The Reporters Guide to Wisconsin City & Village Government

Transcription

1 A L EAGUE M ANUAL The Reporters Guide to Wisconsin City & Village Government

2 A LEAGUE MANUAL The Reporters Guide to Wisconsin City & Village Government League of Wisconsin Municipalities 202 State Street, Suite 300 Madison, Wisconsin The League of Wisconsin Municipalities Mutual Insurance Trust provided financial support for this publication.

3 Preface Welcome to the municipal building in Wisconsin s 589 cities and villages. While the municipal building can be a confusing place thanks to a multitude of issues and departments, the League of Wisconsin Municipalities wants to help you make sense of every facet of municipal government. We have put together this Reporters Guide to help you navigate the maze of city and village government. While the guide is not all-inclusive, the League and its members hope it offers some insights that will aid you in your coverage of the city council or the village board, the plan commission, the parks department, the clerk s office and municipal utilities to name just five of the many components of municipal government. We also hope the information we have included allows you to move beyond the coverage of just the meetings and onto in-depth coverage of your local government as its leaders work to build a strong community. And, if you do not find the answers to your questions about the part of city or village government you are covering, or the issues facing cities and villages today, we are ready to assist you in any way we can. Just give us a call at (608) , us at <league@lwm-info.org> or visit our website at < Again, welcome. We are looking forward to working with you. Dan Thompson Executive Director League of Wisconsin Municipalities Printed 2003 League of Wisconsin Municipalities

4 Table of Contents I. Municipal Governments In Wisconsin 1 Distinctions Between Municipalities and Towns 1 Distinctions Between Cities and Villages 2 Classes of Cities 3 Distinctions Among Classes of Cities 4 Annexation and Detachment 4 The Powers of City and Village Governing Bodies 5 Emergency Powers 7 II. Who Governs Cities and Villages? 9 The Common Council 9 The Village Board 9 Statutory Officers 10 Mayor 10 Village President 10 Alderpersons 10 Trustees 11 Clerk 11 Deputy Clerk 11 Treasurer 11 Deputy Treasurer 11 Comptroller 11 Manager 12 Assessor 12 City Attorney 13 Police Chief 13 Fire Chief 13 Marshal 14 Constable 14 Administrator 14 Municipal Boards and Commissions 15 Police and Fire Commission 16 Board of Review 17 Board of Public Works 17 Plan Commissions 17 Zoning Boards of Appeal 18 Utility Commission 18 Library Board 19 Municipal Courts 20 Powers 21 III. Money, Money, Money! 23 Budgeting 23 The State Budgeting Law 23 Budget Summary and Budget Hearing 24 Deadline For Adopting a Municipal Budget 25 Budget Changes 25 Non-Lapsing Reserve Funds 26 Board of Estimates Budget System 26

5 Sources of Local Revenue 26 The General Property Tax 26 Local Tax Options 27 Shared Revenue and State Aids Wisconsin Act 109 Modifications 30 Schedule of Shared Revenue Payments 30 Shared Revenue Funding Level 31 Expenditure Restraint & Small Municipalities Shared Revenue Program 31 Expenditure Restraint Program 31 Small Municipalities Shared Revenue 32 Payments for Municipal Services Program 33 Transportation Aids 33 Recycling Grants 34 Payments in Lieu of Taxes (PILOTS) 35 Special Assessments 35 Special Charges for Current Services 36 Fees in Lieu of Land Dedication as a Condition of Plat Approval 36 Impact Fees 36 Costs That Can Be Funded With Impact Fees 36 Procedure For Adoption of Impact Fee Ordinances 37 User Fees 37 License and Permit Fees 37 Mobile Home Monthly Parking Permit Fee 37 Parking Systems 37 Cable Television Franchise Fee 38 Establishing the Property Tax Levy 38 State Property Tax Credits 38 Preparation of Tax Roll and Tax Bills 38 Settlement Process 39 IV. Contracts 41 Express Contract Authority 41 Implied Contract Authority 41 Who is Authorized to Enter Into Contracts? 41 Prohibited Contracts 42 Public Construction Contracts 42 The Expenditure Threshold 43 Competitive Bidding Exemptions 43 The Bidding Process 44 Advertising for Bids 45 Accepting or Rejecting the Bid 45 The Final Step 46 Intergovernmental Cooperation Agreements 46 Municipal Revenue Sharing Agreements 47 Cooperative Boundary Agreements 47 V. City and Village Legislative Procedures 49 Regular Meetings 49 Special Meetings 49 Common Council or Village Board Meeting Procedures 50 Presiding Officers 50 Quorum 50 Recording of Votes 51 Attendance at Meetings 51 Method of Voting 51

6 Number of Votes Required 52 Refusal to Vote 52 Tie Votes 52 Mayor and Village President s Right to Vote 52 The Public s Role 52 Rules of Parliamentary Procedure 53 Reconsideration 53 Mayoral Approval and Veto of Legislation 53 Agendas and Minutes 54 Minutes 54 Public Hearings 55 Committees 55 Enactment of Legislation 56 Charter Ordinances 56 Ordinances 57 Ordinance Book 58 Resolutions 58 Motions 58 Bylaws, Regulations, Rules, Contracts 58 Direct Legislation Initiated by Citizens 58 VI. Open Government Laws 61 Introduction 61 The Open Meetings Law 61 The Public Records Law 62 Publication Requirements 64 Appendix: Additional Information and Resources 67 The League of Wisconsin Municipalities 67 Additional State Associations and Organizations 67 National Associations 68 Selected State Agency Contacts 69 Selected Federal Agencies 69

7 CHAPTER I Municipal Governments In Wisconsin Cities and villages are local general-purpose units of government. They provide a broad range of services to persons and properties within a defined geographical area, including street maintenance, sewer and water, police and fire protection, garbage collection, libraries, parks and recreation and public transportation. Cities and villages in Wisconsin are incorporated municipalities. They are created at the request of their inhabitants to perform local services. Distinctions Between Municipalities and Towns There are 190 cities and 399 villages in Wisconsin. Together, they encompass about 70% of the state s population. There are 1,265 towns in Wisconsin. Town governments govern those areas of Wisconsin that are not included within the corporate boundaries of cities and villages. Cities and villages in Wisconsin are different from other general-purpose units of local government such as towns and counties because they possess more power to govern themselves in local matters without state interference. That is, cities and villages are granted broad authority under the Wisconsin constitution and statutes to govern themselves locally. The term used to describe this grant of authority to cities and villages is home rule. Significant differences between incorporated municipalities and towns include: 1. cities and villages can create tax incremental finance districts while towns lack such authority; 2. citizens in cities and villages can initiate ordinances and resolutions through the direct legislation process while citizens in towns lack such powers, and; 3. Cities and villages, unlike towns, can expand their boundaries through the annexation of unincorporated territory. 4. Cities and villages have extraterritorial subdivision approval powers; towns do not. 1

8 The Reporters Guide to Wisconsin City & Village Government A town, like a city or village, is a local general-purpose unit of government. It is also, like a city or village, a body corporate and politic. However, unlike cities and villages, towns lack constitutional home rule powers. Towns are occasionally referred to as quasi-municipal corporations to distinguish them from cities and villages. In addition, towns are sometimes referred to as unincorporated in contrast to incorporated local general-purpose units of government (cities and villages). Unlike cities and villages, a town has only those powers that are conferred by statute, or may be necessarily implied from the statute. Distinctions Between Cities and Villages While the powers of cities and villages are similar, there are differences in the way they are organized. Generally speaking, city government consists of a mayor or city manager and a common council. The mayor or manager is the chief executive officer and the council is the legislative arm of the city. The members of the council are elected from aldermanic districts and the mayor is elected at large. Typically, village government consists of a village board made up of trustees and a village president. The village board serves as the executive officer and legislative body of the village. The village president and the trustees are elected at large. Since 1933, villages have had the same broad statutory home rule powers to change the structure of their local government or exercise corporate powers as cities. The following is a summary of some of the differences between Wisconsin cities and villages: In cities, when district boundaries are coterminous, the office of alderperson may be consolidated with the office of county supervisor. In villages, only the office of village president may be so combined A village changing to a city would not, however, thereby acquire greater representation on the county board, since supervisory districts are based on population. Mayors have more power than village presidents. A mayor has the veto power, is the city s chief executive officer and is the head of the police and fire departments, except in cities that have adopted optional powers for police and fire commissions under sec (6), Stats. Sec (8), Stats. A mayor presides at common council meetings and votes on matters before the council only in cases of a tie. While the mayor is a member of the council, the mayor is not counted in determining whether a quorum is present at a meeting. Village presidents preside at village board meetings but are not considered the chief executive officer of the village. Village presidents do not have the veto power and, like any other trustee, may vote on all measures that come before the board. Village presidents are members of the village board and are counted in determining whether a quorum is present at the meeting. Nominations are generally made by caucus in villages and are always made by nomination papers in cities. All cities are required to have an official newspaper and to publish all legal notices, council proceedings and ordinances in it. In villages, no official newspaper is required, although publication in newspapers is required in some instances. Also, in villages only ordinances that impose a forfeiture must be published or posted. 2

9 Chapter I: Municipal Governments in Wisconsin The list of statutory officers for cities is somewhat longer than for villages. For example, fire chiefs and police chiefs are listed as city officers in ch. 62, Stats., but they are not listed as village officers in ch. 61, Stats. However, both cities and villages are authorized to create additional offices not listed in the statutes and eliminate offices listed in the statutes. Other statutory city officers that are not mentioned as village officers in ch. 61, Stats., include comptroller, attorney, engineer, local health officer or local board of health, street commissioner and board of public works. Village presidents and trustees are officers of the peace, and may suppress riotous or disorderly conduct in public places and may command the assistance of private citizens. Formerly, city council members were given such powers. That statute, however, was repealed by the legislature in The extraterritorial zoning and plat approval jurisdiction of first, second and third class cities extends to the unincorporated area within three miles of their corporate limits. Fourth-class cities and villages have extraterritorial zoning and plat approval jurisdiction for only one and one-half miles beyond their corporate boundaries. In villages, a majority of the members-elect constitutes a quorum of the village board. In cities, two-thirds of the members of the common council constitutes a quorum, except that in cities having not more than five alderpersons a majority constitutes a quorum. Classes of Cities Wisconsin law divides cities into four classes for purposes relating to governmental administration and the exercise of corporate power. The division is based on population as determined by the last federal decennial census or a special interim census. The four classes of cities are as follows: Cities of one hundred and fifty thousand population and over constitute cities of the first class. Cities of thirty-nine thousand and less than one hundred and fifty thousand population constitute cities of the second class. Cities of ten thousand and less than thirty-nine thousand population constitute cities of the third class. Cities of less than ten thousand population constitute cities of the fourth class. A city changes from one class of city to another only when all of the following conditions are met: (1) a federal census shows that the city s population has reached the required population; (2) provisions for any necessary changes in government have been duly made; and (3) a proclamation by the mayor (manager), declaring the change, has been published under ch. 985, Stats. Presently, the City of Milwaukee is the only first class city in Wisconsin. There are twelve cities of the second class, twenty-five cities of the third class and 152 cities of the fourth class. 3

10 The Reporters Guide to Wisconsin City & Village Government There are cities, such as Madison, whose populations would permit their inclusion in a higher or lower classification but which have not taken the two discretionary steps necessary to alter their official classification. Distinctions Among Classes of Cities For the most part, few differences exist between the structures of government in the first three classes of cities. Moreover, since all Wisconsin cities have home rule powers, both constitutional and statutory, the basic governmental powers of all classes of cities are essentially the same. The greatest discrepancies in structure and authority exist between first class cities and the other classes of cities. In 1921, the legislature repealed all special city charters except the City of Milwaukee s and provided that cities would subsequently operate under ch. 62 of the Wisconsin statutes. The City of Milwaukee, at its discretion, was authorized to adopt the provisions of ch. 62, Stats., by simple ordinance. However, the legislature did not refer to the City of Milwaukee by name but rather as a city of the first class. Over the years, special grants of authority and other provisions relating to cities of the first class have been adopted with only the City of Milwaukee in mind. These laws include ch. 119, Stats., relating to the Milwaukee school system; sec , Stats., governing police and fire departments in first class cities; sec , Stats., relating to discontinuance of streets in first class cities; secs , and 74.87, Stats., authorizing first class cities to sell land for nonpayment of taxes; and secs to 65.20, Stats., relating to municipal budget systems in first class cities. Fourth class cities have extraterritorial zoning and plat approval jurisdiction for only one and one-half miles beyond their corporate boundaries as contrasted with three miles for other classes of cities. Certain regulations with respect to firefighters also differ for fourth class cities Library boards in fourth-class cities consist of seven members while library boards in cities of the second or third class consist of nine members. Library boards in first class cities consist of twelve members. With respect to shared revenue and other financial provisions of the Wisconsin statutes, distinctions are based on population rather than class of city. In recent years little use has been made of class distinctions among cities except with respect to Milwaukee, the state s only first class city. Therefore, the act of changing from one class of city to another, except for the change from a second to a first class city, will have a relatively minor effect on the structure or powers of city government. Annexation and Detachment Annexation is the process by which parcels of land in unincorporated areas come under the jurisdiction of adjacent cities or villages. Annexation in Wisconsin is a landowner-driven process. Landowners are motivated to annex their land into a city or village for different reasons, but generally it is the desire to obtain higher levels of service, such as sewer or water, that the town is unable or unwilling to provide. Cities and villages cannot unilaterally annex town territory unless the parcels are town islands in existence on December 2, 1973 or are owned by the municipality. The following is a brief summary of the powers of annexation and detachment. The statutes provide several methods of annexation. These are: 4

11 Chapter I: Municipal Governments in Wisconsin Direct Annexation (including Annexation by Unanimous Approval). Annexation by Referendum. Annexation of Town Islands in Existence on December 2, Annexation by Court Ordered Referendum under sec , Stats. Annexation of municipally owned territory under sec , Stats. The most common method of annexation is direct annexation initiated by electors and property owners. Under this method, town territory contiguous to a city or village may be annexed when a petition signed by electors and property owners is filed with the city or village requesting that the described territory in which they reside or own property be annexed. The annexation becomes effective only after a city or village s governing body enacts an annexation ordinance by a two-thirds vote of all the members of the body. If a sufficient number of electors residing within the territory to be annexed petition for a referendum on the annexation within the statutory time limits, a referendum will be held in the area proposed for annexation. A majority vote against annexation nullifies the annexation or halts the annexation process from proceeding. A majority vote in favor of annexation validates the annexation or allows the annexation process to proceed. Territory may be detached from any city or village and be attached to any city, village or town, to which it is contiguous, by following the procedures set forth in sec , Stats. The Powers of City and Village Governing Bodies Because municipalities were created by the state, they have been referred to as creatures of the state. As creatures of the state, municipalities have no inherent powers and have only the powers given them. Wisconsin cities and villages have been granted extensive home rule powers. Home rule is the ability of cities and villages to govern themselves in local matters without state interference. Although Wisconsin municipalities enjoy broad home rule authority the legislature and Wisconsin courts have eroded that authority in recent years. Wisconsin municipalities have two sources of home rule authority: constitutional and statutory or legislative. The Constitutional home rule amendment, adopted in 1924, allows municipalities to determine their local affairs and government, subject only to the constitution and to legislative enactments of statewide concern that uniformly affect every city or every village. Wis. Const., Art. XI, 3. However, the courts have recognized that because almost every municipal activity has some statewide effect, matters that are local affairs may also be matters of statewide concern. The constitutional home rule amendment requires a municipality to exercise constitutional home rule through a charter ordinance. The courts have interpreted the constitutional home rule amendment as doing two things: First, it directly grants legislative power to municipalities by expressly giving cities and villages the power to determine their local affairs and government; second, it limits the legislature in its enactments in the field of local affairs of cities and villages. To determine whether a municipality has validly exercised its constitutional home rule authority or whether the state legislature has unconstitutionally interfered with a municipality s local affairs, the legislative enactment, whether state or local, must first be classified as one of three kinds: 5

12 The Reporters Guide to Wisconsin City & Village Government 1. exclusively of statewide concern; 2. exclusively a matter of a municipality s local affairs and government; or 3. a mixed bag. The mixed bag includes matters that are not exclusively of local or statewide concern. The courts have recognized that many matters while of state-wide concern, affecting the people and state at large somewhat remotely and indirectly, at the same time affect individual municipalities directly and intimately, and therefore are properly considered local affairs. If the matter is exclusively of statewide concern, the constitutional home rule amendment grants no power to a municipality to deal with it. The legislature may either delegate to municipalities a limited authority or responsibility to further public interests or may preempt the field by expressly banning local legislative action. Furthermore, when the legislature deals with matters that are primarily of statewide concern, it may deal with them free of any restriction contained in the home-rule amendment. Thus, the legislature can enact a law touching on a matter of statewide concern, which applies in one city and not in another, provided that the classification is proper. If, however, the subject can be classified as an area primarily and paramountly a matter of the local affairs and government of the municipality, then the municipality is authorized by the home rule amendment to enact a charter ordinance regulating that subject matter. Furthermore, any state legislative delegation of authority to legislate on such a subject is unnecessary and any attempt by the legislature to preempt or ban local legislative action in such an area would be unconstitutional. Finally, if the legislature elects to deal with the local affairs and government of a city or village, its act is subordinate to a charter ordinance unless the legislature s act uniformly affects every city or village across the state. If a matter falls into the mixed bag category, it is necessary to apply what is referred to as the paramountcy test whether the legislative enactment in question is primarily or paramountly a matter of local affairs and government under the home rule amendment or of state-wide concern. Although legislative pronouncements classifying a subject as a local affair or a matter of state-wide concern, are entitled to great weight, they are not controlling and courts have the final say in deciding whether a matter is properly classified as primarily or paramountly a matter of local affairs and government under the home rule amendment or of state-wide concern. Once the legislative enactment has been classified as being paramountly a matter of local affairs and government or a matter of statewide concern, it is analyzed accordingly. The courts have classified the vast majority of legislative enactments falling into the mixed category as matters, which are paramountly of statewide concern. The legislative or statutory grants of home rule power are found in secs 62.11(5) (cities) and 61.34(1) (villages), Stats. Statutory home rule power is separate and distinct from the constitutional home rule power. These grants of power are very broad and give the governing body of the municipality, except as otherwise provided by law, management and control of the municipality s property, finances, highways, navigable waters, and the public service. The statutes empower the governing body to act for the government and good order of the municipality, for its commercial benefit, and for the health, safety, and welfare of the public, and authorize the governing body to carry out its powers by license, regulation, suppression, borrowing of money, tax levy, appropriation, fine, imprisonment, confiscation, and other necessary means. 6

13 Chapter I: Municipal Governments in Wisconsin Unlike constitutional home rule, legislative or statutory home rule is not limited to local affairs and government. Municipalities may act even in matters of statewide concern when exercising statutory home rule powers although there are limits to what they can do. Municipalities may enact ordinances in the same field and on the same subject covered by state legislation where such ordinances do not conflict with, but rather complement, the state legislation. However, a municipality cannot lawfully forbid what the legislature has expressly licensed, authorized or required or authorize what legislation has forbidden. If the state has expressed through legislation public policy concerning a subject, a municipality cannot ordain an effect contrary to or in qualification of the established public policy unless there is a specific, positive, lawful grant of power by the state to the municipality to so ordain. Where a municipality acts within the legislative grant of power but not within the constitutional initiative, the state has the authority to withdraw the power of the municipality to act. The Wisconsin Supreme Court has devised a four-part test for determining whether such a legislatively intended withdrawal of power, which would necessarily nullify the local ordinance, has occurred. If any one of the following questions is answered with a yes, the ordinance will fail. 1. Whether the legislature has expressly withdrawn municipalities power to act? 2. Whether the ordinance logically conflicts with the state legislation? 3. Whether the ordinance defeats the purpose of the state legislation? 4. Whether the ordinance goes against the spirit of the state legislation? While it appears municipal home rule is alive and well in Wisconsin, a closer look shows a disturbing trend. The courts have been willing to allow implied preemption and the legislature has, with increasing frequency, preempted local regulation or allowed local regulation only when it strictly conforms to state legislation. Emergency Powers In the event of an emergency, Wisconsin municipalities are empowered, despite any other provision of law to the contrary, to declare, by ordinance or resolution, an emergency existing within the city, village or town. This power exists whenever conditions arise by reason of war, conflagration, flood, heavy snow storm, blizzard, catastrophe, disaster, riot or civil commotion, acts of God, and including conditions, without limitation because of enumeration, which impair transportation, food or fuel supplies, medical care, fire, health or police protection or other vital [municipal] facilities. The ordinance or resolution must limit the emergency period to the time during which the emergency conditions exist or are likely to exist. The governing body s emergency power includes the authority to order, by ordinance or resolution, whatever is necessary and expedient for the health, safety, welfare and good order of the [municipality] in the emergency and includes without limitation because of enumeration the power to bar, restrict or remove all unnecessary traffic, both vehicular and pedestrian, from the local highways. If the municipal governing body cannot meet promptly because of the emergency, the chief executive officer or acting chief executive officer is empowered to exercise by proclamation all of the powers conferred upon the governing body which the officer believes necessary and expedient. Any such proclamation is subject to ratification, alteration, modification or repeal by the governing body as soon as it can meet, but the subsequent action taken by the governing body does not affect the prior validity of the proclamation. 7

14 The Reporters Guide to Wisconsin City & Village Government State law requires that municipalities adopt an effective program of emergency management consistent with the state plan of emergency management and appoint a head of emergency management services. The head of emergency management services is responsible for developing and promulgating emergency plans consistent with state plans, directing the emergency management program, directing local emergency management training programs and exercises, advising the county head of emergency services and performing other duties relating to emergency management required by the governing body. 8

15 CHAPTER II Who Governs Cities and Villages? The Common Council A common council consisting of alderpersons and the mayor governs Cities. A common council serves as the legislative arm of city government. It decides policy matters. The corporate authority of the city is vested in the common council and the mayor. The common council enacts ordinances, resolutions and motions; approves and amends the annual budget; levies taxes; approves the paying of claims made against the city; grants licenses issued by the city; and enters into contracts on behalf of the city. The council also appoints or confirms the appointment of certain city officers. The council may conduct business at a meeting only when a quorum is present. Twothirds of all the members of the council constitute a quorum. In cities with five or fewer alderpersons, a majority constitutes a quorum. While the mayor is a member of the council and presides over council meetings, the mayor is not counted in determining whether a quorum is present. Cities may determine the size of their councils. Some cities have as many as twenty council members (Madison), but the average ranges between six and ten. The council is the judge of the election and qualification of its members, may compel their attendance, and may fine or expel for neglect of duty. In order to remove a member, however, the council must comply with the procedures for removal set out in the statutes. Councils may create as many or as few committees as they wish. Common councils may determine by ordinance the size, organization and powers of council committees. The Village Board A board consisting of a president and trustees governs a village. The trustees and the president are typically elected at large. The president-board of trustees form of government does not clearly distinguish between the legislative and administrative branches of government. Rather, the village board exercises executive, legislative and administrative responsibilities. The president is a village trustee who presides at village board meetings and votes on all matters before the board. A majority of the members-elect constitutes a quorum of the village 9

16 The Powers and Duties of Wisconsin Mayors board. The village president, being a trustee is counted in determining whether a quorum is present. The statutes provide that villages shall elect six trustees. Small villages, with populations of 350 or less, are required to have two trustee. However, any village may by ordinance change the number of trustees. That s why the size of village boards varies across the state. Village boards may adopt their own rules of parliamentary procedure. Village boards have power to preserve order at their meetings, compel attendance of trustees and punish nonattendance. The board is judge of the election and qualification of its members. Village boards may create as many or as few committees as they wish. A board may determine by ordinance the size, organization and powers of board committees. Statutory Officers MAYOR The mayor is, by statute, a member of the council, presides at its meetings and may vote on measures before the council in the event of a tie vote. The mayor has the power to veto actions of the council. As chief executive officer of the city, the mayor has a statutory duty to take care that city ordinances and state laws are observed and enforced and that all city officers and employees discharge their duties. The mayor s authority as chief executive officer is not unlimited. For example, a mayor cannot unilaterally decide what uses are to be made of city property and cannot, without prior council approval, enter into a contract on behalf of the city. Also, a mayor cannot, without prior council approval, expend municipal funds. The mayor is the head of the police and fire departments, except in cities where the police and fire commission has been granted optional powers by the electorate. In cities without a police and fire commission, the mayor appoints all police officers. The chief of police has command of the police force under the direction of the mayor, and must obey lawful written orders of the mayor and common council. VILLAGE PRESIDENT The village president is a trustee, with a vote on all matters that come before the board. The president is not designated chief executive officer, but has certain administrative responsibilities. The president presides at all board meetings, and signs all ordinances, rules, bylaws, regulations, commissions, licenses and permits adopted or authorized by the board and all orders drawn on the treasury except as provided by sec , Stats. In addition, the president must maintain peace and good order, see that the ordinances are faithfully obeyed and have charge of the village jail (unless that duty is delegated to a constable or police officer). The president also has a leadership role in coordinating the inter-network of village government, responding to citizens, and representing the village at state and local events. ALDERPERSONS Alderpersons are the individual members of the common council. Alderpersons are generally elected from aldermanic districts although a few municipalities have chosen to have some alderpersons elected at large. The common council is made up of alderpersons and the mayor. In contrast to other city officers, the statutes do not provide a list of duties for alderpersons. Individual alderpersons are not empowered to act on behalf of the city, and can only exercise power when a quorum of the council is present. 10

17 Chapter II: Who Governs Cities and Villages? TRUSTEES Trustees are the individual members of the village board. The president is a trustee, by virtue of the position. Trustees are generally elected at large and represent all village residents rather than those living in a particular district. In contrast to other village officers, the statutes do no provide a list of duties for trustees. A village trustee has no power to act unilaterally and can only act on behalf of the village when a quorum is present. CLERK Although the duties set forth by statute for city and village clerks vary somewhat, they are in large part the same. Generally speaking, the clerk is entrusted with the care and custody of the corporate seal and all papers and records of the city or village. The clerk is required to attend governing body meetings and keep a full record of the proceedings. The clerk is responsible for maintaining a minute book, an ordinance book, and is also required to keep a record of all licenses and permits granted and record all bonds, in appropriate books. The clerk must draw and sign all orders upon the treasury in the manner provided by state law and keep a full accounting in appropriate books. The clerk must carefully preserve all receipts filed with the clerk. The clerk must keep an accurate account with the treasurer and charge the treasurer with all tax lists presented for collection and with all moneys paid into the treasury. The clerk must keep all papers and records in the clerk s office open to inspection at all reasonable hours. The clerk is also authorized to administer oaths and affirmations required by statute. DEPUTY CLERK The clerk may, in writing filed in the clerk s office, appoint a deputy, who shall act under the clerk s direction, and in the clerk s absence or disability or in case of a vacancy shall perform the clerk s duties, and shall have power to administer oaths and affirmations. TREASURER Although the duties set forth by statute for city and village treasurers vary with regard to specific details, they are largely the same. Generally speaking, the treasurer is responsible for collecting all city or village, school, county and state taxes, receiving all moneys belonging to the municipality or which by law are directed to be paid to the treasurer, and paying over the money in the treasurer s hands according to law. The treasurer must also deposit municipal funds upon receipt into the public depository designated by the governing body and keep a detailed account in suitable books in such manner, as the governing body shall direct. The treasurer must keep in a separate book an account of all fees received. The treasurer s books are open to inspection at all reasonable times. The treasurer must make, at times specified by statute and as required by the governing body, a verified report to the governing body of moneys received and disbursed and of the condition of the treasury. The treasurer is required to execute and file an official bond, generally and for purposes of tax collection. DEPUTY TREASURER The treasurer may, in writing filed in the clerk s office, appoint a deputy who shall act under the treasurer s direction and in the treasurer s absence or disability, or in case of a vacancy shall perform the treasurer s duties. COMPTROLLER The office of comptroller is only specified for cities, not villages. The comptroller is responsible for preparing written reports advising the council on the condition of outstanding con- 11

18 The Powers and Duties of Wisconsin Mayors tracts and of each of the city funds and claims payable. The comptroller is also required to annually, on or before October 1, file with the clerk a detailed statement of the receipts and disbursements on account of each fund of the city and of each aldermanic district or other financial district during the preceding fiscal year, specifying the source of each receipt and the object of each disbursement, and also an estimate of the receipts and disbursements for the current fiscal year. The comptroller is responsible for examining the treasurer s accounts and reporting to the council as to their correctness and as to any violation by the treasurer of the treasurer s duty in the manner of keeping accounts or disbursing moneys. The comptroller must examine each claim presented against the city, and determine whether it is in proper form, and if it is on contract, whether authorized and correct. For these purposes the comptroller may swear witnesses and take testimony. If the comptroller finds no objection the comptroller shall mark his or her approval on the claim. If the comptroller disapproves in whole or in part, the comptroller shall report the reasons for that disapproval to the council. The comptroller shall in all cases report evidence taken. The council may not consider a claim and no claim may be referred to a committee until the comptroller has examined the claim and reported on it. The comptroller must countersign all contracts with the city if the necessary funds have been provided to pay the liability that may be incurred under the contract. No contract shall be valid until countersigned by the comptroller. The comptroller must annually make a list of all certificates for the payment of which special taxes are to be levied, in time for the same to be inserted in the tax roll, and certify its correctness. The comptroller may in writing, filed in the office of the clerk, appoint a deputy who shall act under the comptroller s direction and in the comptroller s absence or disability, or in case of a vacancy shall perform the comptroller s duties. The deputy shall receive such compensation as the council provides. The acts of such deputy shall be covered by official bond as the council directs. MANAGER In municipalities with a manager form of government under ch. 64 of the Wisconsin statutes (currently there are ten cities and nine villages), the manager is appointed by the governing body and serves, at the pleasure of the governing body, as the city or village s chief executive officer and head of administration. The manager must be selected on merit, based on professional training and experience in municipal management. The manager possesses all executive and general administrative authority, which was conferred by general law and special charter on the council, the mayor and the various boards and commissions and officers and in force in the municipality at the time it reorganized under ch. 64. The manager has the power to create minor administrative offices and positions and to discontinue such offices and positions. The manager has the power to appoint and remove all heads of departments (subject to sec , Stats., which governs police and fire commissions and police and fire chiefs). ASSESSOR Cities and villages must have an assessor unless a county assessor under Wisconsin Statutes assesses the municipality. The assessor is responsible for assessing real and personal property for purposes of taxation. No person may assume the office of city or village assessor unless certified by the department of revenue as qualified to perform the functions of the office. If a person who has not been so certified is elected to the office, the office is considered vacant and the appointing authority is required to fill the vacancy from a list of persons certified by the department of revenue. 12

19 Chapter II: Who Governs Cities and Villages? A municipality may appoint a corporation or an independent contractor as the assessor. That corporation or contractor must designate the person responsible for the assessment. Only persons certified by the Department of Revenue (DOR) can be designated. The designee must file the official oath of office and sign the affidavit of the assessor attached to the assessment roll. Independent contractor means a person who either is under contract to furnish appraisal and assessment services or is customarily engaged in an independently established trade, business or profession in which the services are offered to the general public. CITY ATTORNEY Although the statutes provide for a city attorney, they do not provide for a village attorney. Nonetheless, most villages have designated a municipal attorney. The duties and responsibilities of a village attorney would be the same as that for city attorney. The statutes provide that the attorney shall conduct all the law business in which the city is interested. When requested by city officers, the attorney must give written legal opinions, which shall be filed with the clerk. The attorney shall draft ordinances, bonds and other instruments as may be required by city officers. The attorney shall examine the tax and assessment rolls and other tax proceedings, and advise the proper city officers in regard thereto. The attorney may appoint an assistant, who shall have power to perform the attorney s duties and for whose acts the attorney shall be responsible to the city. Such assistant shall receive no compensation from the city, unless previously provided by ordinance. The council may employ and compensate special counsel to assist in or take charge of any matter in which the city is interested. POLICE CHIEF Although the chief of police is a designated officer in cities, there is no similar designation in state law governing villages. Nonetheless, villages with a population of 5,000 or more are required to provide police protection services and villages that create police departments typically have a police chief. In cities, the police chief has command of the police force of the city under the direction of the mayor, and must obey all lawful written orders of the mayor or common council. In villages, the police chief would have command of the police force under the direction of the village board. In municipalities where the electors have given the police and fire commission optional powers, the police chief answers to the commission. The police chief holds the office during good behavior, subject to suspension or removal by a police and fire commission or, in those municipalities not required to have a police and fire commission, by a person or body acting in place of the commission. FIRE CHIEF Although the fire chief is a designated officer in cities, there is no similar designation in the state law governing villages. Nonetheless, villages with a population of 5,500 or more are required to provide fire protection services and a village which provides that service by creating its own fire department typically has a fire chief. In municipalities that are required to have a police and fire commission, the commission appoints the fire chief. The fire chief holds the office during good behavior, subject to suspension or removal by the commission. In contrast to the police chief, there is no statutory section that sets forth the fire chief s duties and responsibilities. 13

20 The Reporters Guide to Wisconsin City & Village Government MARSHAL Although the office of Marshal is provided for in ch. 61, the law governing villages, it is not provided for in ch. 62, which governs cities. Of the 382 villages that were League members in 2002, only 8 villages designated a marshal. Any village may, by charter ordinance, discontinue the office of marshal. There are no Wisconsin cases discussing the role of the village marshal but a well-respected treatise on municipal law states with regard to the authority and duty of a marshal, that he or she generally speaking, occupies the same relation to the governmental affairs of the municipality as the sheriff does to the county. CONSTABLE Although it is not widely used, the office of constable exists in both villages and cities. According to the League s database, there are no city constables and only nine village constables. Any city or village may discontinue the office of constable. In towns, the office of constable exists more widely and the town is required to define the constable s jurisdiction and duties. Although some constables duties may be limited to service of court process, any constable who performs the duties of a law enforcement officer must fulfill the training requirements for law enforcement officers required under state law. ADMINISTRATOR Because most governing body members and chief executives in Wisconsin cities and villages are part-time officials, many municipalities have found it expedient to employ full-time administrative personnel to oversee the day-to-day operations of the city or village government in accordance with the policies and procedures adopted by the elected representatives. Even in those communities which have full-time alderpersons or mayors, the routine administrative work is often delegated to elected or appointed administrative officials and department heads such as clerks, treasurers, assessors, directors of public works and comptrollers. The growth in the use of municipal administrators has been steady. According to a 1995 survey of municipal administration in Wisconsin, prepared by the Wisconsin Taxpayer s Alliance, the number of incorporated municipalities with an administrator position rose from 37 in 1976 to 124 in 1995, an increase of 235 percent. The League s member database indicates that 146 municipalities (71 villages and 75 cities) have designated administrators. This number does not necessarily reflect the number of municipalities using an administrator because in addition to those communities which have formally established the position of administrator, it is likely that there are additional municipalities which have an official acting in that capacity, but not formally designated as administrator. The municipal administrator is not a statutorily created position. A municipality under its home rule authority creates it. As such, there is wide variation in how municipalities have responded to the necessity of having full-time administration of local government affairs and the position of administrator differs from municipality to municipality. An individual with the designation of administrator may, in a large city, be an administrative assistant to the mayor and his administrative authority may be limited to that given him by the mayor. In another municipality, the administrator may be responsible for general government functions, including those assigned to the clerk, treasurer, assessor, building inspector and health officer, and activities relating to personnel and planning, along with financial duties of budgeting, accounting and purchasing. In other communities a stronger administrator position may be established with all the general government responsibilities, plus administration of public works, police and fire services, parks and recreation and other city services. 14

21 Chapter II: Who Governs Cities and Villages? Some municipalities have established the position of fulltime administrator, while others have combined two or more administrative offices or positions (e.g., clerk/treasurer) to create a single position that is filled by a full-time, paid professional public servant. In recent years, there has been a trend to combine offices in the hopes of increasing efficiency. Many municipalities have combined positions to create one full-time office to replace two or more parttime offices. This permits the payment of a higher salary and the employment of a qualified individual who will serve on a professional basis. For many small communities it is the only way to have at least one official on duty at all times for the convenience of citizens. Most administrator positions have been created by ordinance. In some cases, however, a charter ordinance may be required, for example if the new position includes the duties of an official who was previously elected, such as the clerk or treasurer. The ordinance may enumerate the duties and responsibilities of the position or provide broad authority for the position. There are several reasons why an administrator-type position may be established. One is the desire to improve the administration of municipal government by having an appointed, full-time official in charge of some or all phases of municipal government. Another is a realization on the part of a governing body that, with the increased size of the municipality and the complexity of present day municipal problems, a part-time council or board needs to be relieved of administrative responsibilities by having a person assigned to be in charge. Other factors may be to aid part-time mayors in carrying out their executive responsibilities and to give continuity to administration of local government services. In the larger cities, the complexities of local government, including state and federal aid applications, budgeting, purchasing, personnel negotiations and financial management, also may prompt consideration of an administrative-type position. Municipal Boards and Commissions The state statutes provide for many different municipal boards and commissions. Some are mandatory while others are optional. Optional boards and commissions may be created at the discretion of the municipal governing body or must be created when the municipality chooses to engage in a particular activity. Typically, boards and commissions are established to supervise and manage special municipal activities. The membership, organization, and powers of municipal boards and commissions are set forth in the statutes authorizing their existence or creation. Municipalities are not limited to statutory boards and commissions. Municipalities may also establish, by ordinance, other boards and commissions not contemplated by the statutes that are designed to address unique local concerns and interests. Mandatory municipal boards and commissions include: Board of Police and Fire Commissioners Sec , Stats. Board of Review Sec , Stats. Zoning Board of Appeals (Mandatory for any municipalities that have enacted zoning regulations.) Sec (7)(e), Stats. Board of Election Officials Sec. 7.30(4), Stats. Local Board of Health (Required in cities located in counties with population of 500,000 or more.) Sec (2), Stats. 15

22 The Reporters Guide to Wisconsin City & Village Government Optional municipal boards and commissions include: Plan Commission Sec (1), Stats. Library Board Sec , Stats. Board of Utility Commissioners Sec , Stats. Board of Park Commissioners Sec , Stats. Board of Public Works Sec (1), Stats. Museum Board Sec & , Stats. Ethics Board Sec (3)(d), Stats. Board of Estimates Sec & 65.02(3), Stats. Airport Commission Sec (2), Stats. Board of Harbor Commissioners Sec , Stats. Civil Service Commission Sec (4), Stats. Board of Public Land Commissioners Sec , Stats. Housing Authority Board of Commissioners Sec (5), Stats. Redevelopment Board of Commissioners Sec (3), Stats. Local Exposition District Sec , Stats. POLICE AND FIRE COMMISSION All cities having a population of 4,000 or more must have a board of police and fire commissioners. Villages with their own police department, having a population of 5,000 or more and less than 5,500, according to the last federal census, may have a board of police commissioners or have a village board committee perform the board s function. Villages with a population over 5,500 must have a board of police commissioners, and villages over 5,000 with a joint police department with another municipality must have a joint board. Those villages whose population is 5,500 or more with their own or joint fire departments must have either a separate or joint board of fire commissioners. At the discretion of the village, these separate boards may be combined into a board of police and fire commissioners. The composition, method of selection, duties and responsibilities of the board of police and fire commissioners are established by state law and may not be altered by local enactment. The board of police and fire commissioners is a civil service body with exclusive jurisdiction over hiring, promotions, and the discipline (i.e., suspension or reduction in rank, suspension and reduction in rank, or termination) of police officers and fire fighters. Its primary functions are to provide for the selection of police and fire employees, including the chiefs of the departments, and to review disciplinary, discharge and promotional actions of the chiefs of the respective departments. It is autonomous from the governing body and other municipal officers with respect to its area of jurisdiction. However, the PFC does not have authority over the day-to-day operation of the police and fire departments unless it has been granted optional powers by the voters at a referendum. A commission that has been granted optional powers has the additional authority to: Organize and supervise the fire and police departments Prescribe rules and regulations for controlling and managing the departments. Contract for and purchase all necessary apparatus and supplies for the use of the departments. 16

23 Chapter II: Who Governs Cities and Villages? Audit all bills, claims and expenses of the fire and police departments before such bill are paid by the municipal treasurer. Only the electors at a referendum can grant optional powers. Placement on the ballot requires filing of a petition signed by not less than twenty percent of the total vote cast in the municipality for governor at the last general election. About fourteen police and fire commissions statewide have been granted optional powers. BOARD OF REVIEW All municipalities must have a board of review. The board is a quasi-judicial (i.e., court like) body that hears and decides appeals by property owners dissatisfied with the value placed upon their property by the municipal assessor for property tax purposes. The general powers, duties and practices of boards of review are described in secs through 70.48, Stats. Boards of review have the following three primary duties: Adjust the assessor s valuation of a parcel when the assessment has been proven incorrect by sworn testimony at hearing before the board. Correct any errors or omissions in the descriptions or computations found on the assessment roll. Check the assessment roll for omitted property and double assessments. BOARD OF PUBLIC WORKS In cities, a department known as the board of public works, consisting of three commissioners, must exist. In second-class cities, commissioners are appointed by the mayor and confirmed by the council at its first regular meeting. In all other cities, the board consists of the city attorney, city comptroller and city engineer. By two-thirds vote the council may determine that the board of public works shall consist of other public officers or persons and provide for the election or appointment of the board members. Alternatively, by a two-thirds vote the council may dispense with the board and provide that the board s duties and powers be exercised by the council or a committee of the council or by such officer, officers or boards as the council shall designate. No similar provision exists for villages except those that have adopted the alternative method of letting contracts. In these villages, the authority vested in the board of public works shall be exercised by the village board or as delegated by the board. PLAN COMMISSIONS Municipalities are allowed by state law to create plan commissions. The organization, powers and duties of plan commissions are set forth in sec (1), Stats. (Note: Section is made applicable to villages by sec , Stats.) Plan commissions have numerous functions and duties relating to land use planning and zoning. They can also be delegated many other related responsibilities. The primary function of a plan commission is developing and recommending the initial adoption or amendment of a comprehensive plan. Plan commissions also play an important role in subdivision regulation. Indeed, the establishment of a plan commission is a prerequisite to the adoption of local subdivision ordinances. At a minimum, plats must be referred to the plan commission for consideration prior to final action by the 17

24 The Reporters Guide to Wisconsin City & Village Government governing body. In addition, the governing body can delegate to the plan commission the power to approve preliminary and final plats. Plan commissions are extensively involved in zoning matters. When a municipality chooses to enact zoning regulations, the plan commission is required to prepare the ordinance and recommend adoption to the governing body. Plan commissions are also required to review and provide recommendations on amendments to the zoning ordinance. Plan commissions are also involved in special zoning issues, such as extra-territorial zoning and shoreland and wetland zoning. With regard to the make-up of the plan commission, the governing body may, by ordinance, provide for any size and membership of the commission that it sees fit to establish. Absent an ordinance establishing a different membership, the statutes state that the plan commission is to consist of seven members appointed by the mayor (or village president in villages) and the mayor (village president) may choose the commission s presiding officer. In addition, the mayor (village president) may appoint himself or herself and other municipal elected or appointed officials to the plan commission. However, the commission must have at least three citizen members who are not municipal officials. Appointments to the commission are to be made in April for three-year terms that expire in April. Appointments can be made at any other time if a vacancy occurs during the middle of a commissioner s term. In cities, mayoral appointments to the plan commission are subject to confirmation by a majority vote of all members of the common council. A village president s appointments to the plan commission, however, are not subject to confirmation by the village board unless the village board has adopted an ordinance providing for board confirmation of such appointments. ZONING BOARDS OF APPEAL Any city or village that has enacted a zoning ordinance must have a board of zoning appeals. This board consists of five members appointed by the mayor or village president subject to confirmation by the common council or village board for terms of three years. The mayor or president must designate one of the members as chairperson. The mayor or president may also appoint two alternate members who have full power to act when a regular member of the board is absent or has refused to vote because of a conflict of interest. The organization, general authorities and procedures of boards of appeals are described in sec (7)(e), Stats. The zoning board of appeals serves as an appellate and review body for decisions of the municipal zoning administrator or building inspector. The board is authorized to grant variances to the terms of a zoning ordinance. In addition, the board may be granted authority to approve special exceptions or conditional uses in accordance with the provisions of the local zoning ordinance. UTILITY COMMISSION Cities and villages owning public utilities, such as water or sewer utilities, may create one or more boards of utility commissioners to manage and administer the utilities. Section , Stats., describes the organization and powers of such boards. A board may consist of three, five, or seven commissioners who are elected by the governing body. The board is authorized to take entire charge and management of the utility, to appoint a manager and determine the compensation of utility employees, and to supervise the operation of the utility under the general control and supervision of the governing body. The board is also authorized to command the services of the municipal engineer. 18

25 Chapter II: Who Governs Cities and Villages? Municipal governing bodies may provide for the operation of a public utility by the board of public works or by another officer or officers, in lieu of a board of utility commissioners. LIBRARY BOARD Municipalities that establish public libraries must establish library boards to administer the libraries. The establishment and operation of public libraries is governed by ch. 43, Stats. The provisions most relevant to municipal library boards are found in sec , Stats., (municipal libraries); sec , Stats., (municipal library board composition); and sec , Stats., (powers and duties of library boards). Library boards in cities of the second or third class consist of nine members, although the common council may, by a two-thirds vote, reduce the number of members to seven. Library boards in cities of fourth class consist of seven members. Village library boards are composed of five members, although two additional members may be appointed so that the board has seven members. Members of the library board must be residents of the municipality, except that not more than two members may be residents of other municipalities. Up to two additional members may be appointed to a library board. The mayor or village president, with the approval of the governing body, appoints members of the library board. Members are appointed for three-year staggered terms starting the third Tuesday in April in the year of appointment. One member of the library board must be a school district administrator or his or her representative. No more than one member of the municipal governing body may serve on the library board at any one time. The library board has exclusive control of the expenditure of all moneys appropriated by the governing body or donated to the library fund. Although the library board has exclusive control of the moneys appropriated for the library fund, the board does not make actual disbursements from the appropriation. Rather, the board audits and approves vouchers for expenditures and forwards these to the municipal clerk, who follows the ordinary procedure for disbursing municipal funds. The library board is authorized to receive, manage and dispose of gifts and donations for library purposes. When a gift or donation is made to a public library, library board members are considered special trustees of such property. The library board has exclusive control and custody of all lands, buildings and other property given or granted to, or otherwise acquired or leased by, the municipality for library purposes. The library board may, if authorized by the governing body, have exclusive control over the purchase of a site and the erection of a library building. Otherwise, the municipal governing body, in the absence of a specific grant of authority to the library board, has the sole right to purchase or acquire sites or erect buildings for library purposes. However, in the case of a gift for a library building, the library board has the exclusive right to select and contract for the purchase of a site. The library board has control over the hiring, firing and fixing of wages of library employees. Municipal governing bodies retain some control over the number of library employees and compensation paid to such employees by virtue of the fact that they control the purse strings. A municipality s ability to control the number of library employees and their salary by a reduction in funding is limited by the need to fund libraries at a level not lower than the average of the previous three years as required by state law to retain membership in a public library system and remain eligible for state funding. 19

26 The Reporters Guide to Wisconsin City & Village Government Municipal Courts A municipal court is authorized to hear and decide actions for violations of municipal ordinances of the municipality that operates the court. Since a municipal ordinance is only enforceable within the boundaries of the municipality that enacted the ordinance, the territorial jurisdiction of a municipal court is the same as the geographical boundary of the municipality that operates the court. An exception to this limitation on a municipal court s territorial jurisdiction exists for truancy violations. A municipal court in a municipality that has adopted a truancy ordinance, and is located in the same municipality as the administrative center of the school district, in which a student is enrolled, may exercise jurisdiction in proceedings against such student for a violation of the truancy ordinance. Thus, a student may attend a school that is located outside of a municipality s boundaries but may be prosecuted for violating the municipality s truancy ordinance in its municipal court if the administrative center for the school district is located in the municipality. There is another statutory provision that qualifies the foregoing statements on the territorial jurisdiction of a municipal court. A municipal judge has country-wide jurisdiction. If a judge is elected in a city or village lying in more than one county, the judge shall qualify and have jurisdiction in each county, the same as though the municipality lay wholly therein, and may hold court in one county while exercising jurisdiction in the other. The subject matter jurisdiction of municipal courts is limited. Unlike circuit courts, a municipal court is not authorized to hear and decide cases where a defendant is charged with an offense for which incarceration is a possible penalty. As noted above, a municipal court is only authorized to hear and decide ordinance violation cases. Moreover, this jurisdictional power is further limited to ordinance violation actions for which forfeiture is sought. As a result, a municipal court, unlike a circuit court, has no authority to issue an injunction or order other equitable relief There are two exceptions to or qualifications on a municipal court s subject matter jurisdiction. First, a municipal court does have authority to order a defendant to pay restitution for damage to property or a person upon conviction of an ordinance with a statutory counterpart or in operating while intoxicated (OWI) cases. Second, even though a municipal court generally has no authority to order a person to tear down or repair a dilapidated structure or perform some act, a municipal court may impose a forfeiture for a violation but order it reduced to some lesser amount (but not less than the minimum penalty allowed under the ordinance for the violation) if the defendant takes some specific action (e.g., paints the house by such and such a date or has no contact with a particular person during a specified period of time). In this manner, a degree of equitable relief is attainable in municipal court. In some instances, municipal courts share jurisdiction with other courts. For example, a municipal court has concurrent jurisdiction with a juvenile court for children twelve or older in cases involving a violation of a municipal ordinance. Thus, if the nature of the violation or other circumstances surrounding the ordinance violation by a juvenile warrant it, the case may be heard in a juvenile court that has a greater range of options to address the issues rather than municipal court with more limited powers A municipal court may lose its jurisdiction over a matter. For example, a municipal court does have jurisdiction in first offense OWI cases. However, the court loses its jurisdiction to hear the case if the defendant files a timely request to transfer the case to circuit court. A municipal court also loses jurisdiction over an OWI or any other case if it is transferred to a circuit court subsequent to a defendant s timely request for substitution of the municipal judge and no other municipal judge is available to hear the case. 20

27 Chapter II: Who Governs Cities and Villages? POWERS Like other courts in the Wisconsin court system, a municipal court has the power to decide the cases within its jurisdiction. However, a municipal court has no power to commence such an action on its own or direct a municipality to commence an action against any person. Like other courts, a municipal court is directed through the rules of judicial conduct to function as an unbiased arbiter of facts and law for the resolution of disputes. It is not a prosecutor or an otherwise interested party. A municipal court has the power to find a defendant guilty or not guilty of the violation charged. If the municipality proves the violation by the required level of evidence, there is no legal authority for a municipal court to amend the charge and convict a defendant of a lesser violation or dismiss the case even if the defendant complies with conditions that might be imposed by the court. If a municipal court finds a defendant guilty, it has the power to order the payment of a forfeiture, costs, applicable assessments, and, if the conviction is for a violation of an ordinance with a statutory counterpart, restitution for damage to a person or property. If a court finds a defendant guilty, it does not have the power to impose a penalty less than the minimum allowed by the ordinance. It must impose at least the minimum forfeiture for each violation or day of violation proved. A municipal court also has the power to impose a penalty for nonpayment of the forfeiture, costs, assessments, or restitution ordered paid. These alternate penalties include drivers license suspension (in violations of traffic ordinances), incarceration and, if all parties agree (the court, defendant, municipality, and, if applicable, the person owed restitution), community service. A municipal court is also vested with other powers to facilitate the administration of the court and its cases. These include authority to issue civil warrants for the arrest of a person or persons and inspection warrants to allow inspectors to determine compliance with building, electrical, plumbing, fire, health and zoning codes. A municipal court also has the power to issue a summons requiring a defendant to appear before the court and subpoenas to require the appearance of witnesses and the production of evidence. In addition, if the municipality has adopted an ordinance granting the municipal court contempt authority, it may impose forfeiture not to exceed $50 for contempt of court or, upon nonpayment of the contempt forfeiture or applicable assessment, a jail sentence not to exceed seven days. 21

28 The Reporters Guide to Wisconsin City & Village Government 22

29 CHAPTER III Money, Money, Money! Decisions about money are among the most important ones that elected officials make. James Donoghue, Local Government in Wisconsin, Wisconsin Blue Book Perhaps the biggest challenge facing local government is determining what services to offer and how to fund them. Susan Paddock, The Changing World of Wisconsin Local Government, Wisconsin Blue Book Municipal policy decisions are almost always tied to decisions about money. This chapter focuses on how Wisconsin municipalities make policy decisions in the context of preparing, adopting and administering an annual budget. It also looks at the sources of revenue available to Wisconsin municipalities and property tax administration. Budgeting Municipal governing bodies must allocate scarce resources to programs, services and capital assets through the budget process. Consequently, it is one of the most important activities undertaken by local governments. THE STATE BUDGETING LAW State law requires all municipalities in Wisconsin to adopt an annual budget. A budget is a projected financial plan or fiscal blueprint that outlines how municipal funds will be raised and spent. Technically, for purposes of complying with state law, a budget is an ordinance or resolution enacted by the governing body that meets the requirements of sec (2), Stats. Under sec (2), the following information must be included in a municipal budget: all existing indebtedness and all anticipated revenue from all sources during the ensuing year; 23

30 The Powers and Duties of Wisconsin Mayors all proposed appropriations for each department, activity and reserve account during the ensuing year; actual revenues and expenditures for the preceding year, actual revenues and expenditures for not less than the first six months of the current year and estimated revenues and expenditures for the balance of the current year; all anticipated unexpended or unappropriated fund balances, and surpluses. BUDGET SUMMARY AND BUDGET HEARING A municipal governing body must, before adopting the annual budget, hold a public hearing on the proposed budget to allow citizen comment. To inform the public about the proposed budget, the municipality must publish the following information as a class 1 notice under ch. 985, Stats., at least fifteen days before the date of the public hearing on the budget: A budget summary that includes information specified by state law; A notice of the place where the proposed budget in detail may be inspected (e.g., the clerk s office); A notice of the time and place of the budget hearing. The published budget summary must contain the following information for the current budget and the proposed budget, and must also include the percentage change between the current and proposed budgets: General fund expenditures in the following categories: general government; public safety; public works; health and human services; culture, recreation and education; conservation and development; capital outlay; debt service; other financing uses. General fund revenues from the following sources: taxes; special assessments; intergovernmental revenues; licenses and permits; fines, forfeitures and penalties; public charges for services; intergovernmental charges; miscellaneous revenue; other financing sources. All beginning and year-end governmental and proprietary fund balances. The contribution of the property tax to each governmental fund and to each proprietary fund that receives property tax revenue and the totals for all funds. Revenue and expenditure totals, by fund, for each governmental fund, and for each proprietary fund and the revenue and expenditure totals for all funds combined. In addition, the budget summary must include an itemization of proposed increases and decreases to the current year budget due to new or discontinued activities or functions. 24

31 Chapter III: Money, Money, Money A public hearing on the proposed budget must be conducted not less than fifteen days after the budget summary is published. Sometime after the public hearing, either at the same meeting or at a subsequent one, the budget ordinance or resolution is formally adopted by the governing body. In cities, the budget ordinance or resolution is submitted to the mayor for his or her approval. Mayors are authorized to veto actions of the common council. If the mayor vetoes the budget, it is sent back to the council where a two-thirds vote of all the members is required to override the veto. Statutory law does not authorize a partial veto by a mayor. However, cities may rely on their constitutional home rule powers to enact a charter ordinance providing for partial line or item veto of the municipal budget by the mayor. Once a budget has been adopted by the governing body and, in cities, approved by the mayor, it provides the authorization to levy taxes and spend the authorized appropriations. The provisions of an adopted budget are obligatory and may be amended only by following certain procedures described below. DEADLINE FOR ADOPTING A MUNICIPAL BUDGET State law does not set forth a specific date by which a municipal budget must be enacted. Certainly the budget must be adopted by the end of the year because villages and cities operate on a calendar fiscal year. For all practical purposes, however, the budget should be adopted by the end of November or, at the latest, the beginning of December. Otherwise, the municipality will be unable to comply with certain other deadlines relating to the property tax collection process. For example, village boards must determine the village s tax levy by December 15. Also, the municipal clerk must transfer the tax roll to the municipal treasurer by December 8. (This deadline is extended to the third Monday in December if the municipality has in effect a policy of issuing refund checks to taxpayers whose escrow check for property taxes exceeds the actual tax bill within fifteen business days after receiving the escrow payment.) In addition, the clerk must return the annual Statement of Taxes, showing all taxes levied in the municipality, to the Department of Revenue (DOR) and county treasurer on or before the third Monday in December. Moreover, many municipalities have their tax bills printed by the county or a private service provider. In such situations, the municipality will need to have its budget adopted in time to comply with the county s or private service provider s deadline for receiving the tax roll. Practically speaking, the deadline for adopting a budget is dictated by other deadlines, both statutory and otherwise, designed to ensure that tax bills are sent to taxpayers by Christmas so that taxpayers can pay their property tax bills before the end of the year. BUDGET CHANGES A two-thirds vote of the entire governing body is required to change an adopted budget, and a class 1 notice of the change must be published under ch. 985 within ten days after the change is made or the change is invalid. This process must be followed when altering the amount of tax to be levied, the amounts of the various appropriations and the purposes for such appropriations stated in the budget. However, transfers from the contingency fund to other budgeted accounts may be done under normal voting requirements, without the necessity of an extraordinary vote and a class 1 notice publication. 25

32 The Powers and Duties of Wisconsin Mayors NON-LAPSING RESERVE FUNDS In general, municipalities may not accumulate unappropriated surplus funds. However, cities and villages may: 1. maintain reasonable amounts of unappropriated funds on hand to meet immediate cash flow needs, and 2. accumulate needed capital in non-lapsing funds to finance specifically identified future capital expenditures (e.g., new fire truck, village hall or library). BOARD OF ESTIMATES BUDGET SYSTEM The budget development and adoption process set forth in sec , Stats., applies to nearly all Wisconsin municipalities. However, as mentioned above, the City of Milwaukee follows the budget system set forth in secs to 65.20, Stats. Any other city may, by ordinance adopted by three-fourths of all the members of the common council, adopt this budget development process. Only a few municipalities, such as the City of Madison, have done so. Under this alternative budget development process, the city must create a Board of Estimates made up of key city officers such as the mayor, president of the common council, city attorney, and comptroller. The Board of Estimates receives budget requests from each city department and prepares and submits a proposed budget to the common council by October 25 each year. Sources of Local Revenue Wisconsin municipalities finance public services and capital assets through a combination of taxation, shared revenue and state aids, special assessments, user fees, license and permit fees and borrowing. Each of these and a number of other revenue sources are described below in more detail. THE GENERAL PROPERTY TAX The primary source of tax revenue for Wisconsin cities and villages is the general property tax. The general property tax is an annual ad valorem (according to value) tax levied on real and personal property located within the municipality. Wisconsin municipalities, counties, and school districts, by necessity, rely on the property tax more than local governments in most other states. This heavy reliance has contributed to above-average property tax levels. Indeed, property taxes account for virtually all local tax revenue in Wisconsin, approximately 95% in The reasons for this are: 1. municipalities have been granted little authority to levy other types of taxes (e.g., sales or income taxes); and 2. municipalities do not fully use the few local tax options authorized by state law such as the wheel tax. Revenue Options for Wisconsin Municipalities, Wisconsin Taxpayers Alliance, September On average, in 1999 the property tax represented approximately 26.2% of all villages revenue and approximately 23.3% of all cities revenue. Wisconsin Legislative Fiscal Bureau, Property Tax Level in Wisconsin, Informational Paper #13, January

33 Chapter III: Money, Money, Money LOCAL TAX OPTIONS Wisconsin Municipalities may levy only those taxes that are authorized by the state legislature. Municipalities are explicitly prohibited from levying a tax on income. Cities and villages have no authority to levy a general sales tax. However, municipalities are authorized to levy the following optional taxes: 1. a wheel tax, which is a municipal registration fee for certain motor vehicles; and 2. a room tax, which is a sales tax on establishments providing short-term lodging to the public. Counties, but not municipalities, are authorized to levy a 0.5% sales tax on the same goods and services as the state sales tax. Counties are authorized, but not required, to share sales tax revenue with municipalities and school districts, but none has done so. Under certain limited circumstances, a small number of municipalities may levy special sales taxes. All of these options are discussed in more detail below. The Wheel Tax Since 1983, state law has permitted any municipality or county to adopt an ordinance that imposes a flat, annual registration fee on automobiles and trucks of not more than 8,000 pounds customarily kept within that jurisdiction. There is no limit on the amount of the fee. The Department of Transportation (DOT) collects the fee when the annual state registration fee is paid. DOT retains ten cents per registration for administrative costs. The rest of the fee is remitted to the jurisdiction imposing the fee. Municipalities are permitted, but not required, to share any portion of the fee with the county or vice versa. Revenues from the wheel tax must be used for transportation related purposes. The following five governments are the only ones that have imposed a wheel tax: 1. City of Kenosha, a $10 fee from 1977 to 1978; 2. City of Beloit, a $10 fee from 1986 to the present; 3. City of Amery (Polk County), a $5 fee from 1987 to 1991; 4. Marathon County, a $10 fee from 1987 to 1988; and 5. City of Sheboygan, a $10 fee from 1990 to the present. The Room Tax Since 1967, towns, villages and cities have been authorized to impose a tax on establishments providing rooms or short-term lodging to the public. In general, the tax applies to hotels, motels and rooming houses for lodging furnished for less than one-month. The tax applies only to gross receipts from furnishing sleeping accommodations; therefore, food and other items or services furnished by hotels or motels are not subject to the tax. The room tax is in addition to state and county sales taxes that apply to room charges. Legislation enacted in 1994 imposed a maximum tax rate of 8% and required that at least 70% of any new or increased room taxes be used for tourism promotion and development. Certain municipalities, such as Madison and Milwaukee, are authorized to exceed the 8% maximum limit and fall below the 70% tourism promotion requirement for new room tax revenues. 27

34 The Powers and Duties of Wisconsin Mayors Any amount of room tax collected that must be spent on tourism promotion must either be spent directly by the municipality for that purpose or forwarded to a commission on tourism promotion and development if the municipality has created such a commission. To implement a room tax, a municipal governing body must adopt an ordinance that authorizes the tax, determines the tax rate and designates the date the tax takes effect. The last complete information regarding municipalities that levy the tax is provided by financial reports filed with DOR for According to those reports, 145 of the state s 1,850 cities, villages and towns collected the tax in The Wisconsin Taxpayers Alliance and the Wisconsin Legislative Fiscal Bureau have conducted surveys on municipal room tax rates. These surveys found that room tax rates range from 1.5% to 8%. The most common rate was 5%. The number of municipalities that have implemented a room tax increased by 56.5% between 1989 and Further, room tax rates have tended to increase since In 1989 and 1994, the portion of municipalities with a room tax rate greater than 5% was 15.2% and 26.4%, respectively. In 2001, 32.9% of these municipalities had a room tax rate greater than 5%. Wisconsin Legislative Fiscal Bureau, Local Government Revenue Options, Informational Paper #15, January SHARED REVENUE AND STATE AIDS Through the shared revenue program, the State of Wisconsin distributes tax revenues to municipal and county governments for use at their discretion. In 2003 municipalities are projected to receive $776.8 million through this program. Wisconsin s practice of sharing state tax revenues with local governments dates back to 1911 when a share of the new state income tax was earmarked for local governments to compensate them for property tax exemptions for intangible property and household furnishings. Initially, the state employed a return to origin shared tax system where a percentage of certain state taxes was earmarked for return to local governments based on the taxpayer s residence or location. The following information on the shared revenue program is taken from the Wisconsin Legislative Fiscal Bureau, Shared Revenue Program, Informational Paper #18, January The Shared Revenue Formula In the early 1970s, the state legislature modified how shared revenue was distributed to further the goal of equalizing the financial ability of municipalities to furnish services to their residents. Consequently, a major goal of the current shared revenue program is to provide funds to equalize local governments revenue raising capacity by sending proportionately larger amounts of aid to fiscally weaker municipalities. From the 1970s until 2002, when the distribution formula was suspended, the shared revenue distribution was calculated under a formula consisting of the following four components: 1. Aidable Revenues Component. Aidable revenues is the dominant component of the shared revenue program. The aidable revenues formula is based on the principle of tax base equalization and allocates state aid to municipalities to offset variances in taxable property wealth. Entitlements are calculated using two factors: (1) per capita property wealth; and (2) net local revenue effort (the amount of specified revenues the district raises to meet its expenses). The lower a local government s per capita property wealth and the higher its net revenue effort, the greater is the local government s aidable revenues entitlement. Per capita property wealth equals the total equalized value of all taxable property (manufacturing real estate value is excluded for municipalities) divided by population. 28

35 Chapter III: Money, Money, Money 2. Per Capita Component. The per capita component provides a more broad-based aid distribution than aidable revenues. Without adjusting for property wealth, expenditure needs, tax rate or other factors; each municipality receives the same per capita payment. Hence, rather than providing aid to jurisdictions with specific characteristics, the per capita component distributes aid on a universal basis. The total municipal per capita distribution has been fixed at $142,706,480 since As the state s population grows, the per capita payment rate has decreased from $30 per person in 1982 to $26.71 per person in If the per capita component was being administered for municipalities in 2003, the estimated reimbursement rate would be $25.95 per person. 3. Public Utility Component. An annual payment to municipalities to replace property tax revenues lost because utilities are exempt from property taxation and to offset municipal costs of providing services to public utilities located within their boundaries. Although it is only 2.5% of the total shared revenue distribution, the public utility component can be a major part of the total payment for a municipality containing a large power plant. In general, the public utility distribution for cities and villages is computed by applying a mill rate to the net book value of qualifying state-assessed public utility property. Payments to cities and villages are computed at a rate of six mills ($6 per $1,000 of net book value). The major type of qualifying property is the electric power generating plant, although substations and general structures, such as office buildings, also qualify for payments. Payments are subject to two limits. The value of utility property at a specific site is limited to $125 million. Also, payments to a municipality cannot exceed a maximum of $300 per capita. 4. Minimum Guarantee and Maximum Growth Component. The minimum guarantee and maximum growth components are designed to prevent large decreases or increases in shared revenue payments to a municipality from occurring in a short period of time. The calculations for the minimum and maximum components exclude the distributions under the public utility aid component. The minimum guarantee ensures that a local government receives a shared revenue payment that is equal to at least 95% of the prior year s payment. Thus, payments will not decline by more than 5% a year. In 2001, approximately 742 cities, villages and towns (40% of the municipalities in the state) received minimum guarantee payments. The maximum growth limit is a floating limit determined annually. The maximum growth limit is set at a level that generates the exact amount needed for minimum guarantee payments. In 2001, the maximum growth limit was set at 2.9% for municipalities. Thus, if a municipality s 2001 shared revenue entitlement exceeded 102.9% of the comparable 2000 total, that excess was withheld and used to fund municipal minimum guarantee payments. This component reduced entitlements for an estimated 439 cities, villages and towns in As explained below in more detail, provisions in 2001 Wisconsin Act 16 (the biennial budget) suspended the above distribution formula for payments to municipalities in 2002 and Instead, each municipality s payment in 2002 and 2003 equals 101% of the amount the municipality received in the prior year. 29

36 The Powers and Duties of Wisconsin Mayors 2001 Wisconsin Act 109 Modifications A number of changes will be made to the shared revenue program as a result of provisions included in 2001 Wisconsin Act 109 (the budget adjustment bill). After the 2003 distributions under the shared revenue, small municipalities shared revenue, and mandate relief programs, the language authorizing those programs will remain in the state statutes, but payments under them will be suspended, except for the utility aid component of the shared revenue program. Payments under the utility aid component of the shared revenue program will continue in 2004 and beyond. Beginning in 2004, the Act authorizes payments to municipalities and counties under a new program entitled county and municipal aid. The program is authorized under sec of the statutes and funded from a newly created appropriation entitled county and municipal aid account. Each municipality and county will receive a payment in 2004 based on the sum of its payments in 2003 under the shared revenue (except for utility aid), small municipalities shared revenue, and mandate relief programs. Payments will equal the 2003 amounts, reduced on a per capita basis, so that the sum of all reductions equals $40 million. Based on the state s current population, a per capita reduction rate of $3.67 is estimated. Total county and municipal aid payments are estimated at $912.8 million. This figure will change based on the actual 2003 utility aid payment. Act 109 creates a second, new program that will provide consolidation incentive payments to municipalities and counties that agree to consolidate municipal or county services, beginning in Prior to September 1 of each year, local governments can apply to the Department of Revenue for payments in the succeeding year by submitting copies of their consolidation agreements and estimates of the savings resulting from the consolidations. Payments will be limited to the first year in which a consolidation agreement takes effect. Payments will equal 75% of the estimated savings, but total payments cannot exceed $45 million. If eligible applications result in payments in excess of that amount, payments will be prorated. Consolidation incentive payments will be funded by reducing each government s county and municipal aid payment, as described above, on a proportional basis. Based on estimated county and municipal aid of $912.8 million, consolidation incentive payments of $45 million would require payment reductions of 4.9%, in addition to the per capita reduction described above. A smaller reduction rate would be applied if consolidation incentive payments are less than $45 million. For example, payments totaling $10 million would result in a reduction rate of 1.1%. In 2005 and in each year thereafter, each municipality and county will receive a county and municipal aid payment equal to the amount calculated in 2004, as described above. Those amounts will subsequently be adjusted for any consolidation incentive payments for that year. SCHEDULE OF SHARED REVENUE PAYMENTS Payments are made to municipalities on the fourth Monday in July (15% of the total) and the third Monday in November (85% of the total). The Department of Revenue notifies local governments on or before September 15 of their estimated payment for the following calendar year. This procedure allows municipalities to anticipate aid amounts when they are setting their budgets for the coming year. Although not every unit of local government receives a payment under each formula component, each town, village, city and county receives a payment under at least one component. 30

37 Chapter III: Money, Money, Money SHARED REVENUE FUNDING LEVEL Between 1991 and 2001 funding of the shared revenue program increased at an average annual rate of only 0.9%. However, the period between 1991 and 1995, when average annual increases of 2.3% occurred, must be distinguished from the period between , when funding remained frozen at $950.6 million. The state budget froze the shared revenue formula and provided a 1% annual increase in shared revenue payments to municipalities. Under current law, the total amount of shared revenue payments the state plans to distribute to municipalities in 2003 is $776.8 million. EXPENDITURE RESTRAINT & SMALL MUNICIPALITIES SHARED REVENUE PROGRAM The expenditure restraint and small municipalities shared revenue programs provide targeted, general aid to towns, villages and cities. The aid is targeted in that municipalities must qualify for a payment by meeting certain eligibility criteria. The payments are characterized as general aid because the dollars are unrestricted, to be spent however the municipality determines. The distributions for 2002 were set at $57,570,000 for the expenditure restraint program and $11,110,000 for the small municipalities shared revenue program by the last state budget. The following information on the two programs is taken from Wisconsin Legislative Fiscal Bureau, Targeted Municipal Aid Programs, Informational Paper #19, January DOR administers both programs. By September 15 of each year, the department provides estimates of the succeeding year s payments to qualifying municipalities. This procedure allows municipalities to anticipate aid amounts when they are setting their budgets for the coming year. Small municipalities shared revenue is paid 15% on the fourth Monday in July and the balance on the third Monday in November, on the same schedule as shared revenue. Expenditure restraint aid is paid in its entirety on the fourth Monday in July. EXPENDITURE RESTRAINT PROGRAM A municipality must satisfy two eligibility criteria to receive an expenditure restraint payment: 1. Municipal Tax Rate. A municipality must have a full value property tax rate for operation of city, village or town government that exceeds five mills. The tax rate for the second year prior to the payment year is used for this test. Therefore, to be eligible for the 2001 payment, a municipality s local purpose tax rate for the 1999 (payable 2000) levy had to exceed $5.00 per thousand of full value. There were 479 municipalities that met this test relative to 2001 aid payments. 2. Budget Restraint. A municipality must restrict the rate of year-to-year growth in its budget to a percentage determined by statutory formula. The statutes define municipal budget as the municipality s budget for its general fund exclusive of principal and interest payments on long-term debt. The statutes prohibit municipalities from meeting the budget test by creating other funds, unless those funds conform to generally accepted accounting principles (GAAP). These principles have been adopted by the Governmental Accounting Standards Board to offer governments guidelines on how to maintain their financial records. For the year prior to the aid payment, the rate of budget growth cannot exceed the inflation rate plus an adjustment based on growth in municipal property values. The inflation 31

38 The Reporters Guide to Wisconsin City & Village Government rate is measured as the change that occurred in the Consumer Price Index (CPI) in the oneyear period ending in September two years prior to the payment year. The property value adjustment to the CPI rate is unique for each municipality and equals 60% of the percentage change in the municipality s equalized value due to new construction, net of any property removed or demolished, but not less than 0% nor more than 2%. The allowable increase is known at the time when municipal officials set their budgets. To be eligible for a 2001 payment, municipalities were required to limit their 2000 budget increases to 1.9% to 3.9%, depending on individual municipal adjustments due to property value increases. The Department of Revenue certifies the change in the CPI annually on November 1 to the Joint Committee on Finance. Based on the November 1, 2000, certification, municipalities were required to limit the growth in their 2001 budgets to no more than 3.2% to 5.2%, depending on their applicable adjustment for growth in property values, to be eligible for a 2002 expenditure restraint payment. For 2001 payments, 479 municipalities met the tax rate test, but only 270 municipalities also met the budget test. Thus, 209 municipalities either did not meet the budget test or did not submit budget worksheets to DOR on a timely basis. Each year, the Department of Revenue notifies municipalities meeting the tax rate eligibility requirements. To receive a payment, those municipalities must submit a budget worksheet to DOR by May 1. The department uses the worksheet to verify compliance with the budget restraint requirement. Qualifying municipalities are informed in September of the expenditure restraint payment to be received the following July. The formula for distributing expenditure restraint payments is based on municipal levy rates and full values. SMALL MUNICIPALITIES SHARED REVENUE The small municipalities shared revenue (SMSR) program was created in 1991 as part of the biennial budget act, but no funding was provided until In the initial proposal to create the program, it was named the small community improvement program (SCIP), and this acronym continues to be used on occasion as a reference to the program. A municipality must meet three eligibility criteria to receive a SMSR payment: 1. Municipal Population. A municipality must have a population of 5,000 or less. Each year, the Department of Administration estimates the population of each municipality, and the population for the year prior to the payment is used to determine eligibility under this provision. There were 1,689 cities, villages and towns that met the population test for Municipal Tax Rate. A municipality must have a full value property tax rate for operation of city, town or village government equal to at least one mill. The tax rate for the second year prior to the payment year is used to make this determination. Therefore, to be eligible for the 1999 payment, a municipality s local purpose tax rate for the 1999 (payable 2000) levy had to exceed $1.00 per thousand of full value. Of the 1,689 municipalities with populations below 5,000, there were 1,561 municipalities that met this test relative to 2001 aid payments. 3. Full Value. The total full value for a municipality must be no more than $40 million, except for municipalities with a land area exceeding 54 square miles. There is no maximum allowable value for municipalities larger than 54 square miles. This determina- 32

39 Chapter III: Money, Money, Money tion is based on equalized values, exclusive of manufacturing real estate, for the year prior to the payment year. Of the 1,689 municipalities with populations below 5,000, there were 944 municipalities that met this test relative to 2001 aid payments. For payments made in 2001, 880 municipalities met all three eligibility criteria (621 towns, 239 villages and 20 cities). The formula for distributing SMSR payments is based on three components, which include a basic formula, a minimum guarantee and a maximum payment constraint. Earlier in the program s history, entitlements under the three components exceeded the program s appropriations and, as a result, entitlements were prorated. In recent years, entitlements under the formula have been less than the program s appropriations, so entitlements were prorated up. For example, in 2001 entitlements equaled $9,179,855 while the appropriations equaled 11 million. As a result, payments equaled 119.8% of entitlements. As explained above, payments under the small municipalities shared revenue program will be suspended after the 2003 distributions. Payments for Municipal Services Program State agencies are required to make reasonable payments at established rates for water, sewer, electric, garbage collection and other services provided by a municipality to state facilities which are financed in whole or in part by special charges or fees. Sec (1), Stats. Also, since 1973, the state has appropriated funds under the payments for municipal services program (PMS program) to reimburse municipalities for all or a portion of property tax supported services, such as police and fire protection, provided to state facilities, which are exempt from property taxation. Sec (2), Stats. In , $21,565,300 was paid by the state through the PMS program. Annual payments to towns, villages and cities are determined largely by formula. Payment adjustments may be made as a result of negotiations between a municipality and the Department of Revenue. Payments are not made until the Joint Committee on Finance reviews and approves the results of the formula calculations. If the PMS appropriation is not sufficient to fund total entitlements, payments are prorated by a percentage equal to the PMS appropriation divided by the total entitlements. If the appropriation exceeds total entitlements, the excess lapses to the general fund. In 2000, entitlements exceeded appropriations so that payments equaled 94.5% of entitlements. Wisconsin Legislative Fiscal Bureau, Payments for Municipal Services Program, Informational Paper #20, January Transportation Aids The largest state aid program, outside of shared revenue, both in terms of amount paid to municipalities and number of municipalities that receive the aid, is the general transportation aid program. General transportation aid is paid to municipalities to assist in the maintenance, improvement and construction of local roads. The aid must be used for transportation-related expenditures. Aid payments are made from the state s segregated transportation fund, which includes revenues from the motor fuel tax, vehicle registration fees and other transportation-related taxes and fees. In total general transportation aid payments for counties, cites, villages and towns equaled 29.5% of the transportation fund appropriations. Wisconsin Legislative Fiscal Bureau, Transportation Aid, Informational Paper No. 22, January In 1999, per capita transportation aid payments were $52 for cities and $48 for 33

40 The Reporters Guide to Wisconsin City & Village Government villages. This compares to $67 for towns. Wisconsin Legislative Fiscal Bureau, Municipal and County Finance, Informational Paper No. 16, January General transportation aid is calculated and paid on a calendar-year basis, with quarterly payments on the first Monday of January, April, July and October. The Department of Transportation (DOT) is required, by October 1, of each year, to notify each municipal clerk of the estimated transportation aid payments to that county or municipality for the following calendar year. There are two basic formulas by which general transportation aids are distributed: share of costs aid, and mileage aid. Municipalities receive payments based on which ever is the greater between the share of costs aid or mileage aid amounts. 1. Share of Costs Aid. Share of costs aid amounts are computed by multiplying each municipality s six-year average highway-related costs by a statewide average cost-sharing percentage. For the 2000 distribution, the most recent year the formula was used, the municipal cost-sharing percentage was 22%. 2. Mileage Aid. Mileage aid amounts are computed by multiplying the number of miles of road or street under the jurisdiction of each municipality by a specified mileage rate ($1,704 per mile in 2000). Under the biennial state budget, the general transportation aid formula was suspended for calendar year 2001 aid payments. In 2001, each municipality received payments equal to the aid amount that was received under the formula calculation for calendar year The formula was restored for 2002 and For the purpose of determining transportation aid, municipalities, with the cooperation and assistance of DOT, must conduct a biennial assessment of the physical condition of the highways within their jurisdiction and report the results to DOT. Municipalities are required to use a pavement rating system approved by DOT when making these assessments. In addition, all local governments must report their highway-related expenditures for each calendar year. The Department of Transportation has developed cost reporting guidelines to be used by municipalities for cost reporting purposes. This information is submitted on financial report forms required by the Department of Revenue, which relays this information to DOT. Small municipalities (population under 2,500) must report highway-related costs for each calendar year by March 31 of the following year. Large municipalities must report by May 1 of the following year. For municipalities with populations over 25,000, an audited financial statement with supporting schedules must accompany the standard financial report and must be submitted by July 31, of the following year. Wisconsin Legislative Fiscal Bureau, Transportation Aid, Informational Paper No. 22, January While the general transportation aids program accounts for the vast majority of money municipalities receive from the state for road purposes, other transportation aid programs include connecting highway aid and lift bridge aid. Recycling Grants The Department of Natural Resources (DNR) administers a municipal and county recycling grant program that provides financial assistance to responsible units of local government for eligible recycling expenses. A responsible unit is the local unit of government responsible for implementing state-mandated recycling programs and can be the town, village, city, county, Indian tribe or a multiple-jurisdiction unit. 34

41 Chapter III: Money, Money, Money When the program was created in 1990, the grant program was designated to end with calendar year 1999 grants Act 27 extended the grant program through the year 2000 with $24,000,000 in grant funding Act 9 increased the annual amount of grant funding to $24,500,000 beginning in 2000 and established that amount as an annual appropriation, with no statutory end date for grant funding. The biennial state budget retained the annual amount of grant funding at the level of $24.5 million. Municipal and county recycling grants averaged 30.4% of the estimated net eligible recycling costs of responsible units of local government in 2000 and 29.0% in Local governments use the grants to implement effective recycling programs that include specific components, and to comply with the landfilling and incineration bans that prohibit certain recyclable materials from being landfilled (for example, newspapers, aluminum cans and glass containers). The remaining cost of local recycling programs is paid by each local government from local property tax revenues. In some communities, volume-based or other user fees are charged to recover a portion of the cost of implementing a recycling program. The average municipal and county recycling grant as a percent of net eligible costs has decreased from almost 52% in 1992 to 29% in Responsible units may use grants to fund any eligible expenditures for their recycling programs, including salaries for administrative staff and recycling collection crews, training, construction costs, supplies, capital purchases, public education, and equipment use. Expenditures are ineligible for grant assistance if they are not necessary for the planning, construction, or operation of recycling programs. Revenues from sales of recyclables or equipment used in recycling, or for operating another responsible unit s recycling program, are deducted from total costs eligible for reimbursement. Payments in Lieu of Taxes (PILOTS) Like state agencies, two other tax-exempt entities are explicitly authorized to make payments in lieu of taxes (PILOTs) to municipalities for municipal services. These are public utilities and housing authorities. See secs., (2) and (22), Stats. All other tax-exempt entities may voluntarily make a PILOT to a municipality. A municipality may request and negotiate a PILOT agreement with a tax-exempt entity but may not mandate a PILOT. A tax-exempt entity may always decline to pay a PILOT. In certain situations, a municipality may be in a position to require a tax-exempt entity to enter into a PILOT agreement as a condition of the municipality providing the tax-exempt entity a requested benefit or assistance, such as a low interest loan. Special Assessments Special assessments are charges levied by municipalities against real property to recover some or all of the costs of a public work or improvement that benefits such property. Special assessments can be used to pay for street construction, curb and gutter, storm and sanitary sewer improvements, water mains and facilities, tree removal, parkland condemnation and many other public improvements. Special assessments may be levied against any property, including tax exempt parcels, for all or the portion of the cost of a public work or improvement as long as the following basic requirements are met: 1. the property is in fact specially benefited by the improvement; and 2. the amount of the assessment is made on a reasonable basis. 35

42 The Reporters Guide to Wisconsin City & Village Government Special Charges for Current Services State law allows municipalities to impose special charges against property for current municipal services provided to the property. The procedure for imposing such charges is less involved than the process for levying special assessments. Delinquent special charges, like delinquent special assessments, can be placed on the property tax roll. Current services include, among other things, the following expressly listed in the statute: snow and ice removal, weed elimination, street sprinkling, oiling and tarring, repair of sidewalks or curb and gutter, garbage and refuse disposal, recycling, storm water management, tree care, and removal of dead animals. Fees in Lieu of Land Dedication as a Condition of Plat Approval Under ch. 236, Stats., cities and villages that have enacted subdivision ordinances can require developers of subdivisions to either install public improvements, such as streets, sidewalks, water and sewer mains, or reimburse the city or village for the cost of constructing such improvements as a condition of plat approval. Municipalities may impose such a requirement only on developers of subdivisions within the municipality. The power to condition the approval of subdivisions on the construction or financing of public improvements does not apply in a municipality s extraterritorial plat approval jurisdiction. In addition, municipalities may, pursuant to ordinances adopted under authority provided by sec , Stats., condition plat approval on developers dedicating a reasonable amount of land for public use (e.g., parks and bike paths) or requiring the developer to pay a fee in lieu of land dedication to help the municipality pay for future purchases of park or open space land. Any dedication requirement imposed on a developer, however, must have an essential nexus to a legitimate governmental interest in order to avoid violating the takings clause of the 5th Amendment to the U.S. Constitution. Also, the dedication requirement must be roughly proportional to the impact of the proposed development. While no precise mathematical calculation is required to show the required reasonable relationship (which the Supreme Court has called rough proportionality ), municipalities must make some sort of individualized determination that the required dedication is related both in nature and extent to the impact of the proposed development. Impact Fees Wisconsin statutes provide explicit authority for towns, villages, cities and counties to enact ordinances imposing impact fees (i.e., cash contributions, contributions of land or interests in land or any other items of value, ) upon developers of land to pay for the construction of certain public facilities necessitated by the development. The impact fee law specifies the types of public facilities for which impact fees may be imposed and specifies the costs of those facilities that may be recovered through impact fees. In addition, the law specifies procedures that a municipality must follow when adopting an impact fee ordinance or when amending the ordinance. The law also establishes a number of standards that impact fees must meet and specifies limits on the use of impact fee revenues. COSTS THAT CAN BE FUNDED WITH IMPACT FEES Impact fees may be imposed to pay for some or all of the capital costs to construct, expand or improve the following public facilities: highways and other transportation facilities, traffic control devices, facilities for collecting and treating sewage, facilities for collecting and treating storm and surface water, facilities for pumping, storing and distributing water, parks, 36

43 Chapter III: Money, Money, Money playgrounds and other recreational facilities, solid waste and recycling facilities, fire protection facilities, law enforcement facilities, emergency medical facilities. PROCEDURE FOR ADOPTION OF IMPACT FEE ORDINANCES A municipality must, before enacting an impact fee ordinance, prepare a needs assessment for the public facilities for which it is anticipated that impact fees will be imposed. In addition, a municipality must hold a public hearing on any proposed impact fee ordinance. The public facilities needs assessment must be available for public inspection at least twenty days before the public hearing. User Fees Wisconsin Municipalities rely less on user fees as sources of revenue to fund public services than communities in other states. However, municipalities can charge user fees for municipal services such as water, sewer, and electricity furnished by municipal utilities. Municipalities also commonly charge user fees for use of certain park and recreational facilities and for garbage and trash collection. Rates charged for water and electric service are subject to regulation by the Wisconsin public service commission. Rates charged by municipal sewerage systems are not subject to regulation by the public service commission except when water and sewer utilities are combined or when a user of service complains to the commission. License and Permit Fees Local license and permit fees for such activities as building construction, sale of alcohol beverages, variances and conditional use permits, street opening permits, operation of taxicabs, and ownership of dogs, may be imposed by municipalities. Revenues generated by these fees, however, are usually nominal since they are either specifically limited by statute or subject to a court-imposed rule that municipal license and permit fees may not exceed the actual cost of issuance of the license and enforcement of regulations pertaining to licensees. In 1999, license and permit fees accounted for 1.5% of villages total revenue and 1.2% of cities total revenue. Wisconsin Legislative Fiscal Bureau, Municipal and County Finance, Informational Paper No. 16, January Mobile Home Monthly Parking Permit Fee Mobile homes that are not treated as real or personal property may be charged a monthly parking permit fee. Municipalities may regulate and license mobile home parks as well as collect a monthly parking permit fee from each mobile home that occupies a space in a park. The parking permit fee has been designed to mirror the general property tax system. Assessors annually determine the total fair market value of each mobile home, and the parking permit fees are calculated on the general property gross tax rate, subject to exemptions and credits. Parking Systems A possible source of revenue for municipalities are fees charged for the parking of vehicles on municipal streets and in municipal parking lots and other parking facilities. Fees may be collected through the use of parking meters, by payment upon entering or exiting a parking facility, or by periodic billing. 37

44 The Reporters Guide to Wisconsin City & Village Government Cable Television Franchise Fee Another potential, though modest, source of revenue for municipalities is the imposition of a cable television franchise fee. Municipalities are expressly authorized to grant cable television franchises and to charge cable operators a franchise fee in return for use of local rightsof-way. A cable television franchise fee may be based on the income or gross revenues of a cable television system. Federal law limits the maximum franchise fee a municipality may impose to 5% of the cable operator s gross revenues. Establishing the Property Tax Levy Each fall, local units of government determine the amount of their property tax levy by first budgeting their expenditures for the following year and then reducing that total by anticipated amounts from other revenue sources. The remaining amount represents the property tax levy. The municipality acts as the billing and collection agent for the following other taxing jurisdictions: county, school district and technical college district. After these jurisdictions determine their levies, they notify the municipality of the amount that must be paid by property owners in that municipality. The jurisdictions apportion their levies to the municipality based on the municipality s share of the jurisdiction s equalized value. The municipality spreads its tax levy and the municipality s share of the other jurisdictions apportioned levies to individual properties according to their assessed value. State Property Tax Credits The total tax levy is offset by two state tax credits; a school levy tax credit and a lottery and gaming tax credit. For , the statutes authorized a funding level of $469.3 million for the school levy tax credit, and funding for following years will stay at this amount unless the Legislature establishes a new funding level. Funding for the lottery and gaming credit is based on the estimated amount of the net proceeds from lottery revenues, exclusive of a reserve equal to 2% of gross lottery revenues and the amount needed to fund the farmland tax relief credit. In , approximately $89.7 million in lottery and gaming proceeds was distributed. The lottery and gaming credit equals the school tax on a base value for each taxable property. The state reimburses each municipality based on the amount of lottery and gaming credits that the municipality extends on tax bills. Each municipality receives a school levy credit based on its share of statewide school taxes levied over the three preceding years. Tax credits are paid to municipal governments in their capacity as property tax administrators and must be used to reduce the property tax levy. In this regard, they differ from state aids, which local governments anticipate in setting the succeeding year s spending level. The Department of Revenue provides municipalities with the information necessary to calculate tax credits by December 1 of each year, after most local governments have established their budgets. Preparation of Tax Roll and Tax Bills Once the tax levy has been established and municipalities receive the tax credit notice from DOR, the city or village clerk must prepare a tax roll. The clerk must transfer the tax roll to the city or village treasurer by December 8. The one exception to this is that a clerk has until the third Monday in December to transfer the tax roll if the municipality has in effect a policy to issue refund checks to persons who have overpaid their tax bill by December 31 within fifteen business days after the overpayment is received. 38

45 Chapter III: Money, Money, Money The clerk prepares the real and personal property tax bills according to a form prescribed by the department of revenue. The bill must include certain specified information, including: the levy for each taxing jurisdiction; state credits and aids; the assessed value and estimated fair market value; an indication of any delinquencies; and the aggregate net tax rate. The clerk must mail the bill to the property taxpayer or to the taxpayer s designee. Real property taxes must be paid in full on or before January 31, or in two equal installments on or before January 31 and July 31. A municipality may adopt an ordinance allowing real property tax bills to be paid in three or more installments, provided that certain percentages are paid up at specified times and the final payment is made on or before July 31. Regardless of the payment method used for real property taxes, special assessments must be paid in full by January 31, unless the local government has adopted an ordinance authorizing installment payments. Personal property taxes, special charges and special taxes must be paid in full by January 31. Under the basic payment schedule, all payments made on or before January 31 are sent to the local municipal treasurer. Any payments made after January 31 are sent to the county treasurer, although counties and municipalities may enter into agreements where the county collects all the taxes. SETTLEMENT PROCESS Distributing collected property taxes to the other taxing jurisdictions is called the settlement process. Municipalities and counties share this responsibility. Real property taxes, special assessments, special charges and special taxes must be settled on or before January 15, February 20 and August 20. The January and February settlements are the responsibility of the municipal treasurer. The county treasurer collects and settles for the final (July) payment. The county treasurer is required to settle in full for all real property taxes and special taxes by August 20. Thus, counties buy out the delinquent taxes by advancing to all other taxing jurisdictions their share of unpaid property taxes. Therefore, the settlement process is concluded in August. By resolution adopted by the county board, the county treasurer may settle in full for special assessments and special charges. This procedure does not apply to the City of Milwaukee. At each settlement date, collections of special assessments, special charges and special taxes are disbursed first, and then the remaining general property taxes are divided on a proportional basis among the taxing jurisdictions. If 45% of the total levy in the municipality was for the school district, the municipality pays the school district 45% of the property taxes collected to date. Similar payments based on shares of the gross levy are made to the county, technical college district and any special purpose districts. The municipality retains its proportionate share of the collections. Personal property taxes must be paid by January 31 and municipalities buy out unpaid personal property taxes at the February 20 settlement. However, one year after the settlement, municipalities may charge each jurisdiction for its proportionate share of any delinquent amounts. 39

46 The Reporters Guide to Wisconsin City & Village Government 40

47 CHAPTER IV Contracts There are many types and forms of municipal contracts. They include leases, collective bargaining agreements, intergovernmental agreements, purchase agreements, service contracts, public construction contracts and many others. If an agreement satisfies the basic requirements for a contract (see below), it s a contract even if it is labeled something else (e.g., lease). A municipal contract may cover any length of time provided it does not cede away control or embarrass the legislative or governmental power of the municipality or render it unable in the future to control any municipal matter over which it has jurisdiction. Express Contract Authority Wisconsin cities and villages are expressly authorized to execute many types of contracts. These include but are not limited to loans to school districts, public construction, energy savings performance contracts, intergovernmental cooperation agreements, revenue sharing agreements, and garbage and removal services contracts. Implied Contract Authority The principal authority for a city or village to make a contract flows from the statutory provisions granting general police powers to city councils and village boards. Neither statute specifically authorizes contracts as a means for carrying out the enumerated powers. However, both provisions authorize city councils and village boards to carry out the powers granted by other necessary or convenient means that unquestionably includes the authority to contract. Who is Authorized to Enter Into Contracts? As a general rule no single official or employee can obligate a municipality to an agreement or contract without the governing body s authorization. Only the governing body or an officer or employee authorized by the governing body to enter into a contract on behalf of the municipality, may enter into a contract binding the municipality. 41

48 The Reporters Guide to Wisconsin City & Village Government Wisconsin courts have held that a municipal governing body may ratify the unauthorized acts and contracts of its agents that are within the scope of its corporate powers, and such ratification is equivalent to previous authority. In some instances, independent power to make contracts may be expressly vested by statute in a municipal board or commission, such as a library board or a police and fire commission with optional powers. However, the contracting power of such boards and commissions does not include the authority to compel a municipality to allocate funds that are not budgeted. Thus, a municipal board or commission contract is invalid if the municipality has not previously appropriated funds to satisfy its terms. As with the governing body, if a board or commission is empowered to contract, such power may be exercised only by the concurrent action of at least a majority. The power to make contracts on behalf of a municipality may be delegated by the governing body to an officer or committee. However, such delegation may not include the exercise of discretion (i.e., the exercise of legislative power. In the absence of an express delegation or statutory authority, an officer, committee, or board has no power to contract on behalf of the municipality. Prohibited Contracts While Wisconsin municipalities enjoy broad contracting authority, it is not without limits. Some types of contracts are prohibited under all circumstances. These are ultra vires contracts. Significantly, such contracts are not simply voidable, but are generally deemed wholly void and of no legal effect. A municipality may not enter into an agreement or contract that limits or controls the exercise or performance of a legislative power or duty. An agreement between a property owner and a municipality to zone or rezone or not to zone a property is an example of this type of contract. Such a contract is illegal and void because a municipality may not surrender its governmental powers and functions or inhibit the exercise of its police or legislative powers. Wisconsin municipalities are subject to a constitutionally mandated debt limit of five percent of equalized value in most instances. Wisconsin Constitution art. XI, sec. 3(2). A Wisconsin city or village may not create a debt by contract or other means which, when added to existing liabilities, would exceed the constitutional limit. Public Construction Contracts Wisconsin municipalities frequently enter into public construction contracts. State law prescribes bidding procedures that must be followed when the construction project cost exceeds $15,000. An initial question that must be answered to determine if the statutory notice or bidding procedures apply to a particular contract or activity is whether it involves public construction. Unfortunately, neither the legislature nor the courts have provided a clear definition of public construction for Wisconsin public officials. One possible definition states that public construction means activities concerned with the erection of buildings and bridges, the construction of streets and highways, and other similar public improvements which require the combining of materials, supplies and public labor. The term construction encompasses more than the erection of all or part of a new building or structure. It also includes the reconstruction or renovation of an existing structure Contracts for the purchase of equipment that is to be incorporated into a specific building (a 42

49 Chapter IV: Joint Commissions new furnace or built-in cabinets) are subject to the bid procedures. Likewise, contracts for the purchase of materials that are earmarked for a specific construction project are subject to the bid laws. Other contracts that at first blush appear to involve construction are not subject to the bid laws because they are not in fact construction or do not involve a specific project. Simple maintenance and repair of an existing public facility is not construction and such contracts do not require public bidding under the state law. Contracts or agreements for the purchase of materials or supplies such as blacktop that are not acquired for a specific project, are also not subject to the bid law requirements. Likewise, the purchase of construction equipment such as a road grader that may be used for a public construction project at a later date need not be accomplished through the bid procedure if it is not acquired for a specific project. Other types of contracts simply do not involve construction and are not subject to the bid laws. These include contracts for the sale of land, buildings, equipment or materials no longer needed by a municipality. Municipalities also need not competitively bid ambulance, refuse pickup, recycling or similar services since they do not involve construction. Likewise, a fire truck, police car and other types of equipment purchases are not subject to the bid law requirements. Other types of contracts have been found not subject to the bid law by the courts. These include contracts for professional engineering, architect or similar services even if the work involves a public construction project. The Expenditure Threshold The second question that must be answered to determine if the statutory notice or bidding procedures apply is whether the estimated project cost is greater than $15,000 or falls somewhere between $5000 and $15,000. If the former and assuming it involves public construction, then the contract may only be let after the city or village complies with the applicable bid procedures. If the expenditure is in the latter range, advertising for bids is not required, but the contract may be let only after the municipality provides a class I notice under chapter 985 of the proposed public construction. It is also important to remember that these expenditure thresholds may not be artificially reduced by contract splitting or other means since such action would be an impermissible attempt to avoid the statutory procedures and would render the contract void. Competitive Bidding Exemptions Certain municipal public construction contracts are exempt from the competitive bidding requirement. Six specific exemptions to the competitive bidding process are provided by state law. There is also one additional situation where public construction may be done without competitive bidding that should be mentioned. The competitive bidding requirements do not apply to intergovernmental purchases. A city or village may make any purchase from another unit of government, including the state or federal government, without competitive bidding. Section 86.25, Stats., provides cities and villages with specific authority to provide funds to match or supplement state or federal aid for the construction, reconstruction or improvement under chapter 84 of any highway, street, bridge it has authority to construct or reconstruct and enter agreements with the state department of transportation for subsequent maintenance of such facilities. Moreover, such activities are specifically exempted from the state bid law procedures. 43

50 The Reporters Guide to Wisconsin City & Village Government The state bid laws for cities and villages also allow for emergencies. Public construction contracts for the repair and reconstruction of a public facility may be made without competitive bidding when damage or threatened damage to the facility creates an emergency. In cities, the determination of the existence of the emergency is made by resolution of the board of public works or board of public utility commissioners. In villages, that decision is made by the village board. There is a competitive bidding exemption when materials for a project are provided to a city or village at no cost. Accordingly, a public construction contract need not be competitively bid when the materials for it have been donated. This exemption probably requires that all materials sufficient to complete the project be donated. It would clearly not apply if the donated materials did not constitute a substantial portion of the total required. The state bid laws also create an exemption for projects involving volunteer labor. In these cases, competitive bidding is not required for a public construction contract if the labor for the project is provided by volunteers. As with the donated materials exemption, it is unclear whether volunteers must complete the entire project or whether some non-volunteer labor may be involved. Again, it seems reasonable that claiming the exemption would be tenuous where the volunteer labor was not a substantial portion of the total labor needed for completing the project. There is also a direct construction exemption. In cities, a particular class of public construction or any part thereof may be performed directly by a city without competitive bidding if the city council so provides by ordinance approved by three-fourths of all memberselect. This exemption only applies however where the city uses its employees to do the work. In villages, the direct construction exemption is more limited. In fact, it really does not qualify as an exemption since direct construction by a village that has not adopted the city bid procedures under 61.56, Stats., may only be undertaken after the village has solicited bids and either not received any bids or rejected, by two-thirds vote of its members, the bids received as fraudulent, collusive or greater than the fair reasonable value of the work to be done or materials furnished. Upon satisfying this condition, the village board may, by resolution and the vote of two-thirds of its members, direct and determine that the work to be done and materials to be furnished shall be performed and furnished by the village directly under the direction and supervision of the village board. Another situation where public construction may be done without competitive bidding under state law is where the municipality contracts with the county to have the county construct and maintain streets and highways. However, since this section does not explicitly exempt such work from the competitive bidding, it is advisable that a municipality, before authorizing the county to do the roadwork, first adopt, by three-fourths vote, an ordinance allowing the municipality, or, at its option, the county to do the work itself The Bidding Process State law prescribes bidding procedures for cities, villages or both under sec , Stats. Other procedures are the product of court decisions. In addition, some procedures are mandatory and others optional. Some procedures only apply to cities and villages that have enacted an ordinance that makes the city bidding law applicable in the village. All contracts for public construction in excess of $15,000 must be let to the lowest responsible bidder. Accordingly, cities and villages must determine whether a party submitting a low bid is also a responsible bidder. Other than requiring this determination to be made prior to awarding a contract, the bid laws do not otherwise specify the timing for this step in the bidding process. However, state law specifically authorizes a type of pre-qualification procedure. 44

51 Chapter IV: Contracts Because the lack of reasonably definite plans effectively prevents competitive bidding, cities and villages must prepare plans and specifications for the project to be bid. Cities are specifically required to prepare plans that contain a description of the work, the materials to be used and such other matters as will give an intelligent idea of the work required. Although not statutorily required, this is a reasonable benchmark for village officials to use in the preparation of plans in their community. After the plans for a project are prepared, they must be filed with the city clerk for inspection by potential bidders. This step is not statutorily required in villages. However, it may be a good practice to follow so that the same single set of plans is being reviewed by all bidders for a project. ADVERTISING FOR BIDS Cities After plans and specifications have been prepared and filed, notice of the opportunity to bid on a project with a projected cost in excess of $15,000 must be given by publishing a Class 2 notice under chapter 985. The bid notice must include a reference to any prevailing wage rate determination. The notice must also inform bidders of the requirement for a bid bond and its potential forfeiture as liquidated damages upon failure to execute a contract and bond Although not required to be bid, projects in cities with a projected cost of between $5,000 and $15,000 must be noticed by publishing a class 1 notice under chapter 985. Villages For villages that have not adopted the city bid procedures, the bid process in sec , Stats., does not specify a particular method for soliciting bids or the contents of the bid solicitation. Rather it simply indicates that the opportunity to bid be provided by notice duly given. Clearly, this standard is satisfied if the procedure for cities is followed. If an alternate manner of solicitation is used, it will be evaluated on the basis of whether it is reasonably calculated to attract the attention of qualified contractors and yield a competitive result. ACCEPTING OR REJECTING THE BID After the bids have been received, opened and evaluated, and the bidders evaluated, the statutes generally require that the contract be let to the lowest responsible bidder. In most cases, the lowest responsible bidder will be the contractor with the lowest bid. In some circumstances, a municipality may reject the low bid and accept another bid since the bid law does vest a degree of discretion in selecting the lowest responsible bidder. This discretion is made explicit where the right to reject any and all bids is specifically reserved in the advertisement for bids. Therefore, if there are serious questions about the low bidders qualifications, the second lowest qualified bidder may be selected. Where prequalification has been utilized and the lowest bidder has been prequalified, the ability to reject a bid from a low bidder has been given up. The bid statutes do not address the rare event of identical low bids by qualified bidders. If this occurs, the municipality has three choices. It may accept the bid determined to be the most advantageous to the municipality, elect to choose the successful bidder by lot, or rebid. Preferential treatment of bids submitted by one group or class of bidders is contrary to the basic principles of competitive bidding. Thus, a municipality is generally not permitted to award a contract based on a preference for local contractors. However, it might be possible for municipalities to adopt an ordinance similar to state law that grants a preference to local 45

52 The Reporters Guide to Wisconsin City & Village Government contractors in the event that a local contractor and a non-local contractor submit identical, low bids. A full description of provisions that might or ought to be included in a public construction contract is beyond the scope of this guide. However, reporters should note that some contract provisions are mandatory. For example, all public works projects (this includes public construction contracts) must physically incorporate the prevailing wage rates and prevailing hours of labor determinations made by the department of workforce development. Some provisions are mandatory if a specific project cost threshold is met. These include but are not limited to clauses for: 1. contractor s duty to pay claims, 2. contractor s duty to maintain list of subcontractors, 3. subcontractor payment assurance, and 4. contractor payment and performance bond. Other contract provisions are not mandatory in the sense that they must be included in all contracts but take on a mandatory appearance if certain actions are desired. For example, a change clause is required if any modification in the scope of work (a change order) is to be made without obtaining the consent of the contractor for each change. THE FINAL STEP The final step in the basic bid process is the execution of a written contract setting forth the terms of the agreement consistent with the bid proposal advertised by the municipality. This step is a formality since acceptance of a bid by a municipality creates a legally enforceable contract between the bidder and the municipality. Intergovernmental Cooperation Agreements A number of legislatively approved vehicles for intergovernmental cooperation are available to Wisconsin cities and villages. These include joint libraries, and joint water authorities. Because of the increasingly important role intergovernmental cooperation plays in local government administration, three of the most recent and arguably more significant intergovernmental cooperation tools will be highlighted in this section intergovernmental agreements, municipal revenue sharing agreements, and cooperative boundary agreements. Section (2), Stats., states: In addition to the provisions of any other statutes specifically authorizing cooperation between municipalities, unless those statutes specifically exclude action under this section, any municipality may contract with other municipalities and with federally recognized Indian tribes and bands in this state, for the receipt or furnishing of services or the joint exercise of any power or duty required or authorized by law. This is very broad authority that may be used to purchase and share equipment, hire and share staff or professional services, purchase and share land or buildings, purchase or provide water, ambulance, or other municipal services from or to another municipality, establish a joint commission and to accomplish many other public purposes in cooperation with one or several other municipalities. A municipality s contracting authority is only subject to one statutory limitation. A contract may not vest in or create a power for a city, village or other party which it does not have independent of the agreement. Otherwise, the jobs that might be accomplished by a agreement are limited only by the creativity of municipal officials and the ability to find a municipal partner. 46

53 Chapter IV: Contracts There are no specific requirements for the administration of a contract. Rather, the parties to a contract enjoy substantial flexibility in the manner and means of administering it. There are also no statutorily mandated procedures that a municipality must satisfy before executing a basic agreement. As with most contracts, the agreement must be approved by the governing body or an authorized official or committee. MUNICIPAL REVENUE SHARING AGREEMENTS Municipal Revenue Sharing Agreements are another important intergovernmental cooperation tool for Wisconsin villages and cities. Revenue sharing agreements can be incorporated into other types of intergovernmental agreements such as cooperative boundary agreements. Such agreements are authorized by sec , Stats., for municipalities with contiguous boundaries. Unlike a sec , Stats., agreement, there are statutorily prescribed procedures for making a revenue sharing agreement. Each municipal party to a revenue sharing agreement must publish a class 3 notice of and hold a public hearing on the proposed agreement at least thirty days prior to entering into it. A revenue sharing agreement is also subject to an advisory referendum. The referendum may be called for by the governing body of a party municipality within thirty days of the public hearing. An advisory referendum must be held if, within thirty days after the public hearing on the agreement, a petition, signed by a number of qualified electors equal to at least ten percent of the votes cast for governor in the municipality at the last gubernatorial election, is filed with the clerk of a participating municipality, requesting an advisory referendum on the revenue sharing plan. A revenue sharing agreement must also contain certain provisions. The agreement must be for a minimum term of ten years and specify the boundaries of the area within which the revenues are to be shared. The formula or other means of determining the amount of revenues to be shared under the agreement must be specified. The date upon which revenues agreed to be shared under the agreement shall be paid to the appropriate municipality must be specified. Finally, the method by which the agreement may be invalidated after the expiration of the minimum ten-year period must be specified. COOPERATIVE BOUNDARY AGREEMENTS Cooperative Boundary Agreements appear to be the wave of the future. As any official in a growing city or village can attest, annexations are rarely free of conflict. In 1991, the state legislature enacted legislation specifically authorizing municipalities to make cooperative boundary agreements in an attempt to provide an alternative mechanism to the traditional annexation process. This legislation is set forth in sec , Stats., and, in contrast to the intergovernmental cooperation and municipal revenue sharing agreement procedures, provides a detailed and multi-layered process for implementation. Cooperative boundary agreements must also be approved by the state. The basic mechanism for implementing a cooperative boundary agreement is the preparation and approval of a cooperative plan. It must provide for one or more of the following: That specified boundary line changes shall occur during the planning period and the approximate dates by which the changes shall occur. That specified boundary line changes may occur during the planning period and the approximate dates by which the changes may occur. 47

54 The Reporters Guide to Wisconsin City & Village Government That a required boundary line change or an optional boundary line change shall be subject to the occurrence of conditions set forth in the plan. That specified boundary changes may not be changed during the planning period. Preparation of a cooperative plan need not start from scratch. Basing the plan on elements of an existing comprehensive plan for the same territory is permitted. It may include a broad range of information. However, the cooperative plan must include certain information regarding boundaries and services, environmental consequences and housing needs, compatibility with existing laws, planning period, and zoning agreements. A number of procedural steps must be taken before a cooperative plan is effective. First, each municipality that intends to participate in the preparation of the plan must adopt a resolution authorizing its participation. Second, notice of the authorizing resolution must be provided in writing to a number of local governments within five miles of a participating municipality and a variety of other agencies. Third, at least 120 days after adoption of the authorizing resolution, and at least sixty days before submission of the plan to the department of administration for approval, the participating municipalities must hold a joint hearing on the proposed plan after giving a class 3 notice for the hearing. Fourth, after the public hearing and after considering comments made on the proposed plan during the hearing or submitted in writing within twenty days of the hearing, the municipalities may revise the plan in response to the comments and may, by resolution adopted by each participating municipality, adopt a final version of the plan. It is advisable to delay final adoption until at least 30 days after the public hearing since a petition opposing the plan and triggering a three-fourths vote requirement may be filed during that time frame. There are several other steps. Within thirty days after adoption of the final plan, the governing body of a participating municipality may adopt a resolution calling for an advisory referendum on the plan. An advisory referendum shall be held if a referendum petition conforming to the requirements of sec. 8.40, Stats., is filed within thirty days of the adoption of the final plan with the clerk of a participating municipality. Next, the proposed plan must be submitted to the department of administration for review and approval. If no advisory referendum is held, the participants may submit the plan at least sixty days but not more than 180 days after the public hearing. If an advisory referendum is held, each participant shall determine whether to submit the final plan to the department. If any of the plan participants fails or refuses to approve submittal of the plan to the department, the plan may not be submitted. Finally, the plan must be approved by the department of administration for it to be binding. The department must issue its determination within 90 days of submission. This step may include the submission of additional information or comment to the department upon its request, and/or a public hearing. If the cooperative plan is approved, there are two significant consequences. First, no other boundary adjustment procedures, including annexation, may be used in the area covered by the plan. Second, the plan s provisions or amendments are binding and have the force and effect of a contract. Presumably, but not yet decided by the courts, this means that all contract remedies are available to a municipality that successfully sues to enforce the cooperative boundary agreement including a court order requiring the breaching municipality to fulfill its obligations under the contract rather than pay compensation for its breach and relieve itself of its terms. 48

55 CHAPTER V City and Village Legislative Procedures Regular Meetings All regular meetings are subject to the requirements of Wisconsin s open meeting law and must be properly noticed. Villages: In villages, regular meetings are held at such time as may be prescribed by the village board s bylaws. Cities: Following a regular city election, the council first meets on the third Tuesday in April. Thereafter, the council must meet at least once a month, on the first Tuesday of the month unless the council fixes a different day for the regular meeting. The council may establish more frequent regular meetings. Manager Form: The governing body is required to set by ordinance the time for holding regular meetings. Special Meetings Special meetings are subject to the open meeting law and notice must be provided as required by the statutes. This provision requires 24-hours notice of a meeting, although two hours notice will suffice for good cause. Village: Special meetings may be called by any two trustees in writing, filed with the clerk, who must notify all the trustees of the time and place of the meeting in the manner directed by the bylaws. 49

56 The Reporters Guide to Wisconsin City & Village Government Cities: Special meetings may be called by the mayor by written notice delivered personally to each council member or left at the member s usual abode at least six hours before the meeting Council rules may authorize additional procedures for calling special meetings. Manager Form: Under the manager plan, special meetings may be called by the council president or any two council members or by the manager. Common Council or Village Board Meeting Procedures PRESIDING OFFICERS In villages, the village president is the presiding officer and presides at all meetings of the village board. In the president s absence, the village board may select another trustee to preside. In cities, the mayor is the presiding officer and presides at common council meetings. In the mayor s absence, the council president presides at council meetings. The council president is chosen by the common council at the first meeting after the regular election and qualification of new members. Under the manager plan, the governing body selects a member to be president and serve as presiding officer. All presiding officers, except the mayor, have a vote on all matters presented to the body. The mayor has a vote only in the event of a tie. The mayor also has the veto power which none of the other presiding officers possess except a common council president when serving as acting mayor. An acting mayor may not, however, approve an act that the mayor has vetoed. QUORUM A quorum is the minimum number of members of a body that may meet and transact business. The statutes specify what constitutes a quorum for city and village governing bodies. In calculating quorum requirements, answers with fractions are rounded up to the next whole number. Although a lesser number can constitute a quorum for purposes of triggering the open meeting law (i.e., a negative quorum or a walking quorum) that subject is covered in the section titled Wisconsin s Open Meetings Law. Cities: In cities operating under the mayor-council form of government, the mayor and alderpersons constitute the common council. In cities with five or less alderpersons, a majority of the members constitutes a quorum. In cities with more than five alderpersons, two-thirds of the members constitute a quorum. The mayor is not counted in determining whether a quorum is present at a meeting. In cities operating under the council-manager form of government, a majority of the members of the council constitute a quorum. The manager does not have a vote and is not counted for quorum purposes. 50

57 Chapter V: City and Village Legislative Procedure Villages: In villages, the trustees of each village constitute a village board. The village president is a trustee by virtue of the office and has a vote on all matters that come before the board. Unlike a mayor in a city, the village president is counted in determining whether a quorum is present. A majority of the members-elect constitute a quorum. In villages with a village manager, a quorum is still a majority of the trustees. Actions by less than a quorum: Any action taken by a governing body at a meeting without a lawful quorum is null and void. The statutes authorize less than a quorum of a municipality s governing body to adjourn and less than a quorum of the city council can compel the attendance of absent members. Although a village board can also compel the attendance of absent members, the law does not specifically state that attendance can be compelled by less than a quorum. RECORDING OF VOTES Under the manager plan of government, ayes and noes must be called and recorded on every ordinance or resolution. In mayor/council cities, an aye and no vote must be recorded on confirmation of appointments or adoption of any measure assessing or levying taxes, appropriating or disbursing money or creating any liability or charge against the city or any city fund. Any member of the council, village board or other local governmental body may also ask for an aye and no vote. For all types of city or village government, votes should be recorded when the governing body is acting under a law that requires more than a majority of a quorum. The open meetings law requires that a motion to convene in closed session under one of the various exemptions authorizing a closed session, be carried by a majority vote is such manner that the vote of each member is ascertained and recorded in the minutes. The open meetings law further provides that the motions and roll call votes of each meeting of a governmental body shall be recorded, and preserved and open to public inspection to the extent prescribed in the public records law. Finally, the open meeting law flatly prohibits the use of secret ballots unless officers of a governmental body are electing that body s officers. ATTENDANCE AT MEETINGS A common council or village board can compel governing body members attendance at meetings and may punish nonattendance. Some municipalities have adopted an ordinance that provides a procedure whereby a governing body member can request to have an absence excused and that provides for assessing a penalty against a governing body member in case of an unexcused absence. A governing body member who is repeatedly absent from meetings may potentially be subjected to the ultimate penalty removal. Elective officers can also be removed for gross neglect of duty. METHOD OF VOTING As a general rule, the statutes do not require a roll call vote. However, every member of a governmental body has a right to require that a vote be taken at any meeting in such a manner so that the vote of each member is ascertained and recorded. The one exception is where a body is choosing the body s own officers (i.e., chair, secretary, or president) and the law permits the use of a secret ballot. In certain instances, the law requires aye and no votes. Specifically, under the manager plan of government, ayes and noes must be called and 51

58 The Reporters Guide to Wisconsin City & Village Government recorded on every ordinance or resolution. In mayor/council cities, an aye and no vote must be recorded on confirmation of appointments or adoption of any measure assessing or levying taxes, appropriating or disbursing money or creating any liability or charge against the city or any city fund. There are no statutes or case law addressing whether members of a governmental body can vote by telephone if they cannot be physically present in the room. NUMBER OF VOTES REQUIRED Before addressing the specific number of votes required to pass a given measure, it is important to be aware that it is not enough to have a quorum present when a vote is taken. A quorum must vote. Assuming that a quorum is voting, let s turn now to the number of votes required. The general rule is that where the law relating to the particular subject does not specify the vote required to do the particular act, a majority vote is sufficient. In calculating extraordinary vote requirements, if a required percentage of the members of a legislative body results in a certain number of whole votes and a fraction, it is necessary to count the fraction as a whole vote even though it results in a greater percentage of the body than would be the case if the legislative body were equally divisible by such percentage into whole numbers. For example, two-thirds of eight is 5.333, which is then rounded up to 6. While state statutes establish only a minimum voting requirement, a municipality may require a greater proportion of votes for passage of any particular action. REFUSAL TO VOTE In some jurisdictions, abstentions are treated as concurrence with the majority. In Wisconsin, there are no statutes or case law addressing how abstentions should be treated but the League thinks that abstentions should be viewed as a nullity neither favoring nor opposing a proposal. Although it is important that members of a governmental body exercise the power vested in them by voting on matters that come before the body, no member of a governmental body can be compelled to vote. Additionally, there are times when conflicts of interest require that a governmental body member refuse to vote to avoid civil or criminal liability. If a person abstains because of a conflict of interest, that person is not considered present for quorum and voting purposes. TIE VOTES When there is a tie vote, the measure in question fails. In villages, no one is designated to break ties. In cities, the mayor only votes in the event of a tie. The mayor cannot be compelled to break a tie vote. If the mayor refuses to break a tie, the measure fails. In situations where the council president is acting as mayor, the president must decide whether or not to vote with the common council or vote only if there is a tie. The council president may not cast his or her vote as an alderperson, and then act as mayor to break a tie. MAYOR AND VILLAGE PRESIDENT S RIGHT TO VOTE Although the mayor is a member of the common council, the mayor does not have a vote except in the case of a tie. If confirmation of an appointment results in a tie, the mayor has a casting vote as in other cases. In contrast, the village president is a trustee and has a vote on all matters that come before the village board. THE PUBLIC S ROLE Generally speaking, the public has a right to attend meetings of a governmental body unless the meeting is held in closed session as authorized by one of the various open meeting law 52

59 Chapter V: City and Village Legislative Procedure exemptions. Although the public has a right to attend, the public does not generally have a right to participate at meetings of a governmental body, unless the meeting is a public hearing, designed or required to allow public input on a particular subject. A provision in the open meetings law permits a governmental body to designate a period of public comment in its public notice of a meeting. If it does so, the body may receive information from members of the public. The governmental body may also discuss any matter raised by the public. The governmental body cannot take action regarding the matter, other than to deal with it procedurally, until the matter has been properly noticed in compliance with the open meeting law. Local governments often reconcile competing concerns the desire and need to be responsive to constituents while at the same time running orderly and efficient meetings by designating a period of public comment on the agenda and imposing time limits on speakers. RULES OF PARLIAMENTARY PROCEDURE Each city and village must determine what rules of procedure are applicable to the body. Thus, rules of procedure for individual governing bodies vary. However, most common councils and village boards have adopted Robert s Rules of Order Newly Revised, or similar parliamentary rules, such as Sturgis, Standard Code of Parliamentary Procedure. The adoption by the municipal governing body of procedures and policy guidelines represents a means to ensure the maintenance of good order at its meetings. Another helpful resource is A Guide to Parliamentary Procedure for Local Governments in Wisconsin, by Larry E. Larmer. Larry Larmer is a U.W. Professor Emeritus and an expert in parliamentary procedure. RECONSIDERATION How can a municipal governing body revisit an issue that it has previously debated or taken action on? The statutes provide little guidance on the particulars of parliamentary procedure but grant municipalities broad authority to adopt procedural rules. Consequently, the answers to most parliamentary procedure questions are found in a municipality s own ordinances or local rules of procedure, rather than the statutes. Most municipal governing bodies have adopted Robert s as their rules of procedure. Under Robert s, there are at least three ways a municipal governing body can bring a question back before it. Two well-known methods for reviewing or reversing previous actions are motions to reconsider and motions to rescind. Once an ordinance becomes effective, the only way to amend or repeal it is by the enactment of another ordinance or charter ordinance. A way a motion previously considered, but not adopted, by a governing body can be brought back before the body is by simply renewing the same motion at a subsequent meeting of the governing body. MAYORAL APPROVAL AND VETO OF LEGISLATION Village presidents do not have veto power but mayors do. State law provides that the mayor may veto all acts of the council except where the veto power has been expressly or by necessary implication otherwise withdrawn. The mayor does not have the power of partial veto, unless authorized by charter ordinance. Thus, the mayor cannot veto parts of a budget but must veto the entire budget and explain the objectionable parts. At least one Wisconsin municipality, however, has adopted a charter ordinance authorizing the mayor to veto budget items separately. 53

60 The Reporters Guide to Wisconsin City & Village Government The mayor cannot veto negative actions of the council. For example, the mayor s veto power does not apply to the council s failure to act or the council s rejection of a particular measure. The veto power only applies to positive actions of the council. The mayor s approval of council actions is officially given by signing legislation within five days of the time it is submitted to the mayor by the city clerk. Disapproval is expressed by a mayoral veto made within this five-day period. A veto must be accompanied by the mayor s reasons for rejecting the proposal and be filed with the city clerk. Failure of the mayor to act on any measure within five days of the time presented by the clerk is treated by law as an approval of the council s action. In computing the five-day veto period the first day should be excluded and the last included. If the last day for acting falls on a Sunday or holiday, the mayor may exercise a veto on the next work day. The council may override the mayor s veto by a two-thirds vote of all its members. But the statutes do not specify a time when a vote to override a mayor s veto must be taken. AGENDAS AND MINUTES The questions that most frequently arise regarding agendas are what must be on the agenda, how specific must the agenda be, who controls the agenda and what is a consent agenda. What must be on the agenda? Wisconsin s open meetings law requires that all meetings of a governmental body be preceded by public notice. The notice must contain information regarding the subject matters that will be considered at the meeting. How specific must the agenda be? The agenda usually mirrors the meeting notice and the notice must be in such form as will reasonably apprise the public and news media. Although an agenda may contain broad umbrella clauses like Old Business and New Business and Other Business Lawfully Before the Council, those broad umbrella topics are not sufficient to apprise the public and the specific topics that will be discussed under each of these broad categories must be set forth. Who controls the agenda? The common council in cities and the village board in villages may determine the method for setting the governing body s agenda. If the common council or village board have not enacted an ordinance, resolution or otherwise established a policy governing how the body s meeting agenda is prepared, the mayor or village president, arguably, may overrule the request of a particular governing body member to place something on the agenda. The mayor and the village president have the duty, under the open meeting law to give notice of the subject, time and place of the meeting. What is a consent agenda? Some municipalities have adopted a procedural rule that allows for a consent agenda. A rule authorizes the municipal clerk to create a subsection on any agenda entitled consent agenda and then place matters that the clerk deems routine and noncontroversial and which do not require a special vote or specific action by the council under that subsection. MINUTES Village boards and common councils are required, by statute, to keep a full record of their proceedings. Statutes also require that other governmental bodies, such as boards and commissions, keep minutes. The municipal clerk is responsible for attending village board and common council meetings and taking minutes. If the clerk is unable to attend, then it is the deputy clerk s responsibility, assuming one has been appointed, to attend the meeting and take minutes. The minutes need not contain a detailed description of everything that transpires at a meeting. Proceedings, when published in newspapers, means the substance of every official action taken by a local governing body at any meeting, regular or special. 54

61 Chapter V: City and Village Legislative Procedure Any substantive actions taken in a closed session (motions, seconds, votes) must be recorded to the same extent as in open session. The statutes requiring that minutes be kept, and the open meetings law, which requires that the motions and roll call votes of each meeting of a governmental body shall be recorded, preserved, and open to public inspection to the extent prescribed by the public records law, do not distinguish between closed and open sessions. However, if the body does not act in closed session, the minutes from the closed session might simply note that there was a motion, second, and vote to go back into open session. Public Hearings Public hearings serve a number of important purposes. First, municipalities use public hearings to inform the public in general and those citizens who are likely to be affected by a proposed municipal action in particular, about a requested or proposed governmental action. Public hearings also afford citizens the opportunity to comment on a proposed governmental action. At a public hearing, supporters of a particular proposal can explain why the action is necessary and persons opposed to the proposal can testify against the action. Comments received at a public hearing allow the municipality to gauge the need for and impact of the proposed action. As a result of comments received at a public hearing, the municipality may modify or even reject a proposed or requested action. Most municipal actions need not be preceded by a public hearing. In general, a public hearing is required only if a state or federal law, agency regulation, or local ordinance mandates that a hearing be held. Of course, a municipality can decide to hold a public hearing even if there are no state or federal statute or agency rule mandating that a hearing be held. In Wisconsin, state law requires municipalities to conduct public hearings before taking certain actions. For example, municipalities must hold a public hearing before adopting or amending a zoning ordinance, acting on a petition for a conditional use permit or variance, imposing special assessments, and adopting the annual budget. When a public hearing must be held, proper notice to the public is essential and the type of notice required (by publication or to certain persons and the manner of giving the notice) is typically specified by the statute or ordinance imposing the hearing requirement. Committees Cities and villages customarily delegate various types of preliminary work to standing committees. Because committees are creatures of the governing body, issues that arise regarding the appointment, structure, size, organization or powers of committees are almost exclusively governed by local ordinances or bylaws. Any actions taken by a committee must have been previously authorized, or be subsequently ratified by, the governing body. Committees are governmental bodies subject to the requirements of the open meetings law. Committees can serve various functions. For example, they can conduct investigations, make a detailed study of pending proposals (ordinances, resolutions, etc.), keep in close contact with the work of the various municipal departments and officers, and otherwise perform detailed work which the entire governing body cannot feasibly accomplish or which if handled by the entire council or board would unduly prolong meetings. Standing Committees Although the type and number of committees differ from municipality to municipality, many municipalities have standing committees. These committees are generally comprised 55

62 The Reporters Guide to Wisconsin City & Village Government wholly of governing body members, and appointments are typically made by the mayor or by the village president, often at the governing body s organizational meeting. Examples of common standing committees include finance, personnel, health and safety, public works, licensing and regulation, and ordinances. Many municipalities create special committees to deal with specific problems that arise and some of these committees have citizen members. Committee of the Whole In some municipalities the committee of the whole system is used as either an alternative or complement to the committee system. The committee of the whole is used to allow more free-ranging discussion than may be allowed under the rules of the governing body. Where the committee of the whole approach is used, the governing body or its presiding officer refers new matters to the committee of the whole. Sitting as a committee of the whole, the governing body meets to consider these referred matters at a regularly designated time and place, sufficiently in advance of the time of the regular council or board meeting to permit the clerk to draw up the report. At this meeting, the public may be heard, advice of city or village boards and commissions may be sought, and the knowledge of city or village employees and officers may be solicited. The matter is then debated by the council members or trustees and a resulting recommendation is made to the council or board at its regular meeting. Of course, recommendation by the committee of the whole does not foreclose debate by the governing body at its formal meeting. The committee of the whole report may be accepted in its entirety at the regular council or board meeting or any alderman or trustee may ask for separate consideration of any item. This procedure seems to save time while permitting thorough consideration of controversial matters. Enactment of Legislation Governing bodies spend considerable time discussing and deliberating on public matters. These deliberations, however, are not open-ended, for governing bodies generally culminate their discussions in some form of action or decision. Governing bodies take action in a variety of different ways. They vote on motions, pass resolutions, and enact ordinances and charter ordinances. The various types of legislation are explained in detail below. CHARTER ORDINANCES In Wisconsin s early days, municipalities were incorporated by special acts of the legislature granting corporate charters. Wisconsin s constitution was subsequently amended to prohibit incorporation by special or private law. The legislature adopted a general charter law for cities and a general charter law for villages and repealed all special charters except for those in Milwaukee. Cities and villages were granted statutory home rule, which allows municipalities great freedom in dealing with local affairs. This was followed with a constitutional amendment granting cities and villages the power to determine their local affairs and government, subject only to the Wisconsin constitution and to legislative enactments on matters of statewide concern that uniformly affect cities and villages. A charter ordinance is the only way for a municipality to exercise its constitutional home rule powers. However, charter ordinances can also be used to exercise statutory home rule powers. A charter ordinance is the most permanent of all local legislative actions and may only be altered or nullified by another charter ordinance. A charter ordinance may be used when an ordinary ordinance would be equally viable. Thus, a charter ordinance is sometimes used to 56

63 Chapter V: City and Village Legislative Procedure dignify and make more permanent a local enactment, where a governing body wishes to ensure that an enactment will not be repealed without careful consideration. However, a municipality cannot adopt a charter ordinance to deny the effect of a statute, which is of uniform statewide concern. When a governing body adopts a charter ordinance, it must do so by a two-thirds vote of the members elect. The ordinance is not effective until 60 days after its passage and publication. If within the sixty days a petition signed by electors of the city or village equal to not less than seven percent of the votes cast for governor at the last general election is filed in the municipal clerk s office, the charter ordinance must be submitted to a referendum and approved by a majority of the voting electors before it becomes effective. In addition, a governing body may, after adoption, submit the charter ordinance to a referendum without waiting for a petition by the electors. The charter ordinance would then become effective if approved by a majority of the electors that vote. A governing body can also decide by a majority vote, without adopting a charter ordinance, to submit a charter ordinance to a referendum. The charter ordinance becomes effective if approved by a majority of the electors voting. Charter ordinances (or regular ordinances, for that matter) may also be adopted by voter initiative. The following special rules apply to a charter ordinance enactment: a charter ordinance must be entitled Charter Ordinance or clearly indicate that it is such an ordinance; a charter ordinance must specify provisions of the charter amended or repealed or the sections of state law made inapplicable in the city or village enacting the charter ordinance; a charter ordinance must be within the legislative powers of the governing body to enact and not a mere exercise of administrative discretion or contrary to superior law; and a charter ordinance must be adopted by a two-thirds vote of the members-elect of the city council or village board. ORDINANCES Generally, an ordinance is a local law of a municipal corporation, duly enacted by the proper authorities, prescribing general, uniform and permanent rules of conduct relating to the corporate powers of the municipality. A simple or ordinary ordinance is used to effect most local legislative actions. Often, state statutes require exercise of city or village powers by enactment of ordinances. Ordinances generally fall into four distinct categories. They are: 1. police power ordinances prohibiting, licensing or regulating acts or conduct in the interest of the public health, safety or welfare and containing penalties; 2. franchise or contract ordinances; 3. ordinances relating to public improvement, construction and property; and 4. ordinances relating to public finances such as bonding, investment or salary ordinances. 57

64 The Reporters Guide to Wisconsin City & Village Government Ordinance Book After passage, ordinances must be entered in full in an ordinance book by the clerk, with proof of publication or posting, date of passage and page of the journal of proceedings on which they are found. Resolutions Resolutions are generally less permanent enactments than ordinances. Resolutions commonly deal with matters of a special or temporary character. A resolution ordinarily denotes something less solemn or formal than, or not rising to the dignity of, an ordinance. They seldom if ever contain penalties and are the most common form of legislation employed by governing bodies to deal with special matters not affecting the general public such as granting special privileges, expressing opinions or communicating with other governmental units or departments or agencies of the municipality. Unlike ordinances, resolutions need not be in any set or particular form, in the absence of some express requirement. Resolutions are generally brought to the council or board floor in writing. However, oral resolutions confirming committee reports or administrative actions are not uncommon. If resolutions are presented orally, the clerk should record the substance of the resolution accurately in the minutes of the proceedings. A motion duly carried and entered into the record has the legal effect of a resolution. Motions Statements or suggestions for legislative action made orally at a meeting and not entered verbatim in the minutes are generally mere motions. Motions usually relate to the mechanics or rules of the meeting and are introduced to expedite the proceedings. Bylaws, Regulations, Rules, Contracts The term bylaw appears in some state statutes relating to municipal legislative acts. This is an ancient term for ordinance or local law derived from the Scandinavian word for town (by) and may be used interchangeably with the term ordinance. The term rule or regulation is also sometimes used to refer to legislative acts of Wisconsin city and village governing bodies. These terms also appear to be generally synonymous with the term ordinance. Licenses, permits, commissions, bonds, conveyances, promissory notes, contracts, privileges and franchises generally are evidenced by written and signed legal documents separate and apart from an enabling or approving ordinance or resolution. These separate instruments are approved by resolution or ordinance enacted by the governing body. Direct Legislation Initiated by Citizens Wisconsin law permits electors to initiate legislative enactments in cities and villages subject to common-law (court-created) constraints and specific statutory procedures. Under these provisions, electors may petition to have an attached resolution or ordinance adopted, without alteration, by the governing body or submitted to a vote of the electors. For direct legislation to become effective, it must either be passed verbatim by the governing body or submitted to a referendum and approved by the majority of the voting electors. 58

65 Chapter V: City and Village Legislative Procedure The governing body may refuse to adopt initiated legislation or refuse to submit it to the voters under the following circumstances: the ordinance or resolution is administrative in character; the ordinance or resolution compels passage of legislation in direct conflict with a prior resolution or ordinance and constitutes an implied repealer of that legislation (this limitation does not apply to initiated charter ordinances); the ordinance or resolution attempts to exercise powers not conferred on the governing body by statute or constitution; the proposed legislation is within the governing body s powers but could not be exercised within the time limits binding on the body; or state laws prescribe different procedures from what is proposed. If the governing body adopts an initiated charter ordinance, then the proposed charter ordinance is subject to a sixty-day waiting period. During that period, electors opposed to the measure can seek to prevent the proposed charter ordinance from taking effect by filing a petition requiring the charter ordinance to be submitted to the electors for a vote. As noted previously, the governing body may also submit the initiated charter ordinance that they have adopted by two-thirds vote to the voters without waiting for a petition by the electors. The referendum is held at the time of the spring election or at the other times indicated in sec. 9.20(4), Stats. A mayor may not veto charter ordinances initiated by the electors and charter ordinances that have been approved in referenda. 59

66 The Reporters Guide to Wisconsin City & Village Government 60

67 CHAPTER VI Open Government Laws Introduction Wisconsin has a long and proud tradition of open government. Indeed, the state of Wisconsin has always been acclaimed as an innovator of progressive ideas and practices, noted for its honesty in government and marked by significant citizen involvement in public affairs. Without question, the concept of openness in local government is firmly entrenched in Wisconsin law. Two prime examples of this are the open meetings and the public records laws. The thrust of each is to ensure citizens rights to know about and gain information on the affairs and conduct of government. The Open Meetings Law Wisconsin s open meetings law requires that all meetings of city councils and village boards be preceded by public notice, be held in places reasonably accessible to the public, and be open to all citizens unless certain exceptions apply allowing the meeting to be closed. Meeting notices must set forth the date, time, place and subject matter of the meeting. Meeting notices must be provided to the public, members of the news media who have filed a written request for notice and the official newspaper or a news medium likely to give notice in the area. The notice must be given at least 24 hours before the start of the meeting unless for good cause such notice is not possible, in which case at least 2 hours notice must be provided. The open meetings law also applies to any committees, boards and commissions created by a municipality. A meeting is defined as the convening of members of a governmental body for the purpose of exercising the responsibilities of that body. If one-half or more of the members of a governmental body are present, the meeting is rebuttably presumed to be for the purpose of exercising the responsibilities or duties of the body. Wisconsin courts have interpreted the law to apply even when there is less than one-half of the body present if the gathering is for the purpose of engaging in governmental business and the number of members present is sufficient to determine the parent body s course of action on the subject being 61

68 The Reporters Guide to wisconsin City & Village Government discussed. Engaging in governmental business includes taking in information as well as making decisions. City councils, village boards and other municipal governmental bodies have the option of convening in closed session to discuss and possibly take action on certain subjects. These include: Consideration of employment, compensation and performance evaluation data regarding a specific public employee. Certain competitive or bargaining reasons require a closed session. Consideration of financial, medical, social, personal or disciplinary data of specific persons. Consideration of specific personnel problems. Conferring with legal council concerning strategy to be uses in current or likely litigation. Governmental bodies must follow certain procedures when going into closed session. They must convene in open session before moving into closed session. A motion to convene in closed session must be carried by majority vote and the vote of each member must be recorded and preserved in the minutes. Before any vote is taken to convene in closed session, the mayor, village president or other presiding officer must publicly announce the nature of the business to be considered and the specific statutory exception under which the closed session is authorized. This announcement must become part of the record of the meeting. The Public Records Law The public records law establishes rules and regulations concerning public inspection and copying of government records. The purpose of the public records law is to ensure that citizens have access to information regarding the affairs of government, consistent with the conduct of governmental business. The public records law provides, with certain exceptions, that any person has the right to inspect and obtain a copy of a municipal record. A public record is every form of information created or kept by a municipal department, office, committee, board, commission or officer. It includes handwritten, typed or printed pages; maps; photographs, messages; video and audio tape recordings and CD-ROMs. A public record does not include draft documents prepared for the originators personal use or material that is purely the personal property of the custodian. The public records law applies to any authority that has custody of a record. Authority includes any municipal office, body, elected official, board, commission, committee or department created by constitution, law, ordinance, rule or order. The legal custodian maintains public records and has the duty to respond to requests for access to records. Each municipal officer is legal custodian of his or her records and the records of the office. Every municipal department or office is required to designate in writing one or more positions occupied by an officer or employee of the department to serve as legal custodian of the municipal department s public records. Typically, in municipalities, the municipal clerk is designated the custodian of most municipal records. 62

69 Chapter VI: Open Government Laws Each custodian, upon receiving a request for a record, must as soon as practicable and without delay fill the request or notify the requester of the decision to deny the request in whole or in part. The statutes do not specify a precise time within which a records custodian must respond to a records request. The Wisconsin Department of Justice s policy is that a custodian should reply to a records request within ten business days or inform the requester of any delay within that time period. The response time depends on the circumstances and can be affected by the size of the request, the location of the records and consultations with an attorney. A custodian may impose a fee upon a requester for copying a record that may not exceed the actual, necessary and direct cost of reproducing, transcribing or photographing the record. Fees for copying may include labor expenses actually, necessarily and directly incurred in connection with reproduction. If a record is mailed or shipped, the authority may charge the actual, direct and necessary costs. In addition, if the cost of locating a record is $50 or more, the authority may impose a fee for locating the record. A custodian may require prepayment of fees if the total amount exceeds $5. Fees may be waived or reduced in the public interest. While the general presumption in this state is that public records are open to the public, certain limitations on the public s right to access exist. A Municipal official or employee may deny access to a public record if: (1) state or federal law directs that the record be kept confidential, (2) there exists a specific limitation under the common law, or (3) when it is determined by a records custodian that the harm to the public interest from allowing inspection outweighs the public interest in inspection. Records exempted from disclosure by state statute include: Identities of law enforcement informants. Identities of applicants for municipal employment. Public library records indicating the identity of borrowers. Health care records relating to ambulance calls. Public employee personnel files are not statutorily exempt from disclosure under the public records law. However, the Wisconsin Supreme Court has held in a series of recent decisions that in all cases in which a record custodian decides to disclose information from an individual public employee s personnel file implicating the privacy and/or reputational interests of that employee, the employee has a right to be notified of that decision so that the employee may seek judicial review of that decision. In order to facilitate review by a court before damage occurs, the records custodian must inform the employee of the decision to release the record and that the employee has the right to seek judicial review of the decision. The custodian must allow for a reasonable amount of time for the individual to appeal the decision before releasing the record. In a typical records request no statutory exemption or common law limitation applies. Ordinarily, a custodian faced with a records request must engage in a balancing test to determine whether the record should be released or withheld. This requires the custodian to weigh the competing interests involved and determine whether disclosure would result in harm to the public interest that outweighs the recognized public interest in allowing access to public records. If a record custodian determines that a record request should be denied, then the custodian must state the specific policy reasons he or she relied on to make that determination. 63

70 The Reporters Guide to wisconsin City & Village Government If a record contains information that is subject to disclosure under the public records law and information that may be withheld, the custodian must delete or black-out the information not subject to disclosure before releasing the record. Publication Requirements Municipalities are often required to inform the public of municipal matters by the publication or posting of legal notices. These notice requirements are found throughout the statues. The statute governing the publication of legal notices is ch. 985, Stats. Cities are required to designate newspapers for the publication of council proceedings and other city legal notices. Such newspapers must be published in the city, although a fourth class city in which there is no eligible paper published may designate a newspaper published in the county and having a general circulation in the city. A newspaper is published at the place from which its mailing permit is issued, except that if the place where a newspaper has its concentration of circulation has no primary post office, then it is published at the place it designates as its place of publication. A village board may, but is not required to designate a newspaper published or having general circulation in the village as its official paper or use it for specific notices. Alternatively, the village board may direct that other forms of publication, such as posting, be used, except that certain cases do require actual newspaper publication. The statutes specifically require the publication of: tax redemptions or sales, annexations, detachments, consolidations, incorporations and notices directed to specific individuals. Also, if an eligible newspaper is published in the village, village board proceedings and village ordinances imposing a forfeiture must be published in that newspaper. To qualify for the publication of legal notices, a newspaper must meet certain requirements. The paper must report news and publish regularly, at least once a week. For at least two of the five year period prior to publication of a notice, the paper must have published regularly and continuously in the municipality and must have a bona fide paid circulation of at least half of its circulation and must have a designated number of subscribers. Thus, most shoppers do not qualify as newspapers and may not be used for the publication of legal notices, with the limited exception in certain circumstances, as discussed below, of the publication of village board proceedings. The maximum fee a newspaper may charge for publishing a legal notice is specified in the statutes as is the display method a newspaper must use when publishing legal notices. The maximum rate for publishing legal notices is adjusted by the Wisconsin Department of Administration every two years. As mentioned above, a village board may decide to post legal notices. When posting is permitted, the notice must be posted in at least three public places likely to give notice to persons affected. A notice posted before an event must be posted no later than the time specified for the first newspaper insertion. A notice posted after an event must be posted within one week after the event. Actions of governing bodies posted after an event take effect upon posting. The officer or person posting the legal notice must state in an affidavit the time, place and manner of posting, and this affidavit is presumptive evidence of the facts stated in it. The question sometimes arises whether the notice of a meeting of a governmental body under the open meetings law requires newspaper publication. The answer is that the open meetings law itself does not require newspaper publication, although it does provide that open meetings notices must be given to news media that have filed a request to receive notices, and to the official newspaper, or if there is none, to a news medium likely to give 64

71 Chapter VI: Open Government Laws notice in the area. Sec (l)(b), Stats. It is up to the newspaper or the other news media to decide whether to publish or broadcast the notice. City clerks must keep a record of the council proceedings and the proceedings must be published in the official newspaper as a class 1 notice (one insertion). Village clerks must keep a record of the village board proceedings and the published proceedings must include the substance of every official action taken by the governing body at both open and closed sessions. If a village does not have an official newspaper but there is a qualifying newspaper published in the village, the proceedings must be published in the newspaper as a class 1 notice (one insertion). If there is no qualifying paper published in the village, then the board must direct that the proceedings either be published in a newspaper having general circulation in the village, posted in several places or publicized in some other fashion. The question arises whether the authority to publish village board proceedings in a manner other than newspaper publication or posting would allow publication of the proceedings in a shopper or other publication not qualifying as a newspaper. We believe that this is an acceptable form of publication of village board proceedings as long as the shopper is not a qualifying newspaper under the statutes. All city ordinances must be published as a class 1 notice (one insertion) within 15 days of passage. Village ordinances that impose penalties or forfeitures must be published as a class 1 notice (one insertion) and take effect on the day after publication, unless a later date is prescribed. If the village has an official newspaper, such ordinances and bylaws must be published in the official newspaper. If the village does not have an official newspaper, such ordinances and bylaws must be published in an eligible newspaper published in the village, if there is one. If there is no eligible paper published in the village, the board may direct other publication or posting. Penalty ordinances and bylaws take effect the day after the village clerk has filed and recorded the proof of publication unless a later date is prescribed. 65

72 The Reporters Guide to wisconsin City & Village Government 66

73 CHAPTER APPENDIXVI Additional Information and Resources The League of Wisconsin Municipalities The League of Wisconsin Municipalities, 202 State Street, Suite 300, Madison, Wisconsin 53703; phone: (608) ; < League of Wisconsin Municipalities is a voluntary not-for-profit association of Wisconsin cities and villages working to advance local government. First established in 1898, the League acts as an information clearinghouse, lobbying organization and legal resource for Wisconsin municipalities. Annual membership dues are based on a municipality s population and equalized valuation. Additional State Associations and Organizations Wisconsin Alliance of Cities, 14 West Mifflin Street (Suite 206), Madison, Wisconsin 53703; Phone: (608) ; < The Alliance of Cities has 38 member cities. The Alliance s goal is to foster healthy, sustainable neighborhoods and economies in both urban and rural Wisconsin. Wisconsin Association of Assessing Officers (WAAO), WAAO is a volunteer organization dedicated to assessment education and professionalism. Wisconsin Counties Association (WCA), 22 E. Mifflin Street, Suite 900, Madison, WI 53703; Phone: (866) ; < The WCA is an organization set up to protect county interests and further county government. Wisconsin Taxpayers Alliance, 335 W. Wilson Street, Madison, WI ; Phone: (608) ; < The Wisconsin Taxpayers Alliance is a nonprofit, nonpartisan government-research and citizen-education organization serving Wisconsin taxpayers and citizens since