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HomeMy WebLinkAbout06.05.2024 Agenda Materials Finance Department City Hall, 215 Church Avenue P.O. Box 1130 Oshkosh, WI 54903-1130 920.236.5005 http://www.ci.oshkosh.wi.us LONG RANGE FINANCE COMMITTEE AGENDA June 5, 2024 5:15 PM To Whom It May Concern: PLEASE NOTE the City of Oshkosh Long Range Finance Committee will meet on Wednesday, June 5th, at 5:15 pm, in Room 404 at the Oshkosh City Hall, 215 Church Avenue. ROLL CALL I. Citizen Input - (Up to the first 15 minutes of meeting – can be regarding any City Finance topic) II. Approval of April 3, 2024 Minutes III. Introductions (New Members) IV. Elect Chair and Vice-Chair V. Update from GOEDC VI. Tax Increment Finance (TIF) Closure Policy VII. Next Meeting Date & Agenda Items – August 7, 2024 VIII. Adjournment If you have any questions, please call the Finance Office at (920) 236-5005 between 8:00 am – 4:30 pm Monday – Friday. Finance Department City Hall, 215 Church Avenue P.O. Box 1130 Oshkosh, WI 54903-1130 920.236.5005 http://www.ci.oshkosh.wi.us LONG RANGE FINANCE COMMITTEE AGENDA April 3, 2024 5:15 PM To Whom It May Concern: PLEASE NOTE the City of Oshkosh Long Range Finance Committee will meet on Wednesday, April 3rd, at 5:15 pm, in Room 404 at the Oshkosh City Hall, 215 Church Avenue. The meeting was called to order by Mike Ford at 5:17pm. Members Present: John Zarbano, Todd Hutchison, Mike Ford Members Absent: Koby Schellenger, Adam BellCorelli, Andrew Kramp, Brian Wendt Staff Present: Julie Calmes – Director of Finance, Denise Edwards – Finance Management Analyst ROLL CALL I. Citizen Input • None II. Approval of February 7, 2024 Minutes: • MOTION TO APPROVE: John Zarbano; 2nd Todd Hutchison • CARRIED: Approved unanimously, no added comments III. Special Assessment Policy- Continued Discussion: • There have not been any updates to this policy. Finance and Public Works are planning on looking into and drafting a special assessment deferment policy IV. Capitalized Fixed Asset Policy A. Discussion minor changes to description: • All changes were reviewed looks good V. Update on Policy Manual: • Julie suggested that we do more research, look to the GFOA for policy improvements and present the whole policy manual at one time instead of separate submissions Finance Department City Hall, 215 Church Avenue P.O. Box 1130 Oshkosh, WI 54903-1130 920.236.5005 http://www.ci.oshkosh.wi.us VI. Next Meeting Date & Agenda Items – June 5, 2024 A. Tax Increment Finance District (TIF) Closure Policy i. Kelly Nieforth and/or Mark Lyons will come to discuss B. Update from GoEDC i. Confirmed to attend and update committee VII. Adjournment • MOTION TO ADJOURN: Todd Hutchison; 2nd John Zabrano • CARRIED: Approved unanimously • Meeting adjourned at 5:36pm If you have any questions, please call the Finance Office at (920) 236-5005 between 8:00 am – 4:30 pm Monday – Friday. Tax Increment Finance (TIF) District Draft TIF Closure Review Process/Policy May 23, 2013 June XX, 2024 Tax Increment Finance (TIF) Districts have mandatory closing dates, based on the type of district. In general, the TIF District must first pay off project costs including interest, administration, financing, legal etc. The City depends on a TIF District paying off all of its outstanding obligations; otherwise the City is required to assume the remaining TIF obligations. The following options are listed in chronological order based on the time of action needed prior to terminating a TIF District. Each TIF District will go through the following process. All of these options can be used in tandem with one another. The dollar amount for each activity and the timing for each activity would depend on the individual TIF District’s financial performance. A. Create a TIF donor/donee with an amended Project Plan. A well-performing TIF district can be used as a donor TIF for another an under-performing TIF(s). This action requires Joint Review Board approval and has been done in the past in the City. This choice can be made in any year up to the termination of the TIF District. B. Fund Affordable Housing. One additional year of tax increment may be collected in a TIF District if the funds will be used for affordable housing – the 1-year extension of the District would be a City Council decision. This choice can only be made in the year prior to the closure of the TIF District. At the end of a TIF District’s life, if the District has remaining funds upon termination of the TIF District, the funds shall be distributed to the public entities that are entitled to them in accordance with Wisconsin Statutes. The funds distributed to the City of Oshkosh shall be used as follows: C. Use cash balance in TIF account for future economic development activities including: 1. Contribute/”Buy in” to regional Revolving Loan Fund. Estimated cost of $500,000. 1. Create/fund a reserve account to help pay off debts of under-performing TIF districts. 2. Other economic development activities such as housing or development initiatives a local Revolving Loan Fund. Estimated cost to be determined by TID cash balances in the future. State of Wisconsin Department Of Revenue Search Tax Incremental Finance (TIF) - Terminations Secs. 60.23(32), 60.85, 66.1105, and 66.1106, Wis. Stats. For more information, review the TIF Termination web page. 1. When does a municipality terminate a Tax Incremental District (TID)? 2. What should the municipality provide to the Wisconsin Department of Revenue (DOR) when a TID terminates? 3. When lling out the Final TID Accounting Submission Date Agreement (Form PE-223), how does the municipal clerk determine the Final Accounting Submission date? 4. What is the last year a municipality receives an increment for a terminated TID? 5. If a municipality adopts a TID termination resolution, does the municipality need to pay DOR an administrative fee? 6. Can a municipality terminate an existing TID and then create another TID in the same year? wisconsin.gov MENU 7. When a municipality terminates a TID, what happens if there are still debts? 8. How does the municipality divide excess funds among the overlying taxing jurisdictions? 9. How long does the municipality have to return the excess funds? 10. What if a municipality terminated a TID and has some outstanding expenses to pay before disbursing any extra funds to the other overlying tax jurisdictions? 11. If a municipality adopts a TID termination resolution and notied DOR, can it rescind the termination resolution so it can adopt an aordable housing resolution? 12. What happens to the TID's personal property aid and exempt computer aid when the TID terminates? 13. When does a municipality receive the one-time levy limit adjustment? How is this calculated? 1. When does a municipality terminate a Tax Incremental District (TID)? The municipality must adopt a termination resolution when one of the following occurs: All project costs have been recovered TID reaches its maximum life or extended life date Municipality decides to terminate the TID early for any other reason 2. What should the municipality provide to the Wisconsin Department of Revenue (DOR) when a TID terminates? Within 60 days of adopting the termination resolution or by April 15, whichever is earlier: Email tif@wisconsin.gov: Adopted TID Termination Resolution Completed Final TID Accounting Submission Date Agreement (Form PE-223) Provide the assessor and real property lister a list of the property for removing the TID number Within 12 months of adopting the termination resolution: Complete the Final Audit; save a copy in the Municipal TID records Electronically le the Final Accounting Report (Form PE-110) using My-DOR-Gov Verify the TID number is removed from all property on the correct year's tax/assessment roll 3. When lling out the Final TID Accounting Submission Date Agreement (Form PE-223), how does the municipal clerk determine the Final Accounting Submission date? The Final Accounting Submission Date is the date when the municipality agrees to le the TID Final Accounting Report (PE- 110). Before submitting this report, the municipality's Certied Public Accountant must complete the nal audit. Contact the municipal auditor to determine when the nal audit will be completed. Then complete the Final Accounting Submission Date. This due date must be within a year of the TID termination resolution. 4. What is the last year a municipality receives an increment for a terminated TID? The date the municipality adopts the termination resolution determines the last year it receives an increment for that TID. For more details see the TID Termination Timeframes table. 5. If a municipality adopts a TID termination resolution, does the municipality need to pay DOR an administrative fee? The answer depends on the date the local legislative body adopts the termination resolution: On or before April 15 — municipality does not pay the administrative fee that year After April 15 — municipality must pay the administrative fee that year 6. Can a municipality terminate an existing TID and then create another TID in the same year? Yes. If the municipality is over the 12% value limit, the local legislative body must adopt the termination resolution before adopting the creation resolution for another TID. The municipality must remain below the 12% value limit after terminating a TID, to create another TID. If the municipality is under the 12% value limit, the local legislative body can adopt a creation resolution for a new TID if the municipality remains below the 12% value limit (including the new TID). The termination resolution for an existing TID can occur at any time in the same year. 7. When a municipality terminates a TID, what happens if there are still debts? The municipality is responsible for any remaining debt. 8. How does the municipality divide excess funds among the overlying taxing jurisdictions? According to state law (sec. 66.1105(6)(c), Wis. Stats.), the municipality must return excess funds based on each taxing jurisdiction's portion of the total tax rate. DOR recommends basing the distribution on the most recent tax levy proportions without the tax increment. Column A of the Tax Increment Worksheet (PC-202) may be used for this calculation. Contact lgs@wisconsin.gov for further assistance. 9. How long does the municipality have to return the excess funds? State law does not provide a specic deadline for distributing excess funds to other taxing jurisdictions. However, the TID's nal audit must be completed within one year of the termination resolution. DOR recommends distributing the excess funds when the nal audit is completed. 10. What if a municipality terminated a TID and has some outstanding expenses to pay before disbursing any extra funds to the other overlying tax jurisdictions? It is the municipality's responsibility to determine proper administration in this situation. For example, a municipality may set up a temporary escrow account to cover the nal expenses. This allows the municipality to complete its nal audit. 11. If a municipality adopts a TID termination resolution and notied DOR, can it rescind the termination resolution so it can adopt an aordable housing resolution? The answer depends on whether the termination deadline has passed and whether the TID has reached its maximum life. Municipalities must certify a TID as active or inactive by April 15 under state law (sec. 66.1105(6)(ae) Wis. Stats.). Both the termination and rescission must be in the same year based on this deadline. See the TID Termination Timeframes table. Rescinding a termination resolution is possible when all items below apply: TID did not reach its maximum life (or extended life) date Municipality paid the administrative fee for the year to keep the TID active. If the fee is paid, DOR considers the TID active. April 15 deadline has not passed; the TID number is still coded on the current year assessment/tax roll parcels Rescinding a termination resolution is not possible if any of the items below apply: TID's maximum life (or extended life) date has passed Administrative fee deadline has passed and the fee was not paid. Since the fee was not paid, DOR considers this TID terminated. April 15 deadline has passed; the TID number is removed from the current year assessment/tax roll parcels 12. What happens to the TID's personal property aid and exempt computer aid when the TID terminates? Eective with the 2022 payments, based on 2021 Act 61, when a TID receiving these aid payments terminates, DOR transfers the payments to the overlying jurisdictions (ex: municipality, county, school district, technical college). 13. When does a municipality receive the one-time levy limit adjustment? How is this calculated? In the year after the TID's termination year (see TID Termination Timeframes), a municipality may use a one-time levy limit increase. The levy limit adjustment appears on the Levy Limit Worksheet the same year as the TID's termination year. For example, for a TID with a 2024 termination year, the 2024 Levy Limit Worksheet for taxes payable in 2025 reects the increase. The calculation is the TID's nal increment value divided by the municipal TID equalized value without the TID increment, times 50% equals the increase percentage. The nal increment and municipal equalized value used in the calculation are from the last year the TID had an equalized value, set the year before the termination year. Note: If the municipality has more than one TID with the same termination year, the TID increment values are combined. A TID with a negative increment decreases the total increment used in the calculation. Contact lgs@wisconsin.gov for more information. Contact Us MS 6-97 Wisconsin Department of Revenue Oce of Technical and Assessment Services PO Box 8971 Madison, WI 53708-8971 Phone: (608) 266-7750 Email:tif@wisconsin.gov Related Links Act 12 Personal Property Exemption Adjustments Allocation Amendments Annexations Audits and Annual Report Base Value Redetermination Creation Developer's Agreement Extensions General Joint Review Board (JRB) Municipal Expenditures and Debt Municipal-Owned Property Overlaps Parcels Project Costs Project Plan Public Notices Tax Increments Terminations Territory Amendments About Us Contact Us Employment Media Room Privacy Legal Training Español Hmong 中文 русский More... Copyright © State of Wisconsin All Rights Reserved Town TIDs created under sec. 60.23, Wis. Stats. Value Limit What to Consider before Creating a TID