Generally, under current law, starting with taxable years that begin on January
1, 1999, 100% of the the gain realized on the sale or transfer of business assets or
assets used in farming to persons who are related to the seller or transferor by blood,
marriage or adoption within the 3rd degree of kinship is exempt from taxation. Also
under current law, if the person who purchases or receives such business assets or
assets used in farming sells or otherwise disposes of the assets within 2 years after
the person purchases or receives the assets, the person is liable for a penalty. The
penalty is equal to the amount of the capital gains exclusion received by the seller
or transferor when the person purchased or received the assets, prorated based on
the number of months the person held the assets. For example, a person who held
the assets for 18 months of the 2-year period during which the penalty applies would
be liable for 25% of the amount of the capital gains exclusion received by the seller
or transferor.

Under the bill, the penalty on the sale or disposal of such assets within 2 years
after the person purchases or receives the assets is equal to the amount of income tax
on the capital gains the original seller or transferor of the assets would have been
liable for if the exemption for sales or transfers to a person who is related to the seller
or transferor by blood, marriage or adoption within the 3rd degree of kinship did not
exist. The proration provision of the current law penalty provision is not changed
under the bill.

Under current law, a group health benefit plan, which is a health benefit plan
that is issued to an employer on behalf of a group that consists of at least 2 employes,

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may not impose a preexisting condition exclusion related to pregnancy as a
preexisting condition. The bill qualifies that requirement by specifying that the
preexisting condition exclusion related to pregnancy may not be imposed for the
purpose of coverage of expenses related to prenatal and postnatal care, delivery and
complications of pregnancy.

Under current law, the department of transportation (DOT) administers a
transportation infrastructure loan program, under which DOT makes loans for
highway projects or transit capital improvement projects. The loans are paid from
the segregated transportation infrastructure loan fund (loan fund). That segregated
fund is capitalized with federal moneys and state moneys in matching amounts
required by the federal government as a condition of receiving these federal moneys.
The joint committee on finance is specifically authorized to transfer state moneys
from the segregated transportation fund to the loan fund in amounts not to exceed
the amounts necessary to match the federal funds received. The joint committee on
finance is also generally authorized to supplement appropriations and to transfer
moneys between appropriations.

The bill specifies that the authority of the joint committee on finance to transfer
state moneys to the loan fund is limited to transfers of moneys from the
transportation fund to the loan fund only in amounts not to exceed the amounts
necessary to match federal funds received, and that the joint committee on finance
may not exercise its general authority to make such transfers.

Current law also generally prohibits DOT from encumbering or expending any
moneys on a project for which a loan is made under the transportation infrastructure
loan program. The bill eliminates this prohibition.

Under current law, no employe of the department of revenue (DOR) who
performs any duty related to the state lottery or the executive assistant or the
secretary or deputy secretary of revenue may do any of the following:

1. Have a direct or indirect interest in, or be employed by, any vendor while
serving as a DOR employe performing any duty related to the state lottery or as the
executive assistant or as secretary or deputy secretary of revenue or for 2 years
following the person's termination of service.

2. Have a direct or indirect interest in or be employed by a business which has
entered into a lottery retailer contract.

3. Accept or agree to accept money or any other thing of value from any vendor,
retailer or person who has submitted a bid, proposal or application to be a lottery
vendor or lottery retailer.

In addition, no DOR employe who performs any duty related to the state lottery
or the executive assistant or the secretary or deputy secretary of revenue and no
member of such a person's immediate family may purchase a lottery ticket or lottery
share.

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The bill narrows the application of these restrictions from applying to all DOR
employes who perform any duty related to the state lottery to only employes in the
lottery division of DOR.

The bill makes a technical change that indicates the indexing of certain
elements of the mining tax has occurred since 1983.

Under current law, the department of health and family services (DHFS) may
not license a person to operate certain facilities that provide care for children or
adults (entities), for example, child caring institutions, group homes, foster homes,
day care centers, community-based residential facilities and nursing homes, if
DHFS knows or should know that the person has been convicted of, or has pending
against him or her a charge for, a serious crime, as defined by DHFS by rule, that the
person has been found to have abused or neglected a client or a child or to have
misappropriated the property of a client or, if the person must be credentialed by the
department of regulation and licensing (DORL), that the person's credential is not
current or is limited so as to prevent the person from providing adequate care to a
client, unless the person demonstrates that he or she has been rehabilitated.
Similarly, under current law, an entity may not hire or contract with a person who
will be under the entity's control and who is expected to have access to the entity's
clients and may not permit to reside at the entity a person who is expected to have
access to the entity's clients if the entity knows or should know that any of those
conditions apply to that person, unless the person demonstrates that he or she has
been rehabilitated. Current law requires DHFS to obtain, with respect to a person
applying for a license to operate an entity, and an entity to obtain, with respect to a
prospective employe, contractor or resident, a criminal history search, information
contained in the client abuse registry maintained by DHFS, information maintained
by DORL regarding the status of the person's credentials, if applicable, and
information maintained by DHFS regarding any substantiated reports of child
abuse or neglect against the person (criminal history search and abuse record law).

The bill makes all of the following changes relating to the criminal history and
abuse record search law:

1. Extends the applicability of the law to prohibiting DHFS not only from
licensing, but also from certifying or registering a person to operate an entity if the
person is a person who may not be licensed under current law.

2. Limits the application of the law to children and adults who receive direct
care or treatment services from an entity and to entities that are licensed or certified
by, or registered with, but not otherwise regulated by, DHFS to provide direct care
or treatment to clients. The bill also excludes public health dispensaries from
coverage under the law.

3. Requires DHFS, in defining by rule "serious crime" for purposes of the law,
to include in that definition not only crimes involving abuse or neglect of a client for
which a person may not demonstrate that he or she has been rehabilitated, but also

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crimes involving misappropriation of the property of a client or abuse or neglect of
a client for which a person may demonstrate that he or she has been rehabilitated.
The bill also requires DHFS to establish a separate list of crimes or acts involving
abuse or neglect of a client for which no person may demonstrate that he or she has
been rehabilitated. Under current law, the list of offenses for which no person may
demonstrate that he or she has been rehabilitated is limited to certain offenses listed
in the statutes.

4. Requires an entity to report to DHFS, for inclusion in the client abuse
registry, and to report to DORL, for purposes of credentialing a person,
misappropriation only of a client's property, and not of any property, by a person
employed by or under contract with the entity.

5. Transfers from the entity to DHFS the responsibility for investigating the
background of a resident or prospective resident of the entity who is expected to have
access to the entity's clients.

6. Includes among the information that DHFS must obtain in investigating the
background of a person applying for a license, certification or registration to operate
an entity for the care of adults and of a prospective resident of an entity and that an
entity providing care for adults must obtain in investigating the background of a
prospective employe or contractor, information regarding any previous denials of a
license, certification or registration or of employment, a contract or permission to
reside at an entity for a reason specified under current law. Under current law,
DHFS must obtain that information with respect to a person applying for a license
to operate an entity to provide care for children, but not for adults, and an entity that
provides care for children, but not for adults, must obtain that information with
respect to a prospective employe, contractor or resident.

7. Requires an entity, which under current law may obtain the information
required under current law with respect to a person from another entity or from a
temporary employment agency if the other entity or temporary employment agency
has already obtained that information with respect to that person within the last 4
years, to obtain updated information with respect to that person if the entity has
reasonable grounds to believe that the information obtained from the other entity or
temporary employment agency is no longer accurate.

Under current law, certain specified services under the medical assistance
program are not subject to recipient cost sharing or "copayments", including
specialized medical vehicle services (SMV services). The budget act reduced medical
assistance benefits funding to reflect benefit savings from the creation of a
copayment for SMV services, but did not amend the statutory prohibition on
copayments for SMV services. The bill removes that statutory prohibition.

Under current law, state fish hatcheries, the propagation, transportation and
transplanting of fish by the department of natural resources (DNR), the removal of
deleterious fish by DNR, the transportation of fish in or out of the state by other

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states or by the federal government and the transportation and sale of fish by any
person are exempt from any law that protects wild animals. The bill limits this
exemption for the transportation and sale of fish to those fish that are raised on fish
farms.

Currently, a person who is found by a jury or a judge to be be a sexually violent
person must be committed to the custody of DHFS for control, care and treatment.
A sexually violent person is a person who has committed certain sexually violent
offenses and who is dangerous because he or she suffers from a mental disorder that
makes it substantially probable that the person will engage in acts of sexual violence.
A person found to be a sexually violent person must be committed either to
institutional care or for supervised release to the community. A person initially
committed to institutional care is placed in a mental health facility by DHFS, but the
person may later be given supervised release if it is no longer substantially probable
that the person will engage in acts of sexual violence if he or she is not confined in
a mental health unit or facility.

Generally, if a sexually violent person is given supervised release, the social
services department of the person's county of residence must prepare a plan
identifying the treatment and services the person will receive in the community. If
the county of residence declines to prepare such a plan, DHFS must try to arrange
for another county to prepare a plan for the person and accept the supervision and
residence of the person.

However, if DHFS cannot get another county to prepare a plan, the court must
designate a county to prepare a plan and place the person on supervised release in
that county, except that the court may not designate the county where the facility in
which the person was committed for institutional care is located unless that county
is also the person's county of residence.

The bill provides that if a sexually violent person is being given supervised
release and the court must designate a county to prepare a plan for and accept the
supervision and residence of the person, the court may not designate any county
where there is a facility in which persons are placed after being committed to
institutional care for being a sexually violent predator, regardless of whether the
person was actually placed in the facility of that county, unless that county is the
person's county of residence.

The budget act eliminated the Wisconsin works health plan. The bill eliminates
cross-references to the Wisconsin works health plan that erroneously remained in
the budget act.

The bill also transfers 2 full-time general program revenue positions in DHFS
from the subunit of DHFS primarily concerned with general administration to the
subunit of DHFS primarily concerned with health services planning, regulation and
delivery.

Under the current tax incremental financing (TIF) program, a city or village
may create a tax incremental district (TID) in part of its territory to foster
development if at least 50% of the area to be included in the TID is blighted, in need
of rehabilitation or suitable for industrial sites. Before a city or village may create
a TID, several steps and plans are required. These steps and plans include public
hearings on the proposed TID, preparation and adoption by the local planning
commission of a proposed project plan for the TID, approval of the proposed project
plan by the common council or village board and creation by the city or village of a
joint review board to review the proposal. The joint review board, which is made up
of representatives of the overlying taxing jurisdictions of the proposed TID, must
approve the project plan or the TID may not be created. If an existing TID project
plan is amended by a planning commission, these steps are also required.

Also under current law, once a TID has been created, DOR calculates the "tax
increment base value" of the TID, which is the equalized value of all taxable property
within the TID at the time of its creation. If the development in the TID increases
the value of the property in the TID above the base value, a "value increment" is
created. That portion of taxes collected on the value increment in excess of the base
value is called a "tax increment". The tax increment is placed in a special fund that
may only be used to pay back the costs of the TID. The 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 23 years, or 27 years in certain cases, after the TID is created,
whichever is sooner. TIDs are required to terminate, under current law and with one
exception, once these costs are paid back, 16 years, or 20 years in certain cases, after
the last expenditure identified in the project plan is made or when the creating city
or village dissolves the TID, whichever occurs first. Current law also provides that
in general, unless the project plan is amended, no expenditure of tax increments may
be made later than 7 years, or 10 years in certain cases, after the TID is created. In
no event, however, may the total number of years during which expenditures are
made plus the total number of years during which tax increments are allocated
exceed 27 years.

Also under current law, once a TID pays off the aggregate of all of its project
costs under its project plan but not later than the date on which it would otherwise
have to terminate, a planning commission may allocate positive tax increments
generated by that TID (a donor TID) to another TID (a donee TID) created by that
planning commission in which environmental pollution exists to the extent that
development has not been able to proceed according to the project plan because of the
environmental pollution. This increment sharing may only occur in TIDs created by
the cities of Kenosha, Glendale and Oshkosh. The provision that allows such
increment sharing does not apply after January 1, 2002, for Glendale and Oshkosh
and does not apply after August 1, 2016, for Kenosha.

Under the bill the increment sharing provision, as it relates to the city of
Oshkosh, does not apply after January 1, 2016. Also under the bill, a donor TID

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created by the city of Oshkosh is not required to pay off its project costs before
contributing to the donee TID.

Under current law, DOT may authorize the erection of specific information
signs on designated highways. The signs indicate that certain businesses located
near a highway are available to provide gas, food, lodging or camping to motorists.
The budget act designated STH 172 from I 43 southeast of Green Bay to STH 54 west
of Ashwaubenon as a highway on which DOT may authorize the erection of specific
information signs.

The bill repeals the designation of STH 172 from I 43 southeast of Green Bay
to STH 54 west of Ashwaubenon as a highway on which DOT may authorize the
erection of specific information signs.

Under current law, DOT may issue annual and consecutive month permits for
overweight vehicles and combinations of vehicles that are transporting bulk potatoes
from storage facilities to food processing facilities. A permit does not authorize the
operation of a vehicle or vehicle combination at a maximum gross weight of more
than 90,000 pounds. A permit is valid on designated portions of USH 51 and I 39 that
are part of the national system of interstate and defense highways.

The bill provides that any annual or consecutive month permit DOT issues for
an overweight vehicle or vehicle combination that is transporting bulk potatoes from
storage facilities to food processing facilities is not valid on any part of the national
system of interstate and defense highways, except to the extent permitted by federal
law without any loss or reduction of federal aid or other sanction.

Current law authorizes the environmental education board to award grants to
nonprofit corporations and public agencies to develop, disseminate and present
environmental education programs. Moneys are appropriated from the conservation
fund for such grants that are related to forestry.

The bill allows the environmental education board to use up to 5% of the
amount appropriated from the conservation fund to administer the grants that are
related to forestry.

Under current law, the department of workforce development may request from
any person any information that it determines is appropriate and necessary for the
administration of child and spousal support programs and certain economic support
programs, such as aid to families with dependent children and medical assistance.
The person is required to provide the information within 7 days of receiving the

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request. The bill adds the Wisconsin works program to the list of economic support
programs covered by the provision.

Under current law, any county, city, village, town, school district, drainage
district, technical college district and certain other local governing boards (local
governmental units) may delegate the investment authority over any of their funds,
not immediately needed, to banks and certain trust companies. Such funds must be
invested in certain time deposits of a bank, trust company, credit union or savings
and loan association, or in fixed income U.S. government or federal, state or local
government agency securities.

Under this bill, local governmental units may invest supplemental early
retirement pension funds that are not immediately needed in a variety of financial
instruments, consistent with the current statutory "prudent person" standard of
responsibility. These investments may be made with an investment manager who
meets the requirements and qualifications specified in the trust's investment policy
and who is registered as an investment adviser under the Investment Advisers Act
of 1940.