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For a fee: Measure aims to protect WI taxpayers

By   /   May 16, 2013  /   1 Comment

By Ryan Ekvall | Wisconsin Reporter

MADISON – It may be back to the drawing board for Wisconsin officials who want to exceed their local spending authority.

Sen. Frank Lasee, R-De Pere, authored a motion — which recently passed in the Legislature’s Joint Committee on Finance — that would prohibit municipalities from charging fees for services previously financed with property taxes, unless those communities reduce property taxes accordingly.

In other words, if the motion holds through the budget process, your city won’t be able to create a trash collection or fire protection fee without also reducing property taxes.

“Clever local officials have been adding fees to increase their budgets above their limits.” Lasee, said in a statement. “Now they won’t be able to. If municipalities want to increase their budgets above the limits, they are supposed to get the taxpayers’ approval with a referendum.”

FOR A FEE: A measure put into Gov. Scott Walker’s proposed budget prohibits municipalities from charging fees for services previously financed with property taxes, unless there is a corresponding property tax cut.

The rate of service fee increases has outpaced other costs to taxpayers. This happened after the implementation in 2005 of state-imposed levy limits that restrict the rate by which municipalities can increase property taxes.

Take sleepy Stoughton, a Madison bedroom community. In October, the city of 12,611 created a Stormwater Utility to “fund maintenance and improvements to the city’s storm water management system,” according to the city’s website.

City Councilman Michael Engelberger voted in favor of the new fee.

“It was just a way to charge for the stormwater runoff because there are costs to the city. So we added it to the utility bill in Stoughton,” he said.

Engelberger said the fee amounts to roughly $4 a month per household. Businesses pay more depending on their respective size.

“The city had been absorbing the costs through the property taxes and hadn’t really collected for that situation,” he said.

That’s akin to a movie theater imposing an extra ‘seat fee’ with each ticket sold, property taxpayer advocates argue. Taxpayers don’t see a new service provided, but they see the new tax levied.

“What has been happening is, beyond the property tax, municipalities have been creating sewer fees, fire protection fees, solid waste disposal fees – very creative ideas how to collect money but not taking the cost off the property tax,” said Michael Birkley, legislative director at Wisconsin Property Taxpayers, Inc., a lobbying organization.

“We don’t want them to find an easier way to exceed the limits on property taxes. If they can convince people that they need the money to do things that people really want them to do, let the people decide. That’s about as close to home government as you can get,” he said.

Lasee’s measure isn’t an assault on local control, an accusation tossed around in the statehouse like a horseshoe, according to Dan Thompson, executive director of the League of Wisconsin Municipalities. Instead, it’s part of an ongoing, incremental change in the form of local governance in Wisconsin, from representative democracy to direct democracy.

“It’s not clear to me that the average citizen wants to take that kind of time,” Thompson said.

But does the referendum system take elected officials off the hook?

“I understand it sounds like a great bumper sticker, ‘Hey, let the people decide.’ What it means is it’s going to be tough for voters to blame elected officials if a referendum fails and the services they want provided are cut,” he said.

Birkley sees it as taxpayer ownership.

“The state is actually giving local people more opportunity to determine their own tax future,” he said.

Contact Ryan Ekvall at rekvall@wisconsinreporter.com

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M.D. Kittle

  • Jack Lohman

    Charging boat fees, for example, is appropriate rather than state or local tax increases. I’ve never owned a boat in my life. However, under this or any circumstance it is inappropriate for the politicians to get a piece of the action.