Changing certain administrative procedures under the tax incremental financing program

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. Under certain circumstances, the life of the TID and the allocation period may be extended.

Under current law, a planning commission may adopt an amendment to a project plan, which requires the approval of the common council or village board and the same findings that current law requires for the creation of a TID. Current law also authorizes the amendment of a project plan up to four times during a TID's existence to change the district's boundaries by adding or subtracting territory.

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.

This bill changes a number of administrative procedures that apply to TIDs.

Under the bill, in determining whether a city or village complies with the 12 percent test, DOR must exclude any parcel of land in a newly created TID that is located in an existing TID. If DOR determines that a city or village has violated the 12 percent test, it must notify the city or village in writing. The city or village must then either rescind its approval of the resolution creating a TID or notify DOR in writing that the county in which the TID is located approves of the city's or village's action related to the TID even though the 12 percent test is not met.

The bill also changes from December 31 to October 31 the date by which a city or village must submit certain completed forms to DOR and specifies that, in complying with meeting notice requirements, a city or village must use a newspaper that is in general circulation in the county in which the TID is located. With regard to meetings held by a joint review board, the bill requires all such meetings to be preceded by a class 2 notice.

Under current law, any city, village, town, or county (political subdivision) that receives a tax increment for a TID or an environmental remediation TID must pay DOR an annual administrative fee. Under this bill, if the political subdivision does not pay the fee by May 15, DOR may not allocate a tax increment to that political subdivision.

The bill takes effect on October 1, 2010.