Damakant Jayshi
Marathon County will create a task force to study the effect tax increment financing districts have on the county’s budget that will help guide future policies, after a vote on Tuesday.
Among the primary tasks of the new TIF Task Force is evaluating how the county is represented on the Joint Review Board. The group will also study the county’s role in extending the life of TID districts, exceeding valuation limits and using donor TIDs and will make recommendations to the State Legislature about potential changes to existing law.
The task force will present an educational report to the County Board of Supervisors by Dec. 31. and suggest proposed policy changes to the board for consideration by March 31, 2024.
The debate lasted almost an hour, with supervisors discussing pros and cons of the measure, which has been under discussion since early this year and passed by a whisker. The ordinance required the support of the two-thirds of the supervisors present. Of the 34 supervisors who participated in the regular meeting of the Board of Supervisors on Tuesday – in-person and virtual – 23 of them voted yes and 11 said no.
Those in favor of the task force said TIF, a tool used by municipalities to jump start development of blighted or unused properties, has gotten out of control and is depriving the county of revenue.
Officials who supported the task form pointed to the more than $1 billion of increased revenue of properties that is now locked at base value within TIDs. Some said they were not against the tool in principle, but wanted to see how best to use tax increment financing to benefit all tax-levying entities including Marathon County, the city of Wausau North Central Technical College and the Wausau School District.
They also said they were not against TIF or the development parcel it created but that the task force would study and make recommendations on how best to use TIDs for the benefit of all tax-levying entities. The task force will examine how various taxing entities are treated after a TID is created. The Joint Review Board, made up of representatives of the Wausau School District, city of Wausau, North Central Technical College and Marathon County, along with a former Wausau mayor, approves new TIDs or extensions.
Critics of the task force say tax increment districts have tremendous value and have successfully revitalized development and growth. Some board members were concerned that the task force would shut down or limit the use of the tool. They also balked at the negative portrayal of TIF and said an evaluation should be done by economic experts engaged by the county.
They also said the proposed task force would not ensure adequate representation of the municipalities involved.
Supervisor David Oberbeck said the original idea of a TID was to boost redevelopment of areas that needed incentives but that has gotten out of hand.
“TIDs are…not meant to last a lifetime,” said Oberbeck, a former Wausau alder and one-time candidate for mayor. He cited an example of the former Wausau Center mall, with its value plummeting from “$33 million to $12 million and then to zero.” The mall is being redeveloped with help from the City of Wausau.
“We lost $33 million,” said Oberbeck. “Now it will go way up in value but it (value) is going to be locked in for 27- to 30 years with that (incremental) value not available to any of the other tax-levying entities – to improve our schools, improve the roads in the districts.”
Oberbeck said that municipal leaders must find a better way to use TID.
“It’s become a vehicle to just generate money for one entity while others have to find ways to subsidizing their operations,” said Oberbeck, who suggested that the task force could study outcomes and make recommendations for improvements.
Supervisor Gayle Marshall asked her colleagues if they could answer their constituents who might want to know how much additional tax levy the county is paying to cover tax increment districts, some of which have been extended to more than 35 years.
Vice Chair Craig McEwen also pointed out that some redevelopment districts have been extended and can stretch on for decades. “The Marathon County Board should at least be interested in how these TIFs work and how the Joint Review Board (works) as far as extending TIDs (is concerned).”
Supervisor John Robinson, the chair of the committee that will be overseeing the task force, added to McEwen’s remarks on extension of life of TIDs.
“We have had 13 out of 40 TIDs which have been extended beyond their original life,” Robinson said. “Was there a due diligence? Was there a strong evaluation of those? We have donor TIFs. They could be going back to tax rolls, but instead they are supporting other TIDs in the community.”
He pointed to the lac of a policy or a procedure under which county officials can evaluate those extension requests. He said creating the task force would allow them to engage communities and have that conversation at the table.
But Supervisor Ann Lemmer said municipalities do not have fair representation on the nine-member task force because five of its members will be supervisors. Of the rest, two will be local elected officials, one from a local taxing district and one business representative. Marathon County has 40 towns, 15 villages and six cities. Not every municipality has a TID. The current number of TIDs in the county is 40. Lemmer again suggested engaging experts on the use of TIF and TIDs, instead of creating the task force, and added that the county should engage the municipalities in the discussion.
Supervisor Allen Opall accused the proponents of selectively highlighting the failures of TIF and some TIDs. “I haven’t heard about the success of TID but only about failures,” he said. “There have been some failures but there are also successes.”
Similarly, Supervisor Ron Covelli feared that the task force would damage relations between the county and the municipalities that use TIDs. He said he would prefer the county’s finance director come up and explain how she makes decisions at the Joint Review Board on TID. The finance director, Kristi Palmer, represents Marathon County on the JRB.
Supervisor Jacob Langenhahn has insisted that the county do something about the property values in TID that are locked in base value despite the subsidized development parcel generating over a billion dollars in increased revenue.
