Under current law, a man is presumed to be the natural father of a child if he
was married to the child's mother when the child was conceived or born or if he and
the child's mother married after the child's birth but had a relationship during the
period of time within which the child was conceived. In a paternity action, if genetic
tests show that a man alleged to be the father is not excluded as the father and that
the probability that he is the father is 99.0% or more, that man is presumed to be the
father. This bill provides that a presumption of paternity that arises on the basis of
marriage is rebutted in a legal action or proceeding by results of a genetic test that
show that a man other than the one presumed to be the father on the basis of
marriage is not excluded as the father and that the statistical probability that the
man is the father is 99.0% or higher, even if the man who is presumed to be the father
on the basis of marriage is unavailable to submit to genetic tests.
Under current law, an order for child or family support or maintenance is an
automatic assignment of wages or other earnings to the clerk of circuit court. When
a support or maintenance order is entered, the court must send notice of the
assignment by regular mail to a payer's employer or other person who owes the payer
money, requiring withholding of the amount provided in the support order. The
support and withholding orders may be expressed as a fixed sum, as a percentage of
income or as both in the alternative, requiring payment of the greater or lesser
amount. If the payer is entitled to unemployment compensation, however, the order
to withhold benefits must be for a fixed sum.
This bill authorizes the court to send notice of assignment by facsimile machine
or other electronic means in addition to regular mail. Orders for the withholding of
unemployment compensation may be expressed as a fixed sum, as a percentage of
benefits payable or as both in the alternative, requiring payment of the greater or
lesser amount. Notices of assignment for withholding must include the information
that the maximum amount withheld may not exceed the maximum amount that is
subject to garnishment under federal law.
Under current law, if the petitioner in a paternity action fails to appear at a
pretrial hearing or at the trial, the court may dismiss the action. If the respondent
in a paternity action is the alleged father and he fails to appear for a court-ordered
genetic test or a hearing at which an appearance is required, the court must
adjudicate the respondent to be the father. This bill provides that, if the mother of
the child in a paternity action fails to appear for a court-ordered genetic test or a
hearing at which an appearance is required, the court may adjudicate the alleged
father, or the man who alleges that he is the father, to be the father of the child if there
is sufficient evidence for such a finding.
Under current law, if a child's birth occurs in or en route to a hospital and if the
child's parents are unmarried, the hospital administrator or his or her designee must
provide the child's mother with a voluntary paternity acknowledgment form and
with a pamphlet that has information about birth certificates, including how to add
to a birth certificate the name of the father of a child whose parents were not married.
The hospital must submit any completed forms to the state registrar. The fee for
making an alteration in a birth certificate is $10. Upon receipt of the voluntary
acknowledgement form and the fee, the state registrar must insert the name of the
father on the birth certificate.
This bill requires that trained, designated hospital staff provide to the child's
available unmarried parents written and oral information about the voluntary
paternity acknowledgment form and about the significance and benefits of
establishing paternity, before the parents sign the form. The bill provides immunity
from civil liability for trained, designated hospital staff who provide this information
in good faith. The staff must also provide an opportunity to complete the form and
to have the form notarized in the hospital. DILJD must provide to hospitals the
written information required to be provided to parents and must provide training to
hospital staff concerning the voluntary acknowledgment form and the significance
and benefits of establishing paternity. DILJD must pay the hospital, from federal
funds, a financial incentive for each form that is correctly filed within 60 days after
the birth and the $10 fee for altering a birth certificate.
This bill requires DILJD to establish and operate a hiring reporting system that
includes a state directory of new hires. With the exception of employers that employ
individuals in Wisconsin as well as in at least one other state (those employers must
designate for reporting just one of the states in which they employ individuals), all
employers in this state must supply information to DILJD about newly hired
employes. DILJD must specify the exact information that must be provided, how the
information may be provided and a timetable for providing the information.
Children
Under current law, the Milwaukee County department of social services
(Milwaukee County department) is responsible for providing child welfare services
in Milwaukee County. Those services include receiving and investigating child
abuse or neglect reports, referring children to the court assigned to exercise
jurisdiction under the children's code (juvenile court), providing court reports and
permanency plans to the juvenile court, providing appropriate protection or services
for children and their families, licensing foster homes, placing children for adoption
and providing kinship care payments. Current law requires the Milwaukee County
board of supervisors to operate a children's court center which is responsible for
providing intake and dispositional services for the juvenile court and for executing
judicial policy governing intake and juvenile court services.
This bill transfers the responsibility for providing child welfare services in
Milwaukee County, not including juvenile delinquency-related services, from the
Milwaukee County department to DHFS beginning on January 1, 1998. The bill also
transfers on that date the responsibility for providing intake and dispositional
services for children in need of protection or services and for executing judicial policy
governing intake and juvenile court services for those children from the children's
court center to DHFS. Under the bill, Milwaukee County must contribute to the cost
of providing child welfare services in that county an amount equal to the amount that
the county budgeted for those services in 1995.
Under current law, DHFS must establish community advisory committees for
each of the 5 neighborhood-based child welfare service delivery sites planned for
Milwaukee County. Each committee must provide a forum for communication for
those persons who are interested in the delivery of child welfare services in the
neighborhood to be served by the services delivery site and must make
recommendations to DHFS with respect to the delivery of those services in that
neighborhood. This bill eliminates those community advisory committees and
transfers the duties of those committees to the W-2 community steering committees
established by the W-2 agencies serving Milwaukee County.
Under current law, a county may establish a secure detention facility or a
shelter care facility, or both, for holding juveniles in custody. This bill permits a
county to establish a child caring institution, that is, a facility that provides care and
maintenance for 75 days in any consecutive 12-month period for 4 or more children
at any one time. Currently, no person may operate a child caring institution unless
that person obtains a license from DHFS to operate a child welfare agency. Public
agencies, however, are excluded from that licensing requirement. This bill requires
a county that establishes a child caring institution to obtain a license to operate a
child welfare agency.
Currently, the adolescent pregnancy prevention and pregnancy services board
that is attached to DHFS must award grants to organizations to provide adolescent
pregnancy prevention programs or pregnancy services that include health care,
education, counseling and vocational training. Currently, DHFS may award grants
for the provision of services in counties, or to an American Indian tribe or band, for
adolescent parents, emphasizing high school graduation and vocational preparation,
training and experience; these grants are known as "adolescent self-sufficiency
services" grants. DHFS is also authorized to provide grants for pregnancy and
parenthood prevention services to high-risk adolescents; these grants are known as
"adolescent pregnancy prevention services" grants. Lastly, DHFS must make grants
to provide information to communities in order to increase community knowledge
about adolescents' problems and information to and activities for adolescents; these
grants are known as "adolescent choices project grants".
This bill transfers to the adolescent pregnancy prevention and pregnancy
services board the responsibility for awarding adolescent self-sufficiency services
grants, adolescent pregnancy prevention services grants and adolescent choices
project grants.
Under current law, DHFS licenses child welfare agencies, group homes, day
care centers and shelter care facilities. Currently, those licenses are valid for 2 years
from the date of issuance and may be renewed upon their expiration. This bill
provides that those licenses are valid unless suspended or revoked. Under the bill,
DHFS must review each license every 2 years and must "continue" a license for an
additional 2-year period if the minimum requirements for licensure are met, the
applicable license fee is paid, any outstanding forfeitures (civil monetary penalties)
or other penalties are paid and, for a day care center, the criminal background
investigation fee is paid.
Under current law, DHFS may impose sanctions, including daily forfeitures, on
a child welfare agency, group home, day care center or shelter care facility licensee
who commits a violation relating to the child welfare agency, group home, day care
center or shelter care facility. Currently, a licensee who commits a violation must pay
all forfeitures within 10 days after receipt of the notice of assessment, or, if the
forfeiture is contested, within 10 days after receipt of a final administrative decision
ordering payment, unless the decision is appealed and the decision is stayed by a
court order. This bill permits a licensee who owes a forfeiture to DHFS to make an
arrangement acceptable to DHFS for the payment of the forfeiture. The bill also
requires DHFS to revoke a license if, on the date that the licensing fee is due, the
licensee has any forfeitures that are due and have not been paid. Current law does
not specifically authorize revocation under such circumstances.
Under current law, a child welfare agency that provides care and maintenance
for children must pay a biennial license fee of $100, plus $15 per child, based on
licensed capacity. This bill raises that fee to $110, plus $16.50 per child, based on
licensed capacity, beginning on the day on which the bill becomes law, and to $121,
plus $18.15 per child, based on licensed capacity, beginning on July 1, 1998.
Under current law, a child welfare agency that places children in foster homes
or group homes must pay a biennial license fee of $210. This bill raises that fee to
$231, beginning on the day on which the bill becomes law, and to $254.10, beginning
on July 1, 1998.
Under current law, a group home must pay a biennial license fee of $100, plus
$15 per child, based on licensed capacity. This bill raises that fee to $110, plus $16.50
per child, based on licensed capacity, beginning on the day on which the bill becomes
law, and to $121, plus $18.15 per child, based on licensed capacity, beginning on July
1, 1998.
Under current law, a day care center that provides care and supervision for 4
to 8 children must pay a biennial license fee of $50. This bill raises that fee to $55,
beginning on the day on which the bill becomes law, and to $60.50, beginning on July
1, 1998.
Under current law, a day care center that provides care and supervision for 9
or more children must pay a biennial license fee of $25, plus $7 per child, based on
licensed capacity. This bill raises that fee to $27.50, plus $7.70 per child, based on
licensed capacity, beginning on the day on which the bill becomes law, and to $30.25,
plus $8.47 per child, based on licensed capacity, beginning on July 1, 1998.
Under current law, a shelter care facility must pay a biennial license fee of $50,
plus $15 per juvenile, based on licensed capacity. This bill raises that fee to $55, plus
$16.50 per juvenile, based on licensed capacity, beginning on the day on which the
bill becomes law, and to $60.50, plus $18.15 per juvenile, based on licensed capacity,
beginning on July 1, 1998.
Under current law, the state receives federal foster care and adoption
assistance funding under Title IV-E of the federal social security act (generally
referred to as "IV-E funds") in reimbursement of moneys expended by the state or
the counties for activities relating to foster care and adoption of children. Currently,
IV-E funds are credited to the community aids appropriation account of DHFS and
distributed to counties to provide social services to children and families. Currently,
subject to certain exceptions, community aids moneys, including IV-E funds, that
are not spent or encumbered by December 31 of each year lapse to the general fund.
One of those exceptions permits DHFS to carry forward to the next year up to 3% of
the community aids funds allocated to a county in the current year.
This bill permits DHFS to distribute IV-E funds not only for services and
projects to assist children and families, but also for the operational requirements of
DHFS in administering programs to assist children and families. The bill also
provides that if, on December 31 of any year, there remains unspent or
unencumbered in the community aids allocation an amount that exceeds the amount
of IV-E funds allocated as community aids in that year ("excess moneys"), DHFS
must carry forward to the next year the excess moneys and distribute not less than
50% of the excess moneys to counties having a population of less than 500,000 for
services and projects to assist children and families. Under the bill, a county must
use not less than 50% of any excess moneys received by that county for services for
children who are at risk of abuse or neglect to prevent the need for child abuse and
neglect intervention services. A county may not use those excess moneys to supplant
any other moneys expended by the county for services and projects to assist children
and families in a base year determined by DHFS. Any excess moneys carried forward
by DHFS, but not distributed to counties, may be used for the operational
requirements of DHFS in administering programs for children and families.
Under current law, DHFS may establish a system of outpatient clinic services
in any mental health institute operated by DHFS. Currently, subject to certain
exceptions, DHFS may provide those outpatient services only to a patient contracted
for with a county department of community programs or developmental disabilities
services. This bill permits DHFS to provide outpatient services at the Winnebago
Mental Health Institute to a patient who is a pupil enrolled in a school district that
contracts with DHFS for the provision of those services.
Mental illness and developmental disabilities
Under current law, persons who receive treatment for mental illness,
developmental disabilities, alcoholism or drug dependency have the right to refuse
medication or treatment, except that this right does not apply to any of the following:
1. Certain persons who are detained or committed on the basis of mental illness
and certain incapability, lack of services and probability of suffering severe harm
(commonly known as the "5th standard" for mental health detention or
commitment).
2. Persons who a court has determined are incompetent to refuse medication
or treatment, either at or after the hearing to determine probable cause for
commitment or after a final commitment order.
3. Committed persons in a situation in which the medication or treatment is
necessary to prevent serious physical harm to the persons or others.
4. Persons who are found by a court to be both incompetent and incompetent
to refuse psychotropic medication and for whom guardians of the person have been
appointed to consent to or refuse psychotropic medication, including forcible
administration of psychotropic medication, on behalf of the persons.
5. Persons ordered by a court to take medication in order to maintain their
competence to proceed at trial.
This bill substantially modifies the right of patients receiving services for
mental illness, developmental disabilities, alcoholism or drug dependency to refuse
medication or treatment. First, for a patient who has been found by a court to be
incompetent to refuse medication or treatment, the bill establishes, as a standard,
that the medication or treatment may be involuntarily administered if the facility
staff who are primarily responsible for developing the patient's treatment plan
determine that the medication or treatment is appropriate for the purpose of
ameliorating the patient's condition and represents the exercise of treatment
techniques and procedures that are reasonable and appropriate to the patient and
that there would be a current risk of harm to the patient or others if not administered.
Second, for a patient who has not been found by a court to be incompetent to refuse
medication or treatment, the bill establishes the right to request review of the offered
medication or treatment. The review must be conducted by a 3-member panel of
treatment professionals. If the review panel determines that the offered medication
or treatment is appropriate for the purpose of ameliorating the patient's condition
and represents the exercise of treatment techniques and procedures that are
reasonable and appropriate to the patient, or if the patient did not timely request
panel review, the patient's treatment facility or treatment program may, for certain
patients, terminate the contractual agreement with the county department of
community programs or developmental disabilities services and return the patient
to the care and custody of the county department, request reexamination of the
patient or discharge the patient. For all mental health patients, the treatment
facility may transfer the patient to a nontreatment unit or facility until the patient
is released or discharged or consents to the medication or treatment that is offered
under a treatment plan. Patients who are transferred to a nontreatment unit or
facility may be locked in their rooms for certain periods of time and may be subjected
to unit-wide or facility-wide isolation under certain circumstances. These patients
are not entitled to conditions or facilities that are identical or substantially similar
to those in which patients who consent to treatment are housed. The rights under
transfers concerning a form of treatment that is least restrictive of the patient's
personal liberty do not apply to these patients. The bill also authorizes a person
operating a mental health institute or other inpatient facility to establish and
operate nontreatment units or facilities. Lastly, for all patients, the treatment
facility or treatment program may file a motion to request the court to enter an order
requiring administration to the patient of treatment (not including the
administration of psychotropic medication).
Under current state law, treatment records of an individual who is receiving or
has received services for mental illness, developmental disability, alcoholism or drug
dependence that are maintained by DHFS, by county departments of community
programs or developmental disabilities services or by treatment facilities are
confidential. Patient health care records that are prepared by or under the
supervision of a health care provider also are confidential. With certain exceptions,
the treatment records or patient health care records may be released only with the
informed written consent of the individual. One of the exceptions applies to staff
members of the protection and advocacy agency or to staff members of a private
nonprofit corporation with which the protection and advocacy agency has contracted.
(A protection and advocacy agency is an entity designated by the governor to
implement a system to protect and advocate the rights of persons with
developmental disabilities or mental illness, as authorized by federal law.)
Currently, however, if the individual for whom treatment records are sought has had
a guardian appointed for him or her on grounds of incompetence or is a minor with
developmental disability who has a parent or a guardian but not a guardian who was
appointed for him or her on grounds of incompetence, information about that
individual that the protection and advocacy agency, or the nonprofit corporation with
which it has contracted, may obtain is limited to the nature of an alleged rights
violation, if any; the name, birth date and county of residence of the individual;
information as to whether the individual was voluntarily admitted, involuntarily
committed or protectively placed and the date and place of the admission,
commitment or placement; and the name, address and telephone number of the
guardian and the date and place of the guardian's appointment or, for a minor with
developmental disability who has not had a guardian appointed on grounds of
incompetence, the name, address and telephone number of the minor's parent or
guardian. If the protection and advocacy agency or the nonprofit corporation with
which it has contracted wishes to obtain additional information, it must notify the
guardian or the parent in writing and may obtain the information only if the
guardian or parent does not object in writing within 15 days after the notice is
mailed. However, access to records of an individual may be provided to the agency
or corporation if:
1. The record custodian fails to promptly provide the name and address of the
parent or guardian.
2. A complaint is received by the agency or corporation about an individual, the
agency or corporation determines that there is probable cause to believe that the
health or safety of the individual is in serious and immediate jeopardy and the
agency or corporation has made a good-faith effort to contact the parent or guardian
and has either been unable to contact the parent or guardian or has offered
assistance to resolve the situation and the parent or guardian has failed or refused
to act on behalf of the individual.
3. A complaint is received by the agency or corporation about an individual or
there is otherwise probable cause to believe that the individual has been subject to
abuse or neglect by a parent or guardian.
4. The individual is a minor whose custody has been transferred to a legal
custodian or for whom a guardian, who is an agency of the state or a county, has been
appointed.
Current federal law authorizes access to records of an individual with mental
illness or developmental disability who has a legal guardian or other legal
representative and for whom the agency or corporation has received a complaint or
for whom there is probable cause to believe that the health and safety of the
individual is in serious or immediate jeopardy, whenever the agency or corporation
has contacted the individual's representative and offered assistance and the
representative has failed or refused to act on behalf of the individual. Current
federal law also authorizes access for an individual who, by reason of his or her
mental or physical condition, is unable to authorize access for the agency or
corporation, who does not have a legal guardian or other legal representative or for
whom the legal guardian is the state and with respect to whom the agency or
corporation has received a complaint or there is probable cause to believe that the
individual has been subject to abuse or neglect.
This bill changes the conditions under which the agency, or the corporation with
which it contracts, is authorized to provide access to the treatment or patient health
care records of an individual, to conform the conditions to current federal law.
However, the bill retains overriding a denial of access if the record custodian fails to
promptly provide the parent's or guardian's name or address or if the individual is
a minor whose custody is transferred to a legal custodian or for whom the state or
county is appointed as guardian.
Under current law, elderly, physically disabled, developmentally disabled,
chronically mentally ill or chemically dependent persons receive services under the
long-term support community options program. Reimbursement for long-term
community support services may not exceed the average monthly cost of nursing
home care, as determined by DHFS. This limitation does not apply to a person under
the age of 22 or a person who is ventilator-dependent, or if DHFS determines that
the cost of providing that person with nursing home care would exceed the cost of
providing the person with care in the community. This bill eliminates the limitation
on payment under the long-term support community options program for long-term
community support services.
Under current law, DHFS must implement a plan that is approved by DOA to
ensure that, before July 1, 1999, there are sufficient revenues to cover expenditures
in reimbursement of care provided to patients of the Mendota and Winnebago mental
health institutes. DHFS must report to DOA every 3 months, ending on July 1, 1999,
on the implementation of this plan. This bill appropriates general purpose revenues
equivalent to the value of the equipment and buildings of the Mendota and
Winnebago mental health institutes to be used to cover expenditures in
reimbursement of care provided to the mental health institutes. The bill also
eliminates the requirement that DHFS annually increase rates charged for services
provided by the mental health institutes and eliminates the plan deadline of July 1,
1999.
Currently, a county department of community programs must prepare a local
plan to meet the needs of persons within the county department's jurisdiction who
have mental illness, developmental disability, alcoholism or drug addiction,
including homeless persons. The proposed budget for the county for mental health
services for the succeeding year must be based on this plan. The county department
of community programs must submit this plan every 3 years to DHFS for review.
DHFS, in turn, must develop a model community mental health plan for county use,
assist counties in developing their individual plans and, in conjunction with the
council on mental health, review the plans submitted by counties. This bill
eliminates all these requirements.
Other health and human services
Under current law, DHFS must give prior approval to the construction or total
replacement of a nursing home; an increase in the bed capacity of a nursing home;
a capital expenditure that exceeds $1,000,000 by or on behalf of a nursing home; an
expenditure that exceeds $600,000 for clinical equipment by or on behalf of a nursing
home; and the partial or total conversion of a nursing home to a facility primarily
serving the developmentally disabled. This bill eliminates the requirement for prior
approval by DHFS of the total replacement of a nursing home, capital expenditures
that exceed $1,000,000 for renovation or replacement of a nursing home and
expenditures that exceed $600,000 for renovation or replacement of clinical
equipment of a nursing home.
This bill requires that DHFS distribute a total of $250,000 in fiscal year
1997-98 and a total of $150,000 in fiscal year 1998-99 to develop and extend use of
a facility licensing and certification system. However, the bill permits the secretary
of administration to withhold approval for expenditure of these funds until he or she
determines that DHFS has adequately explored and planned for the use of a common
licensing and certification system with the department of regulation and licensing.
Under current law, providers of care or services who contract with DHFS or
with a county department of social services, human services, developmental
disabilities services or community programs must, as a condition of reimbursement,
provide the purchaser with a certified financial and compliance audit report for
purchased care and services that exceed $25,000. The audit report is required
biennially unless federal law requires an annual report. This bill revises audit
requirements for care and service providers who contract with DHFS or county
departments to require annual submission of audits if care and services purchased
exceed $50,000. The bill authorizes DHFS to require audits of a provider from whom
purchases were less than $50,000, under certain circumstances.
Under current law, the Wisconsin Health and Educational Facilities Authority
(WHEFA) may issues bonds to finance certain projects for the construction,
remodeling, furnishing or equipping of a health facility. The definition of "health
facility" does not include a rural medical center that is required to be licensed by
DHFS. A rural medical center is a facility that provides 2 or more health care
services, is organized under a single governing and corporate structure, and is
located in a county or municipality that has a population of less than 15,000 and in
an area that is not an urbanized area.
This bill changes the definition of "health facility" by including rural medical
centers and excluding fitness centers and weight reduction centers. The bill also
provides that WHEFA may retain bond counsel services only on the basis of a
competitive process that is approved by the secretary of administration.
This bill eliminates the current expiration date of July 1, 1997, for the
requirement that DHFS establish a pilot project for a contract with the Red Cliff
Band of Lake Superior Chippewas and requires that DHFS administer the pilot
project.
Under current law, as part of the home-based enterprise program, DILJD must
distribute funds for homecraft services relating to the marketing and distribution of
homecraft products and to the purchase of capital equipment for each client who
participates in the homecraft program. This bill eliminates the requirement that
DILJD distribute funds for homecraft services relating to the purchase of capital
equipment.
Currently, DHFS, in cooperation with DPI, must prepare a joint alcohol and
other drug abuse prevention, intervention, treatment and rehabilitation plan and
biennially submit a report to the legislature on implementation of the plan. This bill
eliminates this requirement.
Insurance
The health insurance risk-sharing plan (HIRSP) under current law provides
major medical health insurance coverage for persons who are covered under
medicare because they are disabled, persons who have tested positive for the human
immunodeficiency virus (HIV) and persons who have been refused coverage, or
coverage at an affordable price, in the private health insurance market because of
their mental or physical health conditions. Responsibility for administering HIRSP
is split between the office of the commissioner of insurance (OCI) and a board of
governors, which includes the commissioner of insurance or a designated
representative from OCI. Claims, other than those in excess of premiums, are paid
by premiums collected from persons with coverage under HIRSP. Administrative
expenses of HIRSP, including claims in excess of premiums, are paid out of the health
insurance risk-sharing fund, which is derived from assessments paid by health
insurers. The commissioner determines each health insurer's annual assessment
and the schedule of premiums. Covered persons with annual household incomes
below $20,000 pay reduced premiums and deductibles through a subsidy program
administered by the board and funded with general purpose revenue and certain
assessments and penalties paid by health insurers.
This bill transfers responsibility for administering HIRSP to the department
of health and family services (DHFS) and the board and makes a number of changes
to the program. Under the bill, the commissioner continues to determine each
insurer's share of the assessments that provide funding for HIRSP and to impose
assessments for certain insurer actions that make a person eligible for coverage
under HIRSP. The secretary of health and family services, or his or her
representative, as well as the commissioner, or his or her representative, are
members of the board, and the secretary, or his or her representative, serves as
chairperson of the board. Payment of claims, as well as other administrative duties,
is performed by the same fiscal agent that pays claims under the medical assistance
(MA) program. While under current law covered expenses under HIRSP are the
usual and customary charges, reduced by 10%, for specified services, after the
transfer occurs the covered expenses are the amounts that are paid for those services
under MA. Under the bill, services and articles covered under HIRSP must be
provided by persons who are certified to provide services or articles under MA.
Reduced premiums and deductibles for covered persons with incomes below $20,000
continue to be subsidized, but DHFS may recover from the estate of a deceased
person who had coverage under HIRSP the amount of any subsidies that are paid on
behalf of the person after the transfer to DHFS occurs.
Local government
Under the current tax incremental financing (TIF) program, a city or village
may create a tax incremental district (TID) in part of its territory to foster
development if at least 50% of the area to be included in the TID is blighted, in need
of rehabilitation or suitable for industrial sites. Before a city or village may create
a TID, several steps are required. These steps include public hearings, preparation
and adoption of a proposed project plan for the TID, approval of the proposed project
plan by the city or village and the creation of a joint review board to review the
proposal. The joint review board, which is made up of representatives of the
overlying taxing jurisdictions of the proposed TID, must approve the project plan or
the TID may not be created.
This bill creates a mechanism, very similar to the TIF program, for financing
the "eligible costs" incurred by a city, village, town or county (political subdivision)
for environmental remediation (ER) of property that is owned by the political
subdivision. If the remediated property is transferred to another person and is then
subject to property taxation, ER tax incremental financing may be used to allocate
some of the property taxes that are levied on the property to the political subdivision
to pay for the costs of remediation.
"Eligible costs" are capital costs, financing costs and administrative and
professional service costs for the removal, containment or monitoring of, or the
restoration of soil or groundwater affected by, environmental pollution. Eligible
costs are reduced by any amounts received from persons responsible for the
discharge of a hazardous substance on the property to pay remediation costs and by
the amount of net gain on the sale of the property by the political subdivision.
If development on the remediated parcel increases the value of the property
above the base value, an "ER value increment" is created. That portion of taxes
collected on the ER value increment in excess of the base value is called an "ER tax
increment". The ER tax increment is placed in a special fund that may be used by
the political subdivision only to pay back the eligible costs of the ER, instead of being
distributed to the overlying taxing jurisdictions that have the authority to levy
property taxes on the remediated parcel of property. The ER tax increment must be
paid into the special fund until all of the political subdivision's eligible costs are paid
or until 17 years after the ERTID of the property has been certified by the
department of revenue (DOR), whichever comes first.
In calculating shared revenue payments, "full valuation" includes these
increments for municipalities and counties that create the district but not for the
other units of government in the district, and "local general purpose taxes" includes
the portion of these increments collected for a municipality or county that is
attributable to the municipality's or county's own levy. Shared revenue payments
decrease as full valuation increases, and those payments increase as local general
purpose taxes increase.
