LRB-1137/1
CS/MS/MG/GM/PH/JK/JTK:jld:ph
2009 - 2010 LEGISLATURE
February 12, 2009 - Introduced by Senators Lassa, Erpenbach, Risser, Taylor,
Plale, Harsdorf, Vinehout, Lehman, Schultz, Darling
and Leibham,
cosponsored by Representatives Shilling, Hintz, Molepske Jr., Lothian,
Seidel, Dexter, Clark, Ballweg, Spanbauer, Jorgensen, Bernard Schaber,
Strachota
and Davis. Referred to Committee on Economic Development.
SB55,2,2 1An Act to renumber 44.02 (24) and 101.121 (4) (a); to renumber and amend
271.07 (9m) (a), 71.07 (9r) (a), 71.28 (6) (a) and 71.47 (6) (a); to amend 13.48 (7),
313.48 (15), 71.07 (9m) (c), 71.28 (6) (c), 71.47 (6) (c), 86.19 (1), 101.121 (4) (b),
4101.19 (1) (intro.), 254.61 (1) (f) 2. and 823.21; and to create 13.48 (10) (c),
520.143 (1) (gb), 41.11 (1) (bm), 44.02 (24) (b), 44.02 (24d), 71.07 (9m) (a) 2., 71.07
6(9m) (g), 71.07 (9m) (h), 71.07 (9r) (a) 2., 71.28 (6) (a) 2., 71.28 (6) (g), 71.28 (6)
7(h), 71.47 (6) (a) 2., 71.47 (6) (g), 71.47 (6) (h), 86.19 (4m), 86.37, 101.121 (3) (c),
8101.121 (4) (a) 2., 101.121 (5), 101.975 (4), 227.01 (13) (zy), 560.03 (21m) and
9560.083 of the statutes; relating to: the regulation, preservation, and
10restoration of historic buildings; the supplement to the federal historic
11rehabilitation tax credit and the state historic rehabilitation tax credit;
12requiring the certification of downtowns; promoting certain downtown areas in

1this state; highway projects involving business and downtown areas; granting
2rule-making authority; and making appropriations.
Analysis by the Legislative Reference Bureau
This bill makes numerous changes with regard to historic buildings and
downtown development. Significant provisions include the following:
Historic buildings
State Historic Building Code
Current law authorizes the Department of Commerce (Commerce) to regulate
the preservation and restoration of qualified historic buildings. A qualified historic
building is a building that is listed on the national or state register of historic places,
or a certified local register of historic property, or that is located in a district that is
listed on the national or state register of historic places and is of historical
significance to the district. Current law permits Commerce, in consultation with the
Historic Building Code Council, to promulgate a historic building code that provides
specific standards for the preservation or restoration of qualified historic buildings,
while still providing for the health, safety, and welfare of occupants of and visitors
to historic buildings. In addition, to permit the preservation or restoration of
qualified historic buildings, Commerce may grant a variance from any rule
promulgated under the chapters of the statutes relating to the regulation of industry,
buildings, and safety or the regulation of plumbing, fire protection systems, and
swimming pools.
With certain exceptions, the owner of a qualified historic building may elect to
be subject to the State Historic Building Code. With limited exceptions, an owner
who makes this election is exempt from any provision of any other building code,
including a local building code, that concerns a matter that is dealt with in the State
Historic Building Code. Although current law does not contain an administrative
procedure designed specifically to determine whether an owner is entitled to this
exemption, current law does contain a procedure that an owner may follow to resolve
any conflicts between a local order and any order of Commerce that relates to the
safety of places of employment or certain buildings that are open to the public (public
buildings).
This bill specifies that the State Historic Building Code must be liberally
interpreted to facilitate the preservation and restoration of qualified historic
buildings. The bill also creates a specific administrative procedure for determining
the extent to which a provision in a local building code applies to a qualified historic
building. The bill permits the owner of a qualified historic building who has elected
to be governed by the State Historic Building Code to request that Commerce review
any decision of a local governmental unit that requires the owner to comply with a
provision in a local ordinance. Commerce must review the decision to determine
whether the provision in the ordinance concerns a matter dealt with in the State
Historic Building Code, in which case the owner would be exempt from the provision.
Commerce must consult with the State Historical Society (SHS) before making its

determination. The bill specifies that, in performing this review, Commerce must
follow the existing procedure for resolving conflicts between local orders and orders
of Commerce that relate to the safety of places of employment or public buildings.
In addition, the bill requires Commerce, in cooperation with the SHS, to develop an
informational pamphlet to increase public awareness and use of the State Historic
Building Code.
Historic buildings used as multifamily dwellings
Current law requires Commerce to promulgate rules that provide uniform
standards for the construction of multifamily dwellings and their components. With
certain exceptions, a multifamily dwelling is an apartment building, row house, town
house, condominium, or manufactured building that does not exceed 60 feet in height
or six stories and that consists of three or more attached dwelling units. These rules
currently apply to any building or portion of a building that is converted to a
multifamily dwelling after April 1, 1995, unless the building is a qualified historic
building and the owner elects to be subject to the State Historic Building Code. Rules
promulgated by Commerce also permit a local governmental unit to exercise
jurisdiction over the construction and inspection of multifamily dwellings by
adopting ordinances that are consistent with Commerce's rules on multifamily
dwellings. Currently, these rules contain specific requirements relating to the type,
height, and design of handrails and guardrails that are required to be used in
multifamily dwellings.
This bill permits a local governmental unit to adopt an ordinance that requires
the local governmental unit to grant a variance from these handrail and guardrail
requirements, as they apply to a qualified historic building that is converted from a
single-family dwelling to a multifamily dwelling, if the owner of the qualified
historic building shows that the type, height, and design of the handrail or guardrail
proposed for installation is historically appropriate and if the handrail or guardrail
is at least as protective of public safety as the rail that is otherwise required.
Historic rehabilitation tax credit
Under current law, a person who is eligible to claim a federal income tax credit
equal to either 10 percent of qualified expenses related to rehabilitating a qualified
building in this state or 20 percent of qualified expenses related to rehabilitating
historic property in this state may also claim a supplemental state income or
franchise tax credit that is equal to 5 percent of such qualified expenses.
Under the bill, for taxable years beginning in 2010, a person who is eligible to
claim the federal rehabilitation tax credit may claim the supplemental state
rehabilitation credit in an amount equal to 20 percent of qualified expenses, if the
rehabilitated property is located in this state and the SHS certifies the
rehabilitation. In addition, under the bill, a person who is not eligible to claim the
federal rehabilitation tax credit because the person's qualified expenses do not
satisfy the adjusted-basis requirement under federal law may claim the
supplemental state rehabilitation credit in an amount equal to 20 percent of
qualified expenses, if the qualified expenses are at least $10,000, the rehabilitated
property is located in this state and the SHS certifies the rehabilitation. The SHS
may charge and collect a fee for the certifications described in this paragraph in an

amount equal to 2 percent of the qualified expenses, but not less than $300 nor more
than $20,000. Fifty percent of the amount of such fees collected by the SHS will be
used to provide additional staffing for the administration of the State Main Street
Program, which is a program that promotes revitalization efforts in certain business
areas.
Under current law, a person may claim an income tax credit equal to 25 percent
of the qualified expenses to preserve or rehabilitate historic property that is used as
an owner-occupied personal residence. The SHS certifies those expenses.
Under this bill, for taxable years beginning in 2010, a person who is eligible to
claim the state income tax credit for preserving or rehabilitating historic property
may claim the state income tax credit in an amount equal to 30 percent of qualified
expenses, if the preserved or rehabilitated property is located in this state and the
SHS approves the preservation or rehabilitation. The SHS may charge and collect
a fee of $150 for certifying such expenses.
Under current law, if a person who claims the income tax credit for qualified
expenses to preserve or rehabilitate an owner-occupied personal residence sells the
property within five years from the date on which the preservation or rehabilitation
is completed, or if the SHS determines that the preservation or rehabilitation does
not comply with the standards established by the SHS, the person who claimed the
tax credit must pay to the state all, or a portion, of the amount of the credit that the
person received, depending on the date on which the person sold the property or on
the date on which the preservation or rehabilitation does not comply with SHS
standards.
Under this bill, if a person who claims the supplemental state income or
franchise tax credit for qualified expenses related to preserving or rehabilitating
historic property in this state sells the property within five years from the date on
which the preservation or rehabilitation is completed, or if the SHS determines that
the preservation or rehabilitation does not comply with the standards established by
the SHS, the person who claimed the tax credit must pay to the state all, or a portion,
of the amount of the credit that the person received, depending on the date on which
the person sold the property or the date on which the preservation or rehabilitation
does not comply with SHS standards.
Downtown development
Certification and promotion of downtowns
This bill requires Commerce to develop and publish guidelines to aid
communities in reconstructing central business districts that are destroyed or
severely damaged in major disasters. The bill also requires Commerce to promulgate
rules pursuant to which Commerce will certify downtowns. In addition, under the
bill, the Department of Tourism must promote travel to these certified downtowns
and to business areas that are or have been the subject of revitalization efforts under
the State Main Street Program.
Currently, the Building Commission (commission) submits biennial
recommendations to the legislature for revisions to the long-range state building
program. No state agency or authority may engage any person to undertake
construction of a building for the agency costing more than $100,000 without prior

approval of the commission. In addition, the commission has authority to lease land
and buildings to be used for state purposes unless that authority is granted by law
to another state agency.
This bill provides that the commission shall not authorize construction of any
state office building to be located outside of a downtown area certified by Commerce,
as required under the bill, unless the cost of locating the building inside such a
downtown area is more than 10 percent greater than the average cost of locating the
building outside the downtown areas of the territory that is served by the functions
to be performed in the building on the date of initial occupancy outside of such a
downtown area, as determined by the Department of Administration (DOA). The bill
also provides that the commission, in preparing its recommendations for the
long-range state building program, shall not recommend construction of a state
office building to be located outside of such a downtown area, unless the commission
would be authorized to permit construction of that building in the recommended
location. In addition, the bill prohibits the commission from approving the lease of
any building for state office facilities to be located outside of such a downtown area
unless the cost of locating the facilities inside such a downtown area is more than 10
percent greater than the average cost of locating the facilities outside the downtown
areas of the territory that is served by the functions to be performed in the facilities
on the date of initial occupancy under the lease outside of such a downtown area, as
determined by DOA.
This bill imposes additional requirements relating to highway projects that are
funded by the Department of Transportation (DOT) and that involve a highway in
a business area included in the State Main Street Program or in a downtown certified
by Commerce. First, DOT must consult, during preliminary stages of a proposed
highway project, on issues concerning the proposed project and its effect on the
business or certified downtown area with Commerce and, unless none exists, with
a local board or downtown planning organization of that municipality. Second, DOT
must, during the concept definition phase of the project, recognize the high visual
and aesthetic significance of, and impact related to, these types of highway projects
in evaluating the aesthetic and visual impact of the project.
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:
SB55, s. 1 1Section 1. 13.48 (7) of the statutes is amended to read:
SB55,6,122 13.48 (7) Biennial recommendations. The building commission shall prepare
3and formally adopt recommendations for the long-range state building program on
4a biennial basis. The building commission shall include in its report any projects

1proposed by the state fair park board involving a cost of not more than $250,000,
2together with the method of financing those projects proposed by the board, without
3recommendation. Unless a later date is requested by the building commission and
4approved by the joint committee on finance, the building commission shall, no later
5than the first Tuesday in April of each odd-numbered year, transmit the report
6prepared by the department of administration under s. 16.40 (20) and the
7commission's recommendations for the succeeding fiscal biennium that require
8legislative approval to the joint committee on finance in the form of proposed
9legislation prepared in proper form. If the building commission includes any
10recommendation for construction of a state office building, the commission shall
11ensure that the recommended location of the building is consistent with construction
12requirements under sub. (10) (c).
SB55, s. 2 13Section 2. 13.48 (10) (c) of the statutes is created to read:
SB55,6,2114 13.48 (10) (c) Unless otherwise required by law, the building commission shall
15not authorize the construction of any state office building, whether for utilization by
16a single agency or otherwise, to be located outside of a downtown area, as certified
17under s. 560.03 (21m), unless the cost of locating the building inside a downtown area
18is more than 10 percent greater than the average cost of locating the building in that
19portion of the territory that is served by the functions to be performed in the building
20on the date of initial occupancy outside of any downtown area, as determined by the
21department of administration.
SB55, s. 3 22Section 3. 13.48 (15) of the statutes is amended to read:
SB55,7,823 13.48 (15) Acquisition of leasehold interests. Subject to the requirements
24of s. 20.924 (1) (i), the building commission shall have the authority to acquire
25leasehold interests in land and buildings where such authority is not otherwise

1provided to an agency by law. The building commission shall not approve any lease
2for state office facilities, whether for utilization by a single agency or otherwise, to
3be located outside of a downtown area, as certified under s. 560.03 (21m), unless the
4cost of locating the facilities inside a downtown area is more than 10 percent greater
5than the average cost of locating the facilities in that portion of the territory that is
6served by the functions to be performed in the facilities on the date of initial
7occupancy under the lease outside of any downtown area, as determined by the
8department of administration.
SB55, s. 4 9Section 4. 20.143 (1) (gb) of the statutes is created to read:
SB55,7,1210 20.143 (1) (gb) Certified downtowns and business district reconstruction. All
11moneys received from the historical society under s. 44.02 (24d) (b) for the purpose
12of providing staff for the administration of ss. 560.03 (21m) and 560.083.
SB55, s. 5 13Section 5. 41.11 (1) (bm) of the statutes is created to read:
SB55,7,1614 41.11 (1) (bm) Promote travel to business areas that are or have been the
15subject of revitalization efforts under the State Main Street Program under s.
16560.081 or that are certified downtowns under s. 560.03 (21m).
SB55, s. 6 17Section 6. 44.02 (24) of the statutes is renumbered 44.02 (24) (a).
SB55, s. 7 18Section 7. 44.02 (24) (b) of the statutes is created to read:
SB55,7,2119 44.02 (24) (b) Charge a fee of $150 for a certification under par. (a). The
20historical society shall collect the fee under this paragraph when an applicant
21applies for certification under par. (a).
SB55, s. 8 22Section 8. 44.02 (24d) of the statutes is created to read:
SB55,8,223 44.02 (24d) (a) Promulgate by rule procedures, standards, and forms necessary
24to certify, and shall certify, expenditures for preservation or rehabilitation of historic
25property for the purposes of ss. 71.07 (9m), 71.28 (6), and 71.47 (6). Those standards

1shall be substantially similar to the standards used by the secretary of the interior
2to certify rehabilitations under 26 USC 47 (c) (2).
SB55,8,93 (b) Charge a fee for a certification under par. (a) equal to 2 percent of the
4qualified rehabilitation expenditures for the historic property that is the subject of
5the certification, except that no fee under this paragraph may be less than $300 nor
6more than $20,000. The historical society shall collect the fee under this paragraph
7when an applicant applies for certification under par. (a). Fifty percent of the amount
8collected under this paragraph shall be deposited into the appropriation account
9under s. 20.143 (1) (gb).
SB55, s. 9 10Section 9. 71.07 (9m) (a) of the statutes is renumbered 71.07 (9m) (a) 1. and
11amended to read:
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