2005 - 2006 LEGISLATURE
February 7, 2006 - Introduced by Representatives Gunderson, Freese, Staskunas,
Albers, Fields, Hines, Jeskewitz, Musser, Nischke, Ott, Owens, Petrowski,
Townsend, Vos and
Zepnick, cosponsored by Senators Roessler, Kedzie,
Cowles, Schultz, Darling, Grothman, Harsdorf and Wirch. Referred to
Committee on Natural Resources.
AB999,2,8
1An Act to repeal 292.15 (2) (at), 292.15 (2) (d), 292.15 (6) (b), 292.31 (1) (a) 2.,
2292.31 (1) (c), 292.31 (3) (cm) and 292.31 (5);
to renumber 292.15 (6) (a);
to
3renumber and amend 66.1106 (13);
to amend 66.1106 (1) (c), 66.1106 (1) (e),
466.1106 (1) (f), 66.1106 (1) (g), 66.1106 (1) (i), 66.1106 (1) (k), 66.1106 (2) (a),
566.1106 (4) (intro.), 66.1106 (4) (b), 66.1106 (7) (a), 66.1106 (7) (d) 1., 66.1106 (9),
666.1106 (10) (title), 66.1106 (10) (a), 66.1106 (10) (b), 66.1106 (13) (title), 74.23
7(1) (b), 74.25 (1) (b) 1., 74.25 (1) (b) 2., 74.30 (1) (i), 74.30 (1) (j), 74.30 (2) (b),
879.095 (1) (c), 79.095 (2) (b), 227.01 (13) (zc), 234.01 (4n) (a) 3m. a., 292.15 (2)
9(c), 292.15 (2) (e), 292.15 (3), 292.21 (1) (c) 2. g., 292.31 (1) (title), 292.31 (1) (a)
103., 292.31 (1) (a) 4., 292.31 (1) (b) 1., 292.31 (2) (intro.), 292.31 (2) (a), 292.31 (3)
11(c), 292.31 (3) (d), 292.31 (4), 292.57 (title) and 292.57 (2) (a);
to repeal and
12recreate 292.31 (1) (a) (title) and 292.31 (1) (a) 1.; and
to create 66.1106 (1)
13(fm), 66.1106 (1) (je), 66.1106 (1m), 66.1106 (10) (c), 66.1106 (10) (d), 66.1106 (10)
14(e), 66.1106 (11), 66.1106 (12), 66.1106 (13) (b), 292.12, 292.15 (2) (ae) 7., 292.15
1(2) (b) 5., 292.15 (7) (d), 292.15 (7) (e) and 292.23 of the statutes;
relating to:
2identification and cleanup of properties that are environmentally
3contaminated; properties with residual contamination; modifying the
4environmental remediation tax incremental financing program; exempting
5local governmental units from solid waste management standards with respect
6to certain properties; the liability of certain persons for environmental
7contamination on property on which a cleanup has been conducted; and
8granting rule-making authority.
Analysis by the Legislative Reference Bureau
Property with residual contamination after a cleanup
Current law generally requires a person who possess or controls a hazardous
substance that is discharged into the environment, including the person who owns
the property on which the discharge occurred, or who causes a discharge to restore
the environment to the extent practicable and to minimize the harmful effects of the
discharge on the environment. The Department of Natural Resources (DNR) usually
has jurisdiction over the cleanup of hazardous substance discharges. The
Department of Commerce has jurisdiction over the cleanup of some petroleum
product discharges and the Department of Agriculture, Trade and Consumer
Protection (DATCP) has jurisdiction over the cleanup of some discharges of
agricultural chemicals.
This bill authorizes the agency with administrative authority over the site of
a discharge of a hazardous substance (DNR, the Department of Commerce, or
DATCP, depending on the type of site) to impose requirements as a condition of
approving a cleanup if residual contamination remains on the site. The agency may
do any of the following:
1. Require maintenance of an engineering control, such as a soil cover, that is
needed to prevent or minimize the spread of the contamination.
2. Require an investigation and the performance of any needed cleanup if a
building is removed that prevented a complete investigation or cleanup of
contamination on the site.
3. Impose limitations or other conditions related to property to ensure the
continued protection of public health, safety, and welfare and the environment and
to promote economic development.
The bill requires DNR to maintain a database of sites for which a cleanup has
been approved but that have residual contamination. DNR must list each of those
sites in the database and must include any requirements imposed by the agency with
jurisdiction over a site. A person requesting approval of a cleanup must pay a fee to
have the site listed in the database.
The bill also requires a person who applies for approval of a cleanup that leaves
residual contamination on property that is not owned by the person to notify the
owner of the property about the residual contamination.
A person who violates the requirements imposed under this bill is subject to a
civil forfeiture of $10 to $5,000 for each day of violation.
Environmental remediation tax incremental financing
This bill modifies the environmental remediation tax incremental financing
program. Under current law, the environmental remediation tax incremental
financing program permits a city, village, town, or county (political subdivision) to
defray the costs of remediating contaminated property that is owned by the political
subdivision. The mechanism for financing costs that are eligible for remediation is
very similar to the mechanism under the tax incremental financing (TIF) program.
If the remediated property is transferred to another person and is then subject to
property taxation, environmental remediation 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.
A political subdivision that has incurred "eligible costs" to remediate
environmental pollution on a parcel of property may apply to the Department of
Revenue (DOR) to certify the "environmental remediation tax incremental base" of
the parcel. DOR is required to certify the environmental remediation tax
incremental base if the political subdivision submits to DOR all of the following: 1)
a statement that the political subdivision has incurred some eligible costs, together
with a detailed proposed remedial action plan approved by DNR that contains cost
estimates for anticipated eligible costs, a schedule for the design and implementation
that is needed to complete the remediation, and certification from DNR that it has
approved the site investigation report that relates to the parcel; 2) a statement that
all taxing jurisdictions with authority to levy general property taxes on the parcel
of property have been notified that the political subdivision intends to recover its
environmental remediation costs by using an "environmental remediation tax
increment"; and 3) a statement that the political subdivision has attempted to
recover its environmental remediation costs from the person who is responsible for
the environmental pollution that is being remediated.
This bill makes technical changes to the environmental remediation tax
incremental financing program. These changes include the following:
1. Creating a definition of "environmental remediation tax incremental
district" (ERTID) that is somewhat similar to the definition of "tax incremental
district" under the TIF program and creating a definition of "project expenditures",
which means "eligible costs" and other costs incurred by a political subdivision in
creating an operating an ERTID.
2. Making changes to the definitions of "environmental remediation tax
increment," "environmental remediation tax incremental base," "period of
certification," and "taxable property." The bill increases the period of certification,
and an ERTID's maximum life, from 16 to 23 years.
3. Adding to the definition of "eligible costs" the cancellation of unrecovered
delinquent property taxes.
4. Creating procedures for the termination of an ERTID that are similar to the
termination procedures for a tax incremental district under the TIF program.
5. Prohibiting DOR from certifying the environmental remediation tax
incremental base of an ERTID if a political subdivision does not send DOR certain
required forms within 180 days of the ERTID's termination.
6. Requiring that the final report under the program include an independent
certified financial audit.
7. Requiring that DOR be provided with a final accounting of the ERTID's
project expenditures and the final amount of eligible costs that have been paid for
an ERTID.
8. Modifying certain provisions of the program to apply to contiguous parcels
of property or land, as well as a parcel of property or land.
9. Authorizing DOR to charge a $1,000 fee to determine or redetermine the tax
incremental base of an ERTID.
Also under the bill, if a city or village annexes property from a town that is using
an ERTID to remediate environmental pollution on all or part of the territory that
is annexed, the city or village must pay to the town that portion of the eligible costs
that are attributable to the annexed territory. The city or village, and the town, must
negotiate an agreement on the amount that must be paid.
The ERTID provisions in the bill take effect on October 1, 2006, and first apply
to an ERTID that is in existence or that is created on that date.
Local governmental exemption from solid waste management standards
Current law generally requires a person who possesses or controls a hazardous
substance that is discharged or who causes the discharge of a hazardous substance
to restore the environment to the extent practicable and to minimize the harmful
effects of the discharge on the environment. Current law generally exempts a local
governmental unit from these clean-up requirements with respect to hazardous
substance discharges on property acquired in specified ways, such as through tax
delinquency proceedings and condemnation.
This bill provides that a local governmental unit is exempt from solid waste
management standards and other legal requirements relating to solid waste for a
property that was acquired in a way that would qualify for the exemption from
clean-up requirements, with a number of exceptions and conditions. The exemption
from solid waste requirements does not apply to a solid waste facility that was
operated by the local governmental unit or owned by the local governmental unit
while it was operated or to landfills that were once licensed by DNR. The bill requires
a local governmental unit to obtain permission from DNR for any construction on the
property and requires the local governmental unit to maintain any health or safety
system on the property, such as a system to collect landfill gas, that DNR required
before the local governmental unit acquired the property.
Voluntary party liability exemption
Under current law, a person, called a voluntary party, who applies for a liability
exemption is exempt from absolute requirements to restore the environment and
minimize the harmful effects of a discharge, and from the requirements of other laws
relating to hazardous substances, if an environmental investigation of the property
is conducted, the property is cleaned up, DNR certifies that the cleanup restored the
environment and minimized the harmful effects of the discharge, and the voluntary
party maintains and monitors the property as required by DNR. Also, under current
law, the voluntary party liability exemption is available even if the cleanup does not
get rid of a substance in groundwater as long as DNR determines that the substance
will naturally break down (attenuate) and, if required by DNR, the voluntary party
obtains insurance to cover the costs of cleanup in case natural attenuation fails.
Under current law, the voluntary party liability exemption is not available for
most sites at which solid waste was disposed of. This bill narrows that exemption
so that only solid waste facilities that were once licensed by DNR are excluded from
the exemption.
In addition this bill provides that, to qualify for the liability exemption for
property on which DNR determines that natural attenuation will successfully
complete the cleanup, a voluntary party who owns the property must provide access
to the property for the purpose of determining whether natural attenuation has
failed and, if so, to allow someone else to clean up the property.
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:
AB999, s. 1
1Section
1. 66.1106 (1) (c) of the statutes is amended to read:
AB999,6,112
66.1106
(1) (c) "Eligible costs" means capital costs, financing costs
, and
3administrative and professional service costs, incurred or estimated to be incurred
4by a political subdivision, for the investigation, removal, containment
, or monitoring
5of, or the restoration of soil, air, surface water, sediments
, or groundwater affected
6by, environmental pollution, including monitoring costs
incurred within 2 years after
7the date on which the department of natural resources certifies that environmental
8pollution on the property has been remediated, cancellation of delinquent taxes if the
9political subdivision demonstrates that it has not already recovered such costs by
10any other means, property acquisition costs, demolition costs including asbestos
11removal, and removing and disposing of underground storage tanks or abandoned
1containers, as defined in s. 292.41 (1)
, except that for. For any parcel of land "eligible
2costs" shall be reduced by any amounts received from persons responsible for the
3discharge, as defined in s. 292.01 (3), of a hazardous substance on the property to pay
4for the costs of remediating environmental pollution on the property, by any amounts
5received, or reasonably expected by the political subdivision to be received, from a
6local, state
, or federal program for the remediation of contamination in the district
7that do not require reimbursement or repayment
, and by the amount of net gain from
8the sale of the property by the political subdivision. "Eligible costs" associated with
9groundwater affected by environmental pollution include investigation and
10remediation costs for groundwater that is located in, and extends beyond, the
11property that is being remediated.
AB999, s. 2
12Section
2. 66.1106 (1) (e) of the statutes is amended to read:
AB999,6,2113
66.1106
(1) (e) "Environmental remediation tax increment" means that
14amount obtained by multiplying the total city, county, school
, and other local general
15property taxes levied on
a parcel of real property that is certified under this section 16taxable property in a year by a fraction having as a numerator the environmental
17remediation value increment for that year
for that parcel in such district and as a
18denominator that year's equalized value of that
parcel
taxable property. In any year,
19an environmental remediation tax increment is "positive" if the environmental
20remediation value increment is positive; it is "negative" if the environmental
21remediation value increment is negative.
AB999, s. 3
22Section
3. 66.1106 (1) (f) of the statutes is amended to read:
AB999,7,423
66.1106
(1) (f) "Environmental remediation tax incremental base" means the
24aggregate value, as equalized by the department, of
a parcel of real taxable property
25that is certified under this section as of the January 1 preceding the date on which
1the
department of natural resources issues a certificate certifying that
2environmental pollution on the property has been remediated in accordance with
3rules promulgated by the department of natural resources environmental
4remediation tax incremental district is created, as determined under sub. (1m) (b).
AB999, s. 4
5Section
4. 66.1106 (1) (fm) of the statutes is created to read:
AB999,7,166
66.1106
(1) (fm) "Environmental remediation tax incremental district" means
7a contiguous geographic area within a political subdivision defined and created by
8resolution of the governing body of the political subdivision consisting solely of whole
9units of property as are assessed for general property tax purposes, other than
10railroad rights-of-way, rivers, or highways. Railroad rights-of-way, rivers, or
11highways may be included in an environmental remediation tax incremental district
12only if they are continuously bounded on either side, or on both sides, by whole units
13of property as are assessed for general property tax purposes which are in the
14environmental remediation tax incremental district. "Environmental remediation
15tax incremental district" does not include any area identified as a wetland on a map
16under s. 23.32.
AB999, s. 5
17Section
5. 66.1106 (1) (g) of the statutes is amended to read:
AB999,7,2418
66.1106
(1) (g) "Environmental remediation value increment" means the
19equalized value of
a parcel of real taxable property that is certified under this section
20minus the environmental remediation tax incremental base. In any year, the
21environmental remediation value increment is "positive" if the environmental
22remediation tax incremental base of the
parcel of
taxable property is less than the
23aggregate value of the
parcel of taxable property as equalized by the department; it
24is "negative" if that base exceeds that aggregate value.
AB999, s. 6
25Section
6. 66.1106 (1) (i) of the statutes is amended to read:
AB999,8,4
166.1106
(1) (i) "Period of certification" means a period of not more than
16 23 2years beginning after the department certifies the environmental remediation tax
3incremental base
of a parcel of property under sub. (4) or a period before all eligible
4costs have been paid, whichever occurs first.
AB999, s. 7
5Section
7. 66.1106 (1) (je) of the statutes is created to read:
AB999,8,86
66.1106
(1) (je) "Project expenditures" means eligible costs and other costs
7incurred by a political subdivision to create and operate an environmental
8remediation tax incremental district.
AB999, s. 8
9Section
8. 66.1106 (1) (k) of the statutes is amended to read:
AB999,8,1110
66.1106
(1) (k) "Taxable property" means all real and personal taxable property
11located in an environmental remediation tax incremental district.
AB999, s. 9
12Section
9. 66.1106 (1m) of the statutes is created to read:
AB999,8,1513
66.1106
(1m) Creation of environmental remediation tax incremental
14districts. In order to implement the provisions of this section, the governing body
15of the political subdivision shall adopt a resolution which does all of the following:
AB999,8,1816
(a) Describes the boundaries of an environmental remediation tax incremental
17district with sufficient definiteness to identify with ordinary and reasonable
18certainty the territory included within the district.
AB999,8,2119
(b) Creates the district as of January 1 of the same calendar year for a
20resolution adopted before October 1 or as of January 1 of the next subsequent
21calendar year for a resolution adopted after September 30.
AB999, s. 10
22Section
10. 66.1106 (2) (a) of the statutes is amended to read:
AB999,9,923
66.1106
(2) (a) A political subdivision that develops, and whose governing body
24approves, a written proposal to remediate environmental pollution may use an
25environmental remediation tax increment to pay the eligible costs of remediating
1environmental pollution on contiguous parcels of property that are located
in an
2environmental remediation tax incremental district within the political subdivision
3and that are not part of a tax incremental district created under s. 66.1105, as
4provided in this section, except that a political subdivision may use an
5environmental remediation tax increment to pay the cost of remediating
6environmental pollution of groundwater without regard to whether the property
7above the groundwater is owned by the political subdivision. No political subdivision
8may submit an application to the department under sub. (4) until the joint review
9board approves the political subdivision's written proposal under sub. (3).
AB999, s. 11
10Section
11. 66.1106 (4) (intro.) of the statutes is amended to read:
AB999,9,2011
66.1106
(4) Certification. (intro.) Upon written application to the department
12of revenue by the clerk of a political subdivision on or before
April 1 of the year
13following the year in which the certification described in par. (a) is received from the
14department of natural resources December 31 of the same calendar year for an
15environmental remediation tax incremental district created before October, as
16determined under sub. (1m) (b), or December 31 of the subsequent calendar year for
17an environmental remediation tax incremental district created after September 30,
18the department of revenue shall certify to the clerk of the political subdivision the
19environmental remediation tax incremental base
of a parcel of real property if all of
20the following apply:
AB999, s. 12
21Section
12. 66.1106 (4) (b) of the statutes is amended to read:
AB999,9,2422
66.1106
(4) (b) The political subdivision submits a statement that all taxing
23jurisdictions with the authority to levy general property taxes on the parcel
or
24contiguous parcels of property have been notified that the political subdivision
1intends to recover the costs of remediating environmental pollution on the property
2and have been provided a statement of the estimated costs to be recovered.
AB999, s. 13
3Section
13. 66.1106 (7) (a) of the statutes is amended to read:
AB999,10,94
66.1106
(7) (a) Subject to pars. (b), (c) and (d), the department shall annually
5authorize the positive environmental remediation tax increment with respect to a
6parcel
or contiguous parcels of property during the period of certification to the
7political subdivision that incurred the costs to remediate environmental pollution on
8the property, except that an authorization granted under this paragraph does not
9apply after the department receives the notice described under sub. (10) (b).
AB999, s. 14
10Section
14. 66.1106 (7) (d) 1. of the statutes is amended to read:
AB999,10,1711
66.1106
(7) (d) 1. The department may not authorize a positive environmental
12remediation tax increment under par. (a) to pay otherwise eligible costs that are
13incurred by the political subdivision after the department of natural resources
14certifies to the department of revenue that environmental pollution on the parcel
or
15contiguous parcels of property has been remediated unless the costs are associated
16with activities, as determined by the department of natural resources, that are
17necessary to close the site described in the site investigation report.
AB999, s. 15
18Section
15. 66.1106 (9) of the statutes is amended to read:
AB999,11,419
66.1106
(9) Separate accounting required. An environmental remediation tax
20increment received with respect to a parcel
or contiguous parcels of land that is
21subject to this section shall be deposited in a separate fund by the treasurer of the
22political subdivision. No money may be paid out of the fund except to pay eligible
23costs for a parcel
or contiguous parcels of land
, or to reimburse the political
24subdivision for such costs
or to satisfy claims of holders of bonds or notes issued to
25pay eligible costs. If an environmental remediation tax increment that has been
1collected with respect to a parcel of land remains in the fund after the period of
2certification has expired, it shall be paid to the treasurers of the taxing jurisdictions
3in which the parcel is located in proportion to the relative share of those taxing
4jurisdictions in the most recent levy of general property taxes on the parcel.
AB999, s. 16
5Section
16. 66.1106 (10) (title) of the statutes is amended to read:
AB999,11,66
66.1106
(10) (title)
Reporting requirements
; notice of district termination.
AB999, s. 17
7Section
17. 66.1106 (10) (a) of the statutes is amended to read:
AB999,11,128
66.1106
(10) (a) Prepare and make available to the public updated annual
9reports describing the status of all projects to remediate environmental pollution
10funded under this section, including revenues and expenditures. A copy of the report
11shall be sent to all taxing jurisdictions with authority to levy general property taxes
12on the parcel
or contiguous parcels of property by May 1 annually.
AB999, s. 18
13Section
18. 66.1106 (10) (b) of the statutes is amended to read:
AB999,11,1514
66.1106
(10) (b) Notify the department within 10 days after the period of
15certification for a parcel
or contiguous parcels of property has expired.
AB999, s. 19
16Section
19. 66.1106 (10) (c) of the statutes is created to read:
AB999,11,2517
66.1106
(10) (c) With regard to an environmental remediation tax incremental
18district, not later than 12 months after the last expenditure is made or not later than
1912 months after an expenditure may be made under sub. (2) (b), whichever comes
20first, prepare and make available to the public a report that is similar to the report
21required under par. (a), except that the report required under this paragraph shall
22also include an independent certified audit of the project to determine if all financial
23transactions were made in a legal manner and to determine if the environmental
24remediation tax incremental district complied with this section. A copy of the report
25shall be sent out to all taxing jurisdictions which received the reports under par. (a).
AB999, s. 20
1Section
20. 66.1106 (10) (d) of the statutes is created to read:
AB999,12,42
66.1106
(10) (d) Not later than 180 days after an environmental remediation
3tax incremental district terminates under sub. (11), provide the department with all
4of the following on a form that is prescribed by the department:
AB999,12,65
1. A final accounting of project expenditures that are made for the
6environmental remediation tax incremental district.