March 2011

 



2011 Ehlers Public Finance Seminar Features Preview of Budget Repair Bill

Attendees at this year's Ehlers Public Finance Seminar benefited from an overview of the Governor's Budget repair bill that had been released the first day of the seminar. 

Speakers at the seminar had firsthand knowledge of the provisions in the budget repair bill and impacts to local government.  

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Do I Need a Paying Agent? (and what the heck is one?)

 

 

Most Wisconsin local governments that issue debt do not use paying agents, which is a third party that is engaged on a contractual basis to make sure debt payments are made in a timely manner.

 

The paying agent is responsible to maintain a record of the debt obligations it has been contracted to administer, to notify the local government in advance of payment due dates, to collect the amounts due, and to make the payment on time to the proper party. 

 

The paying agent also handles other administrative actions, such as processing of mandatory redemption notices for term bonds.

 

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2011 Wisconsin Conferences 

 

We always look forward to seeing you at up-coming conferences!

 

Click here to see which Wisconsin conferences Ehlers will be attending in 2011. 

 

 

Coming Soon:

Arbitrage Workshop   

If you issue debt, this hands-on workshop is for you!

 

Coming soon and based on overwhelming feedback at the Ehlers 2011 Seminar, Gail Robertson, Arbitrage Specialist, has agreed to train issuers on how to manage arbitrage responsibilities in connection with current and advanced obligations and obligations that qualify for the small-issuer exception.

 

More details to follow.

 

 

 

 

 

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The Governor's Budget Proposal and What It May Mean for Your Local Budget

On Tuesday, March 1 Governor Walker submitted to the Wisconsin Legislature his proposed budget for the 2011 - 2013 Biennium.

 

As expected, the impacts on local government are far-reaching.

 

Our Ehlers Public Finance Team has reviewed the Governor's budget (Senate Bill 27 and Assembly Bill 40) and prepared summary comments on the following key aspects of the bill relating to local government budgets and finance:

 

Levy Limits

Shared Revenues

Expenditure Restraint

Transportation Aids

DNR Environmental Loan Programs

Other Provisions:

Recycling Programs and Grants - The proposed budget eliminates funding for the current State Recycling grant and ends the requirement for municipalities or counties to operate recycling programs.  The bill would also divert $4 of the current $7 per ton recycling tipping fee (charged per ton of solid waste deposited) to a new economic development fund, with the remaining $3 deposited to the environmental fund.

Library Maintenance of Effort - The Governor's budget would repeal Wisconsin Statute 43.15(4)(c)5. which requires as a condition for participating in a public library system that the municipality or county provide its public library or joint public library total funding that is not less than the average funding of the prior three years.

The comments we are providing in The Advisor represent Ehlers' interpretation of the language contained within the budget bill.  Since the bill may be amended prior to passage to add, delete or alter certain provisions, or to clarify intent, the information we have provided should be used for discussion and initial planning purposes only.


Steve Apfelbacher

  

 

Levy Limits To Continue Under Proposed State Budget 

by Todd Taves, Financial Advisor

 

Todd TavesThe Governor's proposed budget extends limitations on the tax levies of cities, villages, towns and counties ("political subdivisions") for an additional two-year period.  While the existing language of the prior levy limit law (Wisconsin Statute 66.0602) remains mostly intact, there are three changes that will significantly affect how 2011 and 2012 levies are determined.

 

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Biennial Budget Impact - Shared Revenues to Municipalities and Counties

by Greg Johnson Financial Advisor

 

Greg JohnsonThe Governor's proposed budget provides for continued revenue sharing for cities, villages, towns and counties, however, includes changes to the funding levels.  While the predominant statute language remains intact, according to the Governor's Budget Summary, the reduction in funding levels will have varying impacts to individual municipalities and counties. 

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Expenditure Restraint Program: Funding Remains Constant-Minimum Inflation Factor Removed 

by Dawn Gunderson, Financial Advisor

Dawn GundersonMunicipalities can qualify for additional state aid through the Expenditure Restraint Program ("ERP").   Under current law, if the prior year's equalized tax rate for municipal purposes (excluding TIF) is greater than $5.00, a municipality may complete a request to receive a supplemental aid payment under the ERP provided that its general fund budget has not increased over the previous year by a percentage that is more than the sum of an inflation factor and a valuation factor. 

 

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Transportation Aids Impacted by 2011-2013 Biennium Budget Proposal

by Jim Mann, Financial Advisor

Jim MannThe Governor's proposed budget provides for continued aids for transportation costs for cities, villages, towns and counties, however, includes changes to the funding levels and hold harmless provisions.  While the predominant statute language remains intact, several changes of note are included in the Budget Bill that will impact transportation aids receivable in calendar year 2012. 

 

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DNR Environmental Loan Programs
by
Dave Wagner Financial Advisor

  

Dave WagnerThe Governor's proposed budget continues funding for these programs in the 2011-2013 Biennium with increases in interest rates for some, but not all, loan categories.

Clean Water Fund Loans

Past law provided for subsidized loans to local governments for eligible sewerage system improvements at subsidized rates with repayment over 20 years. Loan-only projects have all generally been funded on a first-come first-serve basis.

 

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