Residents TID petition seeks more oversight on public spending

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By ALEX GARNER

USA TODAY Network via Reuters Connect

SHEBOYGAN – Community members are pushing for more public oversight of large developments being considered by city leaders with a new petition, building on frustration and criticism of city spending and incentives for development.

A group will begin collecting signatures for a petition at the Memorial Day parade. The petition would pave the way for the public to have a say before the approval of major tax incremental financing and public incentive agreements in the future.

“This is not anti-development,” Lisa Salgado, one of the organizers who has been outspoken about city spending, tax incremental financing and data centers, said in a news release. “This is pro-transparency, pro-taxpayer and pro-citizen voice. Most development in Sheboygan would continue as normal. But when projects involve millions of dollars in public incentives or future tax revenue, residents should have the right to vote.”

Residents have been critical of public spending on TID projects for various housing developments and a downtown hotel — several of which are benefiting a handful of developers.

More than $9 million combined in incentives are earmarked for affiliates of Americon for the Malibu and Luedke apartments and$72 million in incentives could go to Pelton Builders and others, which are redeveloping Gartman Farm. Pelton Builders is also redeveloping the former Aurora hospital site, earmarked for $1.6 million in incentives.

Within 60 days, organizers must collect at least 2,599 signatures for the petition based on estimates from the city clerk, which equals about 15% of Sheboygan votes cast for governor in the last general election, according to state law. In case some signatures are not valid, Salgado said they may collect closer to 3,000.

If enough signatures are collected, organizers will file the petition with the Common Council, which could adopt the proposed ordinance without changes.If the council fails to adopt the ordinance within the required time, the proposal may go before voters in a referendum, possibly on the fall ballot.

If that referendum passes, the mayor cannot veto it, and the council cannot repeal or amend it for two years without voter approval.

Proposed TID ordinance would require a citywide referendum for TID projects costing at least $10 million

The proposed ordinance would require a citywide referendum for TID projects with costs or public commitments of $10 million or more, and developer incentives, municipal revenue obligations, cash grants, pay-as-you-go incentives, and other incentives of $5 million or more.

It would also prohibit non-disclosure agreements used to hide public costs, incentives or other financial information for large TID projects; prevent projects being split, phased or amended to avoid voter approval; and require competitive bidding and the public release of information for large TID-related agreements before final action, like incentive calculations, “but-for” analyses, tax increment projections and pro formas with projected costs and added value.

Only voters living in the City of Sheboygan may sign the petition.

Organizers aware of ordinance impact amid looming data centers

While the proposal doesn’t specifically mention or ban data centers, the proposed ordinance could give residents a voice if a proposed project, which can require expensive public infrastructure and site improvements, comes before the Common Council.

Some community members have been wary that the city lacks safeguards against hyperscale artificial intelligence data centers that may be interested in building in the city, calling for regulations in the updated zoning code. The Common Council also voted 7-3 earlier this month to send a data center moratorium draft to the City Plan Commission for consideration.

Sheboygan follows voter-led efforts in Port Washington

Sheboygan organizers follow a successful voter-led effort in Port Washington, where residents utilized direct legislation law to get a TID referendum requiring a public vote for TIDs over $10 million on the spring ballot.

Many were frustrated when city officials approved a $458 million TID for a $15 billion AI data center campus. With 66% of voters approving the referendum, residents there could now have a say in future large projects, pending legal challenges from business groups that say the ordinance could stall development, the Milwaukee Journal Sentinel reported.

How to help collect signatures

Individuals who are interested in helping collect signatures should contact [email protected].