LRB-4360/2
MS/SH/JS/JK:kmg:ks
September 1995 Special Session
1995 - 1996 LEGISLATURE
September 5, 1995 - Introduced by
Committee on Assembly Organization, by
request of Governor Tommy G. Thompson. Referred to Joint survey committee
on Tax Exemptions.
AB1,2,9
1An Act to repeal 16.40 (15m), 20.505 (1) (fm), 71.05 (1) (d) (title) and 71.05 (1)
2(e) (title);
to renumber and amend 71.05 (1) (c), 71.05 (1) (d) and 71.05 (1) (e);
3to amend 13.48 (14) (d) 4., 16.70 (14), 19.42 (13) (a), 20.505 (1) (ka), 20.505 (1)
4(kc), 20.835 (4) (g), 25.50 (1) (d), 66.066 (1) (a), 66.066 (1) (c), 66.067, 66.30 (1)
5(a), 66.75 (1m) (a), 66.75 (2) (intro.), (a), (c) and (d), 66.75 (3), 71.26 (1) (bm),
671.36 (1m), chapter 77 (title), subchapter V (title) of chapter 77 [precedes 77.70],
777.71 (intro.) and (1), 77.71 (2), 77.71 (3) and (4), 77.73, 77.75, 77.76 (1), 77.76
8(2), 77.77, 77.78, 234.65 (1) (c) and 234.65 (6) (b);
to repeal and recreate
920.005 (3) (schedule); and
to create 13.48 (14) (d) 5., 16.40 (15m), 16.82 (6),
1016.82 (7), 16.854, 18.03 (5s), 20.505 (1) (fm), 20.566 (1) (gd), 20.835 (4) (gb),
1120.907 (1e), 24.61 (2) (a) 7., 25.17 (3) (b) 10., 66.04 (2) (a) 3p., 66.066 (5), 66.75
12(1) (bm), 66.75 (1m) (em), 66.75 (1m) (fm), 71.05 (1) (c) 4., 71.26 (1m) (g), 71.45
13(1t) (g), 77.705, 77.76 (3m), 219.09 (1) (c), subchapter III of chapter 229
14[precedes 229.64] and 704.31 (3) of the statutes;
relating to: creating a local
15professional baseball park district in certain jurisdictions; giving a local
16professional baseball park district the authority to issue bonds and granting
17income tax exemptions for interest income on bonds issued by the district;
1making a state moral obligation pledge with respect to bonds issued by a local
2professional baseball park district; giving a local professional baseball park
3district the authority to impose a room tax, a sales tax and a use tax; creating
4an income and franchise tax exemption for a local professional baseball park
5district; creating an exception for a local professional baseball park district
6from certain landlord-tenant provisions; authorizing state expenditures for
7state highway rehabilitation; increasing a limitation on certain economic
8development bonding by the Wisconsin Housing and Economic Development
9Authority; making appropriations; and providing a penalty.
Analysis by the Legislative Reference Bureau
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 the most populous county that is contiguous to that county
(in relation to Milwaukee County, presently Waukesha County) unless that county
is already included in a district, in which case a single-county jurisdiction is created.
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 4 persons appointed by the
governor, one person appointed by the chief executive officer of the more populous
county within the district's jurisdiction, one person appointed by the chief executive
officer of the less populous county in the jurisdiction and one person appointed by the
mayor of the most populous city within the jurisdiction. In single-county districts,
both 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.
Taxation authority
The bill permits a district to impose a room tax on hotel and motel rooms within
its jurisdiction in an amount not to exceed 1% of total room charges. The room tax
may only be used for the district's debt service on its bond obligations. In general,
the room tax may no longer be collected after the bonds, to which the proceeds of the
tax are dedicated, are retired.
The bill also 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. 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. A district and DOA are, however, directed to
attempt to ensure that at least 15% of the total dollar amount of any contracts let by
the district in each state fiscal year for the initial construction of baseball park
facilities is awarded to minority-owned businesses.
Finances
The bill appropriates $300,000 in state general purpose revenue for DOA to
provide a loan to a local professional baseball park district in the 1995-97 state fiscal
biennium for initial operating costs of the district, upon such terms and conditions
as the secretary of administration specifies. Any such loan must be repaid no later
than June 30, 1997.
Under the bill, a local professional baseball park district is permitted to invest
its moneys in the local government pooled-investment fund, which is managed by
the state investment board.
Highway improvements
The bill authorizes the state to expend $211,103,700 in fiscal year 1995-96 and
$220,103,700 in fiscal year 1996-97 for highway improvements, of which not more
than $3,000,000 in fiscal year 1995-96 and not more than $12,000,000 in fiscal year
1996-97 may be expended for state highway rehabilitation associated with the
construction of a new baseball stadium to be used by the Milwaukee Brewers.
Sales of surplus state land
and grants to the state
Currently, any sale of surplus state land having a fair market value of at least
$20,000 is subject to approval of the joint committee on finance. Unless otherwise
provided, a grant of land or other property made to the state is valid only upon
approval of the joint committee on finance. The bill provides that the building
commission may sell or transfer surplus state land to a local professional baseball
park district and DOA may accept a grant of land or other property to the state for
purposes of use for a professional baseball park without approval of the joint
committee on finance.
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.
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.
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:
AB1, s. 1
1Section
1. 13.48 (14) (d) 4. of the statutes is amended to read:
AB1,6,122
13.48
(14) (d) 4.
If Except as provided in subd. 5., if the commission proposes
3to sell or transfer a parcel of surplus land having a fair market value of at least
4$20,000, the commission shall notify the joint committee on finance in writing of its
5proposed action. If the cochairpersons of the committee do not notify the commission
6that the committee has scheduled a meeting for the purpose of reviewing the
7proposed sale or transfer within 14 working days after the date of the commission's
8notification, the parcel may be sold or transferred by the commission. If, within 14
9working days after the date of the commission's notification, the cochairpersons of
10the committee notify the commission that the committee has scheduled a meeting for
11the purpose of reviewing the proposed sale or transfer, the parcel may be sold or
12transferred under this subdivision only upon approval of the committee.
AB1, s. 2
13Section
2. 13.48 (14) (d) 5. of the statutes is created to read:
AB1,6,1614
13.48
(14) (d) 5. The commission may sell or transfer a parcel of surplus land
15to a local professional baseball park district created under subch. III of ch. 229
16without notification or approval under subd. 4.
AB1, s. 3
17Section
3. 16.40 (15m) of the statutes is created to read:
AB1,7,418
16.40
(15m) Loan to local professional baseball park district. From the
19appropriation under s. 20.505 (1) (fm), provide a loan to any local professional
20baseball park district created under subch. III of ch. 229, upon request of the district,
1for initial operating costs of the district. Any loan made under this subsection shall
2be made upon the terms and conditions that the secretary specifies, except that the
3secretary shall require any loan made under this subsection to be repaid no later
4than June 30, 1997.
AB1, s. 4
5Section
4. 16.40 (15m) of the statutes, as created by 1995 Wisconsin Act ....
6(this act), is repealed.
AB1, s. 5
7Section
5. 16.70 (14) of the statutes is amended to read:
AB1,7,98
16.70
(14) "State" does not include a district created under subch. II
or III of
9ch. 229.
AB1, s. 6
10Section
6. 16.82 (6) of the statutes is created to read:
AB1,7,1511
16.82
(6) May provide any services to a local professional baseball park district
12created under subch. III of ch. 229, for compensation to be agreed upon between the
13department and the district, if the district has entered into a lease agreement with
14the department under sub. (7). No order or contract to provide any such services is
15subject to s. 16.705, 16.75 (1) to (5) and (8) to (10), 16.752, 16.754 or 16.765.
AB1, s. 7
16Section
7. 16.82 (7) of the statutes is created to read:
AB1,7,2117
16.82
(7) May enter into a lease agreement with a local professional baseball
18park district created under subch. III of ch. 229 for the lease of land or other property
19granted to the state and especially dedicated by the grant to use for a professional
20baseball park. The lease agreement may be for such rental payments and for such
21term as the secretary determines.
AB1, s. 8
22Section
8. 16.854 of the statutes is created to read:
AB1,8,19
2316.854 Services provided to professional baseball park districts. The
24department may, upon request of any local professional baseball park district, if the
25district has entered into a lease agreement with the department under s. 16.82 (7),
1take charge of and supervise engineering or architectural services or construction
2work, as defined in s. 16.87, performed by, or for, the district for compensation to be
3agreed upon between the department and the district. In connection with such
4services or work, the department may furnish engineering, architectural, project
5management and other building construction services whenever requisitions
6therefor are presented to the department by the district. If the district has entered
7into a lease agreement with the department under s. 16.82 (7), the department may
8also assist the district, upon request of the district, in letting contracts for
9engineering, architectural or construction work authorized by law and in
10supervising the work done thereunder. The department may award any such
11contract for any combination or division of work it designates and may consider any
12factors in awarding a contract including price, time for completion of work and the
13qualifications and past performance of a contractor. In awarding contracts under
14this section for the initial construction of baseball park facilities, as defined in s.
15229.65 (1), the department shall attempt to ensure that at least 15% of the total
16amount expended under the contracts in each fiscal year is awarded to contractors
17and subcontractors which are minority businesses, as defined in s. 16.75 (3m) (a).
18Sections 16.85, 16.855 and 16.87 do not apply to services provided or contracted by
19the department under this section.
AB1, s. 9
20Section
9. 18.03 (5s) of the statutes is created to read:
AB1,8,2321
18.03
(5s) Upon the request of a local professional baseball park district
22created under subch. III of ch. 229, the commission may serve as financial consultant
23to assist and coordinate the issuance of the bonds of a district.
AB1, s. 10
24Section
10. 19.42 (13) (a) of the statutes is amended to read:
AB1,9,4
119.42
(13) (a) All positions to which individuals are regularly appointed by the
2governor, except the position of trustee of any private higher educational institution
3receiving state appropriations
and the position of member of the district board of a
4local professional baseball park district created under subch. III of ch. 229.
AB1, s. 11
5Section
11. 20.005 (3) (schedule) of the statutes, as it affects 20.395 (3) (cq) of
6the statutes, is repealed and recreated to read:
-
See PDF for table ![PDF](https://docs.legis.wisconsin.gov/assets/image/file_acrobat.gif)
AB1, s. 13
9Section
13. 20.505 (1) (fm) of the statutes is created to read:
AB1,10,4
120.505
(1) (fm)
Loan to local professional baseball park district. Biennially, the
2amounts in the schedule to provide a loan to any local professional baseball park
3district under s. 16.40 (15m). No moneys may be encumbered from this
4appropriation after June 30, 1997.
AB1, s. 14
5Section
14. 20.505 (1) (fm) of the statutes, as created by 1995 Wisconsin Act
6.... (this act), is repealed.