Workforce housing development tax incremental districts; local fees and charges; local levy limits; subdivision approval conditions; plat approval conditions; expiration of certain project approvals; division of land by certified survey map; erosion control and storm water management; limiting certain local regulatory authority; relocation benefits in condemnation proceedings; and zoning ordinance amendments. (FE)

Division of land by certified survey map This bill expands the types of land that a political subdivision may allow to be divided by certified survey map to include land that is zoned multifamily.

Under current law, the subdivision of land into five or more parcels generally is regulated by state and local government and must be completed using a subdivision plat, while the division of land into four or fewer parcels is not subject to those regulations and may be completed using a certified survey map. Under current law, a political subdivision that has established a planning agency may enact an ordinance or adopt a resolution that allows land to be divided into more than four parcels by using a certified survey map without the division being a subdivision and, therefore, without all of the attendant requirements that apply to subdivisions.

Currently, the political subdivision's ordinance or resolution may only allow division of land into more than four parcels by certified survey map if the land is located in the political subdivision and is zoned for commercial, industrial, or mixed-use development. The bill extends the special land division rule to land that is zoned multifamily.

Levy limit exception Generally under current law, local levy limits are applied to the property tax levies that are imposed by political subdivisions in December of each year. Current law prohibits a political subdivision from increasing its levy by a percentage that exceeds its “valuation factor,” which is defined as the greater of either 0 percent or the percentage change in the political subdivision's equalized value due to new construction, less improvements removed. Current law contains a number of exceptions to the levy limit.

This bill creates a new levy limit exception that allows a city or village to increase its levy if it has issued occupancy permits for certain residential dwelling units in the preceding year. Specifically, the levy limit is increased by $1,000 for each new single-family residential dwelling unit that is 1) located on a parcel no more than 0.25 acre; or 2) sold for not more than 80 percent of the median price of a new housing unit in the city or village.

Fees imposed by political subdivisions Under current law, a person may contest a fee imposed by a political subdivision if the person does not believe that the fee bears a reasonable relationship to the service for which the fee is imposed by filing a petition with the tax appeals commission within 60 days after the fee's imposition. This bill eliminates the requirement that the petition be filed within 60 days of the fee's imposition.

Sewerage system service charges Under current law, a city, village, town, or metropolitan sewerage district may construct and operate a system for collecting, transporting, pumping, treating, or disposing of sewage, storm water, and surface water. The costs for such a system may be funded with taxes, special assessments, service charges, municipal obligations or revenue bonds, or any combination of these sources. For a storm water and surface water sewerage system, current law specifically allows a system operator to classify the properties it serves for the purpose of establishing service charges. In general, the specified classification criteria is related to the manner in which storm water falling on the property affects the system.

Under this bill, no new and additional storm and surface water sewerage system service charge may be made for a property that retains at least 90 percent of storm water falling on the subject property.

Weekend work Under this bill, a political subdivision may not prohibit a private person from working on a private construction project on a weekend, or impose conditions on the person that are inapplicable to, or more restrictive than conditions that apply to, such a person who works on a construction project during weekdays. If the political subdivision has in effect an ordinance or resolution that is inconsistent with this provision, that ordinance or resolution does not apply and may not be enforced after the bill takes effect.

Uniform dwelling code This bill prohibits a political subdivision from making or enforcing an ordinance that does not conform to the one-family and two-family dwelling code (commonly called the uniform dwelling code). The bill also provides that, if a contract between a political subdivision and the owner of a dwelling requires the owner to comply with such an ordinance, the owner may waive the provision, and the provision, if waived, is void and unenforceable.

Tax incremental financing, impact fees This bill authorizes the creation of workforce housing development tax incremental districts and changes the method of imposing certain impact fees.

Under the current tax incremental financing program, a city or village may create a TID in part of its territory to foster development under certain conditions.

Currently, towns and counties also have a limited ability to create a TID under certain limited circumstances. 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 within specified time frames, 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, approval of the city's or village's proposed TID by a joint review board (JRB) that consists of members who represent the overlying taxation districts, and adoption of a resolution by the common council or village board that creates the TID as of a date provided in the resolution.

Also under current law, once a TID has been created, the Department of Revenue 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 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 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. A TID is required to terminate, under current law and with some exceptions, once its project costs are paid back.

Generally under current law, project costs may be expended to benefit residential development but only certain TIDs for which a project plan was approved before September 30, 1995, or for a mix-use development. With regard to a mixed-use development, lands proposed for newly platted residential use may not exceed 35 percent, by area, of real property within the TID.

Under the bill, a workforce housing TID may contain only newly platted residential uses, 100 percent of which must be workforce housing. Before such a TID may be created, the JRB must approve the TID by a unanimous vote. For other TIDs, only a majority vote is required. A workforce housing TID has a maximum life of 15 years, and DOR may allocate tax increments for only 15 years.

Also under the bill, workforce housing is defined to mean housing based on the following two factors, which are subject to the five year average median costs as determined by the U.S. bureau of census:

1. Housing that costs no more than 30 percent of the household's gross monthly income.

2. The construction cost per housing unit, including rental housing, is no more than 80 percent of the median price for new residential construction in the county.

Under current law, a municipality may impose an impact fee on a developer to pay for the capital costs to construct certain public facilities that are necessary to accommodate land development.

Current law requires that impact fees must be used within certain specified periods, depending upon when the ordinance authorizing impact fees was enacted and when the fee was imposed, or be refunded to the current owner of the property for which the impact fees were imposed. Under this bill, impact fees that are not used within eight years after they are collected must be refunded to the current owner of the property.

This bill requires a municipality to prepare an annual report listing the impact fees that have been imposed during the previous year and containing certain additional information related to the municipality's administration of impact fees during the year. The bill also prohibits certain uses of impact fee moneys.

Under current law, if a city, village, or town imposes an impact fee on a developer to pay for certain capital costs that are necessary to accommodate land development, the ordinance may provide for an exemption from, or a reduction in the amount of, impact fees on land development that provides low-cost housing. Under this bill, the impact fee exemption or reduction provisions also apply to workforce housing. Current law prevents the shifting of an exemption from or reduction in impact fees to any other development in the land development in which the low-cost housing is located. The bill applies this provision to workforce housing as well.

Zoning limitations, inspections The bill provides that if a political subdivision or utility district imposes requirements on a developer related to the installation of a water meter station or a sanitary sewer lift pump station for a development project, the requirements may not require a developer to install more than the minimum level of such a station or its housing that is required to ensure the proper functioning of such a station.

Under the bill, if a political subdivision employs a building inspector to enforce its zoning ordinances or other ordinances related to building, and a developer requests the inspector to perform an inspection, the inspector must complete the inspection not later than 14 business days after receiving the request. If the local inspector does not complete the inspection within this time frame, the bill allows a developer to request that a qualified state inspector perform the required inspection.

The political subdivision must accept a certificate of inspection provided by the state building inspector as if it were provided by the local building inspector if the inspection meets the requirements for an inspection that was supposed to have been provided by the local building inspector.

Inclusionary zoning prohibitions The bill also prohibits a political subdivision from enacting or enforcing an inclusionary zoning ordinance. The bill defines this type of ordinance as one which prescribes that a certain number or percentage of new or existing residential dwelling units in a land development be made available for rent or sale to an individual or family with a family income at or below a certain percentage of the median income.

Plat approval process; public improvements This bill makes various changes related to security required by a city, village, town, or county (approving authority) as part of the plat approval process. Under current law, as a condition of approving a plat, an approving authority may require a subdivider to execute a surety bond or provide other security to ensure that certain public improvements are made in connection with a project. This bill reduces the maximum amount of security that an approving authority may require from 120 percent of the estimated total cost to complete the required public improvements (estimated completion cost) to 110 percent of the estimated completion cost. The bill also creates limitations on how the estimated completion cost is determined and provides that the total cost of the public improvements includes the cost to make and install storm water facilities, but does not include any fees charged by the approving authority or certain land disturbing activities. This bill explicitly requires an approving authority to accept a performance bond, a letter of credit, or any combination thereof, at the subdivider's option, to satisfy the security requirement.

Upon substantial completion of required public improvements, current law limits both the amount of security that may be required from a subdivider and the length of time during which the security may be required. Under the bill, if the public improvements include roads to be dedicated, substantial completion occurs upon the installation of the asphalt or concrete binder course on the roads to be dedicated.

Additionally, under the bill, upon substantial completion, any outstanding local building permits that are related to and dependent upon substantial completion of the required public improvements must be released. Before substantial completion, the bill requires an approving authority to, upon request, issue a permit to commence construction of a foundation or any other noncombustible construction. Finally, the bill prohibits an approving authority from enacting an ordinance related to substantial completion of public improvements that is inconsistent with state law.

Subdivision approval conditions Under current law, a political subdivision may, as a condition of approval of a subdivision or other division of land (subdivision), require land dedication, easement, or other public improvement by a subdivider. However, a political subdivision is generally prohibited from imposing, as a condition of approval of a subdivision, a fee or other charge to fund the acquisition or improvement of real or personal property, except that a city, village, or town may impose a fee or other charge to fund the acquisition or initial improvement of land for public parks (public park fee). The bill modifies that exception to provide that a city, village, or town may impose a public park fee only if the authorizing ordinance of the city, village, or town is enacted by following the same procedures and requirements that apply to the imposition of impact fees on developers.

The bill also provides that, if a political subdivision's ordinance requires, as a condition of approval of a subdivision, that a subdivider dedicate land for a public park, the political subdivision may offer the subdivider the option of either dedicating the land or paying a fee or other charge in lieu of the dedication. If the subdivider elects to pay the fee or other charge, it is payable by the landowner to the political subdivision upon the issuance of a building permit by the political subdivision.

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