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Alliance 2001-2002 Issues & Resolutions Reminder: Kettl Commission meets Nov. 16, Alliance meets Nov. 17In this issue:
| Kettl Commission in Final Stretch | Supreme Court
May Get Takings Case Please Reinforce Message to Lawmakers Alliance Web-Site Features |
Kettl Commission Cuts to the Chase
By Ed Huck
At the Kettl Commission's Nov. 2 meeting, Chair Don Kettl outlined a strategy for implementing commission recommendations with a six-year (three biennial budget) phase in. The commission appears to be heading toward a foundation program for both K-12 education and municipal aids.
Its premise is that there should be some basic local effort required to qualify for state aid -- essentially a minimum-mill-rate effort.
| Commission members also are very much interested in the state takeover of human services and the takeover of at least the juvenile portion of the criminal-justice system. Further, they are interested in expanded local authority for levying fees, and will be discussing a redefinition of the role of counties. But a plan for local levy limits is out of harmony with the commission's other directions . The commission also appeared interested Nov. 2 in discussing integration of Wisconsin's technical college system with K-12 education. There are 16 technical college districts across the state, providing services to about 100,000 students. Wouldn't it be interesting to have just 16 school districts in the state of Wisconsin? At the meeting Gov. Tommy Thompson's former Revenue Secretary, Mark Bugher, amended his plan to shift to 100% state funding of education to include a fiscal disparities program that would include a municipal hold harmless for increases in the tax rate to offset losses in shared revenues. |
Original Bugher Plan analyzed Full state funding of K-12 education, accomplished in part with elimination of the state shared revenue program, would raise overall taxes $808 on a $100,000 home in Milwaukee, but reduce taxes on a $100,000 home $955 in Madison, according to an analysis Revenue Secretary Cate Zeuske presented to the Kettl Commission Nov. 2. (see it here.) In Ashland, the owner of a $100,000 home would see his or her taxes rise $1,157 overall. In general, the Bugher plan would benefit taxpayers in towns, where overall taxes on a $100,000 home would fall an average of $712, compared with cities, where average taxes would fall $286, and villages, where average taxes would fall $658. The $2.8 billion plan relies on $1.5 billion from elimination of shared revenues and the school levies credit (which already reduces school taxes) and $1.3 billion in new state taxes, including a sales tax on groceries, college cafeterias, prescription drugs, farm machinery, manufacturing equipment, movie films and other goods and services that are now exempt from sales taxes. |
At the next Kettl Commission meeting, November 16 in Janesville, the commission will receive a side-by-side comparison of the Bugher Plan and a municipal foundation plan by David Riemer, director of administration for Milwaukee. The next Kettl Commission meeting could be pivotal for the state-municipal partnership, so combining a trip to Kettl with the Alliance meeting November 17 in Janesville could be worthwhile for city leaders.
Comment to the Kettl Commission by clicking here.
Study Documents Effects of Double Whammy
By Rich Eggleston
Double-taxation of city and village residents by counties -- the phenomenon we call double whammy taxation -- costs the typical urban household in Wisconsin "a tax penalty" of between $150 and $350 annually, according to a study by a University of Wisconsin-Oshkosh economist.
M. Kevin McGee found that Wisconsin counties provide about $500 more in services to the typical town household than they do to city or village residents. The disparity showed up in 1998 data from the Wisconsin Taxpayers Alliance despite the trend of more towns to provide services that counties duplicate.
"These additional services are primarily concentrated in the categories of general government spending (around $50 per household); highway construction and maintenance spending (around $180 per household), and public safety spending (around $120 per household)," McGee wrote.
"If these additional services were paid for solely by the county's town residents, there would be no public policy issue," he continued. "But the costs of those services are generally spread evenly over town, city and village dwellers alike. The end result, that town residents receive services that they don't fully pay for, and city/village residents pay for (county) services they don't receive, penalizes those who live within cities and villages, while subsidizing those who locate out in the towns."
McGee said the double whammy faced by city and village residents "creates a strong incentive for the growth of residential developments in rural areas, i.e., in urban sprawl. ... The logical policy conclusion is that a reform in the way town and city/village residents are taxed for county services is warranted." To see his study (reprinted on the Alliance web site with permission) look here.
Double-whammy taxation is one of the issues Governor Tommy Thompson suggested his Blue-Ribbon Commission on State and Local Partnership for the 21st Century look into when the commission initially met in April.
Double-whammy continues to be a Wisconsin Alliance of Cities legislative priority. However, the Alliance's past efforts have been dismissed by the Wisconsin Counties Association. But the Alliance took this priority to the bargaining table with the Wisconsin Towns Association, whose urbanized downs feel the sting of double-whammy taxation just as cities and villages do. The towns, the Alliance and the League of Wisconsin Municipalities sat down at the invitation of Rep. Scott Gunderson (R-Union Grove) and Rep. Wayne Wood (D-Janesville) in an effort to draft boundary-agreement legislation. Negotiations took place beginning in the spring. Within the last month, a compromise was hammered out that can include double-whammy relief for some duplicated services if a city or village reaches boundary agreements with half or more of its contiguous towns.
The resulting bill draft, endorsed by the towns and the League, will be considered by Alliance members Nov. 17 in Janesville.
Judge Cites 'Intent' in Use-Value Ruling
The Legislature may have passed a 10-year phase-in of farmland use-value assessment, but it really didn't intend to, a reserve judge ruled Oct. 30 in Dane County Circuit Court.
Judge Dan La Rocque dismissed a lawsuit challenging the Department of Revenue's decision to implement full use-value assessment immediately rather than adhere to the phase-in. La Rocque concluded the Legislature's intent was expressed not in the Legislative Fiscal Bureau analysis prepared at the time of the statute's enactment nor by the Department of Revenue's initial interpretation of the statute, nor by a Legislative Council staff memo on the subject, but on the failure of two legislative committees to object when the DOR changed its mind and opted for full implementation of the law without the phase-in approved by the Legislature.
The lawsuit brought was brought by Senate Democrats who objected that the agency was usurping legislative powers and landowners harmed by the agency's decision. But La Rocque said the controlling Legislative action was the failure of the Senate Committee on Government Operations and the Assembly Ways and Means Committee to object to the rule.
"The simultaneous progression of this lawsuit with the legislative actions adopting the permenent (sic) rule is a sufficient demonstration of legislative intent..." La Rocque ruled. "This court concludes that any ambiguities in the statutory scheme have been resolved in favor of the Department's interpretation."
To see a copy of the decision in Adobe Acrobat format, click here.
Please reinforce message to legislators
Ed and Gail have begun the time-consuming process of visiting legislators to explain the Alliance's 2001-2002 proactive agenda. As you know, the agenda calls for fair taxation on a number of fronts; an inflationary increase in shared revenues that benefits every municipality in the state; a regional solution to the stormwater mandate; an improved brownfields program; a funding approach to recycling that discourages dumping of out-of-state waste in Wisconsin; and state gas tax exemption for local governments and school districts.
As Ed and Gail make the rounds at the Capitol, please reinforce their message. When you see one of your legislators' names highlighted in the list that follows -- this report will be a regular feature in the Alliance newsletter -- please click on the highlighted name and send that legislator a brief e-mail urging him or her to support the Alliance agenda. Heck, just cut cut and paste from the above paragraph if you're pressed for time. Or, better yet, elaborate. Our issues, position papers and resolutions on the issues are located here. These issues are important to many, many cities. Carbon us in or let us know that you've been in touch.
The legislators and/or staff Ed has visited include: Sen. Richard Grobschmidt, D-South Milwaukee; Rep. Luther Olsen, R-Berlin; Rep. Pedro Colon, D-Milwaukee; Rep. Spencer Coggs, D-Milwaukee; Rep. Hank Urban, R-Brookfield; and Rep. John Ainsworth, R-Shawano.
The legislators and/or staff Gail has visited include Rep. David Cullen, D-Milwaukee; and Rep. Al Ott, R-Forest Junction.
Economic Summit Nov. 29-Dec. 1
The UW, in cooperation with others, is sponsoring an "economic summit" Nov. 29 to Dec. 1 at the Midwest Express Center in Milwaukee.
The effort is aimed at creating a strategic plan for Wisconsin in the
"New Economy." The UW says it's an attempt to identify opportunities and
strategies for
strengthening Wisconsin’s place in the emerging global economic framework, drawing
upon partnerships and expertise in the business community, education, labor, and
government.
The conference website is http://www.wisconsin.edu/summit
On-line registration is available at http://www.uwm.edu/universityoutreach/registration/summitform.shtml.
Supreme Court asked to hear "Takings' Case
The U.S. Supreme Court has been asked to hear the appeal in Palazzolo v. Rhode Island, a Rhode Island Supreme Court ruling that rejected a takings claim by a landowner who wanted to develop some coastal wetlands.
In the complex case, the court ratified a trial court's rejection of a the claim, holding that the action was not "ripe" because the developer never pursued a less ambitious plan to develop the property; that when the property was purchased, the challenged regulations already were in effect; and that the owner lacked reasonable expectation of being able to reap windfall profits from the proposed project.
The court said the developer was unable to cite a single case in which a court-ordered compensation for a taking resulting from a pre-existing regulation.
The developer wants the U.S. Supreme Court to determine whether takings claims are categorically barred when they involve regulation that pre-dates ownership; whether less ambitious development schemes must be sought before a valid takings claim is established; and whether remaining permissible uses of a wetland are economically viable merely because the property retains some value.
We'll keep you informed.
Nov. 8
Partners in Local Govt. 10 a.m. to 1 p.m., WCA, Monona
Nov. 10
Common
Good (anti-takings) Coalition (for info,
Dick Lehmann)
Nov. 16
Kettl Commission, Janesville
Nov. 17
Alliance of Cities meeting,
Janesville
Nov. 29
Leg.
Cncl. Navigable Waters Recodification Committee
Nov. 29
Economic Summit, Milwaukee,
through Dec. 1
Internet sites are monsters that keep growing. Even the Alliance of Cities' web site fits that definition. Here are the initial features that we're trying to incorporate to manage that growth:
Edward J. Huck |
Gail E. Sumi |
Rich Eggleston |
