SB 691

This bill extends the maximum life, the expenditure period, and the time during

which tax increments may be allocated with regard to Tax Incremental District

Number 3 in the city of Middleton.

Under the current tax incremental financing program, a city or village may

create a tax incremental district (TID) in part of its territory to foster development.

Once a TID has been created, the Department of Revenue (DOR) calculates the "tax

incremental 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 the property taxes collected from the TID that

is attributable to the value increment is called a "tax increment." The tax increment

is placed in a special fund that may be used only to pay back the project costs of the

TID. 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, with regard to Tax Incremental District Number 3 in the city

of Middleton, the expenditures for project costs may be made for up to 42 years after

the TID was created, the Department of Revenue may allocate tax increments for up

to 47 years after the TID's creation, and the maximum life of the TID is extended for

ten years.