As nearby states reform, Wisconsin clings to licensure requirements that add little value
The numbers don’t lie, and nobody knows that better than all the kids who no longer want to be accountants in Wisconsin.
The number of people getting accounting degrees at University of Wisconsin System schools plummeted from 868 in the 2019-20 school year to 625 in the 2023-24 school year.
The kids becoming actuaries or finance majors or math teachers instead of accountants can probably do the arithmetic in their heads but, for all the English majors out there like me, my calculator says that’s a 28 percent drop.
Other states have had the same basic problem. But, unlike Wisconsin — at least thus far — many have enacted the same basic solution: elimination of unnecessary and expensive CPA licensure requirements that currently cost many kids about $100,000 in extra tuition and lost earnings.
This is an old problem.
About 20 years ago, states across America — led by Florida — started to require a minimum of 150 credit hours of coursework plus actual work experience before anyone could sit for the exam to become a certified public accountant. That means, in essence, another year of school beyond what’s needed to get a just single bachelor’s degree.
A typical bachelor’s degree requires 120 credits so, in other words, Wisconsin students right now need to add another 30 or so credits — the equivalent of a year of school.
Some just take a bunch of other undergrad courses. Some get an advanced degree. Numbers of both are decreasing. In 2019-20, University of Wisconsin System schools awarded 728 bachelor’s degrees in accounting and 140 master’s degrees for total of 868. In 2023-24, it awarded 545 bachelor’s degrees and 80 master’s degrees for a total of 625, according to data from the University of Wisconsin System’s Office of Policy Analysis and Research.
“I have said for 20 years this (150-hour requirement) was a horrible, horrible mistake made by the profession,” said Dale Kooyenga, an accountant and former legislator who is now president of the Metropolitan Milwaukee Association of Commerce. “It really limits the numbers the profession needs to be healthy.”
This sort of “fencing” has happened in all kinds of licensed professions. The ones who get in use government to fence out as many others as they can in order to protect their realm. Academia, in the meantime, also had motivation to increase requirements.
“I always said this 150 hours was pushed by the universities to make money,” said state Sen. Chris Kapenga, who also is an accountant. But the “academic elites” also think that more education automatically means kids are more prepared, he said. He disagrees. Wisdom often comes from work.
“It used to be a 120-hour (requirement) — that’s what it was for me — and there were no issues with quality in any way.”
He says we should go back to that, the way other states are.
Nearly 20 states have already amended CPA licensing laws so far this year, according to the Wall Street Journal.
Wisconsin is pretty much surrounded by reformers. Minnesota and Iowa already have passed laws lowering requirements, and Illinois appears likely to do the same soon, according to Geno Fragnito, government relations director for the Minnesota Society of CPAs.
Fragnito says there was a “firestorm of pushback” from national groups when they started pushing for reform of licensure requirements in Minnesota in 2023. That’s changed. The American Institute of CPAs and the National Association of State Boards of Accountancy have now approved model legislation.
In Minnesota, where the new law kicks in next January, there will be multiple paths to licensure, but basically aspiring CPAs no longer will need five years of school. Four years will suffice as long as they work two years before trying to pass the famously difficult CPA exam.
Michigan, our other neighbor, appears headed toward change as well. Bob Doyle, CEO of the Michigan Association of CPAs, said he hopes a bill similar to the one in Minnesota will be introduced this summer and effective by Jan. 1, 2026.
All that is going to leave Wisconsin in a precarious and isolated position if we don’t move in the same direction. Why would any aspiring CPA stay in Wisconsin rather than use reciprocity to go to school in, say, Minnesota — or just take her degree from UW-La Crosse across the river and immediately get a job instead of paying for another year of schooling here?
Kids will be “incentivized,” as Kapenga puts it, “to go to other states.”
Tammy Hofstede, president and CEO of the Wisconsin Institute of Certified Public Accountants, said her group is hoping to see something introduced in Madison in this calendar year and effective in early 2026.
“We’re all on the same page with other states,” she said. “I think it is just a matter of time.”
Time, though, is getting short.
If Wisconsin’s neighbors all remove the 150-hour requirement and Wisconsin does not at the same time, kids will just do the math and leave the state.
Kooyenga figures kids from Wisconsin lose $100,000 in that first year out when you add up the cost of further education and lost earnings. First-year accountants in Milwaukee can make mid- or high-60s, according to a little informal survey I did Wednesday.
Kapenga said Wednesday that he expects Wisconsin will follow suit and address the licensure issue that is going to drive away accountants who already are in short supply.
Can’t happen soon enough.
Just consider the numbers.
Mike Nichols is the president of the Badger Institute.
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