LRB-3158/2
MES&PG:wlj:jf
2007 - 2008 LEGISLATURE
September 14, 2007 - Introduced by Representatives Huebsch, J. Fitzgerald and
Rhoades.
AB507,1,9
1An Act to repeal 66.0602 (3) (f) and 66.0602 (7);
to renumber and amend
266.0602 (1) (d) and 66.0602 (3) (e);
to amend 66.0602 (1) (b), 66.0602 (3) (d) 2.,
366.0602 (3) (h) 1., 66.0602 (4) (a), 66.0602 (4) (d), 66.0602 (5), 66.0602 (6) (intro.)
4and 66.0602 (6) (c); and
to create 38.17, 66.0602 (1) (am), 66.0602 (1) (at),
566.0602 (1) (d) 2., 66.0602 (2), 66.0602 (3) (d) 4., 66.0602 (3) (d) 5., 66.0602 (3)
6(e) 1., 66.0602 (3) (e) 2., 66.0602 (3) (e) 3., 66.0602 (3) (e) 6., 66.0602 (3) (e) 7. and
766.0602 (6m) of the statutes;
relating to: modifying and extending local levy
8limits for cities, villages, towns, and counties and creating a levy limit for
9technical college districts.
Analysis by the Legislative Reference Bureau
Until January 1, 2007, the law prohibited a political subdivision (any city,
village, town, or county) from increasing its levy by a percentage that exceeded its
"valuation factor," which was defined as the percentage change in the political
subdivision's equalized value due to new construction, less improvements removed,
but not less than 2 percent. In addition, the calculation of a political subdivision's
levy did not include any tax increment that was generated by a tax incremental
district.
The law contained a number of exceptions to the levy limit for political
subdivisions that transferred the provision of services, for cities or villages that
annexed town territory, for political subdivisions that levied to pay debt service on
debt authorized on or after July 1, 2005, for certain joint fire departments, and for
a county levy that related to a county children with disabilities education board.
Also under the law, a political subdivision's levy limit was increased if the
amount of debt service in the current year exceeded the amount in the prior year for
debt that was approved by the governing body before July 1, 2005. The levy limit
could also have been exceeded if a political subdivision's resolution to do so was
approved in a referendum. If a political subdivision exceeded the levy limit, creating
a "penalized excess," the Department of Revenue (DOR) was required to reduce the
political subdivision's local aid payments in an equal amount. The levy limit applied
only to the 2005 and 2006 levies.
This bill applies the local levy limits to the property tax levies that are imposed
in December 2007 and 2008, modifies the calculation of the limit, and creates a
number of new exceptions to the limit. The bill changes the definition of "valuation
factor" for a municipality (any city, village, or town) by also including in the
calculation 50 percent of the value increment of expired tax incremental districts.
Also under the bill, the base amount of a political subdivision's levy, on which the levy
limit is imposed, is the political subdivision's actual levy for the previous year.
The bill creates several new exceptions to the levy limit for political
subdivisions, including the following: county levies for certain bridge and culvert
construction and repairs; certain levies for fire departments from any combination
of cities, villages, and towns that have entered into a contract to jointly provide fire
protection services; the amount that a county levies for a countywide emergency
medical system; and the amount that a village levies for police services but only in
the year immediately after the year in which the village changes from town to village
status, and only if the town did not have a police force.
Also under the bill, a political subdivision will not be liable for a penalty that
would otherwise be imposed if DOR determines that a taxation district clerk or
county clerk, through mistake or inadvertence, causes a political subdivision's actual
levy in the year before the current year to be different from the amount intended by
the political subdivision's governing body.
The bill establishes a levy limit for technical college districts in 2007 and 2008.
The levy limit is the levy for the previous year multiplied by 1.026. The bill contains
exceptions to the levy limit for districts that transfer the provision of services. The
levy limit may also be exceeded if a technical college district's resolution to do so is
approved in a referendum.
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:
AB507, s. 1
1Section
1. 38.17 of the statutes is created to read:
AB507,3,5
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.
AB507,3,8
6(2) Limit. Except as provided in subs. (3) and (4), no district board may increase
7its levy in 2007 or 2008 to an amount that exceeds its levy for the previous fiscal year
8multiplied by 1.026.
AB507,3,13
9(3) Adjustments. (a) 1. If a district board transfers to another governmental
10unit responsibility for providing any service that it provided in the preceding fiscal
11year, the limit otherwise applicable under sub. (2) in the current fiscal year is
12decreased by the cost that it would have incurred to provide that service, as
13determined by the department of revenue.
AB507,3,1814
2. If a district board increases the services that it provides by adding
15responsibility for providing a service transferred to it from another governmental
16unit that provided the service in the previous fiscal year, the limit otherwise
17applicable under sub. (2) in the current fiscal year is increased by the cost of that
18service, as determined by the department of revenue.
AB507,3,2419
(b) 1. If the amount of debt service for a district board in the preceding fiscal
20year is less than the amount of debt service needed in the current fiscal year, as a
21result of the district board adopting a resolution before July 1, 2007, authorizing the
22issuance of debt, the limit otherwise applicable under sub. (2) for the current fiscal
23year is increased by the difference between the 2 amounts, as determined by the
24department of revenue.
AB507,4,6
12. The limit otherwise applicable under this section does not apply to amounts
2levied by a district board for the payment of any general obligation debt service,
3including debt service on debt issued or reissued to fund or refund outstanding
4municipal obligations, interest on outstanding municipal obligations, or the
5payment of related issuance costs or redemption premiums, authorized on or after
6July 1, 2007, by a referendum and secured by the full faith and credit of the district.
AB507,4,12
7(4) Referendum. (a) 1. A district board may exceed the levy limit under sub.
8(2) if it adopts a resolution to that effect and the resolution is approved in a
9referendum. The resolution shall specify the proposed amount of increase in the levy
10beyond the amount that is allowed under sub. (2), and shall also specify whether the
11proposed amount of increase is for the next fiscal year only or if it will apply on an
12ongoing basis.
AB507,4,1513
2. With regard to a referendum relating to a levy in an odd-numbered year, the
14district board may call a special referendum for the purpose of submitting the
15resolution to the electors of the district for approval or rejection.
AB507,4,1816
3. With regard to a referendum relating to a levy in an even-numbered year,
17the referendum shall be held at the spring primary or election or September primary
18or general election.
AB507,4,2119
(b) The district board shall publish type A, B, C, D, and E notices of the
20referendum under s. 10.01 (2). Section 5.01 (1) applies in the event of failure to
21comply with the notice requirements of this paragraph.
AB507,5,522
(c) The referendum shall be held in accordance with chs. 5 to 12. The district
23board shall provide the election officials with all necessary election supplies. The
24form of the ballot shall correspond substantially with the standard form for
25referendum ballots prescribed by the elections board under ss. 5.64 (2) and 7.08 (1)
1(a). The question shall be submitted as follows: "Under state law, the percentage
2increase in the levy of the .... (name of district) for the next fiscal year, .... (year), is
3limited to ....percent, resulting in a levy of $..... Shall the .... (name of district) be
4allowed to exceed this limit such that the percentage increase for the next fiscal year,
5.... (year), will be ....percent, resulting in a levy of $....?"
AB507,5,116
(d) Within 14 days after the referendum, the district board shall certify the
7results of the referendum to the department of revenue. The limit otherwise
8applicable to the district under sub. (2) is increased for the next fiscal year by the
9amount approved by a majority of those voting on the question. If the resolution
10specifies that the increase is for one year only, the amount of the increase shall be
11subtracted from the base used to calculate the limit for the 2nd succeeding fiscal year.
AB507,5,16
12(5) Penalty. The department of revenue shall notify the board of any amount
13levied by a district board that exceeds the district's limit under this section. The
14board shall reduce the district's state aid under s. 38.28 in the same fiscal year in
15which the excess levy occurred by an amount equal to the amount of the excess levy.
16The amount of the reduction shall lapse to the general fund.
AB507, s. 2
17Section
2. 66.0602 (1) (am) of the statutes is created to read:
AB507,5,2018
66.0602
(1) (am) "Joint fire department" means a joint fire department
19organized under s. 61.65 (2) (a) 3. or 62.13 (2m), or a joint fire department organized
20by any combination of 2 or more cities, villages, or towns under s. 66.0301 (2).
AB507, s. 3
21Section
3. 66.0602 (1) (at) of the statutes is created to read:
AB507,5,2222
66.0602
(1) (at) "Municipality" means a city, village or town.
AB507, s. 4
23Section
4. 66.0602 (1) (b) of the statutes is amended to read:
AB507,6,3
166.0602
(1) (b) "Penalized excess" means the levy over the limit
under sub. (2) 2for the political subdivision, not including any amount that is excepted from the limit
3under subs. (3), (4), and (5).
AB507, s. 5
4Section
5. 66.0602 (1) (d) of the statutes is renumbered 66.0602 (1) (d) (intro.)
5and amended to read:
AB507,6,76
66.0602
(1) (d) (intro.) "Valuation factor" means
a percentage equal to the
7greater of either 2 percent or the percentage
one of the following:
AB507,6,19
81. For a municipality, the sum of the change in the political subdivision's
9January 1 equalized value due to new construction less improvements removed
10between the previous year and the current year,
but not less than 2. Except as
11provided in subs. (3), (4), and (5), no political subdivision may increase its levy in any
12year by a percentage that exceeds the political subdivision's valuation factor. In
13determining its levy in any year, a city, village, or town shall subtract any tax
14increment that is calculated under s. 60.85 (1) (L) or 66.1105 (2) (i) and, if the
15department of revenue does not certify a value increment for a tax incremental
16district for the current year due to the district's termination, 50 percent of the value
17increment of such a district in the municipality, calculated for the previous year; and
18that sum is divided by the municipality's equalized value for the previous year to
19which the levy relates.
AB507, s. 6
20Section
6. 66.0602 (1) (d) 2. of the statutes is created to read:
AB507,6,2321
66.0602
(1) (d) 2. For a county, a percentage equal to the percentage change in
22the county's January 1 equalized value due to new construction less improvements
23removed between the previous year and the current year.
AB507, s. 7
24Section
7. 66.0602 (2) of the statutes is created to read:
AB507,7,7
166.0602
(2) Levy limit. Except as provided in subs. (3), (4), and (5), no political
2subdivision may increase its levy in 2007 or 2008 by a percentage that exceeds the
3political subdivision's valuation factor. The base amount in any year, to which the
4limit under this section applies, shall be the political subdivision's levy for the
5immediately preceding year. In determining its levy in any year, a political
6subdivision shall subtract any tax increment that is calculated under s. 59.57 (3) (a),
760.85 (1) (L), or 66.1105 (2) (i).
AB507, s. 8
8Section
8. 66.0602 (3) (d) 2. of the statutes is amended to read:
AB507,7,159
66.0602
(3) (d) 2. The limit otherwise applicable under this section does not
10apply to amounts levied by a political subdivision for the payment of any general
11obligation debt service, including debt service on debt issued or reissued to fund or
12refund outstanding obligations of the political subdivision, interest on outstanding
13obligations of the political subdivision, or the payment of related issuance costs or
14redemption premiums, authorized on or after July 1, 2005,
and before July 1, 2007, 15and secured by the full faith and credit of the political subdivision.
AB507, s. 9
16Section
9. 66.0602 (3) (d) 4. of the statutes is created to read:
AB507,7,2217
66.0602
(3) (d) 4. If the amount of a lease payment related to a lease revenue
18bond for a political subdivision in the preceding year is less than the amount of the
19lease payment needed in the current year, as a result of the issuance of a lease
20revenue bond before July 1, 2005, the levy increase limit otherwise applicable under
21this section to the political subdivision in the current year is increased by the
22difference between these 2 amounts.
AB507, s. 10
23Section
10. 66.0602 (3) (d) 5. of the statutes is created to read:
AB507,8,524
66.0602
(3) (d) 5. The limit otherwise applicable under this section does not
25apply to amounts levied by a political subdivision for the payment of any general
1obligation debt service, including debt service on debt issued or reissued to fund or
2refund outstanding obligations of the political subdivision, interest on outstanding
3obligations of the political subdivision, or the payment of related issuance costs or
4redemption premiums, authorized by referendum on or after July 1, 2007, and
5secured by the full faith and credit of the political subdivision.
AB507, s. 11
6Section
11. 66.0602 (3) (e) of the statutes is renumbered 66.0602 (3) (e) (intro.)
7and amended to read:
AB507,8,108
66.0602
(3) (e) (intro.) The limit otherwise applicable under this section does
9not apply to
the amount that a county levies in that year for a county children with
10disabilities education board. any of the following:
AB507, s. 12
11Section
12. 66.0602 (3) (e) 1. of the statutes is created to read:
AB507,8,1312
66.0602
(3) (e) 1. The amount that a county levies in that year for a county
13children with disabilities education board.
AB507, s. 13
14Section
13. 66.0602 (3) (e) 2. of the statutes is created to read:
AB507,8,1615
66.0602
(3) (e) 2. The amount that a 1st class city levies in that year for school
16purposes.
AB507, s. 14
17Section
14. 66.0602 (3) (e) 3. of the statutes is created to read:
AB507,8,1918
66.0602
(3) (e) 3. The amount that a county levies in that year under s. 82.08
19(2) for bridge and culvert construction and repair.
AB507, s. 15
20Section
15. 66.0602 (3) (e) 6. of the statutes is created to read:
AB507,8,2221
66.0602
(3) (e) 6. The amount that a county levies in that year for a countywide
22emergency medical system.
AB507, s. 16
23Section
16. 66.0602 (3) (e) 7. of the statutes is created to read:
AB507,9,224
66.0602
(3) (e) 7. The amount that a village levies in that year for police
25protection services, but this subdivision applies only to a village's levy for the year
1immediately after the year in which the village changes from town status and
2incorporates as a village, and only if the town did not have a police force.
AB507, s. 17
3Section
17. 66.0602 (3) (f) of the statutes is repealed.
AB507, s. 18
4Section
18. 66.0602 (3) (h) 1. of the statutes is amended to read:
AB507,9,105
66.0602
(3) (h) 1. Subject to subd. 2., the limit otherwise applicable under this
6section does not apply to the amount that a city, village, or town levies in that year
7to pay for charges assessed by a joint fire department
organized under s. 61.65 (2)
8(a) 3. or 62.13 (2m), but only to the extent that the amount levied to pay for such
9charges would cause the city, village, or town to exceed the limit that is otherwise
10applicable under this section.
AB507, s. 19
11Section
19. 66.0602 (4) (a) of the statutes is amended to read:
AB507,9,2312
66.0602
(4) (a) A political subdivision may exceed the levy increase limit
under
13sub. (2) if its governing body adopts a resolution to that effect and if the resolution
14is approved in a referendum. The resolution shall specify the proposed amount of
15increase in the levy beyond the amount that is allowed
under sub. (2), and shall
16specify whether the proposed amount of increase is for the next fiscal year only or if
17it will apply on an ongoing basis. With regard to a referendum relating to the 2005
18levy,
or any levy in an odd-numbered year thereafter, the political subdivision may
19call a special referendum for the purpose of submitting the resolution to the electors
20of the political subdivision for approval or rejection. With regard to a referendum
21relating to the 2006 levy,
or any levy in an even-numbered year thereafter, the
22referendum shall be held at the next succeeding spring primary or election or
23September primary or general election.
AB507, s. 20
24Section
20. 66.0602 (4) (d) of the statutes is amended to read:
AB507,10,7
166.0602
(4) (d) Within 14 days after the referendum, the clerk of the political
2subdivision shall certify the results of the referendum to the department of revenue.
3The levy increase limit otherwise applicable to the political subdivision
under this
4section is increased in the next fiscal year by the percentage approved by a majority
5of those voting on the question. If the resolution specifies that the increase is for one
6year only, the amount of the increase shall be subtracted from the base used to
7calculate the limit for the 2nd succeeding fiscal year.