Taxation FAQ 8

What process must a municipality follow in order to obtain permission from the electorate to exceed the state-imposed property tax levy limit?

The state law imposing a property tax levy limit on municipalities, Wis. Stat. sec. 66.0602, provides that the levy limit may be exceeded if the governing body approves a resolution to that effect and the resolution is approved by voters at a referendum. The process is set out in sec. 66.0602(4). 

Timing of Referendum. In odd-numbered years a municipality may call a special referendum to exceed the levy limits.  In even-numbered years the referendum may be held at the spring primary or election or partisan primary or election. The only true option, however, is to conduct the referendum at the November general election or at a special election in November since DOR staff has concluded that a community must know what it's allowable levy increase is (i.e., the percentage increase in equalized value because of net new construction) before it can conduct a levy limit referendum. Communities don't learn their net new construction number until August 1 at the earliest.  Because various election notices are required well in advance of a referendum, the referendum can only be conducted at the November general election or a special referendum conducted in November.  

The resolution must specify: 1)  the proposed amount of increase in the municipal levy beyond the amount that is allowed, 2)  the purpose for which the increase will be used, and 3)  whether the proposed amount of increase is for the next fiscal year only or if it will apply on an ongoing basis.

The law requires that the municipal clerk publish type A, B, C, D, and E notices of the referendum under s. 10.01 (2). Section 5.01 (1) applies in the event of failure to comply with these notice requirements.

The referendum must be held in accordance with Chapters 5 to 12 of the Wisconsin Statutes. The municipality must provide the election officials with all necessary election supplies. The form of the ballot must correspond substantially with the standard form for referendum ballots prescribed by the Governmental Accountability Board under ss. 5.64 (2) and 7.08 (1) (a).

The question placed on the ballot must read as follows: "Under state law, the increase in the levy of the .... (name of political subdivision) for the tax to be imposed for the next fiscal year, . . .  (year), is limited to . . . . percent, which results in a levy of $ . . . Shall the . . . (name of municipality) be allowed to exceed this limit and increase the levy for the next fiscal year, . . . (year), for...(purpose for which the increase will be used) by a total of . . .  percent, which results in a levy of $ . . . ?"

Within 14 days after the referendum, the municipal clerk must certify the referendum results to the department of revenue. The levy increase limit otherwise applicable to the municipality is increased in the next fiscal year by the percentage approved by a majority of those voting on the question. If the resolution specifies that the increase is for one year only, the amount of the increase shall be subtracted from the base used to calculate the limit for the 2nd succeeding fiscal year.

A sample resolution for exceeding a municipality's levy limit is set forth below:



Sample Resolution For Exceeding the State Imposed Levy Limit

Whereas, the State of Wisconsin has imposed limits on town, village, city and county property tax levies under Wis. Stat. sec. 66.0602; and

Whereas, Wis. Stat. sec. 66.0602 limits the increase in 2017 to the local property tax levy to no more than the greater of (a) 0% of last year's actual levy or (b) a percentage equal to the percentage change in equalized value due to new construction less improvements removed; which for the Village of ____________ is ________ percent; and

Whereas, the Board of Trustees of the Village of ___________________, _________________County believes it is in the village's best interest to exceed the state levy limit as described above by a greater percentage than _____________ {Note: here insert the option that applies to your village (a) 0% or (b) percentage of new construction less improvements removed, if greater than 0%}; and

Whereas, the Village of _________________________ actual levy in 2016 (collected in 2017) was $________________________ ; and state law would limit the increase to $_________________ for a total allowable 2017(collected in 2018) village tax levy of $_______________________.}

Now, Therefore the Board of Trustees of the Village of ______________________, ______________________County does hereby resolve and order as follows:

The village board hereby supports an increase in the village tax levy for 2017 (to be collected in 2018) to exceed the state levy limit. {Note: If the governing body intends that the levy increase applies on an ongoing basis, it should insert the following sentence here:  The village board intends that the levy increase be applied on an ongoing basis by including it in the base used to calculate the limit for 2018 as well).  The purpose for which the increased levy will be used is ___________________  (e.g. street maintenance, public safety, expanded library hours, etc.)

The village board directs that the question of increasing the village tax levy for 2017 (to be collected in 2018) by ____________ percent, which would increase the village levy by $__________________ (insert dollar amount of proposed increase) over the past year's levy, for a village tax levy of $_________________ (insert total dollar amount of proposed village tax levy for 2014), the increase to be used for ________________ shall be submitted to the electors in a referendum at a special referendum election to be held on _______, _____, 2014.

Adopted this __________ day of ________________, 2____.

By the Village Board


Village President


Attested by Village Clerk: