LRB-4530/1
MS/JK/JS/SH:kmg:hbm
September 1995 Special Session
1995 - 1996 LEGISLATURE
September 28, 1995 - Printed by direction of Senate Chief Clerk.
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1An Act to repeal 71.05 (1) (d) (title) and 71.05 (1) (e) (title);
to renumber and
2amend 71.05 (1) (c), 71.05 (1) (d) and 71.05 (1) (e);
to amend 13.94 (4) (a) 1.,
316.70 (14), 19.42 (13) (a), 19.59 (1) (a), 20.505 (1) (ka), 20.505 (1) (kc), 20.835 (4)
4(g), 25.50 (1) (d), 66.066 (1) (a), 66.066 (1) (c), 66.067, 66.30 (1) (a), 71.26 (1) (bm),
571.36 (1m), chapter 77 (title), subchapter V (title) of chapter 77 [precedes 77.70],
677.71 (intro.) and (1), 77.71 (2), 77.71 (3) and (4), 77.73, 77.75, 77.76 (1), 77.76
7(2), 77.77, 77.78, 234.65 (1) (c) and 234.65 (6) (b); and
to create 13.94 (10), 16.82
8(6), 16.82 (7), 16.854, 18.03 (5s), 19.59 (1) (g), 20.566 (1) (gd), 20.835 (4) (gb),
924.61 (2) (a) 7., 25.17 (3) (b) 10., 66.04 (2) (a) 3p., 66.066 (5), 71.05 (1) (c) 4., 71.26
10(1m) (g), 71.45 (1t) (g), 77.705, 77.707, 77.76 (3m), 219.09 (1) (c), subchapter III
11of chapter 229 [precedes 229.64], 234.65 (1) (h), 234.65 (1) (hm), 234.65 (8) and
12(10) and 704.31 (3) of the statutes;
relating to: creating a local professional
13baseball park district in certain jurisdictions; giving a local professional
14baseball park district the authority to issue bonds and granting income tax
15exemptions for interest income on bonds issued by the district; making a state
16moral obligation pledge with respect to bonds issued by a local professional
17baseball park district; giving a local professional baseball park district the
1authority to impose a sales tax and a use tax; creating an income and franchise
2tax exemption for a local professional baseball park district; creating an
3exception for a local professional baseball park district from certain
4landlord-tenant provisions; increasing a limitation on certain economic
5development bonding by the Wisconsin Housing and Economic Development
6Authority; a smoke-free environment; making appropriations; and providing
7a penalty.
Analysis by the Legislative Reference Bureau
Engrossment information:
The text of Engrossed September 1995 Special Session Assembly Bill 1 consists
of the following documents adopted in the assembly on September 27 and 28, 1995:
Assembly Substitute Amendment 1, as affected by the following Assembly
Amendments: Assembly Amendment 9, Assembly Amendment 11, Assembly
Amendment 18, Assembly Amendment 19, Assembly Amendment 24, Assembly
Amendment 26, Assembly Amendment 29, Assembly Amendment 32, Assembly
Amendment 33 and Assembly Amendment 34.
Creation and dissolution of a district
This bill creates a professional baseball park district, which is a special purpose
district, in each county with a population of at least 500,000 (presently only
Milwaukee County) and all counties that are contiguous to that county (in relation
to Milwaukee County, these counties are Ozaukee County, Racine County,
Washington County and Waukesha County) unless one of the contiguous counties is
already included in a district, in which case a single-county jurisdiction is created
that consists of the county with a population of more than 500,000. A district is a local
unit of government that is a body corporate and politic and that is separate and
distinct from, and independent of, the state.
In connection with baseball park facilities, the powers of a district include the
construction, maintenance, management and promotion of the baseball park and
facilities; the issuance of bonds and imposition of taxes to finance the park and
facilities; and the authority to enter into partnerships, joint ventures, common
ownership or other arrangements with other persons to further the district's
purposes. A district may also set standards governing the use of, and the conduct
within, the park and facilities, and may set and collect fees for the use of the facilities.
The district is governed by a board that consists of 6 persons appointed by the
governor, 2 persons appointed by the chief executive officer of the most populous
county within the district's jurisdiction, one person appointed by the chief executive
officer of each of the other counties in the jurisdiction and one person appointed by
the mayor of the most populous city within the jurisdiction. In single-county
districts, all county appointments are made by the chief executive officer of that
single county.
Once a county in included within the jurisdiction of a district, the county
remains in the district until the district is dissolved. A district may dissolve by action
of the district board, subject to payment of the district's bonds and fulfillment of its
other contractual obligations. If a district is dissolved, its property must be
transferred to the counties in the district's jurisdiction, based on the tax revenues
derived from each county.
Bonding
This bill grants a district the power to issue bonds for purchasing, acquiring,
leasing, constructing, extending, adding to, improving, conducting, controlling,
operating or managing a public utility, which is defined to include a local professional
baseball park. The district is generally subject to the provisions which govern
revenue bonding of municipalities for public utilities. Under the bill, bonds issued
by the district must be secured only by the district's interest in any baseball park
facilities, including any interest in a lease with the department of administration,
by income from these facilities, and by certain specified taxes that the district is
authorized to levy. The district may not pledge its full faith and credit on the bonds
and the bonds are not a liability of the district.
A district may designate one or more accounts as special debt service reserve
funds, if, prior to each issuance of bonds to be secured by the special debt service
reserve fund, the secretary of administration makes certain determinations. In
order to create a special debt service reserve fund, the secretary must find that the
bond proceeds must be used in connection with a baseball park facility that is used
primarily to support the activities of a baseball park. The secretary must also find
that there is a reasonable likelihood that the bonds will be repaid without the
necessity of drawing on funds in the special debt service reserve fund and that the
amount of all bonds that would be secured by all special debt service reserve funds
of the district does not exceed $160,000,000. This limit does not include refunding
bonds or bonds whose proceeds are used to make a deposit into a special debt service
reserve fund or to pay issuance costs or capitalized interest costs. The secretary must
also find that the bonds, other than refunding bonds, will be issued no later than
December 31, 2000.
The bill establishes a formula for calculating the special debt service reserve
fund requirement for a special debt service reserve fund. If the special debt service
reserve fund requirement for a special debt service reserve fund is not met, the bill
expresses the legislature's expectation and aspiration that, if certain conditions are
met, the legislature would appropriate to the district the funds necessary to restore
the special debt service reserve fund to an amount equal to its special debt service
reserve fund requirement. This expression of legislative expectation and aspiration
has been referred to as a state moral obligation pledge. In addition to the state moral
obligation pledge, under the bill the state pledges that it will not limit or alter the
rights vested in a district under the bill before the district has fully performed its
contracts and has fully met and discharged its bonds.
In addition to provisions regarding bond issuance and security, the bill contains
a number of other provisions relating to bonds issued by a district. The bill also
contains provisions authorizing certain state funds and certain regulated financial
institutions to invest in bonds issued by the district. The bill provides that all moneys
received by a district, including proceeds from the sale of bonds, are trust funds to
be held and applied solely for the purposes provided in the bill, but limits the
personal liability of members of a district's board of directors with respect to the
issuance of bonds.
Under current law, the Wisconsin Housing and Economic Development
Authority (WHEDA) may issue bonds and notes for certain economic development
projects involving sports and entertainment home stadiums in an amount not to
exceed $35,000,000 plus such additional amounts as WHEDA considers necessary
or appropriate to fund a deposit into the capital reserve fund. The bill increases this
amount to $50,000,000 and also allows WHEDA to add, along with the capital
reserve fund deposits, the costs of issuing the bonds or notes and capitalized interest.
Under current law, these economic development projects are included in
determining compliance with an overall $200,000,000 cap on WHEDA economic
development loans. This bill amends this overall cap to exclude bonds issued for
these economic development projects involving sports and entertainment home
stadiums.
The bill however, prohibits WHEDA from issuing bonds to finance any single
professional baseball park in an amount exceeding $50,000,000, excluding bonds
issued to fund a deposit into a capital reserve fund, to pay costs of issuing the bonds
or to pay capitalized interest. In addition, the bill prohibits WHEDA from making
an economic development project loan to any professional baseball team unless
WHEDA determines that collateral adequate to cover the amount of the loan has
been pledged as security for the loan, exclusive of any ownership interest of the team
in a stadium.
Taxation
The bill authorizes a district to impose a sales tax and a use tax at a rate of no
more than 0.1%.
The bill exempts the income of a district from the income tax and the franchise
tax, and it exempts the interest on a district's bonds from the income tax.
Provision of services
The bill permits DOA to provide any services to a district, including
engineering, design and building construction services, upon request of the district,
for compensation agreed upon between DOA and the district, if the district has
entered into an agreement with DOA for the lease of land or other property granted
to the state, especially dedicated by the grant to use for a professional baseball park.
Other state agencies may provide assistance to the district, if a lease with DOA has
been entered into.
Contracting
The bill provides that a local professional baseball park district may enter into
contracts without limitation or restriction and, if the district has entered into an
agreement with DOA for the lease of land or other property granted to the state,
especially dedicated by the grant to use for a professional baseball park, the district
may utilize the services of DOA to let contracts for engineering, architectural or
construction work, except that DOA may not serve as a general contractor for such
work. Whether the district contracts independently or through DOA, the district is
not subject to any state requirements for public notice of proposed contracts,
competitive bidding, contractual service procurement procedures, preference for
procurements from Wisconsin firms, preferences for purchases of American-made
or recycled or recovered materials or preferences for purchases from the department
of corrections or from handicapped work centers or nondiscrimination in contracting.
Regarding the construction of baseball park facilities, a district and DOA are
required to ensure that, for construction work and professional services contracts,
a person who receives such a contract agrees that his or her goal shall be to ensure
that at least 25% of the employes hired because of the contract will be minority group
members and at least 5% of the employes hired because of the contract will be women.
It is also a goal of the district and DOA to ensure that at least 25% of the aggregate
dollar value of contracts awarded by the district and DOA, in the areas of
construction of baseball park facilities, professional services related to such
construction and services for the development of baseball park facilities are awarded
to minority businesses and at least 5% of the aggregate dollar value of such contracts
are awarded to women's businesses. The district is also required to hire a person to
monitor the district's and DOA's compliance with minority contracting goals.
Finances
The bill permits a local professional baseball park district to invest its moneys
in any investment it considers appropriate. Under the bill, a district is permitted to
invest its moneys in the local government pooled-investment fund, which is
managed by the state investment board.
Open meetings and
records, audits, ethics
Laws requiring, with certain exceptions, open meetings of governmental bodies
and public access to public records apply to a district. The legislative audit bureau
is permitted to audit the records of a district. Members of the board of directors of
a district are subject to the statutory code of ethics for local public officials. The bill
also creates additional standards of conduct applicable to district board members
that are similar to the standards of conduct applicable to state public officials. The
bill expressly prohibits district board members from accepting free or discounted
admission to professional baseball games.
Other
Current law provides that, if a tenant who is required to construct
improvements exceeding $50,000 at the tenant's own expense on land leased to the
tenant under a lease with a term of 30 years or more defaults or breaches a condition
of the lease, the landlord may commence an action to recover the property after a
one-year redemption period free from all liens, claims or demands of the tenant in
the same manner as a mortgage foreclosure except without a sale of the property.
The bill creates an exception under that statute for leases to which a district is a
party.
This bill will be referred to the joint survey committee on tax exemptions for a
detailed analysis, 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:
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13.94
(4) (a) 1. Every state department, board, examining board, affiliated
3credentialing board, commission, independent agency, council or office in the
4executive branch of state government; all bodies created by the legislature in the
5legislative or judicial branch of state government; any public body corporate and
6politic created by the legislature
including specifically a professional baseball park
7district; every provider of medical assistance under ch. 49; technical college district
8boards; development zones designated under s. 560.71; every county department
9under s. 51.42 or 51.437; every nonprofit corporation or cooperative to which moneys
10are specifically appropriated by state law; and every corporation, institution,
11association or other organization which receives more than 50% of its annual budget
12from appropriations made by state law, including subgrantee or subcontractor
13recipients of such funds.
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13.94
(10) Financial status of local professional baseball park districts. 16As promptly as possible following the end of each state fiscal biennium in which there
17are outstanding bonds or notes issued by a local professional baseball park district
18created under subch. III of ch. 229 that are subject to s. 229.74 (7), the legislative
19audit bureau shall submit a report to the cochairpersons of the joint committee on
20finance concerning the financial status of that district.
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116.70
(14) "State" does not include a district created under subch. II
or III of
2ch. 229.
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16.82
(6) May provide any services to a local professional baseball park district
5created under subch. III of ch. 229, for compensation to be agreed upon between the
6department and the district, if the district has entered into a lease agreement with
7the department under sub. (7), except that the department shall not act as a general
8contractor for any construction work undertaken by the district. No order or contract
9to provide any such services is subject to s. 16.705, 16.75 (1) to (5) and (8) to (10),
1016.752, 16.754 or 16.765.
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16.82
(7) May enter into a lease agreement with a local professional baseball
13park district created under subch. III of ch. 229 for the lease of land or other property
14granted to the state and especially dedicated by the grant to use for a professional
15baseball park. The lease agreement may be for such rental payments and for such
16term as the secretary determines.
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1816.854 Services provided to professional baseball park districts. (1) 19In this section:
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(a) "Minority business" has the meaning given in s. 560.036 (1) (e).
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(b) "Minority group member" has the meaning given in s. 560.036 (1) (f).
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(c) "Women's business" means a sole proprietorship, partnership, joint venture
23or corporation that is at least 51% owned, controlled and actively managed by
24women.