LRB-3097/3
MES&PG:cjs:rs
2003 - 2004 LEGISLATURE
August 12, 2003 - Introduced by Representatives Honadel, Suder, Gard, Bies, J.
Fitzgerald, Freese, Gielow, Hines, Gunderson, LeMahieu, Lothian,
McCormick, D. Meyer, Montgomery, Musser, Nass, Nischke, Owens, Pettis,
Rhoades, Seratti, Stone, Towns, Townsend, Underheim, Van Roy, Vrakas,
Vukmir, Ward, Weber, Wieckert, M. Williams, J. Wood, Ainsworth,
Loeffelholz, Huebsch, Hundertmark, Jensen, Jeskewitz, Johnsrud, Ladwig,
F. Lasee, Albers, Kerkman, Kreibich, Hahn, Kaufert and Gundrum,
cosponsored by Senators Welch and Kedzie.
AB466,1,5
1An Act to amend 121.905 (1), 121.91 (2m) (e) (intro.), 121.91 (2m) (r) 1. (intro.),
2121.91 (2m) (r) 2. (intro.) and 121.91 (4) (f); and
to create 38.17, 66.0602, 121.91
3(2m) (f) and 121.91 (2m) (g) of the statutes;
relating to: school district revenue
4limits and levy limits for cities, villages, towns, counties, and technical college
5districts.
Analysis by the Legislative Reference Bureau
This bill creates local levy limits that apply to cities, villages, towns, counties
(political subdivisions), and technical college districts. Generally, the bill prohibits
a political subdivision from increasing its levy by a percentage that exceeds the
percentage change in the political subdivision's equalized value due to new
construction, less improvements removed, not including any such changes in a tax
incremental district (TID). In addition, the calculation of a city's or village's levy does
not include any tax increment that is generated by a TID. With regard to technical
college districts, the levy limit is the levy for the previous year multiplied by 1.026.
The bill contains exceptions to the levy limit for political subdivisions that transfer
the provision of services, for cities or villages that annex town territory, and for a
county levy that relates to a county Children with Disabilities Education Board. The
levy limit may also be exceeded if a political subdivision's or technical college
district's resolution to do so is approved in a referendum. A town with a population
of less than 2,000 may exceed the levy limit if a resolution to do so is approved by an
annual or special town meeting. The levy limits do not apply beginning three years
after the effective date of the bill.
Under the bill, a technical college district's or political subdivision's levy limit
is increased if the amount of debt service in the current year exceeds the amount in
the prior year for debt that was approved by the governing body before July 1, 2003.
This bill exempts from the limit all funds needed to pay debt service on debt
authorized by resolution or referendum before July 1, 2003, and on debt authorized
by referendum on or after July 1, 2003.
This bill also allows a city or village which has been providing services for a fee
to property located in a town for at least ten years, and which annexes territory from
that town, to increase the limit otherwise applicable in the current year by an
amount equal to the city's or village's mill rate applied to the current assessed value
of the annexed territory. The limit otherwise applicable to the town from which the
territory was annexed is reduced by an amount equal to the town's mill rate
multiplied by the assessed value of the annexed territory as of the last year that the
territory was subject to town taxation.
Also under this bill, the limit otherwise applicable does not apply to the amount
that a 1st class city (presently only Milwaukee) levies for school purposes. Currently,
a 1st class city school district is not authorized to levy a tax; the city in which the
school district is located levies a tax for school purposes at the direction of the school
board.
This bill sets the per pupil adjustment under school district revenue limits at
$120 in the 2003-04 school year and at $100 in each subsequent school year. Under
current law, the per pupil adjustment is approximately $236 in the 2003-04 school
year and $241 in the 2004-05 school year and is adjusted for inflation in subsequent
school years.
Currently, a school district with per pupil revenue below $7,400 in the 2003-04
school year or below $7,800 in any subsequent school year is exempt from the revenue
limits. This bill specifies that these revenue ceilings apply only if the school board
adopts a resolution setting its revenue ceiling at $7,400 or $7,800. Otherwise, the
revenue ceiling is $6,900.
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:
AB466, s. 1
1Section
1. 38.17 of the statutes is created to read:
AB466,2,5
238.17 Levy limit. (1)
Definition. In this section, "debt service" includes debt
3service on debt issued or reissued to fund or refund outstanding municipal
4obligations, interest on outstanding municipal obligations, and related issuance
5costs and redemption premiums.
AB466,3,3
1(2) Limit. Except as provided in subs. (3) and (4), no district board may increase
2its levy for any fiscal year to an amount that exceeds its levy for the previous fiscal
3year multiplied by 1.026.
AB466,3,8
4(3) Adjustments. (a) 1. If a district board transfers to another governmental
5unit responsibility for providing any service that it provided in the preceding fiscal
6year, the limit otherwise applicable under sub. (2) in the current fiscal year is
7decreased by the cost that it would have incurred to provide that service, as
8determined by the department of revenue.
AB466,3,139
2. If a district board increases the services that it provides by adding
10responsibility for providing a service transferred to it from another governmental
11unit that provided the service in the previous fiscal year, the limit otherwise
12applicable under sub. (2) in the current fiscal year is increased by the cost of that
13service, as determined by the department of revenue.
AB466,3,1914
(b) 1. If the amount of debt service for a district board in the preceding fiscal
15year is less than the amount of debt service needed in the current fiscal year, as a
16result of the district board adopting a resolution before July 1, 2003, authorizing the
17issuance of debt, the limit otherwise applicable under sub. (2) for the current fiscal
18year is increased by the difference between the 2 amounts, as determined by the
19department of revenue.
AB466,3,2520
2. The limit otherwise applicable under this section does not apply to amounts
21levied by a district board for the payment of any general obligation debt service,
22including debt service on debt issued or reissued to fund or refund outstanding
23municipal obligations, interest on outstanding municipal obligations, or the
24payment of related issuance costs or redemption premiums, authorized on or after
25July 1, 2003, by a referendum and secured by the full faith and credit of the district.
AB466,4,4
1(4) Referendum. (a) 1. A district board may exceed the levy limit under sub.
2(2) if it adopts a resolution to that effect and the resolution is approved in a
3referendum. The resolution shall specify the proposed amount of increase in the levy
4beyond the amount that is allowed under sub. (2).
AB466,4,75
2. Except as provided in subd. 3., the district board may call a special
6referendum for the purpose of submitting the resolution to the electors of the district
7for approval or rejection.
AB466,4,108
3. A referendum to exceed the limit under sub. (2) for the levy for the 2004-05
9fiscal year shall be held at the spring primary or election or September primary or
10general election in 2004.
AB466,4,1311
(b) The district board shall publish type A, B, C, D, and E notices of the
12referendum under s. 10.01 (2). Section 5.01 (1) applies in the event of failure to
13comply with the notice requirements of this paragraph.
AB466,4,2214
(c) The referendum shall be held in accordance with chs. 5 to 12. The district
15board shall provide the election officials with all necessary election supplies. The
16form of the ballot shall correspond substantially with the standard form for
17referendum ballots prescribed by the elections board under ss. 5.64 (2) and 7.08 (1)
18(a). The question shall be submitted as follows: "Under state law, the percentage
19increase in the levy of the .... (name of district) for the next fiscal year, .... (year), is
20limited to ....%, resulting in a levy of $..... Shall the .... (name of district) be allowed
21to exceed this limit such that the percentage increase for the next fiscal year, ....
22(year), will be ....%, resulting in a levy of $....?".
AB466,5,223
(d) Within 14 days after the referendum, the district board shall certify the
24results of the referendum to the department of revenue. The limit otherwise
1applicable to the district under sub. (2) is increased for the next fiscal year by the
2amount approved by a majority of those voting on the question.
AB466,5,4
3(5) Sunset. This section does not apply beginning 3 years after the effective
4date of this subsection .... [revisor inserts date].
AB466, s. 2
5Section
2. 66.0602 of the statutes is created to read:
AB466,5,6
666.0602 Local levy limits. (1) Definitions. In this section:
AB466,5,107
(a) "Debt service" includes debt service on debt issued or reissued to fund or
8refund outstanding municipal or county obligations, interest on outstanding
9municipal or county obligations, and related issuance costs and redemption
10premiums.
AB466,5,1111
(b) "Political subdivision" means a city, village, town, or county.
AB466,5,1712
(c) "Valuation factor" means a percentage equal to the percentage change in the
13political subdivision's January 1 equalized value due to new construction less
14improvements removed between the year before the previous year and the previous
15year, but not less than zero. In determining the valuation factor, the department of
16revenue shall exclude the value increment, as defined in s. 66.1105 (2) (m), of any tax
17incremental district that is located in the political subdivision.
AB466,5,21
18(2) Levy limit. Except as provided in subs. (3), (4), and (5), no political
19subdivision may increase its levy in any year by a percentage that exceeds the
20political subdivision's valuation factor. In determining its levy in any year, a city or
21village shall subtract any tax increment that is calculated under s. 66.1105 (2) (i).
AB466,6,2
22(3) Exceptions. (a) If a political subdivision transfers to another governmental
23unit responsibility for providing any service that the political subdivision provided
24in the preceding year, the levy increase limit otherwise applicable under this section
25to the political subdivision in the current year is decreased to reflect the cost that the
1political subdivision would have incurred to provide that service, as determined by
2the department of revenue.
AB466,6,83
(b) If a political subdivision increases the services that it provides by adding
4responsibility for providing a service transferred to it from another governmental
5unit that provided the service in the preceding year, the levy increase limit otherwise
6applicable under this section to the political subdivision in the current year is
7increased to reflect the cost of that service, as determined by the department of
8revenue.
AB466,6,149
(c) Except as provided in par. (f), if a city or village annexes territory from a
10town, the city's or village's levy increase limit otherwise applicable under this section
11is increased in the current year by an amount equal to the town levy on the annexed
12territory in the preceding year and the levy increase limit otherwise applicable under
13this section in the current year for the town from which the territory is annexed is
14decreased by that same amount, as determined by the department of revenue.
AB466,6,2015
(d) 1. If the amount of debt service for a political subdivision in the preceding
16year is less than the amount of debt service needed in the current year, as a result
17of the political subdivision adopting a resolution before July 1, 2003, authorizing the
18issuance of debt, the levy increase limit otherwise applicable under this section to the
19political subdivision in the current year is increased by the difference between these
20two amounts, as determined by the department of revenue.
AB466,7,221
2. The limit otherwise applicable under this section does not apply to amounts
22levied by a political subdivision for the payment of any general obligation debt
23service, including debt service on debt issued or reissued to fund or refund
24outstanding obligations of the political subdivision, interest on outstanding
25obligations of the political subdivision, or the payment of related issuance costs or
1redemption premiums, authorized on or after July 1, 2003, by a referendum and
2secured by the full faith and credit of the political subdivision.
AB466,7,53
(e) The limit otherwise applicable under this section does not apply to the
4amount that a county levies in that year for a county children with disabilities
5education board.
AB466,7,146
(f) If a city or village which has been providing services for a fee to property
7located in a town for at least 10 years, annexes territory from that town, the city's
8or village's levy increase limit otherwise applicable under this section is increased
9in the current year by an amount equal to the city's or village's mill rate applied to
10the current assessed value of the annexed territory, and the levy increase limit
11otherwise applicable under this section in the current year for the town from which
12the territory is annexed is decreased by the town's mill rate applied to the assessed
13value of the annexed territory as of the last year that the territory was subject to
14taxation by the town, as determined by the department of revenue.
AB466,7,1615
(g) The limit otherwise applicable under this section does not apply to the
16amount that a 1st class city levies for school purposes.
AB466,7,25
17(4) Referendum exception. (a) A political subdivision may exceed the levy
18increase limit under sub. (2) if its governing body adopts a resolution to that effect
19and if the resolution is approved in a referendum. The resolution shall specify the
20proposed amount of increase in the levy beyond the amount that is allowed under
21sub. (2). With regard to a referendum relating to the 2003 or 2005 levy, the political
22subdivision may call a special referendum for the purpose of submitting the
23resolution to the electors of the political subdivision for approval or rejection. With
24regard to a referendum relating to the 2004 levy, the referendum shall be held at the
25next succeeding spring primary or election or September primary or general election.
AB466,8,3
1(b) The clerk of the political subdivision shall publish type A, B, C, D, and E
2notices of the referendum under s. 10.01 (2). Section 5.01 (1) applies in the event of
3failure to comply with the notice requirements of this paragraph.
AB466,8,124
(c) The referendum shall be held in accordance with chs. 5 to 12. The political
5subdivision shall provide the election officials with all necessary election supplies.
6The form of the ballot shall correspond substantially with the standard form for
7referendum ballots prescribed by the elections board under ss. 5.64 (2) and 7.08 (1)
8(a). The question shall be submitted as follows: "Under state law, the increase in the
9levy of the .... (name of political subdivision) for the tax to be imposed for the next
10fiscal year, .... (year), is limited to ....%, which results in a levy of $.... Shall the ....
11(name of political subdivision) be allowed to exceed this limit and increase the levy
12for the next fiscal year, .... (year), by a total of ....%, which results in a levy of $....?".
AB466,8,1713
(d) Within 14 days after the referendum, the clerk of the political subdivision
14shall certify the results of the referendum to the department of revenue. The levy
15increase limit otherwise applicable to the political subdivision under sub. (2) is
16increased in the next fiscal year by the percentage approved by a majority of those
17voting on the question.
AB466,8,24
18(5) Exception, certain towns. A town with a population of less than 2,000 may
19exceed the levy increase limit otherwise applicable under this section to the town if
20the annual town meeting or a special town meeting adopts a resolution to that effect.
21The limit otherwise applicable to the town under sub. (2) is increased in the next
22fiscal year by the percentage approved by a majority of those voting on the question.
23Within 14 days after the adoption of the resolution, the town clerk shall certify the
24results of the vote to the department of revenue.
AB466,9,2
1(6) Sunset. This section does not apply beginning 3 years after the effective
2date of this subsection .... [revisor inserts date].
AB466,9,85
121.905
(1) In this section, "revenue ceiling" means $6,900, except that
6"revenue ceiling" means $7,400 in the 2003-04 school year and $7,800 in any
7subsequent school year
if a school board adopts a resolution to that effect by a
8two-thirds vote of the members elect.
AB466, s. 4
9Section
4. 121.91 (2m) (e) (intro.) of the statutes is amended to read:
AB466,9,1310
121.91
(2m) (e) (intro.) Except as provided in subs. (3) and (4), no school district
11may increase its revenues for the 1999-2000
, 2000-01, 2001-02, or 2002-03 school
12year
or for any school year thereafter to an amount that exceeds the amount
13calculated as follows:
AB466, s. 5
14Section
5. 121.91 (2m) (f) of the statutes is created to read:
AB466,9,1715
121.91
(2m) (f) Except as provided in subs. (3) and (4), no school district may
16increase its revenues for the 2003-04 school year to an amount that exceeds the
17amount calculated as follows:
AB466,9,2118
1. Divide the sum of the amount of state aid received in the previous school year
19and property taxes levied for the previous school year, excluding property taxes
20levied for the purpose of s. 120.13 (19) and excluding funds described under sub. (4)
21(c), by the average of the number of pupils enrolled in the 3 previous school years.
AB466,9,2222
2. Add $120 to the result under subd. 1.
AB466,9,2423
3. Multiply the result under subd. 2. by the average of the number of pupils
24enrolled in the current and the 2 preceding school years.