamic creatures, and each individual 

figure and measure incorporated within the enacted law plays a 

 

12 See generally Christa Pugh, Legislative Fiscal Bureau, 

Budget Stabilization Fund and General Reserve Fund Requirements

(2019) (outlining the design and purposes of Wisconsin's budget 

reserve).
No. 2019AP2054-OA

17

part in an interconnected network of complementary policy 

choices. WSBU's delay in seeking to reverse decisions from the 

2017-19 biennium deprived the respondents of the opportunity to 

take an altered policy foundation into account in subsequent 

choices. For this, the respondents are surely placed "in a less 

favorable position." Wren, 389 Wis. 2d 516, ¶32. And that 

constitutes prejudice.13

4. Discretion

¶26 The respondents have proved all three elements of 

laches are met in this case. Even so, application of laches is 

within our equitable discretion. See id., ¶15 (explaining a 

court may choose not to apply laches "if it determines that 

application of the defense is not appropriate and equitable"). 

We conclude equity weighs strongly in favor of applying laches 

here.

¶27 We have already covered the specific prejudicial 

effect to the respondents. This by itself is weighty. But in 

addition, every new budget generates substantial reliance 

 

13 As part of their prejudice argument, the respondents

emphasize that the challenged vetoes were made by a previous 

gubernatorial administration. All of the respondents have been 

sued in their official capacity, which means the individual 

occupant of any given position is irrelevant to the broader 

prejudice argument. The prejudice to the official functions of 

the named respondents is the same regardless of whether their 

priorities or policy views may be different. In any event, the 

respondents have shown they will be prejudiced regardless of 

whether there was an intervening change in the governor's 

office.
No. 2019AP2054-OA

18

interests on behalf of both public and private parties across 

the state. The same cascading effects of even modest changes to 

a broader policy framework are true not just within the biennial

budget itself, but for the budgets and outlook of counties, 

municipalities, school districts, nonprofit organizations, 

colleges, road contractors, health care systems, and innumerable 

other public and private actors.14

¶28 Part of this is the reasonable presumption that 

enacted laws, especially budget bills, can be relied upon to 

order one's affairs. The respondents make this point in 

reference to our recent decision in Winebow, Inc. v. CapitolHusting Co., which turned in part on the effect of partial 

vetoes in the 1999-2001 budget. 2018 WI 60, ¶¶12–22, 381 

Wis. 2d 732, 914 N.W.2d 631 (discussing 1999 Wis. Act 9, § 2166m 

and § 2166s). There, on a certified question from the Seventh 

Circuit, we determined whether a wine grantor-dealer 

relationship satisfied the definition of a dealership in the 

Wisconsin Fair Dealership Law. Id., ¶1. Underlying that 

question, the parties each pointed to a different statutory 

provision as containing the dispositive answer. See id., ¶¶23, 

 

14 See also 30A C.J.S. Equity § 155 ("The defense of laches 

is applied with even greater force when delay in attacking the 

legality of the collection and spending of public moneys will 

result in grave public injury were the relief sought to be 

granted."); 27A Am. Jur. 2d Equity § 145 ("The court may look at 

the disruptive effect a plaintiff's relief would have on other 

parties in determining whether laches applies to the claim.

Thus, laches is particularly justified where the plaintiff's 

delay in pursuing a claim would have a catastrophic effect on 

the rights of many third parties." (footnote omitted)).
No. 2019AP2054-OA

19

25 (citing Wis. Stat. §§ 135.02(3)(b), 135.066 (2015-16)). To 

provide background, we unpacked the provisions' relevant 

statutory history, which included partial vetoes from nearly two 

decades earlier. Id., ¶¶12-22. In answering the certified 

question, we did not address the constitutionality of those 

vetoes. But if we had done so and ruled that they were beyond 

the governor's constitutional authority, Wisconsin's commercial 

wine industry could have been radically upended given statewide 

reliance interests on a 19-year-old partial veto that was newly 

determined invalid.

¶29 Other jurisdictions have similarly barred untimely 

challenges to alleged procedural deficiencies in the enactment 

of a law. In so doing, these courts acknowledge the broader and 

more pervasive prejudicial effects resulting from belatedly 

undoing statutory enactments. See, e.g., Schaeffer, 656 A.2d at 

753, 755 (emphasizing prejudice that would be caused to hundreds 

of county employees who relied on pension plan modifications 

effected by an ordinance subject to belated procedural 

challenge); Cole v. State ex rel. Brown, 42 P.3d 760, 764 (Mont. 

2002) (identifying prejudice of former officeholders and 

potential candidates who relied on presumptively valid 
No. 2019AP2054-OA

20

constitutional term-limit initiative subject to belated 

procedural challenge).15

 

15 The New York Court of Appeals decision in Schulz v. State

appears to provide a particularly fitting comparison to this 

case. There, the court held laches should apply against a 

procedural challenge to various public financing laws that had 

been enacted 11 months earlier. 615 N.E.2d 953, 957-58 (N.Y. 

1993). In the intervening period, significant financial 

activity was conducted in reliance on the statues. Id. Thus, 

amongst the "profound destabilizing and prejudicial effects from 

delay" that could affect the state in its "operation and 

maintenance of orderly government," the New York court 

explained: 

Appellants' demand for relief on the merits of their 

constitutional challenge would have the bonds recalled 

and refunded and the nonbond transactions nullified. 

Metaphorically, the impossibility of putting genies 

back in their bottles springs to the imagination. 

Realistically, constitutional challenges to public 

financing of such massive and profound dimension, 

possibly causing traumatic disturbance to settled 

matters of public finances and governance, should be 

undertaken reasonably promptly. To relax this 

procedural safeguard could disproportionately incur or 

threaten a greater harm to the public weal than the 

alleged constitutional transgression itself. Undoing 

such closed financial transactions would also add 

hundreds of millions of dollars of unplanned 

expenditures to the taxpayers' burdens. In sum, 

fiscal year 1990–1991 has come and gone and its 

financial books in this respect have been closed. 

Equitable considerations of time, in the laches sense, 

may justifiably keep them closed and do not warrant, 

in the circumstances presented here, a piecemeal 

invalidation challenge as suggested . . . .

Id. (citation omitted).
No. 2019AP2054-OA

21

¶30 Orderly state governance is premised in no small part 

on the stability and certainty of state finances. Nowhere are 

those principles needed more than in the state's biennial 

budget. Each budget bill is a massive undertaking that is meant 

to fully encapsulate the financing of the state's operations and 

programs over the next two years. Our state is, to a very large 

degree, publicly and privately ordered around that single piece 

of legislation. Judicial disturbance of biennial budgets past 

would be incredibly disruptive to the public and private affairs 

of many whose livelihoods are tied to public policy (which is to 

say, almost everyone).

¶31 It is true that the proper interpretation of the 

governor's partial veto powers is an important question. But 

that alone, in our view, does not counsel undoing the current 

policy framework that was crafted in reliance on the policy 

choices settled in the previous biennium. This court has 

considered cases arising from the governor's veto authority 

before; we will surely do so again. But it is crucial that 

claims of this sort are brought in a timely manner. Because 

this claim was not, application of laches in this case is 

equitable and appropriate.

 

WSBU's citation to another New York case that distinguished 

itself from Schulz simply shows that laches is a fact-specific 

defense. Cf. Saratoga Cty. Chamber of Commerce, Inc. v. Pataki, 

798 N.E.2d 1047, 1056-57 (N.Y. 2003) (rejecting laches defense 

against a challenge to a gaming compact because, in contrast to 

Schulz, there was no showing that delay caused economic 

prejudice given the casino's operations had never been 

interrupted).
No. 2019AP2054-OA

22

III. CONCLUSION

¶32 WSBU challenges two partial vetoes in the biennial 

budget enacted in September 2017. But WSBU waited until October 

2019 to file this action. The 2017-19 biennium has closed, and 

a new biennial budget has since been enacted relying in part on 

the law enacted in 2017. The respondents have established the 

elements of laches and demonstrated that application of the 

equitable doctrine is appropriate here. Accordingly, we dismiss 

WSBU's original action.

By the Court.-Relief denied.
No. 2019AP2054-OA.rgb

1

¶33 REBECCA GRASSL BRADLEY, J. (dissenting). In 

resolving this dispute over the scope of the governor's veto 

power, the Wisconsin Supreme Court should have consulted the 

Wisconsin Constitution, under which "all governmental power 

derives 'from the consent of the governed' and government 

officials may act only within the confines of the authority the 

people give them. Wis. Const. art. I, § 1." Wis. Legislature

v. Palm, 2020 WI 42, ¶66, 391 Wis. 2d 497, 942 N.W.2d 900

(Rebecca Grassl Bradley, J., concurring). Instead, the majority 

latches on to laches, an equitable doctrine that operates not as 

a jurisprudential command, but merely as a discretionary option 

for avoiding a decision on the merits. The text of the 

constitution does not support the exercise of either veto 

challenged in this case and the court should have so declared. 

"Whenever any branch of government exceeds the boundaries of 

authority conferred by the people, it is the duty of the 

judicial branch to say so." Id.

¶34 Under the Wisconsin Constitution, all bills must 

originate in the legislature, and only the legislature may amend 

them. Wis. Const. art. IV, § 19.1 In the exercise of his veto 

power, the governor may approve or reject an appropriation bill, 

in whole or in part, and the approved part then becomes law. 

 

1 Wisconsin Constitution, Article IV, Section 19 provides:

Any bill may originate in either house of the 

legislature, and a bill passed by one house may be 

amended by the other.
No. 2019AP2054-OA.rgb

2

Wis. Const. art. V, § 10(1)(b).2 With respect to each of the 

bills at issue in this case, the legislature delayed the 

effective date of a law, not a bill, by one year; in exercising 

his "veto," the governor delayed their effective dates by 1000 

years and 60 years, respectively, effectively nullifying each 

law. The constitution does not confer on the governor any 

authority to amend or otherwise rewrite a bill in this manner, 

much less abolish laws altogether.

¶35 The governor's vetoes invaded the exclusive province 

of the legislature by amending the effective dates of laws 

previously passed by the legislature and approved by the 

governor, effectively erasing these laws from the books. The 

people of Wisconsin never gave the governor this power. 

Nonetheless, it is not at all surprising that many governors 

have exceeded the veto authority the constitution accords them, 

because this court has repeatedly "dress[ed] up the governor as 

the people's legislative agent (with respect to appropriations 

bills)" in utter disregard for what the constitution actually 

says. Bartlett v. Evers, 2019AP1376-OA, slip op., ¶173 (Wis. S. 

Ct. July 10, 2020) (Kelly, J., concurring in part; dissenting in 

 

2 Wisconsin Constitution, Article V, Section 10(1)(b) 

provides, in relevant part:

Appropriation bills may be approved in whole or in 

part by the governor, and the part approved shall 

become law.
No. 2019AP2054-OA.rgb

3

part).3 Although this court's repeated and erroneous broadening 

of the veto authority invariably contravenes the constitution's 

separation of powers, even this court's atextual interpretations 

of the veto power have never permitted a governor's repeal of 

duly enacted law. Nor has this court ever ducked the merits 

altogether after granting an original action petition to decide 

whether a governor's veto violated the constitution. Until now. 

¶36 Without any precedent to support its sidestepping, the 

court declines to answer the constitutional question it had 

agreed to decide. Instead, it makes the unprecedented move of 

disposing of this case under the doctrine of laches, declaring 

the petitioners filed this action a couple months too late to 

warrant a substantive analysis, under a new rule the majority 

just made up. The majority shirks its responsibility to decide 

a fundamental issue of constitutional law. I respectfully 

dissent.

I. BACKGROUND 

¶37 This case arises from Governor Scott Walker's vetoes 

within the 2017-19 budget bill, namely Section 1641m and Section 

2265. Section 1641m affected Wis. Stat. § 121.91(4)(o), the 

 

3 Justice Daniel Kelly's concurrence/dissent in Bartlett v. 

Evers, 2019AP1376-OA, slip op. (Wis. S. Ct. July 10, 2020), 

thoroughly explores this court's partial veto jurisprudence and 

how it conflicts with the text of the constitution. In that 

opinion, Justice Kelly also explains the mechanism provided by 

the Wisconsin Constitution for the enactment of laws, as well as

the original meaning of the provisions permitting a governor to 

approve an appropriation bill "in part." See id. (Kelly, J., 

concurring in part; dissenting in part). I will not repeat that 

analysis in this opinion, but refer the reader to Justice 

Kelly's opinion in Bartlett.
No. 2019AP2054-OA.rgb

4

statute allowing a school district to exceed revenue limits if 

it "implement[s] energy efficiency measures or" "purchase[s]

energy efficiency products." Id. This has been the law since 

2009. See Wis. Stat. § 121.91(4)(o) (2009-10). The legislature 

decided to impose a moratorium on the "Energy Efficiency Revenue 

Limit Adjustment" for the calendar year 2018. The legislature's 

one-year moratorium was drafted by adding subdivision 4 to 

already-existing Wis. Stat. § 121.91(4)(o). Subdivision 4 

provided: "Unless the resolution is adopted before January 1, 

2018, subd. 1. applies only to a resolution adopted after 

December 31, 2018." The governor struck "1, 2" from the 

"December 31, 2018" date to change the one-year pause of the 

Energy Efficiency Adjustment into a millennium moratorium (1,000 

years) extending until December 3018.

¶38 Section 2265 modified Wis. Stat. § 77.585, a statute 

affording retailers the ability to obtain a refund of sales tax 

paid to the State for the uncollectible amount of customer 

purchases made using retailer-issued credit cards that become 

"bad debt" as defined in the statute. In 2013, the legislature 

amended § 77.585 to allow refunds of sales taxes paid by a 

retailer for the uncollectible amount of purchases made by 

customers using credit cards (like Visa or Mastercard) issued by

third party lenders who partner with the retailer. When this 

bill was enacted into law, the legislature initially delayed the 

effective date to July 1, 2015, subsequently to July 1, 2017, 

and later to July 1, 2018. The "Private Label Credit Card Bad 

Debt Deduction" amendments would have taken effect on July 1, 
No. 2019AP2054-OA.rgb

5

2018, but for the governor's use of his veto power to change the 

effective date to July 1, 2078, thereby delaying the 

implementation of the statute for 60 years.

¶39 After executing his vetoes, the governor approved the 

2017-19 budget bill, which became 2017 Wisconsin Act 59 and was 

published on September 22, 2017. The partial veto review was 

placed on the Assembly calendar for May 8, 2018 as part of the 

veto review session pursuant to Joint Rule 82(2)(a),4 but the 

Assembly did not act to override the governor's vetoes. See

State of Wis. Assemb. J., May 8, 2018, at 943.

¶40 On July 4, 2019, the 2019-21 biennial budget went into 

effect. On October 28, 2019, WSBU filed a petition with this 

court seeking to initiate an original action challenging two of 

the governor's vetoes within the 2017-19 budget. WSBU asked the 

court to answer the following question: "May the Governor, 

pursuant to his constitutional authority under art. V, sec. 10 

of the Wisconsin Constitution, as amended in 1990, reject 

individual parts of a date contained in an enrolled bill so as 

to create a new date that was never approved by the 

Legislature?" The court issued an order requiring the named 

respondents to file a response to the petition, which the 

Attorney General subsequently submitted to the court on December 

6, 2019 on behalf of the respondents.

¶41 The Attorney General's response raised concerns with 

the timing of WSBU's petition and requested the court deny the 

 

4 See Wis. Jt. Rules of Senate and Assembly § 82 ("Veto 

review session, even numbered year.").
No. 2019AP2054-OA.rgb

6

petition on that basis. Emphasizing that WSBU filed the 

petition after the 2017-19 biennium ended, the Attorney General 

asserted that "Petitioners have not acted promptly" and "[t]heir 

petition comes two years after Act 59 was published . . . and 

more than three months after the successive biennial budget bill 

was signed into law." The Attorney General advised the court 

that the "timing of Petitioners' petition is in stark contrast 

to prior lawsuits challenging governors' partial veto 

authority"——noting other lawsuits contesting budget vetoes "were 

challenged promptly, within the same budget biennium."

¶42 Despite knowing WSBU filed its petition after the 

2017-19 budget time period, this court granted the petitioners' 

request for this original action on the issue of whether 

Governor Walker exceeded his authority when he used his veto 

power to change the effective dates of two laws in the 2017-19 

biennial budget bill. The court's order asked the parties to 

file briefs, and the court held oral argument in April 2020.

II. ORIGINAL ACTIONS & CRITERIA FOR REVIEW

¶43 Article VII, Section 3 of the Wisconsin Constitution 

confers jurisdiction on this court to hear "original actions and 

proceedings." Wis. Const. art. VII, § 3(2). Original action 

petitions are relatively rare and the court grants one only if 

four or more justices vote to take the case. Wis. S. Ct. IOP 

III (Sept. 13, 2019). Even before the vote, the respondents 

file a response brief, as they did in this case. Wis. S. Ct. 

IOP III (Sept. 13, 2019). The court then decides whether to 

grant the petition, having had the benefit of hearing from both 
No. 2019AP2054-OA.rgb

7

sides. "When a matter is brought to the Supreme Court for 

review, the court's principal criterion in granting or denying 

review is not whether the matter was correctly decided or 

justice done in the lower court, but whether the matter is one 

that should trigger the institutional responsibilities of the 

Supreme Court." Wis. S. Ct. IOP III (Sept. 13, 2019). "The 

same determination governs the exercise of the court's original 

jurisdiction." Wis. S. Ct. IOP III (Sept. 13, 2019).

¶44 Wisconsin Stat. § 809.62(1r) enumerates "criteria for 

granting review" and provides in pertinent part:

Supreme court review is a matter of judicial 

discretion, not of right, and will be granted only 

when special and important reasons are presented. The 

following, while neither controlling nor fully 

measuring the court's discretion, indicate criteria 

that will be considered:

(a) A real and significant question of federal or 

state constitutional law is presented.

(b) The petition for review demonstrates a need for 

the supreme court to consider establishing, 

implementing or changing a policy within its 

authority.

(c) A decision by the supreme court will help develop, 

clarify or harmonize the law, and

1. The case calls for the application of a new 

doctrine rather than merely the application of wellsettled principles to the factual situation; or

2. The question presented is a novel one, the 

resolution of which will have statewide impact; or

3. The question presented is not factual in nature but 

rather is a question of law of the type that is likely 

to recur unless resolved by the supreme court.
No. 2019AP2054-OA.rgb

8

Determining whether a governor exceeded his constitutional veto 

authority in effectively repealing laws by changing their 

effective dates unquestionably triggers the institutional 

responsibility of this court. At least four justices agreed and 

voted to grant the petitioners' original action petition.

III. THE MAJORITY'S REFUSAL TO DECIDE THE MERITS

¶45 The majority declines to decide the constitutionality 

of Governor Walker's vetoes, a significant issue of statewide 

importance that at least four members of this court agreed 

should be resolved. Instead, the majority denies relief based 

on the equitable doctrine of laches, which by its very nature 

rests within the discretion of the court to apply——or not. 

Although in a footnote the majority denies it,5 the majority's 

opinion establishes a rule barring challenges to a governor's 

vetoes unless filed within the biennium in which the vetoes 

occurred. The majority concludes that because WSBU brought its 

 

5 Majority op., ¶17 n.9. The majority's opinion focuses 

entirely on the untimeliness of WSBU's action based on its 

filing after the relevant biennium had passed and a new biennium 

was underway. Nevertheless, the majority denies establishing 

any laches rule with respect to veto challenges, emphasizing it 

is merely concluding WSBU waited "too long" "under these 

circumstances." Id. In other words, the majority knows it when 

it sees it, but it's not disclosing "it." If the majority isn't 

establishing a laches rule (which would be helpful) and isn't 

resolving the substantive issue it said it would decide (which 

leaves an important question unanswered), then why did the court 

take this case? If the court is declaring merely that under 

these specific facts, laches applies, then the court could have 

(and should have) simply denied the petition. Instead, the 

majority releases an opinion providing no answer to the question 

granted and establishing no precedent. Future litigants will 

have no idea how late is "too late" because the majority offers 

nothing to guide them. So much for the rule of law.
No. 2019AP2054-OA.rgb

9

challenge a few months after the 2017-19 biennium ended, the 

action is too late. The majority embraces this novel laches 

argument (to which the Attorney General devoted a mere 6 pages 

of his 47-page brief) even though laches was not an issue 

presented in the petition.

¶46 The majority denies WSBU relief based on the laches 

doctrine even though this court has never applied laches in an 

original action challenging the constitutionality of a 

governor's veto——giving WSBU no notice or warning that its veto 

challenge would be denied without answering the substantive 

question upon which this court granted WSBU's petition. The 

court employs laches as a mechanism to avoid deciding a 

fundamental question of constitutional law and leaves these 

petitioners in the dark. The people of Wisconsin will never 

know whether these vetoes comport with or violate the 

constitution. Nor will current or future governors or 

legislatures, unless and until the court decides to resolve this 

issue——perhaps in 60 or 1,000 years.

¶47 The majority concludes that the Attorney General 

satisfied his burden of proving all of the elements of laches. 

I disagree.6 Even if the elements of laches were satisfied, I 

 

6 The majority's questionable analysis of laches is 

unprecedented in resolving an original action challenging a 

governor's veto. First, the majority concludes that WSBU could 

have challenged these vetoes as early as September 23, 2017——the 

effective date of the 2017-19 budget bill. Its presumption 

ignores the time period allowed for a legislative override, 

which did not expire until May 8, 2018. The Joint Rules of the

Wisconsin Senate and Assembly provide that "[t]he biennial 

session schedule shall provide for a veto review session" 

between April 1 and June 30 of even-numbered years that would 

include gubernatorial vetoes or partial vetoes. See State of 
No. 2019AP2054-OA.rgb

10

 

Wis. Jt. Rules of Senate and Assembly § 82(1) & (1m)(a). The 

partial vetoes in this case were calendared and then sustained 

on May 8, 2018, because the legislature did not act to override 

them. See Adverse Disposal, State of Wis. 

Assemb. J., May 8, 2018, at 943,

https://docs.legis.wisconsin.gov/2017/related/journals/assembly/

20180508.pdf. Citing nothing but cases from foreign 

jurisdictions, the majority perfunctorily concludes WSBU waited 

"too long" and "[t]here must be a limit to when a lawsuit like 

this may be filed," although it refuses to announce what that 

limit is. Majority op., ¶17. Of course, no Wisconsin law 

specifies a limit, and the one the majority invents apparently 

applies only under the circumstances in this particular case. 

Worse yet, the majority imposes its amorphous time limit 

retroactively on WSBU, who could not have foreseen its action 

would be time-barred.

Second, "[w]hether the doctrine of laches applies is fact 

specific." Riegleman v. Krieg, 2004 WI App 85, ¶22, 271 

Wis. 2d 798, 679 N.W.2d 857. The existence of disputed facts 

would preclude the application of laches, but the majority 

pretends none exist. The majority summarily concludes the 

respondents lacked knowledge of WSBU's forthcoming claim based 

solely on the respondents saying so and "[b]ased on the 

undisputed record before us." Majority op., ¶18. WSBU was 

never afforded the opportunity to refute the assertion and there 

is no "record" before us because this is an original action in 

which no factual development occurred. Nevertheless, the 

majority concludes the respondents proved the "lack of 

knowledge" element of laches despite the absence of any 

evidentiary or testimonial evidence to support it.

Finally, the majority's analysis of the doctrine's 

prejudice prong details a number of speculative, alternative 

actions the State might have taken if the claim against the 

budget vetoes were brought earlier:

 "Maybe different revenue limits would have been 

proposed."

 "Maybe school district spending priorities would have 

been altered by the incentive in a way that would have 

changed their funding requests during the new biennium."

 "[M]aybe they would have chosen to spend $10 million less 

per year on some other state program or priority."
No. 2019AP2054-OA.rgb

11

would not apply the doctrine. A constitutional challenge to the 

power of the governor, particularly as it implicates the 

separation of powers, takes precedence over all other 

considerations, including the economic consequences of 

invalidating a governor's veto (which relate to the remedy 

rather than the merits). The powers constitutionally assigned 

to the legislative branch "must be kept forever separate" from 

those assigned to the executive branch "because, as Madison once 

observed, '[t]here can be no liberty where the legislative and 

executive powers are united in the same person, or body of 

magistrates.' The Federalist No. 47, at 299 (James Madison) 

(Clinton Rossiter ed., 1961)." Palm, 391 Wis. 2d 497, ¶92 

(Kelly, J., concurring). "[O]ur duty to ensure the lines do not 

cross is mandatory and non-discretionary." Id. Regardless, the 

reasoning underlying the majority's application of laches is 

fundamentally unsound. The same economic consequences the 

majority invokes to justify its application of laches would 

exist if WSBU had filed this action on July 3, 2019——one day

before the 2019-21 biennium began, and therefore presumably 

timely under the majority's new case-specific laches rule. 

Given the importance of the issue presented in this original 

action and this court's choice to take the case, the majority 

should have addressed the merits. See Zizzo v. Lakeside Steel & 

Mfg. Co., 2008 WI App 69, ¶6 n.3, 312 Wis. 2d 463, 752 

N.W.2d 889 (Even if a court "find[s] all the elements of laches 

 

Majority op., ¶22. However likely those actions would have 

been, the court cannot cite anything to prove any form of 

prejudice actually occurred.
No. 2019AP2054-OA.rgb

12

present, [it] may nevertheless exercise its discretion not to 

apply the doctrine.").

¶48 In applying laches, the majority credits the 

respondents' reliance on the budget but ignores WSBU's reliance 

on the state of the law when the court granted its single-issue 

petition. WSBU could not possibly have known that a challenge

on October 28, 2019 to the 2017-19 budget was too late, given 

these circumstances:

 The court granted WSBU's petition solely on the issue 

requested: "May the Governor, pursuant to his 

constitutional authority under art. V, sec. 10 of the 

Wisconsin Constitution, as amended in 1990, reject 

individual parts of a date contained in an enrolled bill 

so as to create a new date that was never approved by the 

Legislature?"

 The court granted WSBU's original action petition knowing 

it was filed after the 2017-19 budget biennium had 

passed.

 The court has never granted an original action petition 

challenging a governor's veto and then declined to 

address the merits.

 There is no prior Wisconsin case declaring that laches 

will bar a veto challenge if the petition is filed four 

months beyond the biennium to which the challenge 

applies.

 The petitioner challenges "vetoes" that set effective 

dates 1,000 and 60 years into the future.
No. 2019AP2054-OA.rgb

13

¶49 The court could have established its new laches rule 

barring post-biennium actions challenging gubernatorial vetoes 

at the same time it addressed the merits of the constitutional 

issue it agreed to decide in this case. The laches rule could 

have been applied prospectively and all future litigants would 

have fair warning that a veto challenge must be filed before the 

biennium expires. Instead, the court chose to blindside WSBU. 

Despite granting the petition, well-aware of its post-biennium 

timing, the court refuses to analyze whether the governor 

violated the constitution by employing his veto power to 

eliminate previously enacted law. The court reasons that the 

political branches relied on the 2017-19 budget in developing 

the 2019-21 budget bill and if the governor had known about the 

veto challenge before the enactment of the 2019-21 budget, he 

may have acted differently. This is an unjustifiable excuse to 

avoid deciding the fundamental question of constitutional law 

the court announced it would decide. Any impact on the 2019-21 

budget could have been rectified through a budget repair bill 

under Wis. Stat. § 16.50(7) to address the effects of the court 

declaring the vetoes unconstitutional. The majority took an 

unprecedented and unwarranted "pass" on the issue it said it 

would decide, leaving WSBU, the people, and current and future 

governors and legislatures with a question that may never be 

answered. Even more troubling, the court leaves these 

unconstitutional vetoes unchecked and uncorrected——threatening 

the "tripartite separation of independent governmental power" 

that constitutes "the bedrock of the structure by which we 
No. 2019AP2054-OA.rgb

14

secure liberty." Gabler v. Crime Victims Rights Bd., 2017 WI 

67, ¶3, 376 Wis. 2d 147, 897 N.W.2d 384.

IV. THE WISCONSIN CONSTITUTION, SEPARATION OF POWERS,

AND APPROPRIATION VETOES

¶50 Under Article IV, Section 1 of the Wisconsin 

Constitution, the people vested the legislative power in the 

senate and assembly: "The legislative power shall be vested in 

a senate and assembly." Wis. Const. art. IV, § 1. Under 

Article V, Section 10 (1)(a), "Every bill which shall have 

passed the legislature shall, before it becomes a law, be 

presented to the governor." Wis. Const. art. V, § 10(1)(a). 

With respect to a non-appropriation bill, the governor may 

approve and sign the bill, which then becomes a law. See Wis. 

Const. art. V, § 10(1)(b).7 Alternatively, the governor may 

reject the bill and return it, along with his written 

objections, to the house in which the bill originated. See Wis. 

Const. art. V, § 10(2)(a).8 The governor may approve "in whole 

 

7 Wisconsin Constitution, Article V, Section 10(1) provides:

(a) Every bill which shall have passed the legislature 

shall, before it becomes a law, be presented to the 

governor.

(b) If the governor approves and signs the bill, the 

bill shall become law. Appropriation bills may be 

approved in whole or in part by the governor, and the 

part approved shall become law.

(c) In approving an appropriation bill in part, the 

governor may not create a new word by rejecting 

individual letters in the words of the enrolled bill, 

and may not create a new sentence by combining parts 

of 2 or more sentences of the enrolled bill.

8 Wisconsin Constitution, Article V, Section 10(2) provides:
No. 2019AP2054-OA.rgb

15

or in part" any appropriation bill, "and the part approved shall 

become law." See Wis. Const. art. V, § 10(1)(b). Only a super 

majority of the legislature (two-thirds of the members present) 

may override the governor's veto of any bill. See Wis. Const. 

art. V, § 10(2)(a)-(b).

¶51 Under the Wisconsin Constitution, the governor may 

veto an appropriation bill, but only the legislature may amend 

it. The "powers of amending and vetoing are different things, 

 

(a) If the governor rejects the bill, the governor 

shall return the bill, together with the objections in 

writing, to the house in which the bill originated. 

The house of origin shall enter the objections at 

large upon the journal and proceed to reconsider the 

bill. If, after such reconsideration, two-thirds of 

the members present agree to pass the bill 

notwithstanding the objections of the governor, it 

shall be sent, together with the objections, to the 

other house, by which it shall likewise be 

reconsidered, and if approved by two-thirds of the 

members present it shall become law.

(b) The rejected part of an appropriation bill, 

together with the governor's objections in writing, 

shall be returned to the house in which the bill 

originated. The house of origin shall enter the 

objections at large upon the journal and proceed to 

reconsider the rejected part of the appropriation 

bill. If, after such reconsideration, two-thirds of 

the members present agree to approve the rejected part 

notwithstanding the objections of the governor, it 

shall be sent, together with the objections, to the 

other house, by which it shall likewise be 

reconsidered, and if approved by two-thirds of the 

members present the rejected part shall become law.

(c) In all such cases the votes of both houses shall 

be determined by ayes and noes, and the names of the 

members voting for or against passage of the bill or 

the rejected part of the bill notwithstanding the 

objections of the governor shall be entered on the 

journal of each house respectively.
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the respective exercise of which our constitution commits to 

different branches of government." Bartlett, 2019AP1376-OA, 

slip op., ¶180 (Kelly, J., concurring in part; dissenting in 

part). The only clause in the constitution providing for 

amendment of a bill appears in Article IV, Section 19, which 

states: "Any bill may originate in either house of the 

legislature, and a bill passed by one house may be amended by 

the other." Wis. Const. art. IV, § 19. Accordingly, the 

governor can veto, but he cannot amend the law or create law. 

Bartlett, 2019AP1376-OA, slip op., ¶¶193-195 (Kelly, J., 

concurring in part; dissenting in part) ("Our constitution 

commits the power to amend to the assembly or senate; it 

contains no suggestion that the governor might be able to 

partake of it."). The constitution vests these powers in the 

legislature alone.

¶52 In establishing the Wisconsin Constitution, "[t]he 

people bestowed much power on the legislature, comprised of 

their representatives whom the people elect to make the laws." 

Gabler, 376 Wis. 2d 147, ¶60. As reflected in the 

constitutional text, "[t]he separation of powers 'operates in a 

general way to confine legislative powers to the legislature.'"

League of Women Voters v. Evers, 2019 WI 75, ¶35, 387 

Wis. 2d 511, 929 N.W.2d 209 (citing Goodland [v. Zimmerman], 243 

Wis. [459] at 467, 10 N.W.2d 180). Accordingly, "an idea may 

not become a law without the legislature having voted for it." 

Bartlett, 2019AP1376-OA, slip op., ¶195 (Kelly, J., concurring 

in part; dissenting in part). Acting as a check on the 
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legislature, the governor may veto only the part of a presented 

bill that represents "an idea expressing a potential complete, 

entire, and workable law"——something on which the legislature 

voted and thereby approved. See id., ¶¶193, 195 (Kelly, J., 

concurring in part; dissenting in part). The constitution does 

not, however, give the governor the power to create an entirely 

different idea, and the constitution decidedly does not give the 

governor the ability to unilaterally enact a law of his own 

creation on which the legislature never voted and which it 

therefore never approved. See id., ¶195 (Kelly, J., concurring 

in part; dissenting in part).

¶53 Precluding one branch of government from intruding on 

the exclusive powers of another branch is fundamental to 

preserving the balance of governmental power, which is 

ultimately designed to protect the interests of the people the 

government was formed to serve. "To the Framers of the United 

States Constitution, the concentration of governmental power 

presented an extraordinary threat to individual liberty: 'The 

accumulation of all powers, legislative, executive, and 

judiciary, in the same hands, whether of one, a few, or 

many, . . . may justly be pronounced the very definition of 

tyranny.' The Federalist No. 47, at 298 (James Madison) (Clinton 

Rossiter ed., 1961) . . . . As Madison explained when 

advocating for the Constitution's adoption, neither the 

legislature nor the executive nor the judiciary 'ought to 

possess, directly or indirectly, an overruling influence over 

the others in the administration of their respective powers.'
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Federalist No. 48, id. at 305 (James Madison)." Gabler, 376 

Wis. 2d 147, ¶4. Joseph Story "'deemed [it] a maxim of vital 

importance'" that "'the three great powers of 

government . . . should for ever be kept separate and distinct.' 

2 Joseph Story, Commentaries on the Constitution of the United 

States § 519, at 2-3 (Boston, Hilliard, Gray, & Co., 1833)." 

Gabler, 376 Wis. 2d 147, ¶3.

¶54 Although these legal principles are pertinent to the 

vetoes challenged in this case, it is important to recognize how 

this case differs from Bartlett and all other veto cases 

previously decided by this court. This case involves two unique 

factors. First, the governor used his veto to change provisions 

of laws already on the books——the vetoes were not confined to 

bills waiting to become laws, but instead disturbed previously 

enacted laws. Second, the vetoes effectively eliminated the 

laws entirely by extending their effective dates 1,000 years on 

one and 60 years on the other. The constitution's text 

restricts the governor's ability to reject the work of the 

legislature to bills and nowhere gives the governor the ability 

to repeal laws.

¶55 The veto power "furnishes an additional security 

against the enaction of improper laws. It establishes a 

salutary check upon the legislative body, calculated to guard 

the community against the effects of faction, precipitancy, or 

of any impulse unfriendly to the public good, which may happen 

to influence a majority of that body." Federalist No. 73, at 

443 (Alexander Hamilton) (Clinton Rossiter ed., 1961) (emphasis 
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added). As a general matter, the executive veto power may only 

prevent a bill from becoming a law; therefore, it may be 

exercised only against bills. Nothing in the Wisconsin 

Constitution grants the governor the power to veto a law passed 

years earlier. Even setting aside the effects of these vetoes 

on previously enacted laws, the vetoes nevertheless exceeded the 

governor's authority. Under the Wisconsin Constitution, the 

governor's veto empowers him to negate, not create.

V. BOTH VETOES ARE UNCONSTITUTIONAL

¶56 WSBU challenges two vetoes executed by Governor Walker 

with respect to the 2017-19 biennium budget. Both vetoes 

changed effective dates of laws that had been enacted in 

earlier, non-appropriation legislation. Both vetoes involved 

bills previously passed by the legislature and signed by the 

governor into law. At the time of their passage, the governor 

could have vetoed either bill. He did not. When the 

legislature later decided to delay the effective dates for each 

law, the governor struck digits in dates and a comma, merging 

what was left to create new dates never approved by the 

legislature and set so far into the future that the governor's 

actions essentially repealed two duly-enacted laws. As 

explained below, neither veto "approved in whole or in part" 

something that became law, both vetoes struck something smaller 

than what constitutes a "part," and both vetoes left something 

on which the legislature never voted and which it therefore 

never approved. Neither veto comported with the constitutional 

boundaries of the governor's authority.
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A. The First Veto

¶57 The first veto involves Wisconsin's school district 

revenue limit law, see Wis. Stat. § 121.91, and the increases to 

the revenue limits for school districts that spend money to 

implement energy efficiency measures or to purchase energy 

efficiency products, see Wis. Stat. § 121.91(4)(o). Before the 

2017-19 budget bill, Wis. Stat. § 121.91(4)(o) (2015-16) 

provided:

1. Except as provided in subd. 1m., if a school board 

adopts a resolution to do so, the limit otherwise 

applicable to a school district under sub. (2m) in any 

school year is increased by the amount spent by the 

school district in that school year on a project to 

implement energy efficiency measures or to purchase 

energy efficiency products, including the payment of 

debt service on a bond or note issued, or a state 

trust fund loan obtained, to finance the project, if 

the project results in the avoidance of, or reduction 

in, energy costs or operational costs, the project is 

governed by a performance contract entered into under 

s. 66.0133, and the bond or note issued or state trust 

fund loan obtained to finance the project is issued 

for a term not exceeding 20 years. If a school board 

issues a bond or note or obtains a state trust fund 

loan to finance a project described in this 

subdivision, a resolution adopted by a school board 

under this subdivision is valid for each school year 

in which the school board pays debt service on the 

bond, note, or state trust fund loan.

1m. If a school district issues a bond or note or 

obtains a state trust fund loan to finance a project 

described in subd. 1., the amount of debt service 

included in the amount spent by the school district 

under subd. 1. is the amount paid in the calendar year 

that begins on January 1 of the school year in which 

the school district's revenue limit is increased under 

this paragraph.

2. Any additional revenue received by a school 

district under this paragraph shall not be included in 
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the base for determining the school district's limit 

under sub. (2m) for the following school year.

3. If a school district issues a bond or note or 

obtains a state trust fund loan to finance a project 

described in subd. 1. and the school district's 

utility costs are measurably reduced as a result of 

the project, the school board shall use the savings to 

retire the bond, note, or state trust fund loan.

This law had been in effect since 2009. Section 1641m of the 

2017-19 budget bill added subdivision 4 to this statute, which 

placed a one-year moratorium on the energy efficiency increase 

to the revenue limits, prohibiting the increase for the 2018 

calendar year. Section 1641m provided: "Unless the resolution 

is adopted before January 1, 2018, subd. 1. applies only to a 

resolution adopted after December 31, 2018."

¶58 Governor Walker deleted the "1" in "31" and the "2" in 

"2018" as well as the comma and space between them so the 

moratorium would not lift until December 3018: "Unless the 

resolution is adopted before January 1, 2018, subd. 1. applies 

only to a resolution adopted after December 31, 2018." The 

legislature passed a one-year moratorium on the Energy 

Efficiency Revenue Limit Adjustment, and Governor Walker's veto 

changed one year to 1,000 years. The side-by-side chart below 

shows what the legislature approved compared to what the 

governor wrote in its place:
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Legislative Language Governor's Final Language

121.91 (4) (o) 4. 

Unless the 

resolution is 

adopted before 

January 1, 2018, 

subd. 1. applies 

only to a resolution 

adopted after 

December 31, 2018.

121.91 (4) (o) 4. 

Unless the 

resolution is 

adopted before 

January 1, 2018, 

subd. 1. applies 

only to a resolution 

adopted after 

December 3018.

¶59 The governor did not actually "approve" or "reject" 

any idea passed by the legislature, either in whole or in part, 

when presented with Section 1641m of the 2017-19 budget bill. 

Instead, the governor amended a sentence by striking two digits, 

a comma, and a space to drastically change what the legislature 

wrote——effectively vetoing the entirety of Wis. Stat. 

§ 121.91(4)(o)1 (which had been law since 2009). Nothing in the 

Wisconsin Constitution authorizes the governor to amend or 

create law, and nothing in the Wisconsin Constitution authorizes 

the governor to unilaterally repeal laws (via his veto power or 

otherwise). Despite this court's jurisprudence repeatedly 

inventing veto powers not conferred under the constitution, the 

court has never empowered the governor to change the effective 

date of a bill, much less an existing law. See State ex rel. 

Wis. Senate v. Thompson, 144 Wis. 2d 429, 434, 424 N.W.2d 385 

(1988) (allowing the so-called "digit" veto, which permits a 

governor to "veto" an appropriation amount by reducing it); 

Citizens Utility Bd. v. Klauser, 194 Wis. 2d 484, 534 N.W.2d 608 

(1995) (allowing a governor to write in a different 
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appropriation amount, provided it is an amount lower than the 

amount proposed by the legislature).

¶60 The governor's "veto" cannot withstand constitutional 

scrutiny. The 2017-19 budget bill imposed a one-year moratorium 

on the Energy Efficiency Revenue Limit Adjustment available to 

Wisconsin school districts under previously enacted law. By 

excising individual digits within the date in the bill (along 

with a comma and a space), the governor imposed a 1,000-year 

moratorium on the Adjustment. In doing so, he effectively 

repealed the law, an action the people never approved as an 

executive power under the constitution but instead reserved 

solely for the legislature.9 The governor changed the one-year 

moratorium approved by both houses of the legislature to 1,000 

years, creating a law the legislature never considered, 

approved, or presented. In doing so, the governor effectively 

nullified a law that had been on the books for years, 

singlehandedly eliminating the Energy Efficiency Revenue Limit 

Adjustment. This veto encroached on the exclusive province of 

 

9 "The constitutional authority to repeal statute law 

resides exclusively with legislatures." 1A Norman Singer

Sutherland Statutory Construction § 32:3 (7th ed. Oct. 2019) 

("Power to repeal") (quoted sources omitted; emphasis added). 

See also Wisconsin Legislature v. Palm, 2020 WI 42, ¶¶91-92, 391 

Wis. 2d 497, 942 N.W.2d 900 (Kelly, J., concurring) ("Powers 

constitutionally vested in the legislature include the powers: 

'to declare whether or not there shall be a law; to determine 

the general purpose or policy to be achieved by the law; [and] 

to fix the limits within which the law shall operate.' See, 

e.g., Schmidt v. Dep't of Res. Dev., 39 Wis. 2d 46, 59, 158 

N.W.2d 306 (1968) (quoting State ex rel. Wis. Inspection Bureau 

v. Whitman, 196 Wis. 472, 505, 220 N.W. 929 (1928)). Koschkee 

v. Taylor, 2019 WI 76, ¶11, 387 Wis. 2d 552, 929 N.W.2d 600 

(alteration in original).").
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the legislature, thereby violating the separation of powers 

reflected in the constitution, and this court should have so 

declared in order to confine current and future governors to the 

exercise of executive power as delineated in the text of the 

constitution.

B. The Second Veto

¶61 The second veto involves the Private Label Credit Card 

Bad Debt Deduction. Wisconsin law allows retailers who issue

credit cards to customers to claim a refund of state sales taxes 

the retailers paid if the retailers are unable to collect 

payments from customers who charged purchases on the credit 

cards issued by the retailers, but then failed to pay the credit 

card bills. Because retailers began partnering with third-party 

lenders using payment processors such as Visa or Mastercard, 

instead of using retailer-brand credit cards, the legislature 

passed a law in 2013 Wisconsin Act 229, amending the definition 

of "bad debt" in Wis. Stat. § 77.585 to include "dual purpose 

credit debts and private label credit debts." See § 77.585 

(2013-14). This allowed the retailer to take a tax deduction on 

bad debts arising from credit cards issued by third-party 

lenders.

¶62 Governor Walker could have vetoed this bad debt bill 

when the legislature presented it to him in 2013. He did not. 

He instead signed the bill into law, which was scheduled to take 

effect on July 1, 2015. The legislature decided to delay the 

effective date until July 1, 2017, amending § 77.585's effective 

date in the 2015-17 budget bill. In the 2017-19 budget bill, 
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the legislature decided to delay the effective date for an 

additional year. The legislature approved July 1, 2018 as the 

effective date for the bad debt deduction law, and included the 

following language in Section 2265 of the 2017-19 budget bill:

Section 6(1) This act takes effect on July 1, 2017

2018, and first applies to bad debts resulting from 

sales completed beginning on July 1, 2017 2018.

The governor rejected the legislature's deletion of the "20" in 

"2017"; approved the deletion of the "1" in "2017"; rejected the 

legislature's deletion of the "7" in "2017"; deleted the "201" 

in "2018"; and deleted the space between the "2017" and "2018" 

to create a new effective date of "July 1, 2078." A side-byside chart shows the legislative language compared to the 

governor's amended language:

Legislative Language Governor's Final Language

[2013 Wisconsin Act 

229] Section 6 (1) 

This act takes 

effect on July 1, 

2017 2018 and first 

applies to bad debts 

resulting from sales 

completed beginning 

on July 1, 2017

2018.

[2013 Wisconsin Act 

229] Section 6 (1) 

This act takes 

effect on July 1, 

2078 and first 

applies to bad debts 

resulting from sales 

completed beginning 

on July 1, 2078.

Like the other veto, the governor never approved anything passed 

by the legislature, in whole or in part. Instead, he amended 

the legislature's language by rejecting the deletion of six 

digits, striking six digits, deleting two spaces, and merging 

what was left into a date 60 years in the future. The 
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legislature never presented a 60-years-later effective date to 

the governor and the legislature never voted on or approved a 

60-year delay.

¶63 Similar to the other veto, the governor's actions

effectively repealed a law previously enacted and signed by the 

governor. Unlike the 1,000 year delay created by the other 

veto, the people will have to wait only 60 years for the law 

enacted by the legislature to take effect. As a result, the 

current statutes contain (and every subsequently printed statute 

book for the next 60 years will contain) both the current Wis. 

Stat. § 77.585 as well as the law enacted by the legislature 

(albeit with an effective date unilaterally chosen by the 

governor), which appears in a "Note" following the current 

statute offering the following explanation: "Sub. (1) is 

renumbered, in part, amended, in part, and created, in part, 

eff. 7-1-2078 . . . to read:"; the text of the enacted statute 

follows, as amended by the governor.10

 

10 On July 2, 2078, Wis. Stat. § 77.585 will provide:

(1) (a) In this subsection:

1. "Bad debt" means the portion of the sales price or 

purchase price that the seller has previously reported 

as taxable under this subchapter, and for which the 

seller has paid the tax, and that the seller or lender 

may claim as a deduction under section 166 of the 

Internal Revenue Code. "Bad debt" does not include 

financing charges or interest, sales or use taxes 

imposed on the sales price or purchase price, 

uncollectible amounts on tangible personal property or 

items, property, or goods under s. 77.52 (1) (b), (c), 

or (d) that remain in the seller's possession until 

the full sales price or purchase price is paid, 

expenses incurred in attempting to collect any debt, 

debts sold or assigned to 3rd parties for collection, 
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not including dual purpose credit debts and private 

label credit debts, and repossessed property or items.

2. "Dual purpose credit card" means a credit card that 

may be used as a private label credit card or to make 

purchases from persons other than the seller whose 

name or logo appears on the card or the seller's 

affiliates or franchisees, if the credit card issuer 

is able to determine the sales receipts of the seller 

and the seller's affiliates or franchisees apart from 

any sales receipts of unrelated persons.

3. "Dual purpose credit debt" means accounts and 

receivables that result from credit sale transactions 

using a dual purpose credit card, but only to the 

extent the account or receivable balance resulted from 

purchases made from the seller whose name or logo 

appears on the card.

4. a. "Lender" means any person who owns a private 

label credit debt, an interest in a private label 

credit debt, a dual purpose credit debt, or an 

interest in a dual purpose credit debt, if the person 

purchased the debt or interest directly from a seller 

who remitted the tax imposed under this subchapter or

from a third party or if the person originated the 

debt or interest pursuant to the person's contract 

with the seller who remitted the tax imposed under 

this subchapter or with a third party.

b. "Lender" includes any person who is a member of the 

same affiliated group, as defined under section 1504 

of the Internal Revenue Code, as a lender or is an 

assignee or other transferee of a lender.

5. "Private label credit card" means any charge card 

or credit card that identifies a seller's name or logo 

on the card and that may be used only for purchases 

from that seller or from any of the seller's 

affiliates or franchisees.

6. "Private label credit debt" means accounts and 

receivables that result from credit sale transactions 

using a private label credit card, but only to the 

extent the account or receivable balance resulted from 

purchases made from the seller whose name or logo 

appears on the card.
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(b) A seller may claim as a deduction on a return 

under s. 77.58 the amount of any bad debt that the 

seller or lender writes off as uncollectible in the 

seller's or lender's books and records and that is 

eligible to be deducted as a bad debt for federal 

income tax purposes, regardless of whether the seller 

or lender is required to file a federal income tax 

return. A seller who claims a deduction under this 

paragraph shall claim the deduction on the return 

under s. 77.58 that is submitted for the period in 

which the seller or lender writes off the amount of 

the deduction as uncollectible in the seller's or 

lender's books and records and in which such amount is 

eligible to be deducted as bad debt for federal income 

tax purposes. If the seller or lender subsequently 

collects in whole or in part any bad debt for which a 

deduction is claimed under this paragraph, the seller 

shall include the amount collected in the return filed 

for the period in which the amount is collected and 

shall pay the tax with the return.

(bm) For purposes of par. (b), a seller may compute 

the seller's bad debt deduction using an estimate, if 

the department approves the method for computing the 

estimate. The department may audit the seller's books 

and records to review the estimate and adjust the 

estimate as necessary to reflect the actual allowable 

bad debt amount.

(c) For purposes of computing a bad debt deduction or 

reporting a payment received on a previously claimed 

bad debt, any payment made on a debt or on an account 

is applied first to the price of the tangible personal 

property, or items, property, or goods under s. 77.52 

(1) (b), (c), or (d), or service sold, and the 

proportionate share of the sales tax on that property, 

or items, property, or goods under s. 77.52 (1) (b), 

(c), or (d), or service, and then to interest, service 

charges, and other charges related to the sale. If 

payment is received on an account for which the 

balance reflects multiple sales transactions, the 

payment is applied to the sales transactions in the 

same order in which the sales transactions occurred.

(d) A seller may obtain a refund of the tax reported 

for any bad debt amount deducted under par. (b) that 

exceeds the amount of the seller's taxable sales as 

provided under s. 77.59 (4), except that the period 
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¶64 The governor used his veto power to modify the 

effective date of a law passed years before the 2017-19 budget 

bill and set to go into effect on July 1, 2018. The governor 

did not veto a complete idea voted on and approved by the 

legislature and presented to the governor as a bill. His veto 

prevented existing law from taking effect for another six 

decades. Like the other "veto," this veto also invaded the 

province of the legislature by amending——to the point of 

nullifying——an enacted law, previously passed by the legislature 

and approved by the governor.

¶65 The people of Wisconsin never gave the governor this 

power. It is the responsibility of this court to guard against 

 

for making a claim as determined under s. 77.59 (4) 

begins on the date on which the return on which the 

bad debt could be claimed would have been required to 

be submitted to the department under s. 77.58.

(e) If a seller is using a certified service provider, 

the certified service provider may claim a bad debt 

deduction under this subsection on the seller's behalf 

if the seller has not claimed and will not claim the 

same deduction. A certified service provider who 

receives a bad debt deduction under this subsection 

shall credit that deduction to the seller and a 

certified service provider who receives a refund under 

this subsection shall submit that refund to the 

seller.

(f) If a bad debt relates to the retail sales of 

tangible personal property, or items, property, or 

goods under s. 77.52 (1) (b), (c), or (d), or taxable 

services that were sourced to this state and to one or 

more other states, as determined under s. 77.522, the 

total amount of such bad debt shall be apportioned 

among the states to which the underlying sales were 

sourced in a manner prescribed by the department to 

arrive at the amount of the deduction under par. (b). 
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the encroachment of the executive branch upon the people's 

representatives in the legislative branch. "The significance of 

preserving clear boundaries between the branches has been 

understood since the founding of our nation[.]" Gabler, 376 

Wis. 2d 147, ¶60. It is the duty of this court to be "ever 

vigilant in averting the accumulation of power by one body——a 

grave threat to liberty[.]" Id. When this court hears a case 

involving such encroachment by the governor via the exercise of 

veto power not authorized by the constitution, it is the duty of 

this court to check it.

¶66 In exercising each of these vetoes, the governor 

violated the separation of powers by assuming the authority to 

legislate, a power the constitution confers on the legislature 

alone. Under the Wisconsin Constitution, the governor may 

approve or reject a bill presented by the legislature and may 

approve "in whole or in part" an appropriation bill. The vetoed 

part as well as the approved part must each represent a complete 

idea on which the legislature voted. The veto cannot be used to 

change what the legislature presented; the veto cannot be used 

to create new law the legislature never approved; and the veto 

cannot be used to unilaterally erase laws enacted in previous 

years.

¶67 These vetoes were unconstitutional, and this court 

should have so declared. Instead, the majority leaves the 

petitioners, the governor, the legislature, and the people of 

Wisconsin without an answer to this important constitutional 

question the court told them we would resolve.
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VI. CONCLUSION

¶68 The governor's vetoes challenged by WSBU transgressed 

the boundaries of executive power in unilaterally repealing 

existing laws by extending their effective dates 1,000 years and 

60 years, respectively. Rather than approving these 

appropriation bills "in whole or in part," as permitted under 

the Wisconsin Constitution, the governor deleted digits in 

dates, a punctuation mark, and spaces in order to create new 

effective dates set far in the future. When a governor replaces 

a law's legislatively-written effective date with his preferred 

effective date——one never approved or presented by the 

legislature——he assumes a power to create law, which only the 

legislature may constitutionally exercise. Both vetoes are 

patently unconstitutional because nothing in the constitution 

authorizes a governor to unilaterally repeal existing law or 

amend a law's effective date, actions reserved to the 

legislature alone.

¶69 The majority refuses to consider the merits despite 

having granted this original action on the sole and significant 

issue of the constitutional scope of the governor's veto power 

as exercised in the two instances presented for our review. 

Instead, the majority takes the unprecedented and completely 

discretionary step of declining to declare rights in an original 

action presenting an issue of first impression regarding the 

constitutionality of a governor's vetoes, electing to deny 

relief under the doctrine of laches. In doing so, the majority 

shirks its duty to preserve the constitutional balance of power 
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between the political branches, abandoning the judiciary's 

pivotal role in protecting the bedrock of our structure of 

government. I respectfully dissent.

¶70 I am authorized to state that Justice DANIEL KELLY 

joins this dissent.
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