In another sign of the fiscal crisis, repaying debt will take a greater share of Wisconsin’s revenue in years to come.

Like a financially strapped consumer facing higher credit card bills, the state would face unprecedented debt payments over the next four years under state budget proposals by Democratic Gov. Jim Doyle and lawmakers.

By 2012, yearly payments on state debt will likely consume at least 4.5 percent of the state’s total income from taxes and fees, according to projections by the Legislature’s and Doyle’s budget offices. That’s 13 percent higher than the 4 percent threshold state officials have long considered to be a reasonable limit.

“If you cross that threshold, that’s a new development,” said Todd Berry, president of the Wisconsin Taxpayers Alliance. “We have been pushing the borrowing and debt envelope because we haven’t been coming to grips with our budget problems.”

The rising debt levels are one more sign of how the state’s financial crisis — the worst in at least a generation — will linger for years to come, threatening further cuts to state services and increasing pressure to raise taxes.

Even the billions the state is getting in federal stimulus dollars won’t be enough in the long run. Once the money stops flowing two years from now, figures from the nonpartisan Legislative Fiscal Bureau show, the state will face huge budget challenges:

• The state’s cushion to absorb new shocks in the 2009-11 budget would be a little more than $130 million under the budget bills passed by the Democrat-controlled Senate and Assembly. That’s only enough to run state government for three or four days. The state, which operates with some of the lowest budget reserves in the nation, would still have essentially no money in its rainy day fund.

• The projected shortfall in the following two-year budget — taking into account tax cuts and spending commitments in the current budget bill — would reach $2.26 billion. That’s more than any projected shortfall in the last decade except the $2.87 billion shortfall in the 2003-05 budget. If tax revenues fail to grow enough by 2011 to cover that future deficit, state officials will once again face tough decisions.

• Payments on debt would rise from $487 million in 2011 to $650 million in 2012 — an increase of 33 percent.

The rising debt load would be due in part to the proposal by Doyle and Democrats to push off $499 million in debt payments from the 2009-11 budget. Delaying those payments makes sense given the state’s $6.6 billion deficit and cheaper interest rates available through the federal stimulus bill, the officials said.

“It’s really a modest part of a broad response to the worst national and global economic crisis in generations,” Doyle budget director Dave Schmiedicke said of the increased state borrowing.

Rep. Mark Pocan, D-Madison, co-chairman of the Legislature’s budget committee, said the problem wasn’t simply the increase in borrowing. The state’s sharply declining tax revenues were also making the debt payments larger by comparison, he said.

“This is a budget of historic proportions,” Pocan said. “In the next (budget) biennium, if you keep seeing a trend like that, there should be a concern.”

Under the federal stimulus bill, the federal government will cover 35 percent of the interest costs on so-called “Build America Bonds,” providing another incentive to turn to borrowing in the face of the state’s huge budget deficit.

Using that program, Schmiedicke said, the state was able to cut the interest rate on a recent $54 million bond sale from 4.7 percent to 3.5 percent, saving the state $9.1 million.

Assembly Minority Leader Jeff Fitzgerald, R-Horicon, said the state’s debt levels have been rising for years because the state has failed to live within its means.

Fitzgerald said he worried that in coming years a similar increase in borrowing by the federal government could lead to rising inflation and as a result higher interest rates for all borrowers, including the state. That could make debt levels that are manageable now a much greater burden in the future, he said.

“Two years from now, you’re really going to see a problem,” Fitzgerald said.