Wisconsin's Policy on Municipal Utility Taxation

Abstract

manufacturing establishments. These amounts varied considerably, so at different times studies were made to establish a more equitable basis. In 1937, Chapter 66 of the statutes of the state of Wisconsin was modified to read as follows: income of a public utility owned by a municipality shall first be used to meet operations, maintenance, depreciation, interest, sinking fund requirements, local and school tax equivalent, additions and improvements, and other necessary disbursements or indebtedness. The Public Service Commission, in establishing a uniform system of accounting for these utilities, made provisions for a charge which the local utility would be required to pay to the local municipality, the same as if the utility were privately owned. Many of the municipalities had the local assessor examine the books of record each year, which records were made by the local utility on demand of the state government through the commission. This examination was followed by the dev lopment of an assessment by the local assessor on the same basis as that which was used on similar property in the city, which usually found the utility property classed in the manufacturing group. The assessment so developed became the basis on which the municipal govrnment and school tax rates were applied. The dollar value was paid to the municipality in actual cash and so recorded on the utility books and reported yearly to the commission. This seemed proper for a time, but the commission found out that there was no uniformity in the actual tax paid on property of similar value. Many municipalities were using the local utilities as collectors of money through rates which were not comparable to other utilities furnishing the same commodities or service. This was in