AB229: Bill Text

LRB-2716/1

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2001 - 2002 LEGISLATURE

2001 Assembly BILL 229

March 20, 2001 - Introduced by Committee on State and Local Finance (Select). Referred to Committee on State and Local Finance (Select).

AB229,1,8 An Act to repeal 79.03 (2), 79.03 (3) (b) 4. b., 79.03 (3) (b) 4. bg., 79.03 (3) (b) 4. bm. and 79.03 (3) (b) 4. h.; to amend 20.835 (1) (d), 25.50 (3) (b), 33.32 (3) (b), 79.005 (1), 79.005 (2), 79.01 (1), 79.01 (2), 79.015, 79.02 (2) (b), 79.02 (3), 79.03 (1), 79.03 (3) (a), 79.03 (3) (b) 1., 79.03 (3) (b) 3., 79.03 (3) (b) 4. (intro.), 79.03 (3) (b) 4. a., 79.03 (3) (b) 4. d., 79.03 (3) (b) 4. e., 79.03 (3) (b) 4. f., 79.03 (3) (b) 5., 79.03 (3) (b) 6., 79.03 (4), 79.06 (1) and 79.06 (2); and to create 20.835 (1) (db), 20.835 (1) (dd), 66.1001 (3) (rm), 79.01 (5), 79.01 (6) and 79.065 of the statutes; relating to: restructuring municipal shared revenue.

Analysis by the Legislative Reference Bureau

Under current law, a municipality receives a shared revenue payment based on the municipality's population. The payment is equal to the municipality's population multiplied by the product of the following: the 1982 state population multiplied by $30 divided by the state's current population. This bill eliminates the current shared revenue payment to a municipality based on population.

Under current law, a municipality also receives an aidable revenues payment that is equal to the product of the municipality's aidable revenues and the municipality's tax base weight. Aidable revenues are, generally, revenues raised by the municipality, such as local taxes and regulation revenues. Tax base weight is based, generally, on the value of property in the municipality compared to the municipality's population. This bill eliminates a municipality's aidable revenues payment.

This bill creates an aidable expenditures payment for a municipality. The bill also creates a "growth-sharing region" payment for a municipality. Beginning in 2002, a municipality receives an aidable expenditures payment that is equal to the product of the municipality's aidable expenditures and the municipality's tax base weight. Aidable expenditures include a municipality's expenditures for general government operations; law enforcement, fire protection, ambulance services, and other public safety services; and health and human services. Aidable expenditures do not include a municipality's expenditures for highway maintenance, administration, or construction; road-related facilities or other transportation; solid waste collection and disposal or other sanitation; culture; education; parks and recreation; conservation; or development.

Annually, the department of revenue (DOR) determines the amount of each municipality's aidable expenditures. The amount of a municipality's aidable expenditures in a year is the lesser of: 1) the amount of the municipality's aidable expenditures in the year that was two years before the municipality receives an aidable expenditures payment or 2) the average of the municipality's aidable expenditures in 1998, 1999, and 2000, adjusted for inflation and for the property value in the municipality.

Under the bill, a municipality in a growth-sharing region may also receive a growth-sharing region payment. DOR must define "growth-sharing region" by rule and in such a way so that the state consists of at least seven but not more than 25 growth-sharing regions. A municipality will receive a growth-sharing region payment if the municipality limits the annual increase in its municipal budget to the allowable increase, based on the inflation rate and the property value in the municipality, to qualify for the expenditure restraint program under current law and if the municipality enters into an area cooperation compact (compact).

Beginning in 2002 and ending in 2005, to receive a payment, a municipality must enter into a compact with at least two municipalities or counties, or with any combination of at least two such entities, to perform at least two specified functions. Beginning in 2006, to receive a payment, a municipality must enter into a compact with at least four municipalities or counties, or with any combination of at least four such entities, to provide law enforcement and to perform at least five other specified functions. The specified functions are housing, emergency services, fire protection, solid waste collection and disposal, recycling, public health, animal control, transportation, mass transit, land use planning, boundary agreements, libraries, parks and recreation, culture, purchasing, and electronic government. A municipality that is not adjacent to at least two other municipalities may enter into a compact with any adjacent municipality or with the county in which the municipality is located.

A compact must provide a plan for any municipalities or counties that enter into the compact to collaborate to provide the specified functions. The compact must also provide benchmarks to measure the plan's progress and provide outcome-based performance measures to evaluate the plan's success. Municipalities and counties that enter into the compact must structure the compact in a way that results in significant tax savings to taxpayers within the municipalities and counties. Annually, the municipality that is to receive a payment must certify to DOR that the municipality has complied with all of the compact requirements.

The total amount of the growth-sharing region payments allocated to all growth-sharing regions is an amount equal to the sales and use taxes collected in the state in a year multiplied by .05, and each growth-sharing region is allocated an amount that is proportional to the sales and use taxes that are collected in the region. A municipality that is eligible to receive a growth-sharing region payment receives an amount, from the amount allocated to the growth-sharing region in which the municipality is located, in proportion to its population within the growth-sharing region.

In 2002, a municipality is guaranteed a combined minimum aidable expenditures and growth-sharing region payment equal to 95% of the amount of the aidable revenues and per capita payments the municipality received in 2001. In 2003 and subsequent years, a municipality is guaranteed a combined minimum aidable expenditures and growth-sharing region payment equal to 95% of the combined amounts of the aidable expenditures and the growth-sharing region payments the municipality received in the previous year, if the municipality received growth-sharing region payments in both the current year and the previous year.

For further information see the state and local fiscal estimate, which will be printed as an appendix to this bill.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

AB229, s. 1 Section 1. 20.835 (1) (d) of the statutes is amended to read:

AB229,3,5 20.835 (1) (d) Shared County shared revenue account. A sum sufficient to meet the requirements of the county shared revenue account established under s. 79.01 (2) to provide for the distributions from the shared revenue account to counties, towns, villages and cities under ss. 79.03, 79.04, and 79.06.

AB229, s. 2 Section 2. 20.835 (1) (db) of the statutes is created to read:

AB229,3,9 20.835 (1) (db) Municipal services aid account. A sum sufficient to make the payments to municipalities under ss. 79.04 and 79.065 (2) and to make the payments to municipalities under s. 79.065 (5) that are not paid from s. 20.835 (1) (dd).

AB229, s. 3 Section 3. 20.835 (1) (dd) of the statutes is created to read:

AB229,4,4 20.835 (1) (dd) Municipal growth sharing account. A sum sufficient in the amount determined under s. 79.01 (5) to make the payments to municipalities under s. 79.065 (3) and to make the payments to municipalities under s. 79.065 (5) that are not paid from s. 20.835 (1) (db).

AB229, s. 4 Section 4. 25.50 (3) (b) of the statutes is amended to read:

AB229,4,12 25.50 (3) (b) On the dates specified and to the extent to which they are available, subject to s. 16.53 (10), funds payable to local governments under ss. 79.03, 79.04, 79.05, 79.058, 79.06, 79.065, 79.08, and 79.10 shall be considered local funds and, pursuant to the instructions of local officials, may be paid into the separate accounts of all local governments established in the local government pooled-investment fund and, pursuant to the instructions of local officials, to the extent to which they are available, be disbursed or invested.

AB229, s. 5 Section 5. 33.32 (3) (b) of the statutes is amended to read:

AB229,4,19 33.32 (3) (b) If a county or municipality fails to pay a special assessment levied by a district, the clerk of the district may certify this fact to the department of administration, and shall state the amount due. The department, at the time of making the next scheduled distribution under s. 79.03 or 79.065, shall deduct the amount claimed from the payment due the county or municipality, and shall forward it to the district.

AB229, s. 6 Section 6. 66.1001 (3) (rm) of the statutes is created to read:

AB229,4,21 66.1001 (3) (rm) Area cooperation compacts under s. 79.065 (4).

AB229, s. 7 Section 7. 79.005 (1) of the statutes is amended to read:

AB229,5,3 79.005 (1) "Municipality" means any town, village , or city in this state. If a municipality is located in more than one county, payments under this subchapter shall be computed using data for the municipality as a whole. If a municipality is located in more than one growth-sharing region, as defined in s. 79.065 (1) (d), payments under s. 79.065 (3) shall be computed using data for the portion of the municipality that is located in each growth-sharing region.

AB229, s. 8 Section 8. 79.005 (2) of the statutes is amended to read:

AB229,5,10 79.005 (2) "Population" means the number of persons residing in each municipality and county of the state as last determined by the department of administration under s. 16.96, except that under s. 79.065 (3) (b), if a municipality is located in more than one growth-sharing region, "population" means the number of persons residing in the portion of the municipality located in each growth-sharing region.

AB229, s. 9 Section 9. 79.01 (1) of the statutes is amended to read:

AB229,5,17 79.01 (1) There is established an account in the general fund entitled the "Expenditure Restraint Program Account". Account." There shall be appropriated to that account $25,000,000 in 1991, in 1992, and in 1993,; $42,000,000 in 1994,; $48,000,000 in each year beginning in 1995 and ending in 1999 and; $57,000,000 beginning in the year 2000 and ending in 2001; and $63,000,000 in 2002 and in each year thereafter.

AB229, s. 10 Section 10. 79.01 (2) of the statutes is amended to read:

AB229,5,22 79.01 (2) There is established an account in the general fund entitled the "Municipal and County Shared Revenue Account,", referred to in this chapter as the "shared revenue account.". There shall be appropriated to the shared revenue account the sums specified in ss. 79.03 and, 79.04, and 79.06.

AB229, s. 11 Section 11. 79.01 (5) of the statutes is created to read:

AB229,6,3 79.01 (5) There is established an account in the general fund entitled the "Municipal Growth-Sharing Account." There shall be appropriated to that account an amount, determined by the department of revenue, that is equal to the sales and use tax revenue collected under subch. III of ch. 77 in the fiscal year prior to the fiscal year that any municipality receives the statement under s. 79.015 multiplied by .05.

AB229, s. 12 Section 12. 79.01 (6) of the statutes is created to read:

AB229,6,9 79.01 (6) There is established an account in the general fund entitled the "Municipal Services Aid Account." There shall be appropriated to that account the amounts necessary to make the payments to municipalities under ss. 79.04 (1) and (4) (a) and 79.065 (2) and to make the payments to municipalities under s. 79.065 (5) that are not paid from s. 20.835 (1) (dd).

AB229, s. 13 Section 13. 79.015 of the statutes is amended to read:

AB229,6,14 79.015 Statement of estimated payments. The department of revenue, on or before September 15 of each year, shall provide to each municipality and county a statement of estimated payments to be made in the next calendar year to the municipality or county under ss. 79.03, 79.04, 79.05, 79.058 and, 79.06, and 79.065.

AB229, s. 14 Section 14. 79.02 (2) (b) of the statutes is amended to read:

AB229,6,18 79.02 (2) (b) Subject to s. 59.605 (4), payments in July shall equal 15% of the municipality's or county's estimated payments under ss. 79.03, 79.04, 79.058 and, 79.06, and 79.065 and 100% of the municipality's estimated payments under s. 79.05.

AB229, s. 15 Section 15. 79.02 (3) of the statutes is amended to read:

AB229,6,23 79.02 (3) Subject to s. 59.605 (4), payments to each municipality and county in November shall equal that municipality's or county's entitlement to shared revenues under ss. 79.03, 79.04, 79.05, 79.058 and, 79.06, and 79.065 for the current year, minus the amount distributed to the municipality or county in July.

AB229, s. 16 Section 16. 79.03 (1) of the statutes is amended to read:

AB229,7,3 79.03 (1) Each municipality and county is entitled to shared revenue, consisting of an in the amount determined on the basis of population under sub. (2), plus an amount determined under sub. (3).

AB229, s. 17 Section 17. 79.03 (2) of the statutes is repealed.

AB229, s. 18 Section 18. 79.03 (3) (a) of the statutes is amended to read:

AB229,7,10 79.03 (3) (a) The amount in the shared revenue account for municipalities and the amount in the shared revenue account for counties, less the payments under sub. (2) and s. 79.04, shall be allocated to each municipality and county respectively in proportion to its entitlement. In this paragraph, "entitlement" means the product of aidable revenues and tax base weight.

AB229, s. 19 Section 19. 79.03 (3) (b) 1. of the statutes is amended to read:

AB229,7,12 79.03 (3) (b) 1. "Aidable revenues" means:

AB229,7,13 a. For a municipality, the average local purpose revenues.

AB229,7,14 b. For a county, 85% of the average local purpose revenue.

AB229, s. 20 Section 20. 79.03 (3) (b) 3. of the statutes is amended to read:

AB229,8,7 79.03 (3) (b) 3. "Full valuation" means the full value of property that is exempt under s. 70.11 (39) as determined under s. 79.095 (3) plus the full value of all taxable property for the preceding year as equalized for state tax purposes, except that for municipalities the value of real estate assessed under s. 70.995 is excluded. Value value increments under s. 66.1105 plus the full value of property that is exempt under s. 70.11 (39) that would otherwise be part of a value increment are included for municipalities but excluded for counties. Environmental remediation value increments under s. 66.1106 are included for municipalities and counties that create the environmental remediation tax incremental district and are excluded for units of government counties that do not create the district. If property that had been assessed under s. 70.995 and that has a value exceeding 10% of a municipality's value is assessed under s. 70.10, 30% of that property's full value is included in "full valuation" for purposes of the shared revenue payments in the year after the assessment under s. 70.10, 65% of that property's full value is included in "full valuation" for purposes of the shared revenue payments in the year 2 years after the assessment under s. 70.10 and 100% of that property's full value is included in "full valuation" for purposes of subsequent shared revenue payments.

AB229, s. 21 Section 21. 79.03 (3) (b) 4. (intro.) of the statutes is amended to read:

AB229,8,15 79.03 (3) (b) 4. (intro.) "Local purpose revenues" means the sum of payments under s. 79.095, local general purpose taxes, regulation revenues, revenues for services to private parties by a county's or municipality's general operations or enterprises, revenue for sanitation services to private parties, special assessment revenues, and tax base equalization aids and, for municipalities only, a proxy for private sewer service costs, a proxy for private solid waste and recycling service costs and a proxy for retail charges for fire protection purposes. In this subdivision:

AB229, s. 22 Section 22. 79.03 (3) (b) 4. a. of the statutes is amended to read:

AB229,9,2 79.03 (3) (b) 4. a. "Local general purpose taxes" means the portion of tax increments collected for payment to a municipality under s. 66.1105 which is attributable to that municipality's own levy, the portion of environmental remediation tax increments collected for payment to a municipality or county under s. 66.1106 that is attributable to that municipality's or county's own levy, general property taxes, excluding taxes for a county children with disabilities education board, collected to finance the general purpose government unit, property taxes collected for sewage and sanitary districts, mobile home fees, the proceeds of county sales and use taxes, and municipal and county vehicle registration fees under s. 341.35 (1).

AB229, s. 23 Section 23. 79.03 (3) (b) 4. b. of the statutes is repealed.

AB229, s. 24 Section 24. 79.03 (3) (b) 4. bg. of the statutes is repealed.

AB229, s. 25 Section 25. 79.03 (3) (b) 4. bm. of the statutes is repealed.

AB229, s. 26 Section 26. 79.03 (3) (b) 4. d. of the statutes is amended to read:

AB229,9,10 79.03 (3) (b) 4. d. "Revenue for sanitation services to private parties" means revenues collected from private parties by a county's or municipality's general operations or enterprises and by sewerage, sanitation, or inland lake rehabilitation districts as refuse collection fees, sewerage service fees, and landfill fees.

AB229, s. 27 Section 27. 79.03 (3) (b) 4. e. of the statutes is amended to read:

AB229,9,21 79.03 (3) (b) 4. e. "Revenues for services to private parties by a county's or municipality's general operations or enterprises" means revenues collected from private parties for the following services: general government services consisting of license publication fees, sale of publications, clerk's fees, and treasurer's fees; public safety services, consisting of police or sheriff's department fees, fire department fees, and ambulance fees; inspection services, consisting of building, electrical, heat, plumbing, elevator, and weights and measures; sidewalk replacement or construction fees, storm sewer construction fees, street lighting fees; parking ramps, meters and lot fees; library fines or fees; and museum and zoo users or admission fees.

AB229, s. 28 Section 28. 79.03 (3) (b) 4. f. of the statutes is amended to read:

AB229,9,24 79.03 (3) (b) 4. f. "Special assessment revenues" means charges assessed against benefited properties for capital improvements by a municipality or county placed on the current tax roll for collection or collected during the year in advance of being placed on the tax roll.

AB229, s. 29 Section 29. 79.03 (3) (b) 4. h. of the statutes is repealed.

AB229, s. 30 Section 30. 79.03 (3) (b) 5. of the statutes is amended to read:

AB229,10,7 79.03 (3) (b) 5. "Standardized valuation" means the product of the standardized valuation per person times the population of a municipality or a county in the preceding year.

AB229, s. 31 Section 31. 79.03 (3) (b) 6. of the statutes is amended to read: