Under one of the current law exceptions, if DOR does not certify a value
increment for a TID as a result of the district's termination, the levy limit otherwise
applicable to the political subdivision is increased by a certain amount.
Under the current law exception to the levy limit relating to DOR not certifying
a value increment for a TID that is terminated, the allowable increase is an amount
equal to the political subdivision's maximum allowable levy for the preceding year,
multiplied by a percentage equal to 50 percent of the amount determined by dividing
the terminated TID's value increment by the political subdivision's equalized value,
as determined by DOR. This bill increases the percentage from 50 percent to 80
percent.
Also under current law, a city, village, or town (municipality) must annually
prepare and make available to the public updated reports describing the status of
each TID that exists in the municipality. Under this bill, the report must describe
the financial status of each existing TID, including an itemized list of prior
expenditures made for the TID and revenues received by the TID, as well as
anticipated future TID-related expenditures and revenues. The bill requires a
municipality to hold a public hearing on the report.
Also under the bill, the annual report that a municipality must prepare must
also include a comparison of the district's total actual expenditures to the total
amount of tax increments received and determine whether these amounts are the
same or if they are out of balance.

Beginning in 2014, the bill also requires a municipality's chief financial officer
to create and distribute annually to the municipality a report card for each TID that
is the subject of an annual report. The report card must evaluate the degree to which
the district's expenditures and tax increments received are balanced, and the
municipality must make the report card available to the public.
Based on the degree to which a TID's expenditures and revenues are balanced,
the bill requires a municipality to issue a report card with a grade of A, B, C, D, or
F. Subject to an exception, if the amount of a TID's expenditures and tax increments
received are balanced, the TID earns an "A." If these amounts are within 5 percent
of being balanced, the TID earns a "B." If they are within 10 percent the TID earns
a "C." If they are within 15 percent the TID earns a "D", and if they are more than
15 percent out of balance, the TID earns an "F." Under the exception, for a TID's first
eight years of life, a municipality's chief financial officer is required to award a "B"
to a district in which the TID's projected expenditures and tax increments received
are in balance with the projections for those items in the TID's project plan. If a TID
does not meet this standard, the TID must be awarded a lower grade.
The project costs of a TID, which are initially incurred by the creating city or
village, include public works such as sewers, streets, and lighting systems; financing
costs; site preparation costs; and professional service costs. DOR authorizes the
allocation of the tax increments until the TID terminates or, generally, 20 years, 23
years, or 27 years after the TID is created, depending on the type of TID and the year
in which it was created. Also under current law, a city or village may not generally
make expenditures for project costs later than five years before the unextended
termination date of the TID. Under certain circumstances, the life of the TID, the
expenditure period, and the allocation period may be extended.
Under this bill, for a TID that has at least a "B" grade in the year in which it
would otherwise be required to terminate, the TID's life may be extended for ten
years, and expenditures may be made for an additional five years, if the planning
commission amends the district's project plan to change the district's boundaries. An
amendment to a TID's project plan is subject to approval by the common council or
village board (governing body), and the joint review board. If the TID's project plan
has already been amended the maximum number of times that are allowable (four
times under current law), the TID's life and expenditure period may still be extended
for ten and five years, respectively, if the joint review board approves a planning
commission request to do so; final approval would still be subject to the current law
provisions for amending a project plan.
This bill creates two new definitions for project costs for a city or village TID.
Under the bill, project costs may include expenses incurred by a city or village to
recruit a new business to locate in a TID, and expenses incurred by the city or village
to remodel the interior space of an existing building located in a TID to make the
space useable for a business.
Currently, before a TID may be created or its project plan amended, the city or
village must adopt a resolution containing a finding that the equalized value of
taxable property of the TID plus the value increment of all existing TIDs does not
exceed 12 percent of the total equalized value of taxable property in the city or village

(the "12 percent test"), subject to one exception. Under the exception, a city or village
may simultaneously create a new TID and subtract territory from an existing TID
without adopting a resolution containing the 12 percent test if the city or village
demonstrates to DOR that the value of the territory that is subtracted at least equals
the amount that DOR believes is necessary to ensure that, when the new TID is
created, the 12 percent test is met. The city or village must also certify to DOR that
no other district created under this exception currently exists in the city or village.
Under this bill, subject to a number of exceptions, if the average grade of all of
the TIDs in a city or village is at least a B in any year, the 12 percent test becomes
a 15 percent test. Under certain circumstances, the 15 percent test may revert back
to a 12 percent test, and this limit may change back and forth depending on a number
of factors related to the average grade of TIDs in the city or village, the creation of
new TIDs, and the equalized value of taxable property of all existing districts within
the city.
The bill also expands the definition of project costs to include a parking
structure that supports redevelopment activities.
For further information see the 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:
AB547,1 1Section 1. 60.85 (8) (c) of the statutes is renumbered 60.85 (8) (c) 1. and
2amended to read:
AB547,4,103 60.85 (8) (c) 1. The town shall prepare and make available to the public updated
4annual reports describing the status of each existing tax incremental district,
5including expenditures and revenues. The town shall send a copy of the report to
6each overlying district by May July 1 annually. Except as provided in subd. 2., the
7report shall also contain the most recent annual budget for each existing tax
8incremental district and an explanation of each district's value increment and how
9the value increment affects property taxes in the district. The town shall also hold
10a hearing on the report.
AB547,2 11Section 2. 60.85 (8) (c) 2. of the statutes is created to read:
AB547,5,4
160.85 (8) (c) 2. A town may decline to include in its report the most recent
2annual budget and the value increment explanation described in subd. 1., except
3that if it does not include the budget the town shall hold a public hearing at which
4each such budget and the value increment explanation is discussed.
AB547,3 5Section 3. 60.85 (8) (d) of the statutes is created to read:
AB547,5,116 60.85 (8) (d) In the annual report described under par. (c), the town shall also
7include an assessment of each existing tax incremental district's performance. The
8assessment shall compare a district's total actual expenditures to the total amount
9of tax increments received and determine whether these amounts are the same or
10if they are out of balance. This assessment shall be completed by the town's chief
11financial officer.
AB547,4 12Section 4. 60.85 (8) (e) of the statutes is created to read:
AB547,5,1713 60.85 (8) (e) Annually, beginning in 2014, the town's chief financial officer shall
14prepare a report card for each tax incremental district for which the town prepares
15a report described under par. (c). The report card shall evaluate each tax incremental
16district based on the degree to which the district's total actual expenditures and total
17tax increments received are balanced or out of balance.
AB547,5 18Section 5. 60.85 (8) (f) of the statutes is created to read:
AB547,5,2519 60.85 (8) (f) The town shall issue a report card as described in par. (e), which
20it shall forward to the town board. The report card shall contain the chief financial
21officer's explanation of the methods and data he or she used to evaluate a tax
22incremental district. The town board shall make the report card and the explanation
23available to members of the public. Subject to par. (g), the town's chief financial
24officer shall award a tax incremental district one of the following grades on its report
25card:
AB547,6,2
11. An "A" if the district's total actual expenditures and total tax increments
2received are balanced.
AB547,6,43 2. A "B" if the district's total actual expenditures and total tax increments
4received are within 5 percent of being balanced.
AB547,6,65 3. A "C" if the district's total actual expenditures and total tax increments
6received are within 10 percent of being balanced.
AB547,6,87 4. A "D" if the district's total actual expenditures and total tax increments
8received are within 15 percent of being balanced.
AB547,6,109 5. An "F" if the district's total actual expenditures and total tax increments
10received are more than 15 percent out of balance.
AB547,6 11Section 6. 60.85 (8) (g) of the statutes is created to read:
AB547,6,1712 60.85 (8) (g) For the first 8 years of a tax incremental district's life, the town's
13chief financial officer shall award a tax incremental district a "B" if the district's
14projected expenditures and tax increments received are in balance with the
15projections for those 2 items, as contained in the district's project plan. The report
16card shall explain how this grade is awarded. A tax incremental district that does
17not meet this standard must be awarded a grade that is less than a "B."
AB547,7 18Section 7. 66.0602 (3) (dm) of the statutes is amended to read:
AB547,7,319 66.0602 (3) (dm) If the department of revenue does not certify a value
20increment for a tax incremental district for the current year as a result of the
21district's termination, the levy increase limit otherwise applicable under this section
22in the current year to the political subdivision in which the district is located is
23increased by an amount equal to the political subdivision's maximum allowable levy
24for the immediately preceding year, multiplied by a percentage equal to 50 80 percent
25of the amount determined by dividing the value increment of the terminated tax

1incremental district, calculated for the previous year, by the political subdivision's
2equalized value for the previous year, all as determined by the department of
3revenue.
AB547,8 4Section 8. 66.1105 (2) (f) 1. o. of the statutes is created to read:
AB547,7,65 66.1105 (2) (f) 1. o. Expenses incurred by the city to recruit a new business to
6locate in the tax incremental district.
AB547,9 7Section 9. 66.1105 (2) (f) 1. p. of the statutes is created to read:
AB547,7,108 66.1105 (2) (f) 1. p. Expenses incurred by the city to remodel the interior space
9of an existing building that is located in the tax incremental district to make the
10space useable for a business.
AB547,10 11Section 10. 66.1105 (2) (f) 2. b. of the statutes is amended to read:
AB547,7,1412 66.1105 (2) (f) 2. b. The Except for a parking structure that supports
13redevelopment activities, the
cost of constructing or expanding any facility, if the city
14generally finances similar facilities only with utility user fees.
AB547,11 15Section 11. 66.1105 (6) (am) 6. of the statutes is created to read:
AB547,7,1716 66.1105 (6) (am) 6. No expenditure may be made later than 5 years before the
17termination date of a tax incremental district to which sub. (7) (av) applies.
AB547,12 18Section 12. 66.1105 (6m) (c) of the statutes is amended to read:
AB547,8,219 66.1105 (6m) (c) The city shall prepare and make available to the public
20updated annual reports describing the financial status of each existing tax
21incremental district, including an itemized list of expenditures paid and revenues
22received in prior years, and anticipated expenditures to be paid, and revenues to be
23received, in future years
. The city shall send a copy of the report to each overlying
24district by May July 1 annually and shall present the report to the common council

1at an open meeting. The city shall also hold a hearing on the report in conjunction
2with the presentation of the report
.
AB547,13 3Section 13. 66.1105 (6m) (d) of the statutes is created to read:
AB547,8,94 66.1105 (6m) (d) In the annual report described under par. (c), the city shall
5also include an assessment of each existing tax incremental district's performance.
6The assessment shall compare a district's total actual expenditures to the total
7amount of tax increments received and determine whether these amounts are the
8same or if they are out of balance. This assessment shall be completed by the city's
9chief financial officer.
AB547,14 10Section 14. 66.1105 (6m) (e) of the statutes is created to read:
AB547,8,1511 66.1105 (6m) (e) Annually, beginning in 2014, the city's chief financial officer
12shall prepare a report card for each tax incremental district for which the city
13prepares a report described under par. (c). The report card shall evaluate each tax
14incremental district based on the degree to which the district's total actual
15expenditures and total tax increments received are balanced or out of balance.
AB547,15 16Section 15. 66.1105 (6m) (f) of the statutes is created to read:
AB547,8,2317 66.1105 (6m) (f) The city shall issue a report card as described in par. (e), which
18it shall forward to the common council. The report card shall contain the chief
19financial officer's explanation of the methods and data he or she used to evaluate a
20tax incremental district. The common council shall make the report card and the
21explanation available to members of the public. Subject to par. (g), the city's chief
22financial officer shall award a tax incremental district one of the following grades on
23its report card:
AB547,8,2524 1. An "A" if the district's total actual expenditures and total tax increments
25received are balanced.
AB547,9,2
12. A "B" if the district's total actual expenditures and total tax increments
2received are within 5 percent of being balanced.
AB547,9,43 3. A "C" if the district's total actual expenditures and total tax increments
4received are within 10 percent of being balanced.
AB547,9,65 4. A "D" if the district's total actual expenditures and total tax increments
6received are within 15 percent of being balanced.
AB547,9,87 5. An "F" if the district's total actual expenditures and total tax increments
8received are more than 15 percent out of balance.
AB547,16 9Section 16. 66.1105 (6m) (g) of the statutes is created to read:
AB547,9,1510 66.1105 (6m) (g) For the first 8 years of a tax incremental district's life, the
11city's chief financial officer shall award a tax incremental district a "B" if the district's
12projected expenditures and tax increments received are in balance with the
13projections for those 2 items, as contained in the district's project plan. The report
14card shall explain how this grade is awarded. A tax incremental district that does
15not meet this standard must be awarded a grade that is less than a "B."
AB547,17 16Section 17. 66.1105 (7) (av) of the statutes is created to read:
AB547,9,2117 66.1105 (7) (av) Notwithstanding the limits specified in pars. (ak) and (am),
18with regard to a district that earns at least a "B" grade on its report card under sub.
19(6m) (f) for the year in which the district would otherwise be required to terminate
20under par. (ak) or (am), 10 years after that otherwise applicable termination date if
21at least one of the following applies:
AB547,9,2322 1. The planning commission adopts an amendment to the district's project plan
23under sub. (4) (h) 1.
AB547,9,2524 2. If the district's project plan has been amended the maximum number of times
25that are authorized under sub. (4) (h) 2., the planning commission adopts a resolution

1requesting that the joint review board authorize an extension of the termination date
2as described in this paragraph and the joint review board authorizes the extension,
3except that the procedure described in this subdivision may not be used more than
4once for that district. If the joint review board authorizes an extension under this
5subdivision, the planning commission may amend the district's project plan under
6sub. (4) (h) 1. as if the district's project plan had not been amended the maximum
7number of times allowed under sub. (4) (h) 2.
AB547,18 8Section 18. 66.1105 (17) (d) of the statutes is created to read:
AB547,10,129 66.1105 (17) (d) Exception based on report card grades. 1. Subject to subds.
102. to 4., if the average grade of all tax incremental districts in a city, under sub. (6m)
11(f), is a "B" in any year, the 12 percent limit under sub. (4) (gm) 4. c. shall be 15
12percent.
AB547,10,1713 2. If the average grade of all tax incremental districts in a city, under sub. (6m)
14(f), is less than a "B" in any year subsequent to a year in which the the 12 percent limit
15becomes 15 percent under subd. 1., the limit shall revert back to 12 percent if the
16equalized value of taxable property of all existing districts within the city is 12
17percent or less of the total equalized value of taxable property within the city.
AB547,10,2118 3. If the average grade of all tax incremental districts in a city, under sub. (6m)
19(f), is less than a "B" in any year subsequent to a year in which the the 12 percent limit
20becomes 15 percent under subd. 1., the limit shall remain at 15 percent if all of the
21following apply:
AB547,10,2522 a. A new district was created in the city, or the project plan of an existing district
23is amended and adds territory to the district, between the time that the limit was
24raised to 15 percent under subd. 1. and the year in which the average grade of all tax
25incremental districts in a city, under sub. (6m) (f), is less than a "B."
AB547,11,3
1b. The equalized value of taxable property of all existing districts within the
2city is more than 12 percent of the total equalized value of taxable property within
3the city.
AB547,11,74 4. If a city's limit under sub. (4) (gm) 4. c. becomes 15 percent under subd. 1.
5and the city creates a new district that increases the equalized value of taxable
6property of all existing districts within the city above the 12 percent limit under sub.
7(4) (gm) 4. c., the limit shall revert to 12 percent if all of the following occur:
AB547,11,128 a. Due to the termination of existing districts or the subtraction of territory
9from an existing district under an amendment to a project plan, the department of
10revenue determines the equalized value of taxable property of all existing districts
11within the city is 12 percent or less than the equalized value of taxable property
12within the city.
AB547,11,1513 b. The average grade of all tax incremental districts in a city, under sub. (6m)
14(f), is less than a "B" in the year in which the determination described in subd. par.
154. a. occurs.
AB547,19 16Section 19. Initial applicability.
AB547,11,1817 (1) The treatment of section 66.0602 (3) (dm) of the statutes first applies to a
18levy that is imposed in December 2013.
AB547,11,1919 (End)
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