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Thursday, December 14, 2017

Wisconsin Communities Should Heed WMC's Dark Store Position

Did you know Wisconsin municipalities held a "Dark Store Day" to push state legislators into passing two bills they believe will close the dark store loophole?

I didn't know until after it was over. Only one tweet appeared under the dark store day hashtag and it was by the Wisconsin Manufacturers and Commerce in opposition to the city's campaign. That doesn't say much for the Municipal Association's social media digital operation. Actually, it's non-existent.

The WMC tweeted a link to their dark store editorial titled, Local Governments Participate in “Raise Your Taxes Day”

Basically, the WMC wrote that A.) it's just a ploy by local governments and aggressive assessors to raise taxes, B.) the WMC oppose the state's uniformity clause because they believe keeping assessment procedures and formulas including tax rates uniform mean higher costs to Wisconsinites. They said that right here...

WMC Excerpt:
“Don’t let them fool you. This is about raising taxes on all businesses, not just ‘big box’ stores,” Manley added. “Thanks to our state’s uniformity clause, these bills could raise taxes for the small manufacturer in your town or your favorite spot for Friday fish fry. Unfortunately, that means higher costs for all Wisconsinites.”

You read that right. The WMC is blaming the state's constitutional uniformity clause for uniform taxes. Uniform taxes that they believe "unfortunately" lead to higher costs on their membership. When for the most part, legislators have been ignoring the clause for years to pass specialized tax cuts, portability options and exemptions for their donor-class business partners.

The theory is if nobody challenges uniformity clause abuses in the courts's constitutional, and if somebody does challenge it, they can't challenge its constitutionality unless they can prove personal harm. That almost guarantees abuse.

Because I believe dark store litigation and TIF District abuse are intrinsically linked together by the state's abuse of the uniformity clause, the WMC's dark store position paper is a shot across the bow of WILL's challenge to a TIF District in Eau Claire. The WMC is advising the State Supreme Court through media that the court should not uphold or apply the state's uniformity clause when making their TIF District decision in February. I also think state republicans are waiting on SCOWI language and direction on the February TIF ruling before taking up dark store legislation.

But, what the WMC is also saying is; when a city like Janesville must refund $500K to several big box stores and other businesses and then lower future assessments by a third or more, NOBODY is twisting Janesville's arm to shift the tax burden onto homeowners and small businesses. That's absolutely true. In effect, the WMC suggests that cities should cut their budgets by a corresponding amount, and start closing roads, shuttering schools and laying off administration, police and fire - to meet budget balance. That's what they're saying.

Because not to make those cuts is the reason why the WMC is accusing city officials for using the dark store issue as an excuse to pile on and raise taxes ...and the WMC is right, at least half way.

Here's why.

If I was mayor of Janesville, I would hold a press conference and name the businesses including the amounts each have sued for that are forcing city budget cuts. I would also explain that as a mayor who takes his fiduciary responsibility seriously, I cannot in good conscience force others (homeowners and small business) to pay more than their fair share when others refuse to pay theirs.

So as mayor I would recommend two things. The first would be a list of city services that will be cut along with the personnel layoffs to meet the dark store budget cuts. Second, I would suggest Janesville residents take up a petition for a referendum asking to raise property taxes an amount equal to the dark store refunds and make them as permanent as the dark store assessments remain in effect. IF they want those jobs and services restored.

Sure, the WMC would probably accuse me of grandstanding the dark store issue anyways, but that is what the state's largest business association is recommending in their dark store day editorial.

Friday, December 08, 2017

Public Policy Group Takes Up Fight Against TIF District Abuse

God, how patient are thy poor! These corporations and masters of manipulation in finance heaping up great fortunes by a system of legalized extortion, and then exacting from the contributors-to whom a little means so much-a double share to guard the treasure! -- Robert M. La Follette, Sr.

The Wisconsin Supreme Court has agreed to hear a challenge to a Eau Claire TIF District, a case filed by the Right-Wing Wisconsin Institute for Law & Liberty (“WILL”) led by attorney Rick Esenberg.

WILL is working on behalf of local taxpayers who say Eau Claire abused Wisconsin’s tax incremental financing (TIF) law.

WILL Excerpt:
The lawsuit seeks to invalidate the City’s actions in creating and amending two tax incremental financing (“TIF”) districts to fund certain aspects of the Confluence Project and, in particular to pay fees and expenses to the real estate developers involved in the construction of a student residence hall/mixed use facility. The suit alleges that the TIF districts are illegal for the following reasons:

The properties within the TIF districts do not meet the legal definition of “blight”

Development within the TIF districts would occur even without TIF money

The city council and the joint review board (a board made up of representatives of the different authorities that can tax property within the district) lacked a factual basis for their conclusions

The TIF districts lack a valid public purpose

The TIF districts violate the Uniformity Clause of the Wisconsin Constitution

TIF funds are unlawfully being used to reimburse the developer for demolishing historic buildings

In what should have been a torchlight policy fight by every progressive, liberal, lefty lawyer in the state of Wisconsin is instead taken up by the Right. Go figure.

But it's about time somebody challenged these abuses. They are a scourge against the free markets and a pox on good government, let alone that active TIF Districts can increase the property tax burden of those outside the TIF by as much as 30%. People then wonder why paving their roads and keeping their schools open seems so unaffordable.

According to a recent story from Madison Dot Com, the state's Attorney General Office (Brad Schimel) is sending counsel to intervene in support of the Eau Claire TIF District project against Esenberg's lawsuit.

That will set up some interesting dynamics worth watching between the Bradley Foundation funded WILL group against the Bradley-owned AG office and the Bradley Foundation majority state supreme court with TIF District right-wing engineered trickle-down economics hanging in the balance.

It's popcorn time! Stay tuned.

Tuesday, December 05, 2017

The Pride Of Dollar General: Janesville's Paul Ryan

From the Wall Street Journal via Vox: The Dollar General CEO just accidentally made clear how screwed up the economy is, “The economy is continuing to create more of our core customer.”

Living from ketchup bottle to ketchup bottle:

Vox Excerpt:
Here’s a grim picture of the state of the American economy: The CEO of Dollar General explained to the Wall Street Journal why things are looking up for his company.

Dollar General, with about 14,000 stores across the country and a $22 billion market value, targets customers making $40,000 a year or less. They are expanding, CEO Todd Vasos told the Journal.


“The economy is continuing to create more of our core customer,” Vasos said.

This is how he described the typical Dollar General customer: “Doesn’t look at her pantry or her refrigerator and say,‘You know, I’m going to be out of ketchup in the next few days. I’m going to order a few bottles. The core customer uses the last bit of ketchup at the table the night prior, and either on her way to work or on her way home picks up one bottle.”

How does Paul Ryan fit into all that? Easy.

During this past summer, Ryan paid a rare visit to Janesville to celebrate the grand opening of the new Dollar General warehouse. At that event, Ryan said that his tax and regulatory reforms helped bring Dollar General to Janesville.

I don't know exactly which of Ryan's tax and regulatory reforms helped bring Dollar General to Janesville, versus say, to Illinois or Indiana. So I asked that same question in my original June blog posting. Of course no one from Ryan's office ever responded.

I asked the same question of Dollar General's local management team since they were giddy over Ryan's remarks and also gave the Janesville congressman much credit for their continued growth and success. As expected, no one from Dollar General responded.

I don't think Ryan and Dollar General employees were being dishonest or hamming it up for political theater. Simply asking them which of Ryan's reforms helped them prosper was my effort to get better informed. Instead, they gave credit where credit is due - to Paul Ryan. And he was accepting.

More from the Vox feature, which you should read in full.

Friday, December 01, 2017

Paul Ryan Featured In His Hometown Catholic School Calendar

I just want to speak to you a little bit about Ayn Rand and what she meant to me in my life and [in] the fight we’re engaged here in Congress. I grew up on Ayn Rand, that’s what I tell people." -- Rep. Paul Ryan

Oh wait ...Paul Ryan said his love of Ayn Rand's political philosophy and worldview was made up by the Left and nothing more than an urban legend. Rrrrrright.

A friend emailed explaining how infuriated she was to see Paul Ryan featured for the month of April in St. John Vianney's 2018 calendar. She purchases the calendar every year but will no longer do so to support the Janesville school's fundraising efforts. She also attached a copy of the feature. End of email.

To be fair to the school, St. John Vianney IS Ryan's grade school alma mater. You know, the place where he spent his formative years growing up with Ayn Rand. Still, it is a Catholic institution and apparently they have turned a blind-eye toward the congressman's long and well-documented history with Rand.

Unfortunately, the beautiful Bible passage they used for the caption (Galatians 15:3 is a typo - it's 5:13) is almost a cruel joke considering that Ryan also recently admitted that he's been dreaming of kicking poor people off of Medicaid since his college kegger days. But it's the school's prerogative. They're proud of him. I guess.

Perhaps the only saving grace to the entire matter is the fact that when you move the calendar page from the last day of March to the Ryan feature, you're greeted by April Fool's.


RNR - Janesville Newspaper Reports Cheers For Ryan Rehearsed (Aug. 2012)

Salon - A kids’ book wants to teach your children to love Ayn Rand’s “Atlas Shrugged”

Tuesday, November 28, 2017

In Janesville, After We Broaden The Base - We Raise The Rates!

Here's the expected annual story about the Janesville City Council approving the city budget.

According to the Gazette, City Manager Mark Freitag credits Dollar General and other projects for growth in the city's assessed value, yet the average tax bill from the city's portion of the property tax statement will rise $50 for the typical homeowner.

JG Excerpt:
A municipality can increase its tax levy only by the percent increase of net new construction. Dollar General and other projects have contributed to Janesville's 2018 net new construction increase of 2.73 percent, City Manager Mark Freitag has said.

Of course there are a few problems with that statement.

First is; although Dollar General does "pay" a property tax bill, very very little of it goes to the city's General Fund. Assessed values of any new construction inside TIF Districts are not added to the city's total taxable value until the TIF District expires.

To put it another way, since most of the city's "growth" is inside TIF Districts including Dollar General, they contribute absolutely nothing to taxable net new construction. That includes the giant Downtown TIF District whose assessed values are frozen in time for the next 26 years.

Property taxes collected from downtown property owners will continue to go up, but the portion going to the city in 2030 will be the same as it was in 2017. The rest of us chumps will have to make up the difference.

Secondly; "A municipality can increase its tax levy only by the percent increase of net new construction," is true, but it's not the whole truth. Municipalities can also increase its tax levy by the same percentage in rising property assessments. In other words, rising property assessment value equals net new construction in the eyes of the city tax adjuster.

Think of it this way: There's a reason why your home's property tax bill has gone up dramatically since 2010 and it's not because of new construction.

Sadly for both the City Manager and the Gazette, neither bothered to touch on or credit residential property assessments as the primary driver of taxable growth. While some of the city's biggest business players have lawyered up to have their property assessments cut in half, the rest of us chumps will have to suck it up watching our property tax assessments climb. We're the little people.

Freitag's boast about new construction growth in the city doubling in the past year is little more than a self-ingratiating account. Because if city new construction grew from 3.3 percent to 6.8 percent in a year results in raising the tax rate from $8.82 to $9.24 per $1,000 of assessed valuation is something glorious to behold, then we must believe broadening the base leads to raising the rates.

And THAT my friends is going backwards.


RNR - Use Janesville's $583K Earmark For Dark Store Relief

RNR - Janesville's Dark Store Community Grows

Friday, November 24, 2017

No Excuse NOT to Run For Public Office After The Election Of Donald Trump

What could they say? You filed for bankruptcy? Dodged the military? Were accused of sexual assault? Transgender? Too old? Can't spell? Lack of education? No prior experience? Easily triggered? Those trying to discourage others from running for office by trying to make them feel bad for a lack of accomplishment or a non-traditional personal history have run out of ammo, thanks to the election of Donald Trump.

Watch it:

Tuesday, November 14, 2017

Wednesday, November 08, 2017

Comparing Foxconn Favorably To GM Janesville Is Idiotic

Yes. They went there.

According to the Janesville Gazette, Gov. Scott Walker made a campaign stop at a Janesville business and like Paul Ryan's visits to the area, Walker held a captive audience on private property and would not take questions from the press. So there's that.

But most notable from the story was a comment from one of his supporters favorably comparing Foxconn to Janesville's General Motors plant. The comparison isn't just apples to oranges, it's more like comparing apples to hammers.

Here's why.

First, the most obvious. Not only is the value of the dollar much less today, but the wages expected to be paid to the majority of workers at Foxconn in 2020 is less than half of what GM workers earned 20 years earlier. When you throw in retirement benefits, health insurance and job security, the comparison becomes absolutely laughable and sad at the same time. Clearly, we've moved backwards with Foxconn.

But more importantly are the things we don't readily see like the fact that labor unions, not government, provided a culture of worker training and community. Or that GM or its suppliers didn't require government to act as a middle-man to GM officials for communications, government assistance or subsidies. Clearly, we're moving backwards with Foxconn.

An unlike Foxconn, the hated corporate GM plant did not reside on government purchased land in a tax-free sales-tax exempt embassy-like environment. GM paid their hefty annual property tax bill to the county without demanding massive kickbacks, so much to the point where the city of Janesville was less dependent on state aid.

Today, Janesville officials claim they are being robbed by the state because the state aid formula remains as if the city still had GM paying into the general fund. Clearly, Janesville without GM is more dependent on government. Clearly, we're moving backwards without GM.

Unlike the Foxconn deal, GM paid their public utility bills to the city just like everybody else. GM used massive amounts of city water and public waste facilities and paid for what they used to the point that their payments substantially lowered residents bills. Back then, city officials and the Gazette tried to claim that their "conservative" policies and efficient governance deserved the credit for keeping costs lower than peer cities. But some of us knew better.

Unlike Foxconn, Janesville GM did not require the state government to extract $50M or $100M or $200M a year from taxpayers just to employ workers for the first 15 years. Yet, the UAW labor union was scorned for expecting far less in the form of dues from GM workers to help keep employees free from government dependence. They persevered for 90 years in Janesville and they're still hated today.

Yep, unlike General Motors Janesville, Foxconn brings with it a government-run Chinese mentality where "workforce housing" won't be privately owned homes lining the streets of Mount Pleasant in Racine county like the modest family homes on Janesville's southside, but factory on-site dormitories with channels to cheap global labor.

I'm barely scratching the surface here but I think you get the idea. Foxconn in Wisconsin is a product of inverted free markets and backward thinking. It's "transformational" for the state in the same way an apple pie can be reformed with a hammer.

"Where free unions and collective bargaining are forbidden, freedom is lost!" -- President Ronald Reagan