"Governing body" includes a town or county board, the legislative body of a city or village, the commission of a metropolitan sewerage district created under ss. 200.21
and the board of any other municipality enumerated in sub. (5)
"Initial resolution" means any resolution adopted pursuant to s. 67.05 (1)
, by which a proceeding is instituted for the purpose of authorizing a municipality to borrow money and issue bonds or other municipal obligations.
"Municipality" means any of the following which is authorized to levy a tax: a county, city, village, town, school district, board of park commissioners, technical college district, metropolitan sewerage district created under ss. 200.01
, town sanitary district under subch. IX of ch. 60
, public inland lake protection and rehabilitation district established under s. 33.23
, or 33.24
, and any other public body empowered to borrow money and issue obligations to repay the money out of public funds or revenues. "Municipality" does not include the state.
"Municipal obligation" includes every lawful promise or engagement in writing by a municipality to pay at a specified future time a specified sum of money.
"Recorded" means copied at length in the record book required by s. 67.05 (12)
Every reference to the population of a municipality refers to its population according to the last United States census; and every reference to the value of the taxable property in a municipality refers to such value as equalized for state purposes.
This chapter is not applicable to appropriation bonds issued by a county under s. 59.85
or by a 1st class city under s. 62.62
and, except ss. 67.08 (1)
, is not applicable:
To the borrowing of moneys belonging to the common school fund, the normal school fund, the university fund or the agricultural college fund; all of which borrowing shall continue to be regulated by subch. II of ch. 24
To the issue or payment of street, sewer, harbor or other improvement bonds or certificates which do not constitute a general liability of the municipality issuing them, and for the payment of which specified portions only of the taxable property in such municipality are taxable.
To drainage bonds issued by authority of ch. 88
, 1963 stats., or of ch. 89
, 1963 stats., as it existed prior to January 1, 1965, or of ch. 88
To revenue bonds and revenue bond anticipation notes issued for the purpose of purchasing, acquiring, constructing, extending, adding to or improving public utilities under ss. 62.69
, nor to refunding bonds authorized under s. 66.0621 (4) (b)
, nor to commercial paper issued under s. 200.55 (1) (fa)
, nor to public improvement bonds authorized under s. 66.0619
To contractor's certificates or special assessment B bonds issued under s. 66.0713
except as provided in that section or to general obligation-local improvement bonds issued under s. 67.16
, except as provided in that section.
Wisconsin municipal debt finance: An outlook for the eighties. Schilling, Griggs and Ebert, 63 MLR 539 (1980).
Housing authorities exempted.
This chapter shall not be applicable to borrowing by housing authorities or county veterans housing authorities under ss. 66.1201
History: 1999 a. 150
; 2005 a. 22
Validation of debt. 67.02(1)(1)
Validations before January 1, 1922, effected by legislative enactments of defective or irregular procedure in the creation, execution or issue of municipal obligations continue unaffected by the repeal of the enactments or by the consolidation and revision of them in chapter 576, laws of 1921
Defects and irregularities in any proceeding on or after January 1, 1922, which is for a lawful purpose, is unaffected by fraud, and does not exceed any statutory or constitutional limitation of amount, does not invalidate the bonds issued or the indebtedness incurred after the bonds have been sold or hypothecated and the proceeds received and appropriated by the municipality to a lawful purpose, nor after the performance of a contract has been entered upon by a party whose performance of the contract is the consideration for the bonds or other obligations.
A legislative, judicial or administrative determination, for any reason, that a municipality may not spend the proceeds of contracted debt, or that it has spent the proceeds for a purpose other than the stated purpose for which the debt was contracted or for a purpose for which a municipality may not spend money, shall not affect the enforceability of the debt nor the evidence of indebtedness for it.
History: 1971 c. 40
; 1983 a. 207
The sub. (2) validation provision does not apply to promissory notes securing unauthorized municipal debt. Schmidt v. Town of Alvin, 145 Wis. 2d 806
, 429 N.W.2d 541
(Ct. App. 1988).
Certification of municipal obligations.
In any municipality, the officers charged with the negotiation and sale of its municipal obligations may, in their discretion, prior to the issuance thereof, submit to the attorney general or to an attorney employed under s. 67.10 (7)
a certified copy of all its proceedings preliminary to such issue, and also a printer's proof or sample of or the unsigned obligations, for examination and certification. Such attorney shall examine the proceedings and, if found regular and valid, shall execute a certificate of such examination and validity. As soon as such certificate is returned, the clerk of the municipality shall cause such certificate to be recorded. This section applies to obligations issued under ss. 59.57 (2)
, 59.82 (2) (c)
and 66.1105 (9) (b)
See s. 893.77
for 30-day statute of limitations on municipal obligations which have been certified by an attorney.
Grant of power to borrow; general limitations of indebtedness. 67.03(1)(a)(a)
Except as provided in s. 67.01 (9)
, municipalities may borrow money and issue municipal obligations therefor only for the purposes and by the procedure specified in this chapter. The aggregate amount of indebtedness, including existing indebtedness, of any municipality shall not exceed 5% of the value of the taxable property located in the municipality as equalized for state purposes except that the aggregate amount of indebtedness of any school district that offers no less than grades 1 to 12 and that at the time of incurring the debt is eligible to receive state aid under s. 121.08
shall not exceed 10% of the equalized value of the taxable property located in the school district.
Any school district about to incur indebtedness may apply to the state superintendent of public instruction for, and the state superintendent may issue, a certificate as to the eligibility of the school district to receive state aid under s. 121.08
, which certificate shall be conclusive as to such eligibility for 30 days, but not beyond the next June 30.
The amount so limited includes such indebtedness only as has been or may be incurred independently by a municipality for its own separate purposes; and does not include any indebtedness, in whole or in part, that has been or may be incurred independently by any other municipality for its own separate purposes, even though the territory and taxable property of either municipality constitutes the whole or a part of the territory and taxable property of the other.
The issuance of refunding municipal obligations and the payment of municipal obligations so refunded shall be treated as if they occur simultaneously. The limitation on aggregate indebtedness under sub. (1)
shall not include the amount of the refunded municipal obligation to the extent that provision is made for the payment of the refunded obligation.
Whenever a municipality acquires a utility or other property of any kind that at the time is encumbered by mortgage, trust deed or otherwise, the municipality does not assume the payment of such encumbrance, nor does the encumbrance constitute any part of the amount limited by sub. (1)
. Neither is any deferred payment upon a municipal contract a part of said amount, if the contract expressly provides immunity for the municipality from all liability arising from such contract to make such payment.
The last determination made by the department of revenue of the full value of the taxable property in any municipality under this section or s. 70.57
or 121.06 (1)
shall be the equalized valuation of the taxable property.
When the last determination made by the department of revenue of the full value of the taxable property in a municipality is not a true valuation of the taxable property therein because of a change in the territory thereof, the department of revenue, upon application in writing by the municipal clerk, in such form as the department prescribes, shall increase or decrease the last determination in such amount as in the best judgment of the department makes proper adjustment for the change in territory, and the resulting adjusted valuation shall be the equalized valuation of the taxable property in the municipality.
When a new municipality has been formed for which no determination of the full value of the taxable property therein has been made by the department of revenue, upon application in writing by the municipal clerk, in such form as the department prescribes, the department shall determine according to its best judgment from all sources of information available to it the full value of the taxable property in the municipality, and the resulting valuation shall be the equalized valuation of the taxable property in the municipality.
The department of revenue may certify to the clerk of any municipality the full value of the taxable property of the municipality when the equalized valuation is requested for use in connection with municipal borrowing.
For the purposes of indebtedness school districts which in successive years operate all grades to tenth, eleventh and twelfth as provided in s. 121.78 (2) (b)
shall be considered school districts offering no less than grades one to 12.
For any technical college district, the bonded indebtedness for the purpose of purchasing school sites and the construction and equipping of school buildings may not exceed 2% of the value of its taxable property as equalized for state purposes.
A school district did not incur indebtedness by entering into a lease-purchase agreement for a new school when the district, by electing not to appropriate funds for the following fiscal year's rental payment, had the option to terminate the agreement with no future payment obligation. Deick v. Unified School District of Antigo, 165 Wis. 2d 458
, 477 N.W.2d 613
An agreement to purchase park land whereby a county is to make deferred payments from an existing nonlapsing account, sufficient to cover the entire obligation, secured by mortgaging the property to the grantor, would not create an obligation within the ambit of ch. 67 nor constitute a debt in the context of Art. XI, s. 3. 63 Atty. Gen. 309.
Local government units cannot include the value of tax-exempt manufacturing machinery and specific processing equipment and tax exempt merchants' stock-in-trade, manufacturers' materials, and finished products and livestock in their property valuation totals for non-tax purposes, such as for municipal debt ceilings, tax levy limitations, shared tax distributions, and school aid payments. 63 Atty. Gen. 465.
Tax limitations not applicable to debt levies.
All taxes levied or to be levied by any municipality proceeding under this chapter for the purpose of paying principal and interest on valid bonds or notes, other than noncapital notes, as defined in s. 38.16 (3) (a) 2r.
, now or hereafter outstanding shall be without limitation notwithstanding any legislative limitation now or heretofore existing, and all such limitations are repealed insofar as they apply to taxes levied or to be levied to pay principal and interest upon such bonds or notes.
Purposes of issuing municipal bonds and notes. 67.04(1)(a)
"Ancillary charges" include site preparation expenditures, professional fees, legal claims directly attributable to asset acquisition and interest costs incurred prior to and during construction.
"Operating expenses" include wages, salaries, fringe benefits, materials, supplies, contractual services, equipment with a useful life of less than one year and other costs specified by the department of revenue by rule. "Operating expenses" do not include ancillary charges incurred in the acquisition, development or construction of real property or property with a useful life of one year or more.
"Project" means the acquisition, leasing, planning, design, construction, development, extension, enlargement, renovation, rebuilding, repair or improvement of land, waters, property, highways, buildings, equipment or facilities.
"Public purpose" means the performance of any power or duty of the issuing municipality.
Subject to the limitations specified in ss. 67.03
, any municipality may borrow money and issue bonds to finance any project undertaken for a public purpose.
Subject to the limitations specified in s. 67.03
, any city with a population greater than 75,000 may borrow money and issue bonds to finance the cost of low-interest mortgage loans under s. 62.237
Subject to the limitations specified in s. 67.03
, any municipality may refund municipal obligations including interest on them whether or not the obligations being refunded were issued for any purpose for which the municipal obligations might have been issued in the original instance, if the time for payment of bonds issued to refund bonds and notes authorized under this chapter does not extend beyond the period permitted under s. 67.07
. Bonds issued to refund municipal obligations issued under ch. 66
shall be paid within the period permitted under s. 67.07
, commencing on the original date of the refunding bonds.
The legislature finds that contracting of debt under this chapter for any project constitutes a public purpose.
Except as provided in par. (b)
, the proceeds of any municipal bonds or notes issued by a county under this chapter shall not be used to fund the operating expenses of the general fund of the county or to fund the operating expenses of any special revenue fund of the county that is supported by property taxes.
(b) Paragraph (a)
does not apply to notes issued under s. 67.12 (1)
or to municipal bonds or notes issued by a county for any of the following purposes:
To provide liability insurance, property insurance, or risk management services under s. 611.11 (4)
To pay unfunded prior service liability contributions under the Wisconsin retirement system, or to pay unfunded prior service liability with respect to an employee retirement system, if all of the net proceeds of the note will be used to pay for such contributions or payments.
See also ch. Tax 21
, Wis. adm. code.
Debt issuance conditions. 67.045(1)
The governing body of a county may not issue bonds under s. 67.05
or promissory notes under s. 67.12 (12)
unless one or more of the following apply:
A referendum is held, following the procedures in s. 67.05 (3)
, that approves the debt issuance.
The governing body of the county adopts a resolution that sets forth its reasonable expectations that issuance of the debt will not cause the county to increase the debt levy rate, as defined in s. 59.605 (1) (b)
Issuance of the debt was authorized by an initial resolution adopted by the governing body of the county prior to August 12, 1993.
The debt is issued to fund or refund outstanding municipal obligations, interest on outstanding municipal obligations, or the payment of related issuance costs or redemption premiums.
The governing body adopts a resolution to issue the debt by a vote of at least three-fourths of the members-elect, as defined in s. 59.001 (2m)
The debt is issued by a county having a population of 500,000 or more to pay unfunded prior service liability with respect to an employee retirement system.
The debt is issued for the purpose of acquiring or installing energy efficient equipment.
The department of revenue shall promulgate rules that set forth the standards to be used by the governing body of a county in adopting a resolution under sub. (1) (b)
. The rules shall permit the reasonable exercise of local self-determination and debt management and prohibit the consideration of unreasonable assumptions that may cause an increase in the debt levy rate, as defined in s. 59.605 (1) (b)
The standards in the rules under par. (a)
shall address issues including all of the following:
The equalized value of taxable property in the county.
The treatment of anticipated refunding of balloon payments.
Past and anticipated revenues that may abate a debt levy.
The amount of state aid that may be received in future years.
See also ch. Tax 21
, Wis. adm. code.
Bond issues; procedure. 67.05(1)
Initial resolution by governing body.
If any municipality seeks to issue a bond under s. 67.04
, the governing body of the municipality shall, prior to the issuance of the bond, adopt a resolution that states the purpose for and maximum amount of the borrowing. The resolution adopted under this section shall be known as the initial resolution. If a permissive referendum on the bond issue is allowed under this section, the governing body shall, within 15 days after the initial resolution is adopted, publish a class 1 notice under ch. 985
stating the purpose and maximum principal amount of the bond issue and describing the opportunity and procedure for submitting a petition requesting a referendum on the bond issue.
(2) Initial resolution by electors. 67.05(2)(a)(a)
The electors of any town, common school district, union high school district, whether such district is joint or otherwise, or of any municipality other than a county, a city, a village, a technical college district or a board of park commissioners, may at any annual meeting, or at a special meeting of such electors called for the purpose, adopt the initial resolution prescribed by sub. (1)
without any prior adoption thereof by the governing body of such municipality. The vote in such case shall be made by ballot in substantially the following form: