LRB-1961/2
MES:jld:pg
2005 - 2006 LEGISLATURE
March 10, 2005 - Introduced by Representatives Steinbrink, Kerkman and Ott,
cosponsored by Senators Wirch and Stepp. Referred to Committee on Ways
and Means.
AB193,1,4 1An Act to amend 66.1105 (2) (f) 1. (intro.); and to create 66.1105 (2) (f) 1. m. and
266.1105 (6) (am) 5. of the statutes; relating to: expenditure periods, and
3allowable project costs, for certain tax incremental districts in the city of
4Kenosha.
Analysis by the Legislative Reference Bureau
Under the current tax incremental financing program, a city or village may
create a tax incremental district (TID) in part of its territory to foster development
if at least 50 percent of the area to be included in the TID is blighted, in need of
rehabilitation or conservation, suitable for industrial sites, or suitable for mixed-use
development.
Also under current law, once a TID has been created, the Department of
Revenue calculates the "tax increment base value" of the TID, which is the equalized
value of all taxable property within the TID at the time of its creation. If the
development in the TID increases the value of the property in the TID above the base
value, a "value increment" is created and that portion of taxes collected on the value
increment in excess of the base value is called a "tax increment." The tax increment
is placed in a special fund that may be used only to pay back the project costs of the
TID.
The project costs of a TID, which are initially incurred by the creating city or
village, include public works such as sewers, streets, and lighting systems; financing
costs; site preparation costs; and professional service costs. Generally under current
law, but subject to one exception, project costs are required to be expended within the

boundaries of a TID. Under this bill, the project costs of a TID in the city of Kenosha
may be spent on territory within a one-half mile radius of the boundary of the TID
if that TID is a blighted area TID.
TIDs are required to terminate, under current law and with some exceptions,
once these project costs are paid back. Under one of the exceptions, which is limited
to certain circumstances, after a TID pays off its project costs, but not later than the
date on which it must otherwise terminate, the planning commission may allocate
positive tax increments generated by the TID (the "donor" TID) to another TID
(donee TIDs) that has been created by the planning commission.
Also under current law, certain donor TIDs in the city of Kenosha may share
their tax increments with donee TIDs in that city if environmental pollution in the
donee TID slows development in that TID.
Current law specifies that for certain TIDs, subject to a number of exceptions,
the expenditure period to pay off project costs is limited to five years before the
unextended termination date of the TID. This bill applies that same expenditure
period, five years before the termination date of the TID, to certain donor TIDs in the
city of Kenosha.
For further information see the 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:
AB193, s. 1 1Section 1. 66.1105 (2) (f) 1. (intro.) of the statutes is amended to read:
AB193,3,22 66.1105 (2) (f) 1. (intro.) "Project costs" mean any expenditures made or
3estimated to be made or monetary obligations incurred or estimated to be incurred
4by the city which are listed in a project plan as costs of public works or improvements
5within a tax incremental district or, to the extent provided in subd. subds. 1. k. and
61.m.
, without the district, plus any incidental costs, diminished by any income,
7special assessments, or other revenues, including user fees or charges, other than tax
8increments, received or reasonably expected to be received by the city in connection
9with the implementation of the plan. For any tax incremental district for which a
10project plan is approved on or after July 31, 1981, only a proportionate share of the
11costs permitted under this subdivision may be included as project costs to the extent
12that they benefit the tax incremental district. To the extent the costs benefit the

1municipality outside the tax incremental district, a proportionate share of the cost
2is not a project cost. "Project costs" include:
AB193, s. 2 3Section 2. 66.1105 (2) (f) 1. m. of the statutes is created to read:
AB193,3,84 66.1105 (2) (f) 1. m. With regard to a tax incremental district that is located in
5a city to which sub. (6) (d) applies and about which a finding has been made that not
6less than 50 percent, by area, of the real property within the district is a blighted
7area, project costs incurred for territory that is located within a one-half mile radius
8of the district's boundaries.
AB193, s. 3 9Section 3. 66.1105 (6) (am) 5. of the statutes is created to read:
AB193,3,1110 66.1105 (6) (am) 5. No expenditure may be made later than 5 years before the
11termination date of a tax incremental district to which par. (d) applies.
AB193,3,1212 (End)
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