On May 11, Governor Tony Evers (D) announced that he had come to an agreement with Assembly Speaker Robin Vos (R-Rochester) and Senate Majority Leader Devin LeMahieu (R-Oostburg) on legislation to increase K-12 education funding and provide tax relief in response to the state’s $2.5 billion budget surplus. As originally introduced, the bill included the following provisions:

• $600 million for K-12 schools statewide, half of which is for special education and the other half is for general school funding – known as “general school aids” – which was intended to help reduce property taxes.
• $50 million in aid for the Wisconsin Technical College System, which was intended to reduce property taxes by the same amount.
• Eliminate the individual income tax on cash tips, which would have started in tax year 2026.
• Eliminate the individual income tax on overtime income, which would have started in tax year 2026.
• Individual income tax rebates for taxpayers who filed in tax year 2024 – individuals would have received $300, while married couples who filed jointly would have received $600.

The Legislature’s budget-writing Joint Finance Committee voted to advance this bill on May 12. On May 13, the Assembly amended the bill to include provisions expanding a property tax credit for veterans and their surviving spouses and creating a disaster assistance grant program in response to severe flooding and storms that have taken place in Wisconsin since August 2025. Subsequently, the Assembly passed this amended bill with a bipartisan 61-32 vote. However, the Senate then voted 15-18 to reject this amended bill.