AB100: Bill Text

Under current law, a taxpayer may claim an income or franchise tax credit based, generally, on the taxpayer's business activities in a location designated by the Department of Commerce as a development zone, opportunity zone, enterprise zone, or agricultural development zone. The taxpayer may claim the credit against the taxes imposed on the income derived from the taxpayer's business activities in a zone. In addition, the taxpayer may claim a credit, in part, based on the number of full-time jobs that the taxpayer creates in the development zone that are filled by a member of a targeted group, which includes an individual who resides in an area that the federal government designates as an empowerment zone or enterprise community.

Under this bill, generally, the taxpayer may claim a credit against the taxes imposed on all of the taxpayer's Wisconsin income. In addition, the targeted group includes an individual who resides in an area that the federal government designates as an economic revitalization area.

Under current law, a person may claim an income or franchise tax credit against the person's state income or franchise tax liability for 10 percent of the amount that the person paid in the taxable year to modernize or expand the person's dairy farm. Under the bill, a person may claim the credit for 10 percent of the amount that the person paid in the taxable year to modernize or expand the person's livestock farm.

Under current law, for purposes of computing corporate income taxes and franchise taxes, a formula is used to attribute a portion of a corporation's income to this state. The formula has three factors: a sales factor, a property factor, and a payroll factor. The sales factor represents 50 percent of the formula and the property and payroll factors each represent 25 percent of the formula. Under current law, beginning on January 1, 2008, the sales factor will be the only factor used to attribute a portion of a corporation's income to this state. This bill modifies the sales factor to provide for the apportionment of income derived from the lease, rental, or licensing of real property and moving property, the use of computer software, and the sale or use of intangible property and services.

This bill adopts the substantive provisions of the streamlined sales and use tax agreement for administering and collecting state, county, and stadium district sales and use taxes. States that wish to enter into the agreement must adopt uniform definitions related to the administration of sales and use taxes and uniform policies related to sourcing sales of goods and services, bad debt allowances, refunds, and, to some extent, exemptions.

Under current law, generally, a person needs a permit from DOR to sell cigarettes in this state as a distributor, jobber, vending machine operator, or multiple retailer. Also, a person needs a permit from DOR to sell tobacco products in this state as a distributor or subjobber. A "jobber" is any person who acquires cigarettes from manufacturers or distributors, stores the cigarettes, and sells the cigarettes to retailers for resale. A "subjobber" is any person, other than a manufacturer or distributor, who buys tobacco products from a distributor and who sells such products to any person other than the ultimate consumer.

This bill prohibits a direct marketer from selling cigarettes or tobacco products to consumers in this state without the appropriate permit from DOR. The fee for the permit is based on the number of cigarettes that the direct marketer sells annually to consumers in this state.

Under the bill, DOR may not issue a permit to a direct marketer unless the direct marketer certifies to DOR that all sales of cigarettes or tobacco products to consumers in this state will be credit card transactions; that the invoices for all shipments of cigarettes or tobacco products will bear the direct marketer's name, address, and permit number; and that the direct marketer will provide DOR any information that DOR considers necessary for cigarette and tobacco products tax and permit purposes. The direct marketer may not sell any cigarettes or tobacco products unless the sales tax, use tax, cigarette tax, or tobacco products tax, as appropriate, has been paid on the sale of the cigarettes or tobacco products. In addition, a direct marketer may not sell cigarettes or tobacco products in this state unless the direct marketer has a mechanism, approved by DOR, for verifying the age of the purchaser, and the direct marketer receives from the purchaser, at the time of purchase, a copy or facsimile of an identification card and the name specified on the identification matches the name of the purchaser.

Under the bill, cigarettes and tobacco products may not be shipped to a person who is under 18 years of age and may not be shipped to a post-office box.

Under current law, the state imposes a sales tax on all retailers at the rate of 5 percent of the gross receipts from the sale, lease, or rental of tangible personal property and the sale of certain services. For sales tax purposes, a retailer includes a seller who sells any tangible personal property or taxable service. A retailer who is subject to the sales tax must obtain a seller's permit, collect the sales tax, and remit the collected tax to DOR. The Wisconsin Supreme Court has held that a religious organization that sells tangible personal property is not a retailer subject to the sales tax if the sales are not mercantile in nature. This bill subjects a retailer to the sales tax regardless of whether the sale is mercantile in nature.

Under current law, a nonprofit organization that sells tangible personal property or services is required to have a seller's permit if it sells property or services on more than 20 days during the year and the gross receipts from such sales exceed $15,000. This bill increases this amount to $25,000.

Under current law, the sales of tangible personal property or taxable services made by a nonprofit organization at an event involving entertainment are subject to the sales tax and the use tax if the organization's payment for the entertainment exceeds $300. This bill increases this amount to $500.

This bill authorizes DOT, DRL, and DWD to provide information, such as names, addresses, and social security numbers, to DOR for the purpose of administering state taxes. The bill also authorizes other state agencies that issue occupational licenses to provide such information to DOR for the purpose of administering state taxes.

Under current law, generally, a license, credential, permit, or certificate (license) issued by the state may be denied or revoked if the person who holds the license is liable for delinquent state taxes. Under current law, DOR certifies to the Wisconsin Supreme Court and to the licensing entity that the license holder or license applicant owes delinquent taxes. The Supreme Court and the licensing entity deny or revoke the license based on DOR's certification. The license holder or applicant is then entitled to a hearing conducted by DOR. If, as a result of the hearing, DOR affirms the person's tax delinquency, the Supreme Court and the licensing entity affirm the license revocation or denial. Then the person may appeal the revocation or denial to the Dane County Circuit Court.

Under this bill, if as a result of a hearing DOR affirms the tax delinquency of a person who has applied for or who holds a license to practice law, the license holder or applicant may appeal DOR's determination to the Dane County Circuit Court. If the Dane County Circuit Court upholds DOR's determination, DOR affirms the person's tax delinquency, and the state Supreme Court decides whether to revoke or deny the license to practice law.

Under current law, a state agency may certify to DOR any debt owed to the agency so that DOR may collect the debt from any tax refund owed to the debtor, but only if the debt has been reduced to a judgment. Under current law, generally, a county or municipality may certify to DOR any debt owed to the county or municipality for a similar collection if the debt has been reduced to a judgment or if the county or municipality has provided the debtor reasonable notice and an opportunity to be heard with regard to the debt.

Under this bill, a state agency may certify to DOR any debt owed to the agency so that DOR may collect the debt from any tax refund owed to the debtor if the debt has been reduced to a judgment or if the state agency has provided the debtor reasonable notice and an opportunity to be heard with regard to the debt.

Under current law, the state imposes a rental vehicle fee of 3 percent of the gross receipts from the rental of automobiles, mobile homes, motor homes, and camping trailers if such vehicles are rented or leased without drivers. This bill increases this rental vehicle fee to 5 percent.

Under current law, a county retains 20 percent of all real estate transfer fees collected by the county and submits the balance to the state. Under this bill, the real estate transfer fees retained by the county that are collected in conjunction with the transfer of real estate in a first class city are transmitted to the first class city.

This bill imposes the sales tax and the use tax on audiovisual works, finished artwork, literary works, and audio works that are delivered electronically to a purchaser.

This bill increases the administrative fees that DOR imposes for the enforcement of intoxicating liquor taxes from three cents per gallon on each gallon of intoxicating liquor subject to taxation to 11 cents per gallon on each gallon of intoxicating liquor subject to taxation.

This bill increases the total amount of the school levy property tax credits in 2007 by $150,000,000, from $469,305,000 to $619,305,000.

transportation

Highways

Under current law, DOT, under specified circumstances, may contract up to $565,480,400 in public debt for the purpose of funding major highway projects, southeast Wisconsin freeway rehabilitation projects, and state highway rehabilitation projects. Prior to July 1, 2005, debt service on this debt is paid from the transportation fund. Beginning on July 1, 2005, debt service on this debt is paid from the general fund.

This bill increases by $250,000,000 this authorized general obligation bonding limit from $565,480,400 to $815,480,400. The bill also creates new general obligation bonding authority for DOT, allowing DOT to contract up to an additional $213,100,000 in public debt for the purpose of funding southeast Wisconsin freeway rehabilitation projects. Debt service on this debt is paid from the transportation fund.

Under current law, the Building Commission may issue revenue bonds for major highway projects and transportation administrative facilities in a principal amount that may not exceed $2,095,583,900. This bill increases the revenue bond limit to $2,516,117,900.

Drivers and motor vehicles

Under current law, any person who obtains a vehicle must obtain a certificate of title. If a person obtains a vehicle from a motor vehicle dealer, the dealer must prepare the application for certificate of title, collect the application fees, and submit the application to DOT within seven business days of the sale.

Under this bill, all motor vehicle dealers must process applications for certificate of title electronically. A dealer who fails to do so may have its license revoked or suspended by DOT. In addition, this bill increases the fee for a new certificate of title or a certificate of title after transfer from $18.50 to $28.50 and increases the fee for a replacement certificate of title from $8 to $20.

Under current law, a person pays a $55 annual fee to DOT to register his or her automobile. The fee for a motor truck or dual purpose motor home varies depending on the vehicle's weight. This bill increases the annual fee for registering an automobile from $55 to $65 and increases the annual fees for registering a motor truck or dual purpose motor home.

Under current law, DOT must revoke a person's motor vehicle operating privilege for five years if the person is a habitual traffic offender. A person is a habitual traffic offender if the person, within a five-year period, has accumulated at least four convictions of specified offenses of a more serious nature or at least 12 convictions of moving violations of traffic regulations or of specified crimes related to the operation of a motor vehicle.

Under this bill, a habitual traffic offender is a person who, within a five-year period, has accumulated at least four convictions of specified offenses of a more serious nature or at least 12 convictions of violations of those laws, punishable by either civil or criminal penalty, that relate to rules of the road.

This bill allows DOT to certify driver records electronically as public records qualifying for self-authentication in court if the electronic certification is made in a manner determined by DOT to satisfactorily support a finding that the document is what it purports to be. Accordingly, driver records may be self-authenticating by certification generated by a DOT computer system rather than a DOT employee.

Current law requires DOT to establish new designs for most vehicle registration plates every seven years and to issue the new plates on a rolling basis as vehicle registrations are renewed by the vehicle owners. This bill eliminates the requirement that DOT establish new designs for registration plates.

Under current law, a person may purchase a specialized registration plate for his or her motor vehicle by paying an additional fee. This bill creates a specialized registration plate for persons who are interested in supporting veterans. The bill requires DOT to deposit all of the additional fees collected for specialized registration plates that are related to veterans or the armed forces into the veterans trust fund. The bill specifies that the additional fee assessed for these specialized plates may be claimed as a tax-deductible charitable contribution.

Under current law, a registrant is required to pay an environmental impact fee of $9 upon registering a new motor vehicle with DOT or upon applying for a new certificate of title following a transfer of a vehicle. The environmental impact fees are earmarked for environmental management activities. The fee expires on December 31, 2005. This bill eliminates the expiration date.

Current law prohibits a person from operating a motor vehicle on the highway during any period in which the person's motor vehicle operating privilege is revoked. A person convicted of violating this prohibition on or after May 1, 2002, is subject to a criminal penalty and must be fined not more than $2,500 or imprisoned for not more than one year or both.

This bill decriminalizes the first offense of operating a vehicle while revoked and requires a person to forfeit not more than $600 if the underlying operating privilege revocation did not result from specified alcohol or controlled substance-related traffic violations.

Transportation aids

Under current law, DOT makes a general transportation aid payment to a county based on a share-of-costs formula, and to a village, city, or town (municipality) based on the greater of a share-of-costs formula or an aid rate per mile, which is $1,825. This bill increases the aid rate per mile to $1,862 for 2006 and $1,899 thereafter.

The bill also increases the maximum amount of general transportation aids that may be paid to counties from $90,044,600 in any year to $91,845,500 in 2006 and $93,682,400 thereafter. The bill also increases the maximum amount of aid that may be paid to municipalities from $283,291,100 in any year to $286,124,000 in 2006 and $297,736,000 thereafter.

Under current law, DOT provides state aid, for each of four classes of mass transit systems, to local public bodies in urban areas served by mass transit systems to assist with their costs. This bill increases in 2006 and 2007 the total amount of state aid to each class of mass transit system.

Other transportation

This bill transfers from the transportation fund to the general fund $250,000,000 in fiscal year 2005-06 and $18,058,100 in fiscal year 2006-07.

Under current law, DOT collects a supplemental vehicle title fee and the Department of Commerce collects a supplemental manufactured home title fee. These fees are deposited into the transportation fund. By October 1 of each year, DOT must certify to DOA the amount of these fees collected during the previous fiscal year and that amount, minus $555,000, is transferred from the general fund to the environmental fund.

Under this bill, this transfer mechanism is eliminated and these fees are deposited directly into the environmental fund for nonpoint source water pollution abatement.

This bill allows DOT, through its Rail Passenger Route Development Program, to fund capital costs related to Amtrak service extension routes or other rail service routes between Chicago and Milwaukee and between Madison and La Crosse.

This bill provides transportation fund moneys for the federal Soo Locks project.

The bill also increases the authorized general obligation bonding limit for the acquisition and improvement of rail property from $32,500,000 to $39,000,000.

This bill increases the authorized general obligation bonding limit from $28,000,000 to $39,400,000 to provide grants for harbor improvements.

Under current law, DOT may award grants to partially reimburse eligible applicants for certain harbor improvements. This bill requires DOT to award a grant of $6,000,000 to a city in northeastern Wisconsin that has a harbor facility for constructing or improving boatlift facilities, and to award a grant of $2,100,000 for a boat slip repair and reconstruction project in northeastern Wisconsin, if certain conditions are met.

veterans and military affairs

Under current law, an eligible veteran may receive a home-improvement loan of up to $25,000 from the Veterans Housing Loan Program. This bill removes the limit on the amount of the loan.

The bill also provides that a person who completes six continuous years under honorable conditions in the national guard or a reserve component of the U.S. armed forces is eligible to receive a housing loan.

Currently, a veteran may receive a housing loan to pay for balances due on a construction or bridge loan or for the payment of a loan if the loan's balance does not exceed the amount requested in the veteran's prior loan application and the debt was incurred after the veteran made an application for a loan that was denied by DVA. This bill allows the use of a housing loan to refinance the balance due on any indebtedness as long as the previous loan was obtained for the same purposes as the program.

Under current law, DVA may lend a veteran, a veteran's unremarried surviving spouse, or a deceased veteran's child up to $25,000 for any use, but the loan must be repaid within ten years. This bill authorizes DVA to adjust the maximum term of the loan based upon financial market conditions, funds available, needs of the trust fund, and other relevant factors.

Under the current part-time classroom study program, DVA reimburses veterans for costs associated with correspondence courses and classroom study at proprietary schools, schools approved for the training of veterans, and institutions of higher education. Under the current tuition reimbursement program, DVA reimburses tuition to veterans who are enrolled as undergraduates for at least 12 credits during a semester. To be eligible for the tuition reimbursement program, the veteran must begin the course within ten years after leaving active service, and the annual income of the veteran and the spouse may not exceed $50,000 plus $1,000 for each dependent in excess of two dependents. Reimbursement is limited to 120 credits or eight full semesters at an institution of higher education or 60 credits or four semesters if the institution provides a degree after the completion of 60 credits.

Under the part-time classroom study program, reimbursement is limited to tuition paid for taking fewer than 12 credits if an undergraduate, or fewer than nine credits if a graduate student, for attending a summer session or for taking a correspondence class. The reimbursement amount and income eligibility are the same as for the full-time tuition reimbursement program. A veteran with a master's degree is not eligible for reimbursement.

This bill combines these two programs and makes the following changes in the new, combined program:

1. Eligibility is limited to a veteran whose annual income combined with his or her spouse's income is less than the median household income for the state.

2. Veterans with undergraduate degrees are not eligible.

3. If funds are insufficient to reimburse all of the veterans who apply, DVA may reduce the reimbursement percentage, except for courses taken by certain disabled veterans.

4. Reimbursement is limited to 30 credits if the veteran served on active duty for 90 to 180 days, 60 credits if the veteran served for 181 days to 730 days, and 120 credits if the veteran served more than 730 days.

5. The limit on reimbursement to courses taken within ten years after leaving service does not apply to up to 60 credits of part-time classroom study courses.

Under current law, DVA may grant aid to any incapacitated veteran or dependent of a veteran in an amount that DVA determines is necessary to prevent want or distress. The aid may be paid for no more than three months in any 12-month period. Currently, DVA may grant temporary health care aid to a veteran or dependent of a veteran to meet medical or hospital bills. The amount of aid is limited to $5,000 in any 12-month period and may be used to provide for the treatment of alcoholism or other drug addiction.

Under this bill, the aid is limited to incapacitated veterans and the maximum amount is $2,000 in a 12-month period. The bill limits the payment for health care assistance to dental, vision, and hearing care, with a limit in a 12-month period of $2,500 for dental care, $500 for vision care, and $1,500 for hearing care. The bill places a lifetime limit of $5,000 on the amount that a veteran may receive under the program.

Current law prohibits the admission of surviving spouses or parents of veterans to the southeastern facility for veterans at Union Grove, but permits the admission of these persons to the Wisconsin Veterans Home at King if the Board of Veterans Affairs determines that the home's overall occupancy level is below an optimal level.

This bill allows surviving spouses or parents of veterans to be admitted to the southeastern facility for veterans at Union Grove under the same standard that is used for admission to the Wisconsin Veterans Home at King.

This bill raises the maximum amount of grants that DVA may award to the governing bodies of federally recognized American Indian tribes and bands from $2,500 to $10,000 for the purpose of employing tribal veterans' service officers.

Under current law, DVA coordinates the provision of military honors funerals to deceased veterans by members of local veterans organizations and the national guard. As part of that program, DVA reimburses the local veterans organization an amount not to exceed $50 for its costs in providing the military honors funeral. This bill eliminates reimbursement for such costs.

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.

Because this bill creates a new crime or revises a penalty for an existing crime, the Joint Review Committee on Criminal Penalties may be requested to prepare a report concerning the proposed penalty and the costs or savings that are likely to result if the bill is enacted.

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:

AB100, s. 1 Section 1. 13.101 (6) (a) of the statutes, as affected by 2003 Wisconsin Act 64, is amended to read:

AB100,54,21 13.101 (6) (a) As an emergency measure necessitated by decreased state revenues and to prevent the necessity for a state tax on general property, the committee may reduce any appropriation made to any board, commission, department, or the University of Wisconsin System, or to any other state agency or activity, by such amount as it deems feasible, not exceeding 25% of the appropriations, except appropriations made by ss. 20.255 (2) (ac), (af), (bc), (bh), (cg), (cr), and (r), and (qr), 20.395 (1), (2) (cq), (eq) to (ex) and (gq) to (gx), (3), (4) (aq) to (ax), and (6) (af), (aq), and (ar), and (au), 20.435 (6) (a) and (7) (da), and 20.445 (3) (a) and (dz) or for forestry purposes under s. 20.370 (1), or any other moneys distributed to any county, city, village, town, or school district. Appropriations of receipts and of a sum sufficient shall for the purposes of this section be regarded as equivalent to the amounts expended under such appropriations in the prior fiscal year which ended June 30. All functions of said state agencies shall be continued in an efficient manner, but because of the uncertainties of the existing situation no public funds should be expended or obligations incurred unless there shall be adequate revenues to meet the expenditures therefor. For such reason the committee may make reductions of such appropriations as in its judgment will secure sound financial operations of the administration for said state agencies and at the same time interfere least with their services and activities.

AB100, s. 2 Section 2. 13.101 (13) of the statutes is repealed.

AB100, s. 3 Section 3. 13.121 (1) of the statutes is amended to read:

AB100,55,5 13.121 (1) Current member. From the appropriation under s. 20.765 (1) (a) or (b) or (5), each member of the legislature shall be paid, in equal installments, the salary provided under s. 20.923.

AB100, s. 4 Section 4. 13.123 (1) (c) of the statutes is amended to read:

AB100,55,15 13.123 (1) (c) Each member shall certify to the chief clerk of the house in which the member serves, as promptly as may be following the 1st of each month, the number of days during the previous calendar month on which the member was in Madison on legislative business and for which the member seeks the allowance provided by this subsection. Such allowances shall be paid from the appropriation under s. 20.765 (1) (a) or (b) or (5) within one week after each calendar month; and shall be paid, upon the filing with the department of administration, the chief clerk's affidavit stating the number of days in Madison on legislative business for all members of the chief clerk's house.

AB100, s. 5 Section 5. 13.123 (2) (intro.) of the statutes is amended to read:

AB100,56,4 13.123 (2) Interim expenses. (intro.) From the appropriation under s. 20.765 (1) (a) or (b) or (5), each member of the legislature shall be entitled to an expense allowance for postage and clerical assistance for each full calendar month during which the legislature is in actual session 3 days or less. No allowance is payable to a representative to the assembly unless the speaker of the assembly files with the chief clerk of the assembly a written authorization for the allowance to be paid. No allowance is payable to a senator unless the majority leader of the senate files with the chief clerk of the senate a written authorization for the allowance to be paid. An authorization filed under this subsection becomes effective for the month in which it is filed and continues in effect through the month in which the speaker of the assembly or the majority leader of the senate files a written revocation of the authorization with the chief clerk of the appropriate house. The rate of such allowance shall be as follows:

AB100, s. 6 Section 6. 13.123 (3) (a) of the statutes is amended to read:

AB100,56,15 13.123 (3) (a) Any senator authorized by the committee on senate organization to attend a meeting outside the state capital, any representative to the assembly authorized by the committee on assembly organization to attend an out-of-state meeting or authorized by the speaker to attend a meeting within this state outside the state capital, and all members of the legislature required by law, legislative rule, resolution or joint resolution to attend such meetings, shall be paid no additional compensation for such services but shall be reimbursed for actual and necessary expenses from the appropriation under s. 20.765 (1) (a) or (b) or (5), but no legislator may be reimbursed under this subsection for expenses on any day for which the legislator submits a claim under sub. (1).

AB100, s. 7 Section 7. 13.125 of the statutes is amended to read: