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July 2003
What the State Budget Cuts
to Consumer Protection
Could Mean for You
by Bill Oemichen


One of the more controversial issues for the Wisconsin Legislature’s Joint Finance Committee to handle was the Governor’s request that the state’s Consumer Protection Program be transferred from the Department of Agriculture, Trade & Consumer Protection (DATCP) to the Wisconsin Department of Justice (DOJ). For years, this has been a thorny issue between the governor, the attorney general, and Legislature.

Former Governor Tommy Thompson argued DATCP was the logical location for the Consumer Protection Program since it has a successful 74-year track record as the state’s primary consumer protection agency. Governor Thompson also argued there should be a separation of investigators at DATCP from prosecutors at DOJ in the same way police and local prosecutors are kept separate. Jim Doyle (then the attorney general) argued his office would be the tougher agency on consumer fraud, and that it made sense to have the entire program under DOJ’s jurisdiction for efficiency’s sake.

The Legislature stepped into the battle in 1995 and transferred DOJ’s investigators and Consumer Protection Hotline to join DATCP’s investigators and hotline. According to the Legislature, this move saved the state more than $600,000 per year. Since then, by most accounts, the DATCP program has been working well, with a record $18.9 million returned to consumers and the state treasury in 2002 through fines, forfeitures, and restitution. This compares to an annual state Consumer Protection Program cost of $2.6 million.

In late May, the Joint Finance Committee voted 12–4 against transferring Consumer Protection to DOJ. However, the committee also voted to eliminate more than 13 positions at DATCP and five at DOJ for a “savings” of more than $2 million during the 2003–2005 biennium. The DATCP reduction would reduce Consumer Protection staffing by more than 33 percent. The question now is what this reduction will mean for consumers.

Last year, about 16,000 written complaints were filed with DATCP, another 70,000 questions came by telephone, and 104,000 consumer contacts came through the Internet. Even with DATCP’s current 39 Consumer Protection staff, it’s quite clear DATCP already has a tremendous workload. Certainly, a 33-percent staffing reduction will reduce the level of personal service the average consumer may expect to receive from DATCP. This will then decrease the state’s effectiveness because it’s likely consumers will contact DATCP less if the Consumer Protection Hotline has more busy signals. Fewer complaints will mean less evidence for DATCP to use to successfully investigate and prosecute con artists.

The negative impacts continue. Currently, consumers have access to four regional Consumer Protection Offices in Eau Claire, Green Bay, Milwaukee, and Madison. A staffing reduction may eliminate regional offices outside of Madison, making it harder for consumers to personally visit an office for assistance. More importantly, this may also hurt the close working relationships Consumer Protection investigators have with local law enforcement, prosecutors, senior advocates, etc. Finally, the Consumer Protection Hotline is currently toll-free, but some believe DATCP should charge consumers for advice.

Regardless of where Consumer Protection should be located, it seems clear the real impact of the continuing debate is a dramatic reduction in the ability of the state to effectively combat consumer protection fraud, and this will mean consumers will have to do more to protect themselves.

 

Copyright ©2003 Wisconsin Energy Cooperative News
All rights reserved. Reproduction in whole or in part without permission is prohibited.