Consumer Price Index (CPI-U) Certification

October 23, 2020

To: Municipal Clerks and Treasurers, County Clerks and Treasurers

The Wisconsin Department of Revenue (DOR) would like to inform you that the Consumer Price Index for all urban consumers (CPI-U) was certified at 1.4 percent for the 12 months ending September 30, 2020. Note: this percentage was rounded to the nearest 0.10 percent.

Expenditure Restraint Program (ERP)

Per state law, DOR used this 1.4 percent CPI-U (inflation factor) in ERP to determine the allowable general fund budget percentage increase for qualifying municipalities from 2020 to 2021 (sec. 79.05(1)(am), Wis. Stats.).

To qualify for a 2022 ERP Payment:

  • Your 2020 municipal TID Out property tax rate must exceed five mills
  • Your net general fund budget increase from 2020 to 2021 must be less than the sum of the 1.4 percent CPI-U increase, plus 60 percent of your net new construction percentage during 2019 (up to a maximum 2 percent)
  • Note: By November 1, 2020, DOR will send ERP budget limit letters providing allowable budget percent increases to municipalities with a 2019 mill rate that exceed five mills

Levy Limits

Under state law, the 1.4 percent inflation factor is also used for the levy limit increase available for an increase in charges assessed by a joint fire department or joint emergency medical service (EMS) district (sec. 66.0602(3)(h), Wis. Stats.). You can enter an adjustment in Section D, Line I of the Levy Limit Worksheet if all of the following applies:

  • Your municipality is a member of a joint fire department or joint EMS district as defined in sec. 66.0602(1), Wis. Stats.
  • The increase in assessed charges would result in your municipality exceeding its levy limit
  • The joint fire department or joint EMS district's total charges assessed (imposed on all members) for the current year (2021 budget year) compared to the prior year (2020 budget year), increased less than or equal to the 1.4 percent CPI-U increase plus 2 percent (3.4 percent).
  • All municipalities covered by the joint fire department or joint EMS district adopt a resolution supporting the increase

Example: If the 2020 total assessed charges were $50,000 and the joint fire department's 2021 total assessed charges are $60,000, that is an increase of $10,000 or 20 percent. In this example, the municipality does not qualify for the levy limit adjustment, as the increase cannot be more than 3.4 percent.

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