Under current law, DOR assesses manufacturing property for property tax purposes and imposes a fee on each municipality in which the property is located to cover part of the assessment costs. If a municipality does not pay by March 31 of the following year, DOR reduces the municipality’s July and November shared revenue distribution by the amount of the fee. Under the bill, if DOR is unable to collect the fee from a municipality in this manner, then the fee is directly imposed on the municipality.
General taxation
Milwaukee County sales and use tax
Current law allows a county to enact an ordinance to impose sales and use taxes at the rate of 0.5 percent of the sales price or purchase price on tangible personal property and taxable services. The county must use the revenue from the taxes for property tax relief. The bill allows Milwaukee County to impose, by ordinance, an additional sales and use tax at the rate of 1 percent of the sales price or purchase price on tangible personal property and taxable services. However, the ordinance does not take effect unless approved by a majority of the voters of the county at a referendum. The bill requires 50 percent of the revenue from those taxes to be distributed to the City of Milwaukee, and the revenue may be used for any purpose designated by the common council. The revenue retained by Milwaukee County may be used for any purpose designated by the county board or specified in the ordinance or in the referendum approving the ordinance.
County and municipality sales and use taxes
The bill allows counties besides Milwaukee County to impose, by ordinance, an additional sales and use tax at the rate of 0.5 percent of the sales price or purchase price on tangible personal property and taxable services. However, the ordinance does not take effect unless approved by a majority of the voters of the county at a referendum. The revenue from those taxes may be used for any purpose designated by the county board or specified in the ordinance or in the referendum approving the ordinance.
The bill also allows a municipality, except for the City of Milwaukee, with a 2020 population exceeding 30,000 to enact an ordinance to impose sales and use taxes at the rate of 0.5 percent of the sales price or purchase price on tangible personal property and taxable services. The ordinance does not take effect unless approved by a majority of the voters of the municipality at a referendum. The revenue from those taxes may be used for any purpose designated by the governing body of the municipality or specified in the ordinance or in the referendum approving the ordinance.
Little cigars
The bill taxes little cigars at the same rate as the excise tax imposed on cigarettes. Under current law, all cigars are taxed at the rate of 71 percent of the manufacturer’s established list price, limited to 50 cents per cigar. Under the bill, little cigars are taxed at the rate of 126 mills per little cigar, regardless of weight. The bill defines “little cigar” to mean a cigar that has an integrated cellulose acetate filter and is wrapped in any substance containing tobacco.
Vapor products
Current law imposes a tax on vapor products, which are any noncombustible products that produce vapor or aerosol for inhalation from the application of a heating element to a liquid or other substance that is depleted as the product is used, regardless of whether the liquid or other substance contains nicotine. The tax is imposed at the rate of 5 cents per milliliter of the liquid or other substance based on the volume as listed by the manufacturer.
The bill taxes vapor products at the rate of 71 percent of the manufacturer’s established list price and modifies the definition of “vapor product.” Under the bill, “vapor product” means a noncombustible product that employs a heating element, power source, electronic circuit, or other electronic, chemical, or mechanical means that can be used to produce vapor from a solution or other substance, regardless of whether the product contains nicotine. A “vapor product” is defined to include an electronic cigarette, electronic cigar, electronic cigarillo, electronic pipe, or similar product or device, as well as any container of a solution or other substance that is intended to be used with these items. The bill specifies that any product regulated by the federal Food and Drug Administration as a drug or device is not a vapor product.
Definition of “manufacturer’s list price”
Current law imposes a tax on tobacco products based on the “manufacturer’s established list price,” without defining the term. The bill removes the word “established” and defines “manufacturer’s list price” to mean the total price of tobacco products charged by the manufacturer or other seller to an unrelated distributor. The bill specifies that the total price must include all charges by the manufacturer or other seller that are necessary to complete the sale, without reduction for any cost or expense incurred by the manufacturer or other seller or for the value or cost of discounts or free promotional or sample products. The bill provides that a manufacturer or other seller is related to a distributor if they have significant common purposes and either substantial common membership or substantial common direction or control.
Sales and use tax exemption for gun safety items
The bill creates a sales and use tax exemption for sales of gun safes, trigger locks, and gun barrel locks.
Breastfeeding equipment
The bill creates a sales and use tax exemption for breast pumps, breast pump kits, and breast pump storage and collection supplies.
Sales tax exemption for diapers and feminine hygiene products
The bill creates a sales and use tax exemption for the sale of diapers and feminine hygiene products.
Prewritten computer software
The bill imposes the sales tax on the sale of the right to access and use prewritten computer software that remains in the possession of the seller or third party, including sales made on a per use, per user, per license, or subscription basis. Current law defines “prewritten computer software” as computer software that is not designed and developed by the author to the specifications of a specific purchaser.
Sales tax exemption for energy systems
Current law provides a sales and use tax exemption for a product that has as its power source wind energy, direct radiant energy received from the sun, or gas generated from anaerobic digestion of animal manure and other agricultural waste, if the product produces at least 200 watts of alternating current or 600 British thermal units per day. The sale of electricity or energy produced by the product is also exempt.
The bill modifies current law so that the exemption applies to solar power systems and wind energy systems that produce electrical or heat energy directly from the sun or wind and are capable of continuously producing at least 200 watts of alternating current or 600 British thermal units. In addition, the exemption applies to a waste energy system that produces electrical or heat energy directly from gas generated from anaerobic digestion of animal manure and other agricultural waste and is capable of continuously producing at least 200 watts of alternating current or 600 British thermal units. A system for which the exemption applies includes tangible personal property sold with the system that is used primarily to store or facilitate the storage of the electrical or heat energy produced by the system.
Prairie and wetland counseling services
Under current law, the sale of landscaping and lawn maintenance services is subject to the sales tax. The bill excludes from taxable landscaping services the planning and counseling services for the restoration, reclamation, or revitalization of prairie, savanna, or wetlands if such services are provided for a separate and optional fee distinct from other services.
Sales and use tax exemption for professional baseball park districts
The bill exempts from the sales and use tax tangible personal property and taxable services sold to a local professional baseball park district.
Sales and use tax exemption for improving professional sports and entertainment home stadiums
The bill exempts from the sales and use tax building materials, supplies, and equipment sold to owners, contractors, subcontractors, or builders solely for the improvement, repair, or maintenance of a professional sports and entertainment home stadium.
Repeal of sales tax exemption for farm-raised deer
The bill repeals the sales and use tax exemption that applies to the sale of farm-raised deer to a person operating a hunting preserve or game farm in this state.
Providing notices for public utility taxes
Under current law, public utility companies, including railroads and air carriers, are exempt from local property taxes and instead subject to special state taxes. Current law requires DOR to send certain notices regarding these taxes by certified mail. Under the bill, DOR must still provide the notices but is no longer required to send them by certified mail.
Other taxation
Real estate transfer fee
Current law, generally, requires a person who conveys an interest in real property to file a real estate transfer return with the county register of deeds and pay a real estate transfer fee equal to 30 cents for each $100 of the value of the conveyance. Current law provides certain exemptions from paying the fee, including exemptions for conveyances between an entity and the members of the entity who are related to each other as spouses, lineal ascendants, lineal descendants, or siblings.
The bill modifies current law so that the exemptions for conveyances between entities and related members also apply to conveyances to members who are related as an uncle and his nieces or nephews, an aunt and her nieces or nephews, or first cousins.
TRANSPORTATION
Highways and local assistance
Transportation revenue bonds
Under current law, the Building Commission may issue revenue bonds for major highway projects and transportation administrative facilities in a principal amount that may not exceed $4,325,885,700. The bill increases the revenue bond limit to $4,493,600,000, an increase of $167,714,300.
I 94 east-west corridor bonding
Under current law, the state may contract up to $40,000,000 in public debt for the purposes of reconstructing the “I 94 east-west corridor,” which is defined to mean “all freeways, including related interchange ramps, roadways, and shoulders, encompassing I 94 in Milwaukee County from 70th Street to 16th Street, and all adjacent frontage roads and collector road systems.” The bill increases the authorized general obligation bonding limit for these purposes by $140,873,000 to $180,873,000.
Major interstate bridge bonding
Under current law, the state may contract up to $272,000,000 in public debt for DOT to fund major interstate bridge projects, which are projects involving the construction or reconstruction of a bridge on the state trunk highway system that crosses a river forming a boundary of the state and for which this state’s estimated cost share is at least $100,000,000. The bill increases the authorized general obligation bonding limit for this purpose by $47,200,000 to $319,200,000.
General transportation aids
Under current law, DOT administers a general transportation aids program that makes aid payments to a county based on a share-of-costs formula, and to a municipality based on the greater of a share-of-costs formula or an aid rate per mile. The aid rate per mile is $2,734 for 2023. The bill increases the aid rate per mile to $2,843 for 2024 and $2,957 for 2025 and thereafter.
Currently, the maximum annual amount of aid that may be paid to counties under the program is $127,140,200. The bill maintains this amount for 2023 and increases this amount to $132,225,800 for 2024 and $137,514,800 for 2025 and thereafter. Currently, the maximum annual amount of aid that may be paid to municipalities under the program is $398,996,800. The bill maintains this amount for 2023 and increases this amount to $414,956,700 for 2024 and $431,555,000 for 2025 and thereafter.
Local roads improvement program discretionary grants
Under current law, DOT administers the local roads improvement program (LRIP) to assist political subdivisions in improving seriously deteriorating local roads by reimbursing political subdivisions for certain improvements. LRIP has several components, including discretionary grants. Current law specifies dollar amounts that DOT must allocate in each fiscal year to each of three project types that exceed specified cost thresholds: 1) county trunk highway improvements, 2) town road improvements, and 3) municipal street improvement projects.
Under the bill, in fiscal year 2023-24 and each fiscal year thereafter, of the amount appropriated to DOT for LRIP discretionary grants, DOT must allocate 35.6 percent to county trunk highway improvements, 39.0 percent to town road improvements, and 25.4 percent to municipal street improvements.
Transportation projects
Under current law, for certain highway projects for which DOT spends federal money, federal money must make up at least 70 percent of the funding for those projects. DOT is required to notify political subdivisions receiving aid for local projects whether the aid includes federal moneys and how those moneys must be spent. For certain projects that receive no federal money, DOT may not require political subdivisions to comply with any portion of DOT’s facilities development manual other than design standards. Any local project funded with state funds under the surface transportation program or the local bridge program must be let through competitive bidding and by contract to the lowest responsible bidder. The bill repeals all of these requirements.
Electric vehicle infrastructure program
Under the bill, DOT may establish and administer a program to provide funding for electric vehicle infrastructure projects.
Establishment of bikeways and pedestrian ways in highway projects
Under current law, DOT must, with exceptions, give due consideration to establishing bikeways and pedestrian ways in all new highway construction and reconstruction projects funded from state or federal funds.
Under the bill, with several exceptions, DOT must ensure that bikeways and pedestrian ways are established in all new highway construction and reconstruction projects funded from state or federal funds and must promulgate administrative rules identifying certain exceptions to the requirement.
Interconnected traffic signal and railroad signal systems
Under current law, DOT is appropriated federal, state, and local moneys for the purpose of railroad crossing improvements. The bill appropriates to DOT state and local moneys specifically for the planning and installation of interconnected traffic signal and railroad signal systems.
State funding for local transportation facilities
Under current law, DOT is appropriated moneys received from local units of government and the federal government for the purposes of providing public access roads to navigable waters; improving highway connections between the UW System and state charitable or penal institutions; constructing and maintaining UW System, state charitable or penal institution, and state capitol roadways; constructing and maintaining state park, forest, and riverway roads; and improving transportation facilities.
The bill creates an appropriation of state moneys from the transportation fund for the same purposes.
Traffic calming grants
Under the bill, DOT must develop and administer a local traffic calming grant program. Under the program, DOT must award grants to political subdivisions for infrastructure projects designed to reduce the speed of vehicular traffic.
Ray Nitschke Memorial Bridge
The bill requires DOT, in the 2023-24 fiscal year, to set aside $1,200,000 of the amounts appropriated to DOT for bridge development, construction, and rehabilitation for repairs to the Ray Nitschke Memorial Bridge in Brown County.
Bonding authority for Southern Bridge project
Under current law, the state may contract up to $46,849,800 in public debt for DOT to acquire, construct, develop, enlarge, or improve local bridges and interstate bridges. The bill authorizes the state to contract an additional $50,000,000 in public debt for the construction of the Southern Bridge project crossing the Fox River in Brown County.
Tribal nation welcome signs
The bill authorizes a federally recognized American Indian tribe or band in this state to erect and maintain within the right-of-way of any highway within the boundaries of an Indian reservation or other land held in trust for the tribe or band a tribal nation welcome sign. Under the bill, “tribal nation welcome sign” means an official sign erected and maintained by a federally recognized American Indian tribe or band in this state that the tribe determines is necessary to inform motorists of the territorial boundaries of tribal reservation and trust lands. The bill provides that welcome signs may not be erected within the right-of-way of an interstate highway and are not subject to the Wisconsin manual on traffic control devices adopted by DOT.
Under current law generally, no sign may be placed within the limits of any street or highway except as necessary for the guidance or warning of traffic, the safeguard of children at play, or to indicate the presence of a neighborhood watch program. This prohibition does not apply to directional and other official signs or to municipal welcome signs.
Drivers and motor vehicles
Driver’s cards
Under 2007 Wisconsin Act 20, certain provisions specified in the federal REAL ID Act of 2005 (REAL ID) were incorporated into state law and these provisions became effective on January 1, 2013. Among these provisions was the requirement that DOT follow certain procedures in processing applications for driver’s licenses and identification cards. However, under 2011 Wisconsin Acts 23 and 32, DOT may process applications for driver’s licenses and identification cards in a manner other than that required by REAL ID if the driver’s licenses and identification cards are marked to indicate that they are not REAL ID compliant and DOT processes the applications in compliance with DOT practices and procedures applicable immediately prior to implementation of REAL ID. Under current law, an applicant for a driver’s license or identification card, regardless of whether it is REAL ID compliant or REAL ID noncompliant, must provide to DOT 1) an identification document that includes either the applicant’s photograph or both the applicant’s full legal name and date of birth; 2) documentation, which may be the same as item 1, above, showing the applicant’s date of birth; 3) proof of the applicant’s social security number or verification that the applicant is not eligible for a social security number; 4) documentation showing the applicant’s name and address of principal residence; and 5) documentary proof that the applicant is a U.S. citizen or is otherwise lawfully present in the United States. However, in processing an application for a REAL ID noncompliant driver’s license or identification card, DOT is not required to meet the standards for document retention and verification that are imposed for REAL ID compliant products.
Under the bill, an applicant for a REAL ID noncompliant driver’s license or identification card (noncompliant REAL ID) is not required to provide documentary proof that the applicant is a U.S. citizen or is otherwise lawfully present in the United States. Also, an applicant may, in lieu of item 1 above, provide an individual taxpayer identification number, a foreign passport, or any other documentation deemed acceptable to DOT and, in lieu of items 2 and 4 above, provide documentation deemed acceptable to DOT. If the applicant does not have a social security number, the applicant is required to provide verification only that he or she does not have one, rather than verification that he or she is not eligible for one. In processing an application for, and issuing or renewing, a noncompliant REAL ID, DOT may not include any question or require any proof or documentation as to whether the applicant is a U.S. citizen or is otherwise lawfully present in the United States. The license document issued must display, on its face, the words “Not valid for voting purposes. Not evidence of citizenship or immigration status.” The bill does not change any current law requirements related to driver qualifications such as minimum age or successful completion of knowledge and driving skills tests.
With limited exceptions, DOT may not disclose social security numbers obtained from operator’s license or identification card applicants. The bill prohibits DOT from disclosing the fact that an applicant has verified to DOT that the applicant does not have a social security number, except that DOT may disclose this information to the Elections Commission.
The bill also prohibits discrimination on the basis of a person’s status as a holder or a nonholder of a noncompliant REAL ID, adding this license status as a prohibited basis for discrimination in employment, housing, and the equal enjoyment of a public place of accommodation or amusement.
Electronic renewal of operator’s licenses
Under current law, most operator’s licenses issued by DOT must be renewed every eight years. In general, an applicant for renewal of an operator’s license must pass an eyesight test and have his or her photograph taken.
Under the bill, if an applicant for renewal of an operator’s license meets certain requirements, the applicant may apply for renewal, and DOT may renew the license, by electronic means. The renewal may occur without an eyesight test and without a photograph. One of the eligibility requirements for use of the electronic procedure is that the applicant meets any additional criteria for eligibility established by DOT.
Driving skills test waiver
Under current law, with limited exceptions, an applicant for an operator’s license authorizing operation of “Class D” vehicles, which are automobiles and most passenger vehicles, must successfully complete a knowledge test and a driving skills (road) test. The bill allows DOT to waive the road test for a person if all of the following are satisfied:
1. The person is under 18 years of age.
2. The person is applying for authorization to operate only “Class D” vehicles.
3. The person has satisfactorily completed a course in driver education.
