- When redetermining a base value, does the Wisconsin Department of Revenue (DOR) use the Tax Incremental District's (TID's) current equalized value or the TID's lowest historic value to set the new base value?
DOR sets the new base value to the TID's equalized value as of the date of the local legislative body's resolution.
- What years should the municipality use to determine the equalized values two-year, 10% decline?
Use the two most current years based on when the local legislative body passes the resolution.
Example:
If the resolution is passed:
- By August 14, 2024 — use 2022 and 2023 values
- Between August 15, 2024, and August 14, 2025 — use 2023 and 2024 values
- What steps must a municipality complete for a base value redetermination amendment?
The municipality must:
- Revise the project plan
- Hold the required meetings and a public hearing
- Adopt the necessary resolutions
See the TIF Base Value Redetermination web page for the required steps. See the TID Checklist for more information.
- The amended project plan requires selecting Option (3), (4) or (5) from sec. 66.1105(5)(i), Wis. Stats. What impact do these three options have on the project plan?
Option 3 - (sec. 66.1105(5)(i)3.)
- At least 51% of the public infrastructure improvement's value must be financed by a private developer or entity
- Development agreement is required to receive cash grants which will solely repay the developer or entity for public infrastructure costs
Option 4 - (sec. 66.1105(5)(i)4.)
- All project costs are expected to be paid within 90% of the TID's remaining life
Option 5 - (sec. 66.1105(5)(i)5.)
- Expenditures may be made only within the first half of the TID's maximum life
- Joint Review Board can unanimously approve additional expenditures but not beyond the original expenditure period
- In Option (4), do the "project costs which must be paid within 90% of the TID's remaining life," include debt service?
Yes. The amended project plan must demonstrate the TID will have sufficient revenue to pay off debt and all project costs within 90% of the TID's remaining life. After all project costs are paid, the TID must terminate.
- In Option (4), how is the TID's remaining life calculated?
- Determine the TID's maximum life (review the Active TIDs report)
- Determine the TID's redetermination year:
- Local legislative body resolution adopted January 1 to September 30 — redetermination year is the year the resolution is adopted
- Local legislative body resolution adopted October 1 to December 31 — redetermination year is the year after the year the resolution is adopted
- Subtract the redetermination year from the maximum life year
- Multiply the difference by (0.9)
- Add the result to the TID's redetermination year
Example:
- Local legislative body adopted a resolution to create a mixed-use TID April 1, 2017; the maximum life is April 1, 2037
- Redetermination municipal resolution is adopted April 1, 2019; this is a 2019 redetermination
- 2037 (maximum life) – 2019 (redetermination year) = 18 years
- 18 X (0.9) = 16 years remaining life
- 2019 (redetermination year) + 16 years = 2035; the local legislative body must adopt a termination resolution by April 1, 2035
- In Option (5), do "expenditures" include debt service?
No. With this option, the municipality may only take on project costs within the first half of the TID's maximum life. Debt payments may continue through the TID's maximum life. Also, see Municipal Expenditures and Debt Common Question 1.
- What is the difference between "all project costs" in Option (4) and "expenditures" in Option (5)?
State law (sec. 66.1105, Wis. Stats.), does not provide a specific definition of expenditures; however, DOR considers an expenditure to include any eligible project cost at the point it is incurred. It does not include repayment of debt for an eligible project cost.
- If a municipality asks DOR to redetermine the TID's base value, would the adjustment affect the equalized value used for the apportionment of taxes?
Yes. When the TID's base value is reduced through a redetermination amendment, this affects the municipal TID out value. This could result in a tax rate change to offset the increased TID increment.
- Can a municipality with an Environmental Remediation (ER) TID request a base value redetermination?
Only an ER TID created after November 29, 2017, under sec. 66.1105, Wis. Stats., is eligible for a redetermination if it meets the decrement criteria (TID's current year value is at least 10% below the base value for two consecutive years). An ER TID created under sec. 66.1106, Wis. Stats., is not eligible.
- Can a municipality with a distressed (or severely distressed) TID request a base value redetermination?
Yes. A distressed (or severely distressed) TID is eligible for a redetermination if it meets the decrement criteria (the TID's current year value is at least 10% below the base value for two consecutive years).
- Can a municipality include new project costs with the base value redetermination amendment?
Yes. The municipality must adopt a revised project plan as part of the base value redetermination amendment. The revised project plan may include new projects, but it must show the decrement calculation and select Option (3), (4) or (5). The new costs must meet the requirements of the Option (3), (4) or (5) selected in the revised plan.
- When is the deadline to request a TID base value redetermination with DOR?
The municipality must adopt a municipal resolution on or before September 30 of the amendment year and email the redetermination documents to DOR by October 31. DOR will certify the values the following year.
Example: To redetermine a base value as of January 1, 2024, the local legislative body must adopt the redetermination resolution on or before September 30, 2024, and DOR must receive the redetermination documents on or before October 31, 2024. DOR will certify the redetermined value between January and March 2025.
Redetermination documents include:
See Base Value Redetermination for additional information.
- Can a municipality request that the JRB adopt resolutions to extend a TID and complete a base value redetermination amendment for the same TID at the same time?
Yes. If the TID meets the extension criteria (see TID Extension Types) and the decrement criteria, the municipality may request the JRB approve both at the same time. An extension changes the amount of time allowed for options (4 or 5) from sec. 66.1105(5)(i), Wis. Stats., explained in question 4.
Contact Us
MS 6-97
Wisconsin Department of Revenue
Office of Technical and Assessment Services
PO Box 8971
Madison, WI 53708-8971
Phone: (608) 266-7750
Email: tif@wisconsin.gov